Domino’s Delivers Strong NPAT Growth of 20.3%

Media release 10 August 2011

Domino’s Delivers Strong NPAT Growth of 20.3%

Australasia’s largest pizza maker Domino’s Pizza Enterprises Limited (DMP) today announced a $21.4 million 2011 full year Net Profit After Tax, up 20.3% on the previous year.

This takes Domino’s Pizza’s NPAT annual growth rate from 2007 - 2011 financial years to a strong 23.9% (CAGR).

The year’s profit was generated from Total Network Sales of $746.4 million. Strong Same Store Sales (SSS) for the full year grew 11.0% over the corresponding period last year.

Australia and New Zealand achieved double digit SSS growth of 13.2% with Australia achieving its strongest SSS in the last ten years.

During the 12 months to 3 July 2011, Domino’s Pizza added 53 stores to its network, comprised of 28 stores in Australia and New Zealand and 25 stores in Europe.

The year-end store count was 866, allowing for seven A Pizza Company stores which were removed from the network in Belgium, a further two stores which were closed in France as well as one in The Netherlands.

Domino’s CEO and Managing Director Don Meij said the remarkable full year results and sales growth were the result of very successful marketing for new product rollouts and key operational improvements across both the Australia and New Zealand and European markets.

“Our solid performance for the 2011 full year is the result of strong Network Sales of $746.4 million up 7.5% on the last year,” Meij says.

“Europe achieved Network Sales growth of 14.9% while the Australia and New Zealand market achieved growth of 11.3% despite rolling over a 53-week prior year.

“We reported strong EBITDA of $39.1 million, up 20.2% on full year 2010 despite higher tax and currency movements throughout the year.

“As a result of continued strong earnings we have a robust balance sheet with a surplus of cash and a positive Net Cash position of +$12.5 million.”

As a result, the Company will pay shareholders a final fully-franked dividend of 11.5 cents per share, in addition to the interim dividend of 10.4 cents per share. This brings the full year dividend to 21.9 cents which reflects a 70% payout ratio.

The final dividend will be paid on 15 September 2011 with a record date of 30 August 2011.

Full Year 11
Actual Full Year 10
Actual + / -
Store count 866 823
Total Network Sales $746.4m $694.3m 7.5%
Same Store Sales +11.0% +2.8%
Revenue $246.7m $236.1m 4.5%
EBITDA $39.1m $32.5m 20.2%
NPBT $29.7m $23.7m 25.1%
Net Profit After Tax $21.4m $17.8m 20.3%
EPS 31.3c 26.2c 19.5%
Dividend (fully-franked) 21.9c 17.8c 23.0%

Meij said Domino’s group Same Store Sales were aided by strong promotions in both the Australian/New Zealand and European markets.

“In Australia and New Zealand we recorded strong Same Store Sales (SSS) of +13.2%, with the growth on our digital business having a dramatic effect on sales, where we have seen in excess of $1 million sales weeks from mobile devices alone,” Meij says.

“Innovative product launches and a commitment to improving the quality of our ingredients saw customer counts follow in the same growth trends as sales.

“In Europe, Same Store Sales continued to gain momentum in the second half of the year up +6.79% to finish the 2011 full year with growth of +5.9%. This was the result of new product launches, value promotions and increased media spend.”

Looking forward

“Looking forward to the 2011/12 Financial Year, Domino’s is confident of continuing the current momentum we are experiencing and we expect to deliver a NPAT in the region of 15% above 2011, and to add 60 to 70 new stores to the network,” Meij says.

“We have also lifted our Australia and New Zealand market store growth guidance from 620 stores to 750 stores and our goal is to achieve this over the next six years.”

In Australia and New Zealand Domino’s will have unprecedented levels of investment in its digital platform with the expectation of digital orders providing 60% of the business in the next 2½ years.

Over the next six years, the Company is aiming to have 25% of the business in the Netherlands become corporate stores and for France to have a 5% corporate store mix. This will provide leadership structure and support to the entire system.

Domino’s Pizza employs more than 21,000 team members across Australia, New Zealand, France, Belgium and The Netherlands and makes more than 60 million pizzas a year.

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