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Domino's Fiscal Second-Quarter Revenue Tops Street Views on Order Count Growth

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Domino's Fiscal Second-Quarter Revenue Tops Street Views on Order Count Growth

Domino's Pizza (DPZ) reported fiscal second-quarter revenue above market estimates on Monday, driven by order count growth, while the pizza restaurant chain's earnings increased year over year but missed expectations.

The company's revenue rose to $1.19 billion for the quarter ended June 14 from $1.15 billion a year ago, topping the FactSet-polled consensus of $1.18 billion. The top-line benefited from gains in supply chain revenue, as well as higher global franchise royalties and advertising revenue, according to Domino's. Supply chain revenue increased on higher order volumes and food basket pricing to stores.

Per-share earnings in the quarter increased to $4.07 from $3.81, but trailed the Street's view for $4.17.

The stock rose 6.9% in the most recent premarket activity.

"In the second quarter, Domino's drove meaningful order count growth," Chief Executive Russell Weiner said in a statement. "In a quarter where the broader US (quick service restaurant) industry continued to face pressure on consumer demand, Domino's generated order count growth across both our delivery and carryout businesses."

Last month, Domino's announced that Weiner will step down as CEO at the end of September, with Chief Operating Officer Joe Jordan to succeed him.

US same-store sales edged up 0.1% in the second quarter, slowing from a 3.4% increase in the prior-year quarter. International same-store sales, excluding the impact of foreign exchange, declined 0.1%, compared with growth of 2.4% last year.

Earlier this month, UBS Securities said Domino's Pizza was expected to post soft second-quarter results due to economic headwinds and increased promotional activity. The brokerage at the time expected the company to report a US same-store sales decline of 1.5% in the second quarter.

Domino's saw global net store growth of 209 stores, including 26 net store openings in the US and 183 net store openings internationally in the three-month period. Global retail sales climbed 3%, excluding foreign currency.

"Our scale and competitive position have never been stronger," Weiner said. "Domino's is uniquely positioned to continue gaining market share and delivering long-term value for shareholders."

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Domino's Fiscal Second-Quarter Revenue Tops Street Views on Order Count Growth | FINWIRES