Domino's Pizza Enterprises Limited · ASX:DMP
Domino's Pizza Enterprises — Shareholder Meeting (November 2017)
41 slides from Domino's Pizza Enterprises's shareholder meeting presentation, Nov 8, 2017
Slide 1: DMP Annual General Meeting
DMP Annual General Meeting 8 November 2017 AUSTRALIA • NEW ZEALAND • BELGIUM • FRANCE • THE NETHERLANDS • JAPAN • GERMANY
Slide 2: Chairman's Address
Chairman’s Address Jack Cowin
Slide 3: FY17 Result Highlights
FY17 Result Highlights 133.6 • Network sales $2,318.5m, up +18.0% (1) (2) • Net Profit After Tax of $118.5m, up +28.8% 105.4 • Revenue up +15.4%, or $142.9m, to $1073.1m (2) Underlying EPS CAGR 66.2 • Underlying EBITDA growth up +28.3% to +25.2% over the last 10 $230.9m years, with 3 year CAGR • Und
Slide 4: FY17 Result highlights
FY17 Result highlights Network Store Count • Added 178 stores to the network, including record organic openings in ANZ (+66) and Europe (+72) • Group revenue exceeded $1 billion for the Japan, 493 ANZ, 777 first time ($1,073.1m, up +15.4%) • Group Same Store Sales increased +8% • ANZ Same Store Sale
Slide 5: Dividends
Dividends • The Company paid shareholders a final dividend of 44.9c (50% franked) • Full year dividend was 93.3c, up +26.9% per share on prior year 5
Slide 6: Managing Director
Managing Director • Key driver of record growth • Managing Director’s executive service contract renewed for five years • Substantially the same terms and conditions as his previous contract 6
Slide 7: Conclusion
Conclusion • FY17 was a significant year of achievement for Domino’s Pizza Enterprises Limited • Management executed the Company’s strategy across all markets, increasing sales, revenue, EBITDA and margins • Thank you to our shareholders, and Leadership Team 7
Slide 8: Chairman's Address transcript
Domino’s Pizza Enterprises Ltd Annual General Meeting Chairman’s Address 8 November 2017 (SLIDE 1) – Introduction/Holding Slide (SLIDE 2) – Chairman’s Address Shareholders and guests, as Chairman of Domino’s Pizza Enterprises Limited, I would like to welcome you to our Annual General Meeting. I will
Slide 9: Chairman's Address transcript (continued)
• Our Japan franchised stores now make up 37% of Japan’s network. These are impressive results for a mature business that remains hungry for growth, and committed to always doing better. To deliver these results, management have maintained their focus on our customers’ experience and delivered conti
Slide 10: Managing Director's Address
Managing Director’s Address Don Meij
Slide 11: FY17 Performance - ANZ
FY17 Performance - ANZ • Fourth consecutive year of double digit network sales growth, up +16.6% • Exceptional results of Taste the Colour menu • SSS lifted to a record level in October (+23%), up +13.6% for the full year • Launch of Thick Shake machines added sales and became a new pillar of growth
Slide 12: FY17 Performance - Europe
FY17 Performance - Europe • Delivered EBITDA of $60m, +47.1% on previous year (largest increase in the group) • Added 72 organic new stores, a record for the market, finishing the Full Year at 865 stores • New menu offerings in all markets; improving operational efficiency and delivering higher cust
Slide 13: FY17 Performance - Japan
FY17 Performance - Japan • Network sales up +8.4% (-0.6% SSS basis) • SSS improved +3.6% in H2, strongest in three years • EBITDA growth of +17% to $55.6m • Relocated 9 stores to carry-out friendly locations - carry-out sales reached 49% - a DPJ record • Franchisee-owned stores increasing (+50 to 18
Slide 14: FY17 Performance - Digital
FY17 Performance - Digital • Launched new digital innovations, including DRU Assist, first virtual assistant for the Australian QSR market • Launched Domino’s Anywhere in Netherlands • European online sales continue to break records in all countries, with Germany showing the highest online orders gr
Slide 15: Group store focus in FY17
Group store focus in FY17 • Added 178 organic stores to the network • All Joey’s stores are now fully converted to Domino’s • 22 Pizza Sprint stores converted in FY17 (44 in total since acquisition) • +66 organic new stores opened in ANZ – an ANZ record • +40 organic new stores in Japan • +72 organi
