Domino's Pizza is reducing the number of corporate stores it runs in the UK and Ireland from its present 35, after their profit contribution in the 12 months to December 2002 dropped nearly 20% on 2001.
The company originally moved into corporate stores to help meet the increased royalty payments due to Domino's in the United States, which went up from from an average rate of 1.94% in 2001 to 2.5% last year and 2.7% on 1 January 2003.
However, it said, now its infrastructure had been completed, "we wish to concentrate our efforts on the roll-out of stores, which we feel is best achieved in partnership with our franchisees."
It has already sold the two corporate stores in Edinburgh to an existing franchisee, and other sales will be completed in the current year, with the cash flow generated re-invested in the franchise business, used to repay bank borrowings or returned to shareholders, the company said.
Domino's reported a 48% year-on-year increase in pre-tax profit for the year to 29 December 2002 in the United Kingdom and Ireland, as system sales.
The company, echoing comments of previous years, credited its television advertising campaigns for the increase. Domino's said that it would spend more than £5.5m on nation-wide advertising this year.
It saw pre-tax profit rise to £4.2m from £2.9m in the previous year. Operating profit was up 43.2% to £4.5m, against £3.1m in 2001.
Like-for-like sales were up 11.2%, a slowdown on 2001, when they were up by 21.4%.
Like-for-likes for the first six weeks of 2003 are up by 10.1%. The company also said that it plans to accelerate new store openings in 2003.
Another 42 stores were "re-imaged" during the year, bringing the number of stores with the latest image to 85% of the system. More stores were opened in 2002 than in any other year, with 11 new stores in the South of England, five in the Midlands, six in the North of England, six in the Republic of Ireland, one in Northern Ireland and five in Scotland.
The company said it had more than 2,300 franchise applicants in 2002, and accepted only 14, adding: "With a selection that large, we are able to select only the most competent and experienced franchisees to add to our family tree."
Stephen Hemsley, Domino's chief executive, said: "2002 was the most successful year on record for Domino's Pizza in the UK and Ireland."
Domino's Pizza UK & IRL preliminary results 52 weeks to 29 December 2002
The company originally moved into corporate stores to help meet the increased royalty payments due to Domino's in the United States, which went up from from an average rate of 1.94% in 2001 to 2.5% last year and 2.7% on 1 January 2003.
However, it said, now its infrastructure had been completed, "we wish to concentrate our efforts on the roll-out of stores, which we feel is best achieved in partnership with our franchisees."
It has already sold the two corporate stores in Edinburgh to an existing franchisee, and other sales will be completed in the current year, with the cash flow generated re-invested in the franchise business, used to repay bank borrowings or returned to shareholders, the company said.
Domino's reported a 48% year-on-year increase in pre-tax profit for the year to 29 December 2002 in the United Kingdom and Ireland, as system sales.
The company, echoing comments of previous years, credited its television advertising campaigns for the increase. Domino's said that it would spend more than £5.5m on nation-wide advertising this year.
It saw pre-tax profit rise to £4.2m from £2.9m in the previous year. Operating profit was up 43.2% to £4.5m, against £3.1m in 2001.
Like-for-like sales were up 11.2%, a slowdown on 2001, when they were up by 21.4%.
Like-for-likes for the first six weeks of 2003 are up by 10.1%. The company also said that it plans to accelerate new store openings in 2003.
Another 42 stores were "re-imaged" during the year, bringing the number of stores with the latest image to 85% of the system. More stores were opened in 2002 than in any other year, with 11 new stores in the South of England, five in the Midlands, six in the North of England, six in the Republic of Ireland, one in Northern Ireland and five in Scotland.
The company said it had more than 2,300 franchise applicants in 2002, and accepted only 14, adding: "With a selection that large, we are able to select only the most competent and experienced franchisees to add to our family tree."
Stephen Hemsley, Domino's chief executive, said: "2002 was the most successful year on record for Domino's Pizza in the UK and Ireland."
Domino's Pizza UK & IRL preliminary results 52 weeks to 29 December 2002
Group turnover | £53.1m | +21.2% |
Store numbers | 269 | +13.5% |
System sales | £118.9m | +20.8% |
Like-for-like sales | +11.2% | (2001: +21.4%) |
Average weekly unit sales | +8.1% | (2001: +19.0%). |
Profit from corporate stores | £633k | -19.6% |
Operating profit | £4.5m | +43.2% |
Pre-tax profit | £4.2m | +48.1% |
Net cash generated | £5.1m | +13.3% |
Gearing | 53.9% | (2001: 60%) |
Basic earnings per share | 5.60p | + 40.0% |
Total dividend | 2.00p | +50.4% |
