USA | Domino's Pizza has announced its second quarter 2024 financial results, which have outlined global retail growth.
Domino's Pizza, Inc, the largest QSR-pizza company in the world, announced results for the second quarter of 2024.
"Our year-to-date performance demonstrates that our Hungry for more strategy is off to a great start, having an immediate impact on sales and profits," said Russell Weiner, Domino's Chief Executive Officer.
"For the second straight quarter, we drove U.S. comp performance in the healthiest way possible, through profitable order count growth. We had positive order counts in our delivery and carryout businesses and across all income cohorts. Our strategy is resonating with customers and our system, which gives me great confidence that we can drive significant long-term value creation for our shareholders."
Revenues increased by USD 73.1 million, or 7.1 percent, in the second quarter of 2024 compared to the second quarter of 2023, primarily due to higher supply chain, U.S. franchise advertising and U.S. franchise royalties and fees revenues. The increase in supply chain revenues was primarily attributable to higher order volumes, as well as an increase in the Company's food basket pricing to stores, but was partially offset by a shift in the relative mix of the products sold by the Company.
The Company's food basket pricing to stores increased 0.7 percent during the second quarter of 2024 as compared to the second quarter of 2023. U.S. franchise advertising revenues increased as a result of higher same-store sales, the return to the standard 6.0 percent advertising contribution rate at the beginning of the second quarter of 2024 following the end of the temporary reduction to 5.75 percent, which began in the second quarter of 2023, and net store growth. U.S. franchise royalties and fees increased as a result of higher same-store sales and net store growth.
U.S. Company-owned store gross margin decreased by 1.0 percentage points in Q2 of 2024 as compared to the second quarter of 2023. This decrease was primarily driven by higher insurance costs and increased labour costs as a result of higher wage rates. This decrease was partially offset by sales leverage due to higher customer transaction counts.
Supply chain gross margin increased by 0.4 percentage points in the second quarter of 2024 as compared to the second quarter of 2023, primarily due to procurement productivity, partially offset by investments in supply chain labour.
Income from operations increased USD 0.7 million, or 0.4 percent, in Q2 of 2024 as compared to the second quarter of 2023. Excluding the negative impact of foreign currency exchange rates on international franchise royalty revenues of USD 2.7 million, income from operations increased USD 3.4 million, or 1.7 percent, in the second quarter of 2024 as compared to the second quarter of 2023. These increases were primarily a result of higher U.S. franchise royalties and fees, as well as gross margin dollar growth within supply chain, each as discussed above. These increases were partially offset by higher general and administrative expenses of USD 18.2 million, primarily driven by higher labour costs as well as expenses for the Company's Worldwide Rally that takes place every two years.
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