Domino’s shares drop after missed earning guidance reported for FY17
Domino’s shares have taken a plunge after the pizza giant missed its earning guidance for its 2016-17 financial year.
In announcing its profit results for the most recent financial year, Domino’s reported a record net profit after tax of AUD $118.5 million, an increase of 28.8 per cent on its prior financial year results.
Share prices however dropped with Domino’s missing its earing guidance after running into difficulties with French operations.
Domino’s Chief Executive Officer and Manager Director, Don Meji, said while Domino’s achieved records on multiple levels, he still recognises the business did not reach the targets outlined in its half yearly results.
“We significantly lifted sales, revenue, EBITDA and margins for the group, which demonstrates that we are leveraging our competitive advantages; our scale, digital platforms, and market-leading customer-focused improvements including Project 3/10,” Meiji said.
“I acknowledge our results, while strong, did not reach guidance we set,.
“This was largely due to the delay in rectifying some issues with our online platform in France, and the initial response H2 to our value range offering in France, which did not meet our expectations – both have now been addressed.”
Strong Australian store performance
Australian and New Zealand stores performed strongly with Domino’s reporting earnings before interest, tax, depreciation and amortisation (EBITDA) of AUD $115.4 million, an increase of 25.8 per cent on the prior financial year.
Domino’s said it will now be launching a new Australian and New Zealand ‘Quality Fresh’ menu with 20 pizzas and sides, along with new premium ice cream offerings, expecting these products to help drive sales further.
Despite difficulties in France, Domino’s reported a EBITDA for Europe of $60 million, an 18.4 per cent increase on the prior financial year.
- Big FY17 profits projected for Domino’s
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Domino’s has lifted its earnings forecast for the 2017 financial year.
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