Domino's misses mark on year-end financials

The world's top-selling pizza chain, Domino's, released its Q4 and FY17 financials this week showing that the brand aimed high and performed well but fell short of predictions in some categories.  A news release said the brand saw strong same-store sales growth, along with healthy growth in global store counts and earnings per share. 

As positive as those numbers seem, the company fell short in hitting some of its own predictions. Domino's, for example, expected U.S. company-owned comparable sales to increase by 6.3 percent but managed only 3.8 percent. For U.S. franchised comparable sales, the growth was 4.2 percent, while it had anticipated 6 percent growth. Internationally, comparable sales grew 2.5 percent, rather than the anticipated 5..5 percent, according to the release.

Key results for Q4 and the fiscal year include: 

  • Q4 global retail sales growth of 11.7 percent, with 12.7 percent growth for the fiscal year. 
  • Q4 domestic same-store sales growth of 4.2 percent and 8.7 percent for the year. 
  • Q4 international same-store sales growth of 2.5 percent and 3.4 percent for the year. 
  • Global net store grew by 422 in the last quarter and 1,045 for fiscal 2017
  • Q4 diluted EPS rose 41.2 percent to $2.09, while FY17 diluted EPS rose 35.6 percent to $5.83.
  • Q4 domestic same-store sales grew 4.2 percent from the previous year's number and 7.7 percent for the full year.

Q4 2017 marked Domino's 24th year of positive international same-store sales growth and the 27th consecutive quarter of positive domestic same store sales growth. President and CEO J. Patrick Doyle said he was pleased. 

"Without question, we are pleased with our fourth quarter and full-year 2017 performance — with results that continued to outpace the industry," Doyle said in the release. "Our 2017 global retail sales growth and domestic comps outperformed the high-end of our stated three to five-year outlook. This, along with tremendous net store growth and an incredibly low number of closures, helps validate that our long-term fundamental strength is well intact heading into 2018."

On Feb. 14, 2018, the company's board declared a 55-cent per share quarterly dividend for shareholders of record as of March 15, to be paid on March 30. The dividend represents a 20 percent increase over the previous quarterly dividend amount.

Topics: Business Strategy and Profitability, Financial Management, Financial News, Franchising & Growth

Companies: Domino's

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