Domino's Pizza said finding properties to meet its target of 500 stores by the end of 2006 was proving a "key challenge", as it revealed interim pre-tax profits up 46%.
The company said while it was confident that 500 stores was realistic, its strict selection criteria for new store sites, combined with "ever more stringent" planning requirements, were making it tough to find suitable sites.
For the 26 weeks to June 30, Domino's said, like-for-like sales were up 15.8%, against a like-for-like sales increase of 22.0% for the same period in 2001.
A total of 18 new stores opened, including four in the Republic of Ireland, up from 13 stores for the period in 2001, taking the total number of stores to 255, and operating profit rose 41.3% to £1.88m. The number of corporate stores rose from 34 to 36.
Group turnover was up 26.3% to £26.2m, and system sales, including franchises, increased by 24.6% to £57.8m from £46.4m.
Stephen Hemsley, Domino's chief executive, said: "The business is rapidly approaching a position where all major infrastructure costs and royalty increases have been absorbed. From then on the marginal contribution from increases in system sales, whether this be from new store openings or continuing buoyant like-for-like sales increases, will be significant.
"Even though some overhead costs will continue to grow, pre-tax profit in the 26 weeks to 30 June increased 45.6% on a system sales increase of 24.6%."
Hemsley said e-commerce net sales increased by 28% to £1.9m in the period.
Domino's will open a third £1.5m factory in Penrith, Cumbria to allow further expansion northward.
The company's broker, Peel Hunt, forecasts full-year pre-tax profits rising from £2.86m to £3.83m.
Domino's Pizza 26 weeks to June 30 2002
Sales £26.22m +26.4%
Pre-tax profit £1.72m +45.8%
Operating profit £1.88m +41.4%
EPS 2.34p +41.8%
Interim div 0.78p +51.4%
The company said while it was confident that 500 stores was realistic, its strict selection criteria for new store sites, combined with "ever more stringent" planning requirements, were making it tough to find suitable sites.
For the 26 weeks to June 30, Domino's said, like-for-like sales were up 15.8%, against a like-for-like sales increase of 22.0% for the same period in 2001.
A total of 18 new stores opened, including four in the Republic of Ireland, up from 13 stores for the period in 2001, taking the total number of stores to 255, and operating profit rose 41.3% to £1.88m. The number of corporate stores rose from 34 to 36.
Group turnover was up 26.3% to £26.2m, and system sales, including franchises, increased by 24.6% to £57.8m from £46.4m.
Stephen Hemsley, Domino's chief executive, said: "The business is rapidly approaching a position where all major infrastructure costs and royalty increases have been absorbed. From then on the marginal contribution from increases in system sales, whether this be from new store openings or continuing buoyant like-for-like sales increases, will be significant.
"Even though some overhead costs will continue to grow, pre-tax profit in the 26 weeks to 30 June increased 45.6% on a system sales increase of 24.6%."
Hemsley said e-commerce net sales increased by 28% to £1.9m in the period.
Domino's will open a third £1.5m factory in Penrith, Cumbria to allow further expansion northward.
The company's broker, Peel Hunt, forecasts full-year pre-tax profits rising from £2.86m to £3.83m.
Domino's Pizza 26 weeks to June 30 2002
Sales £26.22m +26.4%
Pre-tax profit £1.72m +45.8%
Operating profit £1.88m +41.4%
EPS 2.34p +41.8%
Interim div 0.78p +51.4%
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