# Domino’s Pizza report system sales of £1,499.1m for 2021 with profit after tax at £78.3m

- Link: https://www.directorstalkinterviews.com/dominos-pizza-report-system-sales-of-1499.1m-for-2021-with-profit-after-tax-at-78.3m/4121055852
- Published: 2022-03-08T07:43:53+00:00
- Author: Giles

**Domino’s Pizza Group plc** (LON:DOM) have provided full year results for the 52
weeks ended 26th December 2021.

The company says it was a transformational year: robust trading, excellent strategic
progress, resolution with franchisees and significant returns to shareholders.

|   | 52 weeks ended26 December2021 | 52 weeks ended27 December2020 | % change | 
| System sales^(1) | £1,499.1m | £1,348.4m | +11.2% | 
| Like-for-Like system sales growth (exc.splits)^(2) | 10.9% | 10.3% | – | 
| Group revenue | £560.8m | £505.1m | +11.0% | 
| Underlying EBITDA^(3) | £136.4m | £125.5m | +8.7% | 
| Underlying EBIT^(3) | £119.9m | £109.0m | +10.0% | 
| Underlying profit before tax^(3) | £113.9m | £101.2m | +12.5% | 
| Underlying basic EPS^(3) | 20.3p | 18.2p | +11.5% | 
| Net debt^(4) | £199.7m | £171.8m | +16.2% | 
| Statutory profit after tax | £78.3m | £39.7m | +97.2% | 
| Statutory basic EPS | 17.1p | 8.9p | +92.1% | 
| Full year dividend per share | 9.8p | 9.1p | +7.7% |

**Financial highlights**

·     Continued strong momentum, with system sales of £1,499.1m, up 11.2%. Like-
for-like system sales, excluding splits, up 10.9% (9.8% including splits)

·      Underlying like-for-like system sales (excluding the temporary benefit of
VAT) grew by 5.5%, 150 basis points higher than last year’s equivalent figure of
+4.0%

·      Underlying profit before tax of £113.9m, up £12.7m driven by strong underlying
trading

·      Statutory profit after tax of £78.3m, up £38.6m due to significantly reduced
international losses

·      Continued strong free cash flow of £104.6m (2020: £99.0m)

·      Net debt of £199.7m, in-line with guidance, resulting in a net debt / underlying
EBITDA leverage ratio of 1.54x

·      Additional £6.6m investment in a new Northern Ireland Joint Venture

·      £136m returned to shareholders in FY21 through dividends and share buybacks
and £14.3m of capex to support store growth

·      Proposed final dividend for FY21 of 6.8p per share to be paid on 10 May 2022,
resulting in a total dividend for FY21 of 9.8p per share, +7.7% vs. FY20

·      New £46m share buyback programme, effective imminently, in line with capital
allocation framework and commitment to distribute surplus capital to shareholders

**Operational and strategic highlights**

·      Good growth in total orders, up 5.5% in the year. Delivery performed well,
and collections continued to recover, growing sequentially each quarter. Collections
finished the year at 87% of 2019 levels

·      Excellent service standards with average delivery times of around 25 minutes

·      Now a truly digital-first business with 91.2% of sales through digital channels,
new App launched which now accounts for 42% of system sales (+2.2pts vs. 2020)

·      Opened 31 new stores in the year with new stores trading ahead of expectations.
On track to open at least 45 new stores in FY22

·      Reached resolution with our world-class franchisees heralding a new era of
collaboration. First national price campaign for several years launched in January
2022, five new stores opened in FY22 vs. one in the same period in FY21

·      With the franchisee resolution, increased our medium-term targets to at least
the upper end of £1.6bn – £1.9bn system sales and to exceed 200 new stores

·      New integrated media campaign, ‘_Domin-Oh-Hoo-Hoo_‘_, _targeting families
and friends reuniting post lockdown and followed by first ever festive TV ad campaign,
which resulted in order count growth ahead of expectations

·      Continue to strengthen the Leadership Team with appointment of a new Chief
Marketing Officer and Operations Director. New People Director starting in March
2022

·      Opened our third UK supply chain centre in Cambuslang, Scotland

·      Completed exit from all directly operated international markets allowing 
us to focus on the core UK and Ireland markets

**Current trading and outlook**

As previously guided, we expect FY22 underlying EBITDA and EPS to be in line with
current market expectations. Trading in the first quarter has started well, aided
by our first national price campaign for several years, made possible because of
the resolution with our franchisees. Overall order count and customer acquisition
continues to be positive, despite being up against a comparative quarter last year
when there were strict lockdown restrictions in the UK.

Our flexible and robust business model means we are well placed to adapt to changing
market conditions and ongoing challenges related to inflation and recruitment. As
such, we continue to expect an acceleration in underlying system sales growth (excluding
the benefit of the reduced rate of VAT), largely driven by increased store openings
and like-for-like growth due to the operating and capital investments associated
with the franchisee resolution and continued implementation of our strategic plan.

> **Commenting on the results, Dominic Paul, Domino’s Pizza Chief Executive Officer
> said:**
> “This was a transformational year for Domino’s. Our performance continues to be
> strong, and we have made significant progress against our strategic plan, all 
> while delivering on our ambition to return excess capital to shareholders. None
> of this would have been possible without the hard work of our franchisees and 
> my fantastic colleagues.
> “There were two major milestones in the year. First, the launch of our new strategy,
> which is already delivering outstanding results and a better experience for our
> customers. Secondly, the resolution with our franchisees which has unlocked further
> potential within the system. Our franchisees are world class operators and the
> whole team is already embracing a new era of collaboration, with the system working
> together more closely than ever before.
> “This year has started well, and we now have the right strategy and a strong senior
> team in place to continue to drive the business forward. We remain focussed on
> accelerating the sustainable growth of our system together, to deliver a better
> future through food people love.”

Notes

^(1) System sales represent the sum of all sales made by both franchised and corporate
stores to consumers in UK & Ireland

^(2) Like-for-like excluding splits system sales performance is calculated for UK&
Ireland against a comparable 52-week period in the prior period for mature stores
which were not in territories split in the current period or comparable period. 
Mature stores are defined as those opened prior to 29th December 2019

^(3) Underlying is defined as statutory performance excluding discontinued operations,
and items classified as non-underlying which includes significant non-recurring 
items or items directly related to merger and acquisition activity and related instruments
as set out in note 4 to the financial information

^(4) Net debt is defined as the bank revolving facilities, cash and cash equivalents
and other loans, including balances held in disposal groups held for sale

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