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Domino's Pizza shares slip as sales growth slows | Domino's Pizza shares slip as sales growth slows |
(about 3 hours later) | |
Domino's Pizza shares have fallen almost 7% after the company reported a slowdown in sales growth this year. | Domino's Pizza shares have fallen almost 7% after the company reported a slowdown in sales growth this year. |
Like-for-like sales, which strip out the impact of sales at new stores, rose by 4.7% during the first seven weeks of 2011, compared with double digit growth in the first six weeks of 2010. | Like-for-like sales, which strip out the impact of sales at new stores, rose by 4.7% during the first seven weeks of 2011, compared with double digit growth in the first six weeks of 2010. |
The UK's biggest pizza delivery chain also reported a fall in profits for 2010 due to a one-off credit in 2009. | The UK's biggest pizza delivery chain also reported a fall in profits for 2010 due to a one-off credit in 2009. |
Pre-tax profit came in at £35.2m, down 14% on the £41m the firm made in 2009. | Pre-tax profit came in at £35.2m, down 14% on the £41m the firm made in 2009. |
Taking out the impact of the one-off credit from the 2009 figures, profits in 2010 rose by 27% to £38m. The credit refers to a £15.1m goodwill figure from the acquisition of Domino's Leasing, an office furniture company. | Taking out the impact of the one-off credit from the 2009 figures, profits in 2010 rose by 27% to £38m. The credit refers to a £15.1m goodwill figure from the acquisition of Domino's Leasing, an office furniture company. |
Tough comparisons | Tough comparisons |
Sales growth at the start of the year does not compare well with earlier years, analysts said. | Sales growth at the start of the year does not compare well with earlier years, analysts said. |
"It is the weakest number we can recall over the last five-and-a-half years," said Simon French at Panmure. | "It is the weakest number we can recall over the last five-and-a-half years," said Simon French at Panmure. |
"Comparatives will only get harder over the [next few months] as the football World Cup had a very positive impact on the second quarter last year." | "Comparatives will only get harder over the [next few months] as the football World Cup had a very positive impact on the second quarter last year." |
However, Domino's said it was perfectly relaxed about the slowdown in sales growth. | However, Domino's said it was perfectly relaxed about the slowdown in sales growth. |
"We're up against extraordinarily tough comparatives, 10 years of double digit like-for-likes, so we're quite pleased with [the 4.7% growth]. Seven weeks doesn't make a year at Domino's," said finance director Lee Ginsberg. | "We're up against extraordinarily tough comparatives, 10 years of double digit like-for-likes, so we're quite pleased with [the 4.7% growth]. Seven weeks doesn't make a year at Domino's," said finance director Lee Ginsberg. |
'Exceptional results' | 'Exceptional results' |
Like-for-like sales for 2009 rose by 11.9% compared with 2009. | Like-for-like sales for 2009 rose by 11.9% compared with 2009. |
Total sales rose by 19.3% to £485.3m, thanks in part to 57 new store openings during the year - a record for the group. | Total sales rose by 19.3% to £485.3m, thanks in part to 57 new store openings during the year - a record for the group. |
A 63% rise in online sales, to £128m, also helped to boost overall sales. | A 63% rise in online sales, to £128m, also helped to boost overall sales. |
"I am delighted to report another exceptional set of results. The business has continued its remarkable run," said Domino's chief executive Chris Moore. | "I am delighted to report another exceptional set of results. The business has continued its remarkable run," said Domino's chief executive Chris Moore. |
Domino's has 655 stores across the UK and the Republic of Ireland, and more than 9,000 in total in 65 countries. | Domino's has 655 stores across the UK and the Republic of Ireland, and more than 9,000 in total in 65 countries. |