Slide 16: FY18 Trading Update
FY18 Trading Update • First 17 weeks SSS results FY18 to October 29 • ANZ SSS +4.45% • Europe SSS +8.48% • Japan SSS +0.12% • Group SSS +5.03% 14
Slide 17: FY18 Outlook
FY18 Outlook • SSS guidance FY18 • ANZ SSS guidance – affirming +7-9% • Europe SSS guidance – upgrading to +6-8% from +5-7% • Japan SSS guidance – affirming +0-2% (1) (2) • Affirming Underlying NPAT – growth expected to be in the region of 20% • H1 18 NPAT growth will be materially lower than H2 18,
Slide 18: FY18 Outlook
FY18 Outlook • New store openings – 32 Financial Year to Date • Reaffirming FY store openings – 180-200 organic new stores • Hallo pizza acquisition – 170 stores • 90-130 stores forecast for conversion • 20-40 stores to be converted in in FY18 16
Slide 19: FY18 Outlook - Overview
FY18 Outlook - Overview Time is the enemy of food Our focus is safely delivering high-quality food, in the shortest time possible. More engaging, and less friction for our customers, at every stage. • Digital innovation • Food innovation • Update on Project 3/10 (including GPS Driver Tracker roll-ou
Slide 20: FY18 Outlook – Australia/New Zealand
FY18 Outlook – Australia/New Zealand • Free Your Flavour menu launches (AU/NZ) • New Yorker range – 16” premium pizzas giving customers more of what they want • Dessert offerings – leveraging Thickshake machine investment • New ingredients • New, high-impact television campaign • Project 3/10 • 400+
Slide 21: FY18 Outlook – Australia/New Zealand
FY18 Outlook – Australia/New Zealand Launched Year to Date • Domino’s Anywhere • Social logins • My Menu • PayPal Bill Share Underway • Operations 360 Completed in FY18 • Hot Lockers – trial in Queensland • Tanda – adding AI in 2018 • DRU Drone by Flirtey next phase 19
Slide 22: FY18 Outlook – Domino's Pizza Checker
FY18 Outlook – Domino’s Pizza Checker • Biggest customer-focused product quality innovation ever • Solves the number one customer complaint of incorrect toppings & poorly made pizzas • The future of food and precision, Domino’s Pizza Checker, Checked by DRU AI will help improve product consistency a
Slide 23: Domino's Pizza Checker – Checked by DRU AI
Domino’s Pizza Checker – Checked by DRU AI 21
Slide 24: FY18 Outlook Japan
FY18 Outlook Japan DPE purchased minority interest in Japan Oct 27 – now 100% owner • OneDigital in final stages of customer testing – will leverage online ordering innovations from ANZ and Europe • Introduction of the three-minute oven – first in the Domino’s network – targeted for aggressive roll-
Slide 25: President and CEO Domino's Pizza Japan
President and CEO Domino’s Pizza Japan • Scott Oelkers will be retiring from his role after 30 years in the business Under his leadership DPJ: • built 325 stores in eight years • revolutionised the carry out niche in Japan • developed almost 200 franchised stores Scott Oelkers • Domino's Executive J
Slide 26: FY18 Outlook - Europe
FY18 Outlook - Europe • Commence test-rollout GPS Driver Tracker in Belgium and Germany in FY18 • Provides additional focus on operations for Project 3/10 • First 30 stores in France GPS Driver Tracker enabled • Gift card roll-out in Netherlands pre Holiday Season • Trading results indicate online o
Slide 27: Hallo Pizza Acquisition
Hallo Pizza Acquisition • Entered binding agreement to acquire the “Hallo Pizza” chain of 170 stores in Germany • Increases store count from 209 to between 300 and 340 • Purchase price of €32 million + additional €20 – €30 million of conversion costs over the next c. 24 – 36 months • DPE’s share of
Slide 28: FY18 Outlook - Europe
FY18 Outlook - Europe Germany • Taste the Colour menu launch – introducing 6 new pizza recipes in 6 months • Pasta range to be reinvented and relaunched • Introducing Garlic Bread and Cheesy Garlic Bread • Introducing intelligent rostering system, Tanda, to increase store efficiencies (Germany) • Re
Slide 29: FY18 Outlook - Europe
FY18 Outlook - Europe Netherlands and Belgium • Targeting the lunch menu with sandwiches – increased number of stores open from 10% to 50% (target 100%) • New pizzas launching, including every day value range • Positive initial results from Thickshake trials – with a view to expansion • First 4 minu
