Domino's Pizza Group Plc · LSE:DOM
Domino's Pizza — FY2022 Earnings Presentation
39 slides from Domino's Pizza's earnings presentation, Mar 9, 2023
Slide 1: Full Year Results 2022
Y Dominos we cor TH FULL YEAR RESULTS 2022 DOMINO’S PIZZA GROUP PLC 52 WEEKS ENDED 25 DECEMBER 2022 9 MARCH 2023
Slide 2: Agenda
S AGENDA Overview - Elias Diaz Sese, Interim CEO 2. Financial performance — Edward Jamieson, CFO 3. Strategic & operational update - Elias Diaz Sese, Interim CEO 4. Q&A
Slide 3: Strategic progress, strong trading & shareholder returns
STRATEGIC PROGRESS, STRONG TRADING & SHAREHOLDER RETURNS Business model well placed in current environment Alignment with our franchise partners and our investment in growth is delivering value for customers and market share gains OW ALL PIZZA SMALL MEDN LARGE £8 £10 £12 Trading, digital and operati
Slide 4: Agenda
S AGENDA 1. Overview - Elias Diaz Sese, Interim CEO Financial performance — Edward Jamieson, CFO 3. Strategic & operational update - Elias Diaz Sese, Interim CEO 4. Q&A
Slide 5: Financial highlights
FINANCIAL HIGHLIGHTS Sales and orders growth with increased returns to shareholders + Like-for-like sales' up 5.3%, with 1.6% order count growth ¢ DPGrevenue up 7.0% ¢ Underlying EBITDA was affected by the accounting treatment of investment in cloud- based technology platforms. A lower contribution
Slide 6: Sales performance
SALES PERFORMANCE Strong growth in revenue while maintaining stable margins %change %change £m FY22 FY21 FY19 vs. FY21 vs. FY19 UK system sales 1,380.1 1,426.3 1,144.0 (3.2)% +20.6% Ireland system sales 76.3 72.8 66.9 4.8% 414.1% Total system sales 1,456.4 1,499.1 1210.9 (2.8)% +20.3% Supply chain r
Slide 7: LFL sales growth and order count growth
13.9% 15.0% 10.0% 5.5% 5.3% 3.9% 4.1% 5.0% 2.4% 1.6% 0.9% 0.0% -1.3% -1.9% -5.0% LFL ex splits (VAT adj) sales growth % Total order count growth %
Slide 8: Technology platform costs
TECHNOLOGY PLATFORM COSTS Investment to capture growth and drive further efficiencies &m EBITDA see aement before tx expendinure ERP (2.7) (0.8) (3.5) - eCommerce platform Pe Technology platform costs (5.2) (2.4) (7.6) (1.9) + During FY22, we commenced projects to develop and implement two new cloud
Slide 9: Analysis of EBITDA
ANALYSIS OF EBITDA Good underlying performance £m FY22 FY21 %change Supply chain centre EBITDA 108.9 105.2 +3.5% * Increase in supply chain centre EBITDA dri ici h Net royalties 40.7 42.0 (3.10% driven by pricing growt Net overheads, property & incentives (33.0) (34.0) (2.9)% * Net royalties down du
Slide 10: Group EBITDA movement
GROUP EBITDA MOVEMENT Investment in franchise partners’ growth and technology platforms 136.4m FY21 underlying EBITDA ‘10 FULL YEAR RESULTS 2022 0.3m Underlying trading 2.1m Corporate stores sale (1.1)m. Shorecal Technology platform costs FY22 underlying EBITDA rod Domino's’ eT 8
Slide 11: Income statement
INCOME STATEMENT PBT lower due to technology platform costs and higher interest Underlying, £m FY 22 FY 21 Group EBITDA 130.1 136.4 Depreciation & Amortisation (20.3) (16.5) Bi ecg urernmnnnnnnnrnnanl os _ 6.0) : Profit before tax 98.9 113.9 Taxation (17.3) = (20.5) Profit after tax 81.6 93.4 Underl
Slide 12: Franchisee trading
FRANCHISEE TRADING Profits for the system remain above 2019 levels FY 22* FY 21* FY 20* FY 19* Store level + Franchisees and their teams continue to eae operate effectively and safely in Average EBITDA £182k £287k £229k £145k constantly changing environment _EBITDAmargin = 16% 28% 20% 1% * VAT was 1
Slide 13: Free cash flow
FREE CASH FLOW Working capital outflow will largely reverse in FY23 &m FY 22 FY 21 a . Continuing operations EBITDA 130.1 136.4 * Lower contributions from investments Discontinued operations EBITDA - (0.7) * Working capital outflow primarily due to Remove contribution from payments i tments (7.6) (1
