Domino's Pizza Enterprises Limited · ASX:DMP
Domino's Pizza Enterprises — H1 FY2010 Earnings Presentation
28 slides from Domino's Pizza Enterprises's earnings presentation, Feb 17, 2010
Slide 1: Half Year Results to 3 Jan 2010
For personal use only Half Year Results to 3 Jan 2010
Slide 2: Executive Team
Executive Team For personal use only Don Meij Chief Executive Officer/ Managing Director Andrew Rennie Chief Executive Officer France/Belgium Richard Coney Group Chief Financial Officer 2 Domino’s Pizza Enterprises Limited
Slide 3: Agenda
Agenda For personal use only 1. Highlights 2. Results Detail 3. Achievements & Innovation 4. Outlook 3 Domino’s Pizza Enterprises Limited
Slide 4: 1. Highlights
For personal use only 1. Highlights
Slide 5: Result Highlights
Result Highlights For personal use only • H1 10 NPAT $8.7m, up 39.2% on H1 09 H1 08 H1 09 H1 10 +/(-) H1 09 $ mil $ mil $ mil % • Solid network sales growth, up 7.6% on H1 09 Network Sales 287.0 328.6 353.5 7.6% Same Store Sales % 7.6% 4.2% 2.9% • EBITDA $15.9m, up 24.2% on H1 09 Revenue 115.8 113.4
Slide 6: Australia/NZ Highlights
Australia/NZ Highlights For personal use only • SSS growth in Australia/NZ +4.57% • Online ordering now exceeds 28% of sales in Australia • Successful launch of the new Domino’s iPhone App in November exceeded all expectations, over $2m sales in first 12 weeks • Successful launch of the new lunchtim
Slide 7: Europe Highlights
Europe Highlights • Core operating profits up 72.7% (like for like vs H1 09 – royalty equalised) For personal use only • Opening of 8 new stores in H1 10 • New Dutch commissary opened in December • Total network sales up 13.6% (constant currency) on H1 09 • SSS slightly behind last year -0.67%, pred
Slide 8: 2. Results Detail
For personal use only 2. Results Detail
Slide 9: Network Sales Growth
Network Sales Growth For personal use only Network Sales $m 676.4 Total Sales Same Store Sales 591.2 H2 134.0 518.9 H2 106.0 Australia/NZ 9.0% 4.6% H2 80.7 H2 213.8 H2 359.4 353.5 198.2 H2 Europe (€) 13.6% (0.7%) 306.1 187.2 H1 252.9 H2 H1 123.7 182.8 H1 117.8 212.5 H2 85.1 157.5 H1 65.1 • Strong AN
Slide 10: Network Store Count
Network Store Count For personal use only H1 09 H2 09 H1 10 Aus/NZ Network Sales ($ mil) 210.8 213.8 229.8 Europe Network Sales ($ mil) 117.8 134.0 123.7 • Stores currently trading as at 17 Total Network Sales ($ mil) 328.6 347.8 353.5 February 2010 is 813 Number of Aus/NZ stores Franchised stores 4
Slide 11: Revenue & EBITDA
Revenue & EBITDA For personal use only • A stronger AUD has resulted in lower H1 08 H1 09 H1 10 +/(-) H1 09 $ mil $ mil $ mil % REVENUE reported revenue for Europe (effect: Australia/NZ 85.8 71.7 78.0 8.8% approx $3.5m). Constant currency growth is 7.2% Europe 30.0 41.7 41.4 (0.8%) Total Revenue 115
Slide 12: Europe Royalty Changes
Europe Royalty Changes For personal use only • FY10 sees the royalty paid to the US reach its Restated with 1.8% European Royalty cap of 3.0%, increasing from 1.8% in FY09 H1 09 $ mil H1 10 $ mil +/(-) H1 09 % H1 10 $ mil +/(-) H1 09 % REVENUE • The increase in royalty paid to the US has Australia/N
Slide 13: Profit & Loss
Profit & Loss For personal use only H1 08 H1 09 H1 10 +/(-) H1 09 • Depreciation & Amortisation up $ mil $ mil $ mil % 24.2% as a result of digital media Revenue 115.8 113.4 119.4 5.3% and European investments EBITDA 13.0 12.8 15.9 24.2% Depreciation & Amortisation 3.1 3.1 3.8 24.2% • Interest costs
Slide 14: Earnings per Share
Earnings per Share For personal use only EPS Growth (cps) 22.6 • H1 EPS CAGR of 22.4% since 18.4 2007 14.8 H2 H2 13.2 8.8 • FY10 onwards, EPS is no longer H2 diluted by Dividend 9.1 Reinvestment Plan (DRP) H1 H1 H1 12.8 H1 9.6 9.4 5.7 FY07 FY08 FY09 FY10 14 Domino’s Pizza Enterprises Limited
Slide 15: Cash Flow
Cash Flow For personal use only H1 09 H1 10 Aust/NZ Europe Group Aust/NZ Europe Group • Group continues to $ mil $ mil $ mil $ mil $ mil $ mil deliver both profit growth EBIT 8.6 1.1 9.7 11.3 0.8 12.1 and free cash flow Depreciation & Amortisation 2.2 0.8 3.1 2.8 1.0 3.8 Change in Working Capital (2
