The Group revenue surged 40.3% driven by both like‐for‐like growth and store openings.
DP Eurasia N.V. is the exclusive master franchisee of the Domino’s Pizza brand in Turkey, Russia, Azerbaijan and Georgia. Its preliminary results for the year ended 31 December 2017 showed that Turkish systems sales increased 14.2% whilst the Russian system sales skyrocketed 169.0%. Adjusted EBITDA was up 28.9% to TRY 96.8 million mainly driven by the Group’s strong sales growth.
The adjusted EBITDA margin as a percentage of system sales was 11.3%, with both regions delivering improved returns. Turkey's adjusted EBITDA margin increased by 0.5% points to 13.1% and Russia's adjusted EBITDA margin increased by 2.0% points to 6.1%.
The Group's adjusted net income was down 39.4% to TRY 21.7 million predominantly driven by the adverse movement of the Russian rouble against the Euro and additional depreciation and amortization driven by increased capital expenditure.
DP Eurasia has launched 76 new stores this year, bringing the total number to 643, including the opening of the 500th Turkish store and the 100th Russian store.
DP Eurasia's chief executive officer Aslan Saranga said, “DP Eurasia has had another successful year and we are pleased to report good progress in our maiden annual results since becoming a public company. We have seen strong performance in both of our geographical segments. Turkey and Russia had solid top line growth driven by our store additions and like‐for‐like growth. This top line growth translated into a significant increase in our adjusted EBITDA, where we also saw increases in the adjusted EBITDA margins as a percentage of system sales in Turkey and Russia.
“Our growth continues to be driven by our innovation in technology and products. In 2017, we revamped our iOS and Android apps in both Turkey and Russia, which resulted in increasing app conversion rates and app like‐for‐like growth significantly higher than the total online like‐for‐like growth. In Turkey our apps like for like increased from 56.8% to 112.6% and in Russia our apps like for like increased from 34.7% to 317.5%, In Turkey, we launched our loyalty program, which is already showing encouraging signs of order
frequency increase. On the product side, we launched oven baked sandwiches, mosaic cakes and popcorn chicken in Turkey, and salads in Russia. In February, oven baked sandwich revenue mix was 14% in Turkey and is encouragingly creating incremental sales and not cannibalising pizza sales. We are also transferring menu items from Turkey to Russia, such as our ultra‐thin crust and our newly launched mosaic cake.
“Our expansion in Russia outside of Greater Moscow is continuing to progress strongly. After opening stores in St Petersburg and Krasnodar in December 2017, we have also expanded into Rostov‐on‐Don in January 2018.
“We had a strong start to 2018 in line with our expectations with like‐for‐like growth of 10.7% and 25.0% in Turkey and Russia, respectively, and the Board remain confident in the business and its growth opportunities for the rest of the year. I would like to thank all our employees who have contributed to our strong results and look forward to another successful year,” he concluded.
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