Domino’s UK prepares for £2b system sales milestone
The group reported an increase of 11.1% for FY2023.
Domino’s UK reported an increase of 11.1% to £679.8m in the group’s revenue for the 53 weeks ended 31 December 2023, driven by an increase in system sales volume, acceleration of store openings and the pass-through of increased food cost.
The group reported a like-for-like system sales increase of 5.7%. Underlying EBITDA up 3.6%, which includes £8.9m of previously guided technology platform costs and no contribution from Germany.
Domino’s UK CEO Andrew Rennie also set targets for 2024.
"In December I set out a framework for accelerating sustainable, long-term growth. Following a great year for store openings in 2023 we are accelerating our growth and expect to have 1,600 UK & Ireland stores delivering £2b billion of system sales by 2028 and 2,000 stores by 2033 delivering £2.5bn of system sales. Crucially, we have alignment with our franchisees and there is a strong, motivated second-generation talent coming through the franchisee ranks to help drive this growth,” Rennie said.
The group expects some food cost deflation in FY24 which, in line with Domino’s model, will be passed through to its franchise partners.
“In FY23 we proactively took action to reduce our cost base and this will partially offset the overall impact of inflation on our cost base in FY24. As a result, we expect to deliver FY24 Underlying EBITDA in line with current market expectations8, and so delivering another year of further profit growth, despite the continued uncertain consumer environment,” the group said.
Domino’s February 2024 trading saw an improved sales and order trajectory following a slow January, after the brand held back on marketing spend to support more strategic launches in 2024. It expects the current trajectory to continue but, due to performance in January, also expects orders and like-for-like sales growth to be lower than in Q1 2023.
Franchisee buyout
In a separate release, Domino's Pizza Group also announced that it has purchased the remaining 85% shareholding it does not already own in Shorecal Limited.
Shorecal Limited is the largest Domino's franchise business operating in the Republic of Ireland and Northern Ireland.
The shares were bought for a total consideration of €72m (£62m), subject to completion adjustments. DPG will also repay the outstanding debt on completion, currently €19.9m (£17.3m)
Shorecal operates 34 of the 99 Domino’s stores across the Republic of Ireland and Northern Ireland.
