Ann Arbor / MG. (dp) Domino´s Pizza Inc., the recognized world leader in pizza delivery, announced results for the fourth quarter and fiscal 2014, comprised of strong growth in same store sales, global store counts and earnings. Domestic same store sales grew 11.1 percent during the quarter versus the year-ago period, and 7.5 percent for the full year, continuing the positive sales momentum in the Company´s domestic business. The international division also posted strong results with same store sales growth of 6.1 percent during the quarter and 6.9 percent for the full year. The fourth quarter marked the 84th consecutive quarter – or 21st full year – of international same store sales growth. The Company also had global net store growth of 743 stores in 2014, comprised of 81 net new domestic stores and a record 662 net new stores internationally.
On an as-reported basis, fourth quarter diluted EPS was 85 cents, up 9.0 percent over the prior-year quarter; full year diluted EPS was 2.86 USD, up 15.3 percent over the prior year. On an as-adjusted basis, fourth quarter diluted EPS was 91 cents, up 16.7 percent over the prior-year quarter; full year as-adjusted diluted EPS was 2.90 USD, up 18.4 percent over the prior year.
Management commented that it had deployed free cash flow totalling approximately 147 million USD in fiscal 2014, including 82.4 million USD in share repurchases, 52.8 million USD in quarterly dividend payments and 11.8 million USD in required principal payments on long-term debt. Additionally, on February 11, 2015, the Board of Directors declared a 31 cent per share quarterly dividend for shareholders of record as of March 13, 2015 to be paid on March 30, 2015. This represents a 24 percent increase over the previous quarterly dividend amount.
J. Patrick Doyle, Domino´s President and Chief Executive Officer, said: «Fundamental strength, with a growing global store base, robust sales and technological innovation, continues to truly drive the business. Franchisees are both energized and financially sound, which is fuelling our store re-image program, sales and store growth».
Fourth Quarter and Fiscal 2014 Highlights:
- Revenues were up 13.5 percent for the fourth quarter versus the prior year period, due primarily to higher supply chain volumes and elevated commodity prices (specifically cheese and meats) as well as increased sales of equipment to stores as our store re-imaging program continues. Additionally, sales and store growth contributed to increased revenues in all business segments. These increases were partially offset by the negative impact of foreign currency exchange rates.
- Net Income was up 3.4 million USD, or 7.5 percent, for the fourth quarter versus the prior year period, primarily driven by domestic and international same store sales growth and global store count growth, as well as increased supply chain volumes. The resulting increase in net income was partially offset by an impairment charge recognized in connection with the sale of the Company´s corporate airplane (which negatively impacted net income by 3.6 million USD) and the negative impact of foreign currency exchange rates.
- Diluted EPS increases, as noted above, were due to higher net income and lower weighted average diluted shares outstanding.
Share Repurchases
During fiscal 2014, the Company repurchased and retired 1,151,931 shares of its common stock under its open market share repurchase program for approximately 82.4 million USD, or an average price of 71.54 USD per share. As of February 17, 2015, the Company had authorization for repurchases of approximately 132.7 million USD remaining under the program.
Change in Segment Reporting
Historically, we have operated in, and reported three business segments: domestic stores, domestic supply chain and international. In the fourth quarter of 2014, several organizational changes were made within the Company´s management structure, with one of the changes impacting the management of our supply chain operations. As a result, management determined that its previous domestic supply chain segment and the international supply chain operations division of its previous international segment should be combined into a new global supply chain segment. As a result, we now report the following three business segments: domestic stores, supply chain and international franchise. While the consolidated results of the Company have not been impacted by this change in our reportable segments, we have restated our historical segment information in order to provide readers of our financial statements with a consistent presentation.
Long Range Outlook
The Company does not provide quarterly or annual earnings estimates. The following long range outlook does not constitute specific earnings guidance, but the Company believes these ranges to be appropriate and achievable over the long term. In January 2015, the Company adjusted portions of this long range outlook, as follows:
| . | Current Outlook | Prior Outlook |
| Domestic same store sales growth | 02 to 04 percent | 02 to 04 percent |
| International same store sales growth | 03 to 06 percent | 03 to 06 percent |
| Net unit growth | 05 to 07 percent | 04 to 06 percent |
| Global retail sales growth | 07 to eleven percent | 06 to ten percent |
| Capital expenditures | 50 to 60 million USD | 35 to 45 million USD |
| Effective tax rate | 37 to 38 percent | 37 to 38 percent |
