NEWS
A transformational year for Domino’s In announcing its full year results for the 52 weeks ended 26 December 2021, Domino’s Pizza Group Plc has reported continued strong momentum, with system sales of £1,499.1m, up 11.2%. Like-for-like system sales, excluding splits, up 10.9% (9.8% including splits). Underlying like-for-like system sales (excluding the temporary benefit of VAT) grew by 5.5%, 150 basis points higher than last year’s equivalent figure of +4.0% and underlying profit before tax of £113.9m, was up £12.7m driven by strong underlying trading. Statutory profit after tax of £78.3m, up £38.6m due to significantly reduced international losses with continued strong free cash flow of £104.6m (2020: £99.0m). Net debt of £199.7m, in-line with guidance, resulted in a net debt/underlying EBITDA leverage ratio of 1.54x. There was additional £6.6m investment in a new Northern Ireland joint venture and £136m was returned to shareholders in FY21 through dividends and share buybacks and £14.3m of capex to support store growth. A proposed final dividend for FY21 of 6.8p per share is to be paid on 10 May 2022, resulting in a total dividend for FY21 of 9.8p per share, +7.7% vs. FY20. Operational and strategic highlights included good growth in total orders, up 5.5% in the year. Delivery performed well, and collections continued to recover, growing sequentially each quarter. Collections finished the year at 87% of 2019 levels and there were excellent service standards with average delivery times of around 25 minutes, reported the brand. Now a truly digital-first business with 91.2% of sales through digital channels, a new App launch now accounts for 42% of system sales (+2.2pts vs. 2020) 31 new stores were opened in the year with new stores trading ahead of expectations and on track to open at least 45 new stores in FY22. They had reached resolution with their world-class franchisees heralding a new era of collaboration and a first national price campaign for several years launched in January 2022, with five new stores opened in FY22 vs. one in the same period in FY21. There had been a new integrated media campaign, ‘DominOh-Hoo-Hoo’, targeting families and friends reuniting post lockdown and followed by first ever festive TV ad campaign, which resulted in order count growth ahead of expectations, they reported. They had also continued to strengthen their leadership team with the appointment of a new chief marketing officer and operations director and a new people director. They had also opened their third UK supply chain centre in Cambuslang, Scotland and completed exit from all directly operated international markets allowing them to focus on the core UK and Ireland markets They expect FY22 underlying EBITDA and EPS to be in line with current market expectations. Trading in the first quarter has started well, aided by their first national price campaign 6
for several years, and made possible because of the resolution with our franchisees. Overall order count and customer acquisition continues to be positive, despite being up against a comparative quarter last year when there were strict lockdown restrictions in the UK. Their flexible and robust business model means they are well placed to adapt to changing market conditions and ongoing challenges related to inflation and recruitment, they stated. As such, they continue to expect an acceleration in underlying system sales growth (excluding the benefit of the reduced rate of VAT), largely driven by increased store openings and likefor-like growth due to the operating and capital investments associated with the franchisee resolution and continued implementation of our strategic plan. Commenting on the results, Dominic Paul, chief executive officer said: “This was a transformational year for Domino’s. Our performance continues to be strong, and we have made significant progress against our strategic plan, all while delivering on our ambition to return excess capital to shareholders. None of this would have been possible without the hard work of our franchisees and my fantastic colleagues. “There were two major milestones in the year. First, the launch of our new strategy, which is already delivering outstanding results and a better experience for our customers. Secondly, the resolution with our franchisees which has unlocked further potential within the system. Our franchisees are world class operators and the whole team is already embracing a new era of collaboration, with the system working together more closely than ever before. “This year has started well, and we now have the right strategy and a strong senior team in place to continue to drive the business forward. We remain focussed on accelerating the sustainable growth of our system together, to deliver a better future through food people love.”
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