Plunging cheese prices and the surging appetite for food ordered on mobile phones are boosting sales and profits at Domino’s Pizza.
The company behind the pizza beloved by children but which won’t be found in many Good Food Guides saw sales in the last year to December jump 15.8 per cent to £877 million.
Domino’s turned a profit of £73 million, more than £10 million better than last time around.
The chief executive, David Wild, said Domino’s is aiming for 1,200 UK stores — it has nearly 900 so far. However, e-commerce is plainly the driver, accounting for 78 per cent of all sales.
Domino’s shuns takeaway apps such as Just Eat due to the commission they charge.
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Mr Wild said: “We don’t need to be on them.”
A “record low cheese price, favourable wheat price and a fall in fuel costs” all helped the company, which relies on franchisees to run the actual stores.
While other employers have complained that the introduction of a living wage will hurt jobs, Mr Wild is embracing the move.
He said: “It is putting more money in people’s pockets. That will benefit consumer spending and will help brands like ours.”
The dividend is going up by nearly 19 per cent to 20.75p a share. That means Domino’s is handing out £35 million to shareholders in dividends alone, with more to come from share buybacks.
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The shares slipped slightly this morning to £10.38, which leaves the company valued at £1.7 billion.
Domino’s is still licking its wounds from a disastrous attempt to break into Germany. It quit recently, at significant cost to the company.
The company celebrated its 20th anniversary last year.
Since Christmas sales have kept on rising. In the first nine weeks of trading in 2016, UK like-for-like sales grew by 10.5 per cent.
“Momentum continues with a good start to 2016 despite increasingly tough comparatives through the rest of the year,” Domino’s said.