Domino's Pizza Enterprises (DMP) H2 2024 earnings summary

Executive summary

• Network sales increased 4.6% to $4.19b, with online sales up 7.5% to $3.37b, representing 80.4% of total sales.

• EBIT rose 3% to $207.7m, supported by a $50m restructuring program reinvested into store and franchise partner profitability.

• ANZ and Germany led performance with strong product launches and improved unit economics, while France and Japan underperformed but have turnaround plans.

• Franchise partner profitability improved 6.7% to $97,400 per store, driven by higher same store sales and reduced operating costs.

• Net debt reduced by $148.6m to $690.1m, lowering net leverage ratio to 2.35x.

Financial highlights

• Revenue increased 2% to $2,376.7m; EBIT up 3%; EBITDA rose 4.5% to $362.7m.

• Free cash flow (excluding acquisitions) improved by $104.1m; net CapEx reduced by $96.8m.

• Dividend per share decreased 3.7% to 105.9 cps; interim dividend of 50.4 cps declared, subject to DRP.

• Non-recurring costs totaled $60.4m, mainly from store closures and restructuring.

• Interest costs increased 56% due to higher central bank rates in Europe and ANZ.

Outlook and guidance

• FY25 store growth expected to be flat to slightly positive, with gross openings at ~3% of the network and net growth accelerating in FY26.

• Same Store Sales guidance for FY25 is 3-6%, contingent on improved performance in Japan and France.

• Management expects margin improvement from lower food and labor costs and continued cost reduction initiatives.

• Group earnings growth planned for H2 FY25, with margin expansion expected in all regions.

• Net CAPEX for FY25 to be below previous outlook ($100-150m); long-term target of 7,100 stores after FY26.