Slide 14: Capital allocation framework
CAPITAL ALLOCATION FRAMEWORK Investment in core business, increased dividend and share buybacks in FY22 PRIORITIES FOR CAPITAL PHILOSOPHY OUTCOMES FOR FY22 | Invest in the business to drive Returns-based approach to ) Capital investment of £19.7m | long-term organic growth investment in core busines
Slide 15: Net debt bridge
NET DEBT BRIDGE Increased returns to shareholders, leverage in mid-point of range &m 250 Net Debt / Underlying EBITDA 2.06x at year-end 199.7 Within target range of 1.5x - 2.5x 200 79.0 150 10.3 70 Le — 1.5 19.7 100 50 Oo Openingnet FCF (precapex) DaytonaMAF& Subsidiary Forex and other Capex debt Fu
Slide 16: Investing to drive sustainable growth
INVESTING TO DRIVE SUSTAINABLE GROWTH Capex this year to increase to c.£25m from £19.7m in FY22 GET THE BEST DEALS WHEN YOu a AND COLLECT eCommerce platform * Capacity development * Franchisee operations in Ireland technology GPS Digital acceleration & Dominos: we aot THIS FULL YEAR RESULTS 2022 WE
Slide 17: Current trading & guidance
CURRENT TRADING & GUIDANCE Current trading + We have continued to grow market share in a challenging consumer and inflationary environment + Like-for-like system sales excluding split stores and VAT in the first ten weeks have increased by 10.8% with orders up 2.5% and new app customers up 46% For F
Slide 18: Agenda
S AGENDA 1. Overview - Elias Diaz Sese, Interim CEO 2. Financial performance — Edward Jamieson, CFO Strategic & operational update — Elias Diaz Sese, Interim CEO 4. Q&A
Slide 19: Domino's now a stronger business
DOMINO’S NOW A STRONGER BUSINESS Value for franchise partners, customers and shareholders Total system sales (£m) Domino’s revenue (£m) Franchisee Store EBITDA (k) Domino’s EBITDA (£m) 162 130.1 1,456 600.3 145 7 1421 ———> 508.3 — —_— if _ L i “ | - ° 2019 2022 2019 2022 2019 2022 2019 2022 App orde
Slide 20: Stronger position in a competitive market
STRONGER POSITION IN A COMPETITIVE MARKET Driven by collections and continued store openings UK Takeaway Market Share UK Pizza Takeaway Market Share 8.0% _ _ _ 6.5% 6.8% p 12% p 12% 14% fulfilled by fulfilled by fulfilled by aggregators aggregators aggregators ; - — — _— @4’20 Q421 Q4’22 FY20 FY21 F
Slide 21: Delivering a better future through food people love
DELIVERING A BETTER FUTURE THROUGH FOOD PEOPLE LOVE Continuation of current strategy FAVOURITE FOOD DELIVERY AND COLLECTION BRAND, WITH PIZZA AT OUR HEART ©) © Nobody Turbo-charge Amplify our Uphold our Model tmecTues] delivers like our collection | product quality | industry-leading | excellenceasa
Slide 22: Key areas of focus in 2023
5 KEY AREAS OF FOCUS IN 2023 Multiple levers to drive growth and hit targets FULL YEAR RESULTS 2022
Slide 23: Franchisee profitability & organisation
FRANCHISEE PROFITABILITY & ORGANISATION Focused on improving franchisee profitability Reshaped leadership team to accelerate strategy More agility willlead to faster decisions Increased franchise partner alignment through collaborative forums Prioritisation - focus on key projects 2 Dominos: we aot
Slide 24: Value for money
VALUE FOR MONEY Value and customer experience essential in current environment Average delivery time a SMALL MEDIUM LARGE £8 £10 £12 July August-September October November December —FY22 FY21 First year of national value campaigns Focus on continuing to improve service Continue to give compelling va
Slide 25: Digital opportunity
DIGITAL OPPORTUNITY Significant growth in app customers Material increase in app customers is app importan + App only customers +43% higher sales than web only customers * App only customers 5.3m average order frequency +51% than web only customers Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Ju
Slide 26: Convenience
