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DP Poland (DPP ), the operator of the Domino’s Pizza brand across Poland, saw like-for-like system sales in the first quarter of 2022 increase by 21% while EBITDA figures are expected to be in line with market expectations for the full financial year ended 31 December 2021
In a trading update, it said 1Q22 had delivered strong sales growth against the previous three years, with trends accelerating towards the end of the quarter and also continuing into 2Q22.
While COVID-19 restrictions were lifted on 28 March 2022, market movement was already occurring as children returned to school in February, bringing families back to large cities.
Like-for-like system sales, meaning the total sales of all restaurants using the brand, for the period rose to PLN 42.8m złoty ($10 million) from 35.3 million for the first quarter of 2021.
The Group said it is encouraging that delivery sales have been maintained despite the strong resurgence of dine-in sales which has increased by 520.5% from 1Q21. DP Poland said it expects dine in sales to continue to benefit from increasing tourist numbers, which have remained low relative to 2019, following the recent removal of COVID-19 restrictions.
While high inflationary costs have been persistent, particularly for food and labour, DP’s operating scale has helped offset the higher costs while a new smaller menu has also been introduced to stores in an effort to improve “operational excellence” and reduce food costs.
DP Poland said it believes it has continued to offer “a compelling value proposition to customers” to maintain higher order volumes, helping to mitigate higher labour costs.
The Company acknowledged that sales have continued to grow strongly in early April 2022, despite the company’s implementation of recent price increases to offset higher food costs.
As DP’s store opening program restarts, the Group said it remains confident in its outlook. Two new stores are expected to open in 2Q, with the potential for more during the year.
In addition to driving growth organically, DP said there remains the opportunity to consolidate the fragmented marketplace in Poland as it sees an increasing number of potential M&A opportunities. It added, however, that it remains disciplined in its approach to M&A and will only review opportunities that have “a clear strategic rationale and value accretive metrics.”
The Group expects to announce its final results for the year to 31 December 2021 early in the second half of June and currently, it expects full year EBITDA to be in line with expectations.
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