Slide 30: ANZ - Industrial Relations
ANZ - Industrial Relations Enterprise Bargaining Agreement (EBA) • Existing EBAs will be terminated by January 24, 2018 • Fair Work Commission allowed 12 week transition period for an orderly transition to new EBA • Negotiations are well advanced, and new EBA is expected to be implemented before Jan
Slide 31: Other Updates
Other Updates • Court of Appeal (France) upholds decision in favour of Domino’s Pizza France (DPF) in legal action with Speed Rabbit • Share buy-back • Accumulatively we have bought back 1,967,953 shares for $87.1M • The share buy-back will remain in place for up to 12 months – to August 2018 • Addi
Slide 32: Conclusion
Conclusion (1) (2) • NPAT growth expected to be in the region of +20% • Group Same Store Sales (to October 29) +5.03% • FY18 is another year of executing on our strategy • Innovation • Menu enhancements • Technology, including Domino’s Pizza Tracker – Checked by DRU AI • Thank you 1)Underlying (NPAT
Slide 33: Managing Director's Address transcript
Domino’s Pizza Enterprises Ltd Annual General Meeting Managing Director’s Address 8 November 2017 (SLIDE 8) – Group CEO’s Address Thank you Mr Chairman and thank you to our shareholders and guests who have joined us today. As Group CEO and Managing Director of Domino’s Pizza Enterprises, I am please
Slide 34: Managing Director's Address transcript (continued)
These delivered an +8.4% increase in network sales. On a Same Store Sales basis, Japan was -0.6% for the year, an improvement on the previous year, but pleasingly same store same increased 3.6% in the second half, the strongest result in three years. For the year, EBITDA growth was an impressive +17
Slide 35: Transcript: Same Store Sales guidance
We have provided positive Same Store Sales growth guidance in all markets this year. We expect profit growth will be appreciably lower in the first half, predominantly due to the rollover of last year’s exceptional SSS growth in ANZ and foreign exchange weakness in Japan and New Zealand. In ANZ for
Slide 36: Transcript: menu launches and Project 3/10
These menu launches add: - An Authentic New Yorker Range –five, 16-inch pizzas, super cheesy, slices so big you can fold them. Including Big Cheese, and Big Pepperoni & Sausage. It’s great for sharing, and giving customers more of what they love; - New ingredients and sides; and - New dessert offeri
Slide 37: Transcript: Domino's Pizza Checker
• And adding personality to the ordering process As part of this journey we are excited to share the latest development in this space and what we consider the biggest customer-focused product quality innovation ever. Introducing Domino’s Pizza Checker – Checked by DRU AI. At Domino's we strive for p
Slide 38: Transcript: President and CEO Domino's Pizza Japan
(SLIDE 23) – President and CEO Domino’s Pizza Japan This is a business that has seen significant growth under our ownership, and the strong leadership of Scott Oelkers. Scott has led Domino’s Pizza Japan through both growth, and transformation of this business – adding 325 more stores, building the
Slide 39: Transcript: Europe innovation and growth
We have a significant program of innovation and growth ahead of us in Europe, including significant menu innovations in all countries. In addition to integrating the Hallo Pizza Acquisition, the team will be focused on new customer initiatives. In Germany we will launch a Taste the Colour menu, buil
Slide 40: Transcript: Speed Rabbit and buy-back
Two other matters I would like to update you on: Speed Rabbit Pizza (SRP) filed an appeal in respect of the 2014 decision by the Commercial Court at first instance in favour of Domino’s Pizza France, which was heard in September 2017. The Court of Appeal has upheld the decision in favour of Domino’s
Slide 41: Transcript: closing thanks
Thank you to the members of our Board, and to every member of the Domino’s Pizza Enterprises team. I would like to make special note of the tens of thousands of employees in seven countries, whose passion and commitment are the most important ingredients we have. And thank you to our franchisees, co
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