Domino’s Pizza Group profit falls 9.7%

Australian dollars in Sydney, Friday, Jan. 15, 2016. (AAP Image/Joel Carrett) NO ARCHIVING

Domino’s Pizza Group PLC (DOM.LN) said Tuesday that pretax profit for the first half of 2018 fell 9.7% due to higher costs related to opening of a new supply chain center and the conversion of stores.

For the 26 weeks ended July 1, the pizza-delivery company made a profit of 41.7 million pounds ($54.1 million) compared with GBP46.2 million in the same period a year earlier.

The company said it incurred costs related to the opening of a new supply-chain center in Warrington as part of a transformation of the production and distribution network in the U.K., and to the conversion of Dolly Dimple’s stores in Norway into Domino’s stores.

However, underling pretax profit, which excludes one-off items, increased 2.5% to GBP45.7 million from GBP44.6 million., the company said.

Domino’s Pizza said revenue rose 23% to GBP259.1 million, while group system sales rose 13%. U.K. system sales grew 8.3%, U.K. like-for-like sales increased 5.9% and sales for Ireland rose 2.5% in the period.

The FTSE 250-listed company raised the interim dividend by 8% to 4.05 pence a share.

Domino’s Pizza expects underlying pretax profit for the full year will be in line with current market expectations, which is currently in the range of GBP95.9 million to GBP101.4 million, according to company-gathered consensus estimates.

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