UK economic upturn puts sizzle in Domino's Pizza profits

29th Jul 2014 08:38

The economic recovery in the UK helped takeaway chain Domino's Pizza to rustle up a 10% rise in half-year profits, but it said trading in Germany was tough.Domino's said improved consumer confidence was encouraging more Britons to treat themselves to a pizza, resulting in what it described as an excellent UK performance. System sales in mature stores rose 11.3% and in total by 16%.The group has been improving its online marketing with sponsorship of the app for ITV's The X-Factor and has been offering seasonal pizza deals and a Carnivale range based on the World Cup.Group system sales rose by 14.9% to £375m and group pre-tax profit lifted 10.1% to £24.5m. Basic earnings per share increased 7.4% to 11.6p.Sales in the Republic of Ireland rose 3.2% and by 2.9% in Switzerland, but sales in Germany dropped 1.7% as the group restructured the business including closing four stores, cutting costs and developing an operating model more likely to attract franchisees.Nevertheless, the group said it was sticking with its German business and believed there was potential to launch operations in other countries.It said: "The board continues to believe in the opportunity for Domino's in Germany. Organised local pizza delivery businesses are growing like-for-like sales in mid-single digits and expanding their franchised estate steadily."Chief Executive David Wild said: "We plan to open 40-50 stores in the UK this year as previously reported. I remain very excited by the Domino's business."Shares rose 10p or 1.8% to 552.5p at 08:18 in London.PW