Slide 16: Capital Employed
Capital Employed For personal use only FY 09 H1 10 +/(-) FY 09 $ mil $ mil $ mil Cash 17.4 12.1 (5.3) • PP&E increased Working Capital 0.9 0.9 (0.0) following store Property, Plant & Equipment 30.5 34.2 3.6 purchases and build Intangible Assets 48.2 49.9 1.7 Deferred Tax Assets 2.1 1.3 (0.8) of new
Slide 17: Key Financial Ratios
Key Financial Ratios For personal use only H1 09 H1 10 Net Debt & Interest Cover 28.8x $25.7m Net Debt to 13.2% 3.0% Equity $15.9m Return on 14.1x 13.7% 17.4% Equity 9.0x 5.3x $3.6m Return on $2.9m Capital 16.1% 20.2% Employed FY07 FY08 FY09 H1 10 Net Debt Interest Cover • Return on Equity increasin
Slide 18: 3. Achievements & Innovation
For personal use only 3. Achievements & Innovation
Slide 19: Oven Baked Sandwiches
Oven Baked Sandwiches For personal use only • Launched the new lunchtime Oven Baked Sandwiches in December • Product range includes Chicken Delight, Sweet Chilli Chicken, Meatball, Italian Pizza and Tomato, Spinach & Bacon • Sandwiches and rolls is one of the top fast food categories in consumption
Slide 20: European Commissary
European Commissary For personal use only • Opened new 2,500 sq m commissary in Gorinchem, The Netherlands in December 2009 • Capital investment of approx €2m • Pan European office is included in the facility as well as Pizza Luv Lab and Pizza Training College • The commissary has the capacity to se
Slide 21: Belgium Operations
Belgium Operations For personal use only • Domino’s Pizza Enterprises Ltd entered into a Memorandum of Understanding to purchase Pizza Company in Belgium in December, a chain of 15 stores (completed January 2010) • The acquisition will make Domino’s the number one pizza delivery company in the count
Slide 22: Good Choice Range
Good Choice Range For personal use only • February saw the launch of a brand new range of healthy options on our menu • Domino’s ongoing commitment is to provide customers with even more variety and healthier choices across the menu • Includes 7 new products, all containing less than 390 calories, i
Slide 23: 4. Outlook
For personal use only 4. Outlook
Slide 24: Looking Forward - ANZ
Looking Forward - ANZ For personal use only • Increasing store growth • Continued innovation and investment in technology • Continuing to invest in the quality of core product to modernize our pizza • Management aware of rising labour costs due to award modernization and commodity volatility (cheese
Slide 25: Looking Forward - Europe
Looking Forward - Europe For personal use only • New store openings – twelve new stores opened since 3 January 2010 • Europe to open 300th store in FY10 • France rolling out Oven Baked Sandwiches in H2 10 • Online ordering continues to grow – target 90% of stores connected in France • Online orderin
Slide 26: FY10 Guidance Update
FY10 Guidance Update For personal use only Measure as at June 2009 Current Guidance New Store Openings 40-50 50 + In the region of NPAT Growth 10-15% 15% Estimated Tax Rate 27% 26% Negligible by June Negligible by June Net Debt 2010 2010 Net Capex $15-20m $15-20m • Expecting to have added 70+ stores
Slide 27: Conclusion
Conclusion For personal use only • Strong SSS in Aus/NZ contributed to strong profits • Innovative new product launches have also been fundamental elements to growth • Strong franchise enquiry in all markets likely to result in 70+ new stores in calendar year 2010 • Continue to reap the benefits of
Slide 28: Disclaimer
Disclaimer For personal use only • Domino’s Pizza Enterprises Limited (Domino’s) advises that the information in this presentation contains forward looking statements which may be subject to significant uncertainties outside of Domino’s control. • While due care has been taken in preparing these sta
Domino's Pizza Enterprises — H1 FY2010 Earnings Presentation on 6ix