Domino's beats US same-store sales estimates on delivery, menu boost

Domino's beats US same-store sales estimates on delivery, menu boost

Domino's Pizza Inc on Thursday reported U.S. same-store sales above analysts' estimates for the first time in over a year, as the pizza chain benefited from its focus on faster delivery and new promotions to lure diners.

FILE PHOTO: A Domino's Pizza sign sits on the top of a delivery car outside a restaurant in Lo
FILE PHOTO: A Domino's Pizza sign sits on the top of a delivery car outside a restaurant in Los Angeles, California, U.S. July 18, 2018. REUTERS/Lucy Nicholson/File Photo

REUTERS: Domino's Pizza Inc on Thursday reported U.S. same-store sales above analysts' estimates for the first time in over a year, as the pizza chain benefited from its focus on faster delivery and new promotions to lure diners.

Sales at U.S. restaurants open for at least a year rose 3.4per cent in the fourth quarter, compared with estimates of a 2.3per cent rise, according to IBES data from Refinitiv.

The pizza chain has been opening new stores, launching new menu items and offering faster deliveries to battle competition from rival pizzerias, mom-and-pop stores and aggregators such as Uber Eats, Postmates and GrubHub .

As third party delivery services make it easier for diners to order a variety of food to their door step at the touch of a button, chains like Domino's have been investing heavily to keep customers coming back for their fast service and offers.

As a part of these efforts, Domino's offered half off on menu-priced pizzas for online orders during the Cyber Monday week and also expanded its GPS delivery tracking technology across its U.S stores during the reported quarter.

"Our relentless focus on our customers, our franchisees ... helped us deliver a solid 2019 in the face of unique competitive headwinds," Chief Executive Officer Ritch Allison said.

The Ann Arbor, Michigan-based company has also been aggressively opening new restaurants in a move it calls "fortressing" to facilitate faster delivery to locations beyond homes and offices.

Rival Pizza Hut, owned by Yum Brands Inc , however, reported disappointing results earlier this month as stiff competition took a bite out of sales.

At Domino's international, however, same-store sales rose 1.7per cent missing estimates of a 2.09per cent rise.

Net income rose to US$129.3 million, or US$3.12 per share, in the three months ended Dec. 29, from US$111.6 million, or US$2.62 per share, a year earlier.

On an adjusted basis, the company earned US$3.13 per share.

Total revenue rose 6.3per cent to US$1.15 billion, beating estimates of US$1.13 billion.

(Reporting by Nivedita Balu in Bengaluru; Editing by Shounak Dasgupta)

Source: Reuters

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