INTERNATIONAL | Staff Reporter, UK

Domino's Poland like-for-like system sales grow by over a quarter in 2016

According to the brand's annual report, Domino's delivered a strong store performance in 2016.

Like-for-like System Sales were up +27% 2016 on 2015. The year closed with Domino's 17th consecutive quarter of double digit like-for-like System Sales growth.

Domino's said that like-for-like store performance was driven by a combination of successful sales and marketing activity and increasing traction of the Domino’s brand with existing and prospective customers, overlaid on a bouyant consumer economy.

Total System Sales were up +62% (PLN) 2016 on 2015, while total Corporate Store EBITDA 2016 was +1.76m PLN (+£329k3
) vs +1.0m PLN (+£173k4) in 2015, a growth of +76%.

Total Corporate Store EBITDA performance benefited from improvement in the cost of goods, in part due to commodity deflation in the first part of the year and in part due to growing volumes benefiting commissary procurement. In contrast, higher store labour costs had some impact on store EBITDA in the second part of the year.

The upward pressure on store labour was impacted both by the introduction of a minimum wage and its subsequent increase and by a drop in unemployment, impacting wage levels. On the plus side, in the macroeconomic context, lower unemployment and increased wages feed through to increased disposable income and a higher propensity to purchase.

New store sales growth was driven by the opening of 12 stores in 2016.

Nicholas Donaldson, Domino's Poland Non-Executive Chairman, said, "2016 was a year of robust System Sales growth, driven by strong like-for-likes and the roll-out of new stores to more towns and cities. This growth in System Sales enhanced both store EBITDA and commissary gross profit, albeit in the context of a marginally reduced Group EBITDA loss."

"In 2017 we remain focused on building out the store estate to achieve critical mass and to establish Domino’s Pizza as a national brand in Poland."

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