REG - DP Poland PLC - Full Year unaudited Trading Update for 2024

DP PolandAnnouncement

16/01/2025 07:00

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RNS Number : 5081T  DP Poland PLC  16 January 2025

DP Poland PLC

("DP Poland", the "Company" or the "Group")

 

Full Year unaudited Trading Update for 2024

 

 

DP Poland PLC, the operator of Domino's Pizza stores and restaurants across
Poland and Croatia, provides the following trading update for Q4 and the full
year ended 31 December 2024.

 

DP Poland's Chief Executive Officer, Nils Gornall, said:

 

"2024 has been another year of outstanding growth for DP Poland, reflecting
our continued focus on execution and operational excellence. Despite a
challenging macroeconomic environment and a high comparative base from a
record 2023, we sustained strong sales growth while accelerating the rollout
of new stores and expanding our franchising efforts.

In Poland, our operations achieved a third consecutive year of double-digit
like-for-like (LFL) system sales growth, rising by 17.9%, driven by rising
order volumes and new customer acquisition.  We  have sharpened our pricing
strategy, enhanced customer value and achieved record-breaking levels in both
sales and orders in the fourth quarter, positioning us well for sustained
performance in 2025.

2024 saw the Group achieve consistent pre-IFRS16 EBITDA profitability in
Poland for the first time, reflecting our disciplined cost management and
focus on profitability. With an expanded and optimised store network, the
initiation of a franchising model, and a debt-free balance sheet, we are
confident in our ability to capitalise on the opportunities ahead."

Operational and Financial Highlights

·      The Group expects to report System Sales of £55.4m for FY 2024,
driven by strong customer acquisition in both Poland and Croatia.

·      Poland Performance:

o  Total System Sales grew by 15.9% YoY, with Q4 growth of 8.2%.

o  LFL System Sales increased 17.9% YoY, with delivery LFL sales up 20.1%.

o  Average Weekly Order Count (AWOC) reached 827 for FY 2024, a 13.2%
increase YoY.

o  12 stores were opened (eight new locations, four relocations), with 4
underperforming locations closed during the year. 4 additional stores which
were due to be opened in Q4 2024 were delayed with 3 of these to be opened in
January 2025. The year ended with 113 stores in Poland.

·      Croatia Performance:

o  Total System Sales increased by 40.2% YoY.

o  LFL System Sales rose by 6.0% YoY, with AWOC remaining stable at over
1,200 for FY 2024.

·      Pre-IFRS 16 EBITDA for FY24 is expected to be c. £1.2m (2023:
£0.0m) and post-IFRS16 EBITDA is expected to be £4.8m (2023: £3.5m). This
is a significant improvement on the prior year, however, in H2 2024
profitability was impacted by the growing pressure on food (mainly cheese) and
labour costs (in anticipation of the national minimal salary increase of 8.5%
which applies from Jan 1 2025).

·      Cash at bank as at 31 December 2024 was £13.4m. The company
repaid the outstanding debt to Malaccan in December 2024 and is currently
debt-free.

·      Pressures on energy, rent and utilities costs eased in H2 2024
and inflation in Poland has declined to 3.9% by year-end. Revised pricing
strategies have been introduced to the market in Q4 2024, keeping the
Company's positioning unchanged versus competition and have proven effective
in sustaining customer satisfaction while supporting profitability.

Strategic and Operational Progress

·      Franchise Transition: Initiated franchising model expansion in
Poland, with the transfer of 5 stores to new franchise partners in 2024. Plans
are in place to accelerate franchise expansion, the output of which are
expected to be seen later in 2025.

·      Operational Efficiencies: Cost optimization initiatives,
including fleet electrification, commissary upgrades, and supply chain
improvements, have delivered material savings.

·      Customer Value Proposition: Despite price adjustments, customer
satisfaction ratings remained strong, validating the quality and speed of
service improvements.

·      Competition: In Q4 2024, the main players in the Polish Quick
Service Restaurant business strengthened their promotional actions offering
hot deals, which hindered volume growth for the Company in the quarter.

 

Trading Update 2024

Poland

 

 PLNm                   Q1 2024             Q2 2024             Q3 2024             Q4 2024             FY 2024
                        PLNm  % YoY change  PLNm  % YoY change  PLNm  % YoY change  PLNm  % YoY change  PLNm   % YoY change
 Total System sales(1)  62,2  17,3%         68,0  23,7%         63,7  15,8%         70,9  8,2%          264,8  15,9%

 LFL System sales(2)    60,8  17,9%         66,7  26,5%         61,2  21,0%         65,8  7,8%          254,4  17,9%
 Non-delivery           19,0  17,7%         21,3  20,3%         20,0  10,4%         18,6  5,0%          79,0   13,2%
 Delivery               41,8  18,0%         45,4  29,6%         41,1  26,9%         47,2  9,0%          175,5  20,1%

 

(1   )System Sales and System orders - total retail sales or orders
including sales or orders from corporate and sub-franchised stores, unaudited.

(2   )Like-for-like System Sales growth in Polish Złoty, matching trading
periods for the same stores or orders growth in units, matching trading
periods for the same stores, unaudited.

 

Croatia

 EURm                   Q1 2024             Q2 2024             Q3 2024             Q4 2024             FY 2024
                        EURm  % YoY change  EURm  % YoY change  EURm  % YoY change  EURm  % YoY change  EURm  % YoY change
 Total System sales(1)  0,9   74,1%         0,9   72,7%         0,9   51,0%         1,0   3,6%          3,7   42,4%
 LFL System sales(2)    0,5   8,8%          0,6   9,8%          0,6   4,4%          0,9   3,1%          2,7   6,0%

(1   )System Sales and System orders - total retail sales or orders
including sales or orders from corporate stores, unaudited.

(2   )Like-for-like System Sales growth in Euro, matching trading periods
for the same stores or orders growth in units, matching trading periods for
the same stores, unaudited.

 

 

Outlook

DP Poland enters 2025 with a clear strategy and expects continued LFL and
system sales growth, supported by organic store openings (expected minimum of
15), expansion of our franchise partner network, and strategic price
adjustments to mitigate labour cost inflation and food cost pressures.

We remain focused on delivering high-quality, value-for-money pizza with quick
delivery times, supported by a highly motivated and capable team. With a
strengthened financial position and a streamlined operational base, the
business is well-positioned for further success.

 

The person responsible for arranging the release of this announcement on
behalf of the Company is Nils Gornall, CEO.

 

Enquiries:

DP Poland plc

Nils Gornall, CEO

Tel: +44 (0) 20 3393 6954

Email: ir@dppoland.com

 

Singer Capital Markets (Nominated Adviser and Broker)

Shaun Dobson / Jen Boorer

Tel: +44 (0) 20 7496 3000

 

Notes for editors

About DP Poland plc

DP Poland has the exclusive right to develop, operate and sub-franchise
Domino's Pizza stores in Poland and Croatia. The group operates 116 stores and
restaurants throughout cities and towns in Poland and Croatia.

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