CONVENIENCE Just Eat roll-out and continued store openings to reach more customers Full roll-out on Just Eat at the end of FY22 Significantly stronger pipeline than in FY22 Focused on continuing to drive incrementality Opened 7 stores this year vs. 5 in the same period from being on the Just Eat pla
Slide 27: Technology platform projects
TECHNOLOGY PLATFORM PROJECTS Enable more agile and cost-effective marketing and promotions Enhanced experience for our customers Significant benefits to our franchise partners Future proofs our e-Commerce platform for new developments Loyalty platform potential FULL YEAR RESULTS 2022 Current ERP has
Slide 28: Summary
SUMMARY Alignment with our franchise partners and our investment in growth delivering value for customers, market share gains and increased returns to shareholders Organisation & franchise partner profitability, value for money, digital, convenience, and technology projects the key focus for FY23 As
Slide 29: Q&A
Q&A __—_ WE GOT THIS
Slide 30: Appendix
Appendix __—_ WE GOT THIS
Slide 31: UK & Ireland unit metrics - 2022
UK & IRELAND UNIT METRICS - 2022 LFL Inc Splits (YOY Growth) Total (All Stores) Items Per Orders Order Product Mix YOY Order UK & ROI Sales (Volume) (Volume) (Volume) Price Orders (m) Growth Total Qi (3.6)% 3.2% (8.0)% 2.9% (1.6)% 17.5m 5.5% Q2 (11.49% (3.3)% (6.5)% 1.4% (3.0% 16.9m (1.3)% Q3 (10.2)
Slide 32: UK & Ireland LFL sales growth - 2022
UK & IRELAND LFL SALES GROWTH - 2022 Qi Q2 Q3 Q4 FY LFL sales growth 2022 2022 2022 2022 2022 Excluding splits UK (2.6)% (11.0)% (9.7)% 7.0% (4.2)% Ireland 7.3% 2.7% 1.0% 6.8% 4.6% UK & Ireland combined (2.49% (10.49% (9.3)% 7.2% (3.8)% Including splits UK (3.8)% (11.99% — (10.7)% 6.1% (5.2)% Irelan
Slide 33: Store numbers
STORE NUMBERS 25Dec 26Dec &m 2022 2021 UK 1,202 1,172 Te rrr ll ‘mn Levee diay . lah ROI 59 55 UK & ROI total 1,261 1,227 33 FULL YEAR RESULTS 2022 cd Dominos: cor 8
Slide 34: Group balance sheet
GROUP BALANCE SHEET 25 Dec &m 2022 Intangible assets 30.0 Property, plant and equipment 96.5 21.3 Right-of-use assets Trade and other receivables Inventory iN a Fo grrr Il Cash and cash equivalents Tn mare as mare Assets held for sale Total Assets 34 FULL YEAR RESULTS 2022 rod Domino's’ cor 8
Slide 35: Group balance sheet (continued)
GROUP BALANCE SHEET (CONTINUED) 25 Dec 26 Dec £m 2022 2021 Lease liabilities (223.4) (222.6) Trade and other payables (98.8) (96.3) as 8 || | i Share buy back obligation soreness Tax liabilities (3.4) (2.9) provisions 5.3) 163) Total liabilities (633.5) (580.6) Net liabilities (112.8) (58.6) 35 FULL
Slide 36: Glossary
GLOSSARY Item Definition AWUS Average Weekly Unit Sales aspa Average Sales Per Address EES eCommerce fund The fundused to recharge costs for the development and maintenance of our eCommerce platform with franchisees German associate Represents our 33% associate investment in the trading operations o
Slide 37: Alternative performance measures
ALTERNATIVE PERFORMANCE MEASURES Location in release of Item Definition reconciliation to GAAP measure OVERALL TERMINOLOGY — Non-underlying items -—=—=—=—S—S*«stems that are material in size, unusual or infrequent innature, and are disclosed separately as non-underlying items in the notes to the acc
Slide 38: Alternative performance measures
ALTERNATIVE PERFORMANCE MEASURES Item Definition Location in release of reconciliation to GAAP measure REVENUE MEASURES System sales Like-for-like (LFL) sales growth excluding splits Like-for-like (LFL) sales growth including splits System sales represent the sum of all sales made by both franchised
Slide 39: Forward-looking statements caution
FORWARD-LOOKING STATEMENTS CAUTION These full year results, our Annual Report and the Domino's Pizza website may contain certain "forward-looking statements" with respect to Domino's Pizza Group plc and the Group's financial condition, results of operations and business, and certain of Domino's Pizz