DOMINO’S CEO Don Meij expects to open more than 40 new stores this year, after announcing an after tax profit growth of 29.7 per cent.
Meij attributes the $15.4 million (NPAT) to new menu options and increased demand for affordable pizza, with a 22.5 per cent rise in sales.
“We’re going to try and open 40 to 50 new stores in 09/10 and over the next 10 years we’re expecting to grow from 776 to 1600 stores – so the stores and the employee numbers will double, but profits will quadruple as you get such large economies of scale from having so many stores,” he says.
“We’ve still underpenetrated in Europe, although we are the market leader in the France and the Netherlands – in Australia and New Zealand there needs to be 100 more stores, with Sydney and Melbourne underpenetrated. We’re really happy with the result – it has exceeded our expectations in that we had adjusted our profit forecast. It’s also great that we’ve got such low debt, it’s almost down to zero so we can give a good dividend.”
Meij points out that the new menu helped deliver the best SSS (same store sales) in six years with 7.2 per cent achieved in the second half of 2009.
“The European market also experienced strong SSS with growth of more than 4.3 per cent for the full year, despite rolling over 2.5 years of double digit growth,” he says.
“In Australia, our online ordering continued to impress with more than 22.5 per cent of sales now coming from this part of the business. We are now the No.1 food and beverage retailer online in Australia which we are very excited about.
“Europe also had some impressive milestones with the 150th store opening in France and more than 33 per cent of stores converting to online ordering.”
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