Domino’s Pizza Enterprises has reported a net profit after tax of $40.9 million for the half-year ended December 31, a significant turnaround from the $22.2 million loss reported a year earlier. However, revenue for the period decreased by 5.5 per cent to $1.1 billion. The company owns the rights to the Domino’s name in Australia, New Zealand, Japan, and parts of Europe, operating 3500 stores across those regions. They are known for their extensive pizza delivery and carry-out service.
The improved profitability comes as Domino’s deliberately moves away from heavy discounting. Chairman Jack Cowin stated that this strategic shift is intended to strengthen the business for the long term, despite an expected moderation in sales volumes. As a result of the change in business strategy, the company’s interim dividend has been cut to 25¢ per share, a considerable decrease from the 55.5¢ paid last year.
Cowin explained that reducing the reliance on discounting led to improved unit economics, even as volumes moderated. Domino’s Pizza Enterprises recently appointed Andrew Gregory, a global executive from McDonald’s, as its new chief executive. Gregory is expected to commence his role no later than early August. Cowin holds a substantial 26 per cent stake in Domino’s.
