USA- Multinational pizza chain Domino’s Pizza has revealed it expects its EBITDA for the 2024 financial year to lean towards the lower end of expectations after revenues dip 1.8% indicating a slow performance for the first half of the year.
The company reported revenues of £326.8 million (US$414.9 million) for the first half of the year, a 1.8% decrease from H1 2023 and falling short of analyst expectations.
The pizza giant also reported underlying earnings before tax and currency adjustment (EBITDA) of £69.0 million (US$87.6 million), a 0.4% increase compared to H1 2023. However, it accounts for 46% of the full year EBITDA projections of £147.8 million (US$187.7 million).
Domino’s Pizza also revealed it expects its full year EBITDA to mirror the half year performance, leaning towards the lower end of predictions, ranging between £144.3 million (US$183.3 million) to £149.2 million (US$189.5).
Same-store sales declined by 0.5% while overall orders declined by 0.9% in the reported quarter compared to the first half of 2023. Delivery orders also increased by 2.6%, although collection orders increased by 2.4%.
The company attributes this half year decline in sales and orders to a very slow start of the year.
Overall orders increased by 0.6% while delivery orders increased by 1.1% in Q2 2024 compared to the same quarter last year.
Despite the slow start of the year, the company expressed optimism over the remaining half of the year.
Andrew Rennie, Domino Pizza’s CEO, said, “In Q2 we grew orders, with a notable improvement from the middle of May and importantly have halted the trend of declining delivery orders. These are now returning to growth and this momentum has continued through June and July, helped by a good performance through the Men’s Euro Football tournament.”
The London-trade QSR chain’s slow start of the year is a reflection of the turbulent QSR market environment.
Competitors like Wendy’s and McDonald’s have also reported mixed to poor performance for the first half of the year.
The QSR sector has struggled with high inflation, which has increased cost of inputs and prices, while at the same time stifling demand as cash-strapped consumers cut back on spending. Players have relied on value deals to woo customers.
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