BENGALURU – Australia’s Dominos Pizza Enterprises (NYSE: DPZ) said on Wednesday it expects store growth to be flat to slightly positive in its current fiscal year and decided to close up to 80 low-volume stores in Japan and 10-20 stores in France.
Dominos Japan opened over 400 stores between the financial years 2020-2023, which resulted in several “immature stores”. Moreover, higher media costs and lower advertising funds led the company to undertake a review of its store locations.
“The aggregate contribution of these low-volume stores is loss-making and the closures will have a positive impact on earnings, which will be reinvested into additional marketing and advertising to reach more customers and lift order counts in this low-frequency market,” the company said in a statement.
The pizza maker expects a return to positive same-store sales in Japan in financial year 2025 which started this month and sees overall group store growth of 3%-4% in fiscal 2026.
Dominos Pizza (NYSE: DPZ) added that the long-term outlook for its markets “remains appropriate”, particularly due to possible additional upside in large markets such as Germany.
The retail food outlet operator is due to report its annual results in August. It had withdrawn its fiscal 2024 outlook in January after its first-half profit forecast missed expectations, hurt by weaker-than-expected network sales in Asia and Europe.
(Source: Reuters)
Zabih Ullah is a seasoned finance writer with more than ten years of experience. He is highly skilled at analyzing market trends, decoding economic data, and providing insightful commentary on various financial topics. Driven by his curiosity, Zabih stays updated with the latest developments in the finance industry, ensuring that his readers receive timely and relevant news and analysis.