- Domino’s Pizza’s share price sank following disappointing Half Year 2023 results.
- The company launched a set of strategic initiatives to stem the tide.
- Full Year 2023 results disappointed again, but the latest trading update showed promise of better things to come.
Year to date, the share price of global pizza leader Domino’s Pizza Enterprises is down 20.77%, intraday on 24th November.
Source: ASX
Half Year 2023 Financial Results released in February sent the share price into a tailspin, with network sales down 4%, online sales down 4.5%, and net profit down 21.5%.
Inflation was hitting the company’s franchisees hard, so it stepped in to raise prices to negative effect.
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On 13th June, the company announced a set of strategic initiatives to build a strong foundation for future growth, including exiting the non-profitable Denmark market, closing underperforming stores and streamlining core operations.
Full Year Results showed a modest 2.2% increase in network sales and a 2.4% rise in online sales but another loss, with net profit down 25.7%.
The initiatives may be taking hold as the company’s Annual General Meeting on 1st November included a positive trading update on FY 2024 to date – network sales are up 12.7%.
Company management also claimed that cost cutting will yield significantly higher earnings in FY 2024.
Domino’s is a solid dividend payer, with a five-year average payment of $1.36 and a five-year average total yield – including share buyback yields – of 2.76%.
An analyst at Fat Prophets has a HOLD recommendation on Domino’s Pizza Enterprises, citing rising network sales and encouraging strategic initiatives.
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