Online Sales Boost Domino's Pizza
LONDON -- Domino's Pizza , which now operates pizza stores in the U.K., the Republic of Ireland, Germany, and Switzerland, issued an interim management statement for Q4 this morning.
The company's web presence continued to be the standout performer, with online sales for the quarter up 56.6% to 84.1 million pounds against 2011's Q4 figure of 53.7 million pounds. Annual e-commerce sales came in at 268.6 million pounds, a 46.3% increase on last year's total of 183.6 million pounds -- which itself followed a 43% rise on 2010's online sales, showing the momentum of Domino's in this area.
Indeed, online transactions accounted for 55.7% of deliveries in the U.K., compared with 2011's percentage of 44.3%. And, far from resting on its laurels, Domino's saw annual sales from mobile devices increase by a huge 187%, with this area now making up 19.7% of all online orders.
System sales for Q4 increased 20% to 174.5 million pounds, while like-for-like sales in 612 U.K. mature stores grew by 5%. However, the 47 mature stores in the Republic of Ireland saw like-for-like sales down in euros by 3.8%.
For the full 53 weeks ended Dec. 30, 2012, system sales were up 12.7% to 598.6 million pounds (2011: 531 million pounds for 52 weeks), while like-for-like sales in U.K. stores grew 5% (2011: 3.8% for 52 weeks). Again, the Republic of Ireland's stores saw a drop-off, down in euros by 0.2% (2011: down 4.4% for 52 weeks).
Reserving special praise for the strong sales growth seen in Berlin stores -- like-for-like sales for the year in the two mature Berlin stores increased by 19.3% and 24.1%, respectively -- and franchised stores that have opened in the west of Germany, chief executive Lance Batchelor said:
Yet again, Domino's has delivered solid results in a tough trading environment. Our like-for-like sales growth in our core U.K. market has been good and we have opened a record number of stores across the Group. We are excited by the positive signs in Germany and the Group as a whole is well-placed for further growth.
I am pleased to announce that the Company will deliver full year 2012 profits in line with market expectations. We will update the market further on 25 February 2013 with the publication of the Company's preliminary results.
Early signs indicate that the good news may have been already priced in, as shares dropped off 2.3% today. Investors may also have been put off by the Republic of Ireland's slight decline, but this is unlikely, given the progressive steps made elsewhere.
But Domino's is still predicted to continue its growth, and this morning's update from the company should remind you how dynamic growth companies can become wonderful investments for ordinary investors. Indeed, Domino's shares have jumped more than 25-fold since their 2002 low.
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