MARKET REPORT: Domino’s Pizza posts higher sales AND profits as it has its best day in the stock market since December 2021
Domino’s Pizza saw a surge in takeout orders being picked up from stores by customers rather than delivered to their homes amid the cost-of-living crisis.
Collection orders of 12.2 million in the six months to June 25 were 20 percent higher than in the same period a year ago. Such gains contrasted with a 4.4 percent slump in takeout.
Even as the cost-of-living crisis weighed on spending, sales at the group’s franchise and corporate stores rose 7.9 percent year-on-year during the period.
And profit of £68.7m was 8.2 per cent higher than in the same period a year ago.
Domino’s expects earnings for 2023 to be between £132m and £138m, better than the £127.6m analysts had predicted.
Domino’s posted higher sales at its franchise and corporate stores in the six months ended June 25, alongside a 20% increase in takeout orders
It is in the process of returning £20 million in shares to investors and promised to return a further £70 million.
Shares rose 13.1 percent, or 45.4 pence, to 392.8 pence, marking its best performance since December 2021, when the stock rose 22 percent after reaching resolution with its franchisees.
Last month, the group appointed Andrew Rennie as CEO, starting Monday.
He worked for over twenty years at Sydney-listed Domino’s Pizza Enterprises (DPE). He replaces Elias Diaz Sese, who has led the company on an interim basis since October last year.
Laith Khalaf, head of investment analysis at AJ Bell, said a 20 percent increase in direct debit orders shows that “consumers are finding ways to save money and still get their favorite treats.”
He added: ‘Anyone willing to go to their local store can usually get a deep discount on a Domino’s takeout order.
“In the current cost-of-living crisis, Domino’s should take that trend as a win — after all, moving a slice of pizza at a lower price is better than nothing at all.”
The FTSE 100 fell 0.43 percent, or 33.14 points, to 7666.27 and the FTSE 250 lost 0.41 percent, or 78.1 points, to 19065.66.
4imprint flew high at the top of London’s second tier. The group, which sells promotional products ranging from bags to notebooks and toys, raised its forecasts for 2023. Shares rose 16.1 percent, or 715p, to 5150p to a record high.
Year-to-date orders were 18 percent ahead of the same period in 2022, the company said.
As a result, 4imprint expects to generate a minimum of £1.01 billion in revenue this year alongside a minimum profit of £98 million.
That would be better than the £1bn and £87m figures analysts had expected.
Defense and aerospace manufacturer Chemring launched a share buyback program worth up to £50 million. Shares rose 7.6 percent, or 21.5 pence, to 305 pence.
Fresnillo’s revenue of £1.05 billion in the first half of 2023 was 6.7 per cent higher than the same period a year ago following increases in silver and gold production alongside stronger precious metal prices.
But profits fell by almost 70 per cent to £38 million – less than the market expectation of £96.3 million – while the cost of doing business soared. Shares fell 4.4 percent, or 27.2 pence, to 591 pence.
Weir Group said earnings for this year will be at the higher end of the £428m to £464m analysts had predicted.
The Glasgow-based engineer’s revenue of £1.3bn in the first six months of this year, meanwhile, was up 19 per cent on the same period in 2022.
And profits were up 35 per cent to £170 million. Boss Jon Stanton also said the global drive for decarbonization has led his mining clients to invest in sustainable technology. Shares rose 2.2 percent, or 39.5p, to 1874.5p.
Coats, which supplies yarns and zippers to clothing and shoe makers, expects to increase its market share in the clothing and shoe industry. Shares gained 5.4 percent, or 3.8 pence, to 73.8 pence.