Domino's Pizza Enterprises Ltd Reports Half-Year FY2025 Results

Strong performances in Australia and Benelux, and improvements in Germany and SE Asia, offset by challenges in Japan and France

  • Early progress achieved in delivering savings to reinvest in future growth, but more work underway to optimise costs and simplify the business

  • Domino’s is focused on improving unit economics to fuel future growth – prioritising Same Store Sales growth with continued selective store additions

Key Points:

  • EBIT: $100.6 million (-6.7% vs prior corresponding period H1 24; +0.7% vs H2 24)

  • Network Sales: -2.9% vs pcp to $2.08B, including fX headwinds and store closures

  • Same-Store Sales: -0.6% vs +1.3% in pcp

  • Franchisee Profitability: +13.7% to $96,400 EBITDA rolling 12 months

  • Interim Dividend: 55.5 cents per share (unfranked); fully underwritten DRP continues for H1 25

Domino’s Pizza Enterprises Ltd (ASX: DMP) today announced its financial results for the half-year ended 29 December 2024, delivering a Group EBIT of $100.6 million. This result was guided at the recent trading update: -6.7% lower than the prior corresponding period (H1 24) and +0.7% higher than the preceding half (H2 24).

A strong earnings performance in Australia (EBIT +7.6% to $67.7m) was offset by a lower performance in Asia (-19.0% to $17.0m) and Europe (-11.1% to $32.3m) with Japan and France the subject of close focus to address underperformance.

Management has taken decisive action to deliver immediate savings benefits, including the recent announcement to close 205 loss-making stores, as part of a comprehensive business review designed to deliver a simpler, more consistent Domino’s.

Despite a challenging economic environment, Domino’s continues to demonstrate resilience, growing market share underpinned by a strong brand and a menu offering delivering high quality food for customers at an affordable price.

H1 FY2025 Market Overview

  • Australia & New Zealand (SSS +0.6%): Sustained same store sales growth compounding very strong sales in the prior corresponding period, through new product launches supported by operational excellence.

  • Asia (SSS -4.2%): Weaker H1 trading in Japan, despite a positive Christmas trading period, offset positive performance in South East Asia where Taiwan and Malaysia cycled external headwinds and exited H1 with >10% SSS.

  • Europe (SSS +0.6%): A very pleasing result from the new Benelux branding campaign, Honour the Craving, and an improvement in Germany after cycling the highly successful Doner kebab campaign in FY24, was offset by continued weakness in France.

CEO Commentary

CEO and Managing Director Mark van Dyck said: “At our recent trading update we announced the first outcomes of a detailed operational and financial review to create a simpler and better Domino’s, including taking decisive actions to close loss-making stores and deliver savings to reinvest in growth.

“Those steps were the first in a comprehensive business review, which is ongoing, designed to improve profitability, strengthen franchise partnerships, and position the business for long[1]term sustainable growth and improved shareholder returns.

“Cost control plus sales growth is a powerful equation in our business: our model delivers great leverage for stores as they build sales but we know there is more work to be done.

“The +13.7% improvement in franchise partner profitability is an important step in restarting our growth flywheel, underlining the importance and urgency of more savings and sales.

“These results demonstrate early progress, however we have more to do to restore value for our shareholders, franchise partners, and customers – as we do so, we will be prioritising profitable Same Store Sales growth similar to other retailers, with selective store additions.”

“The performance from leading markets Australia and the Benelux demonstrate it is possible to win share in our category and in QSR when we focus on delivering for the customer first, with quality products, great value, and more effective marketing with a seamless ordering experience.

“We are working to apply those lessons to our other markets, with focused attention particularly on improving performance in Japan and France.

“Our recent decision to close 205 loss-making stores, including 172 in Japan, should demonstrate we will take the steps we need to provide the venture capital to reinvest in sustainable, long-term growth.

“Domino’s operates in a resilient global pizza market with significant growth potential and we will continue to share our plans to reach that potential with our franchise partners and shareholders in the months ahead.”

Strategic Reset:

Domino’s is undertaking a comprehensive operational and financial review focused on creating a simpler, more consistent Domino’s.

Rapid top-line and bottom-line initiatives are underway to provide fuel for further growth, including:

  • Delivering cost efficiencies, including from closing loss-making stores, with >$34m in annualised network savings

  • Growing Same Store Sales through identified initiatives focused on quality food, value and customer experience, such as more transparent and consistent pricing, which can be a barrier for new customers

“This plan is not about promises—it’s about action and results,” Mr Van Dyck said.

“The steps we are taking today will allow us to develop and deliver a roadmap to build out the long-term opportunity for Domino’s, in large, established markets with room to grow.

“In Germany we have the leadership position with a share three times our nearest competitor and still cover just 1/3rd of the geography. In the Benelux we have 95% brand awareness and a store footprint larger than any other QSR competitor, and in Australia we are more than half the pizza category and still only a 5% of QSR.

“But to reach our long-term potential we must deliver a simpler, more consistent Domino’s. “A simplified customer proposition, a simplified cost base, and simplified franchise operations to drive our share of the pizza category; delivering for customers, franchise partners and shareholders.

“These are our immediate priorities.”

Outlook

“Domino’s operates in a dynamic industry with substantial growth potential.

“Success will come from building on the Domino’s brand, better capitalising on our leading market positions, investing in our franchise partners, delivering consistently high-quality food and experiences and telling our story with transparency and passion. I'm confident we'll make it easier to be a customer and encourage customers to visit more often.

“We are committed to returning to profitable growth and delivering improved franchise partner and shareholder returns.

“While challenges remain, we are making early progress, we understand the urgency of the task and we invite shareholders to track our progress.” Mr van Dyck said.

Dividend Maintained

The Board has declared an unfranked interim dividend of 55.5 cents per share, unchanged from the 2024 interim dividend. The dividend is subject to a fully underwritten DRP, with a record date of 4 March 2025 and payment on 2 April 2025.

This release has been authorised for release by the Board of Directors.

Freya Hutson-Jones