Domino’s outlook cools
Shares in Domino’s Pizza Enterprises have plunged after the company reduced its sales growth forecast for Australia and New Zealand.
SHARES in Domino’s Pizza Enterprises have plunged after the company reduced its sales growth forecast for Australia and New Zealand.
Domino’s yesterday reported a net profit of $58.7 million for the six months to December, up 17 per cent from the same period a year earlier.
It came as overall sales rose 4 per cent on a like-for-like basis, which strips out the impact of outlets opening or closing. But the chain has lowered its full-year forecast for likefor-like sales growth in Australia and New Zealand to a range of 6 per cent to 8 per cent, down from 7 per cent to 9 per cent.
Chief executive Don Meij said like-for-like sales growth in Australia and New Zealand was softer than expected, falling from 17.4 per cent a year ago to 3.7 per cent in the sixmonth period just completed.
Shares tumbled in the wake of the revelation, closing down 6 per cent at $46.50.
Mr Meij said sales a year ago were boosted by the biggest menu change in eight years.
After adjusting for the costs of a share buyback, the firsthalf profit growth was 7 per cent and sales were weaker than expected in Japan. But Domino’s has maintained its forecast of full-year net profit growth of about 20 per cent.