DPC Dash: announces positive profit warning for FY-2023

Hong Kong / HK. (dp) DPC Dash Limited (Domino’s Pizza China), exclusive master franchisee of Domino’s Pizza Inc. in the People’s Republic of China, the Hong Kong Special Administrative Region of China, and the Macau Special Administrative Region of China, announced a profit alert for the year ended December 31, 2023 (FY-2023), which showed substantial growth in both top and bottom line.

The Group anticipates total revenues of no less than RMB 3 billion for FY-2023, representing year-over-year growth of no less than 48 percent; the Group expects to record a non-IFRS Adjusted Net Profit of no less than RMB 8 million, turning profitable from Adjusted Net Loss (non-IFRS measure) of approximately RMB 113.8 million for FY-2022; the Group expects to record a net loss of no higher than RMB 29 million for FY-2023, a decrease from RMB 222.6 million for FY-2022.

DPC Dash achieved a jump in revenue and non-IFRS adjusted net profit turned profitable for the full year for the first time in FY-2023, showing a high resilience in profit growth with its rapid expansion and strong sales performance. DPC Dash believes the anticipated strength of FY-2023 performance was mainly attributable to the expansion of its store network, strong revenue growth in existing and new stores, and enhanced profit margins.

In 2023, DPC Dash adapted a «go-deeper and go-broader» strategy to continue its penetration in mature markets while expanding its store network into new cities. The total store count increased to 768 stores as of December 31, 2023 from 588 at the end of 2022, realizing its target to open 180 new stores in 2023.

Between December 23rd and 24th, DPC Dash opened 10 new stores across eight new cities in mainland China, namely Tangshan, Xi’an, Xiamen, Fuzhou, Changsha, Nantong, Yangzhou and Hefei. In January 2024, DPC Dash opened its 800th store in Jinan, Shandong. Looking forward into 2024, DPC Dash has set an ambitious plan to open 240 new stores, which is being pushed forward with a promising pace.

In 2023, DPC Dash witnessed revenue growth from existing stores, while the entrance into new cities brings about a momentum for sustainable growth in sales. The 10 new stores opened between December 23rd and 24th all ranked among the top-15 for sales in the first 30 days among Domino’s global system. Four of these new stores in Xi’an, Changsha, Xiamen, and Hefei, representing DPC Dash’s stores in Northern, Western, Southern and Eastern China respectively, climbed to the top-four spots globally, each of which exceeded RMB 5 million in sales in the first 30 days. As of February 2024, DPC Dash now holds all of the top-17 spots and 18 of the top 20 spots globally for first 30-day sales.

The strong sales performance from existing and new markets is also attributable to DPC Dash’s innovation and localization, tailoring its menu to serve China consumers handcrafted quality pizza at attractive value proposition with easy ordering access and efficient delivery.

Furthermore, DPC Dash greatly improved its operational efficiency at both store and corporate levels during FY-2023, leading to further enhancements in profit margin. In FY-2023, DPC Dash continued improvement in store structure and operation, digitalization, supply chain upgrade, and cost control, while emphasizing human resource management under an ESG strategy. In November 2023, DPC Dash hosted its first Domino’s Pizza China Nationwide Store Manager Annual Party, where store managers and employees showed their passion for pizza in a variety of activities. A total of 42 Domino’s Pizza China stores won an annual award for global stores that meet a series of high standards in financial performance, product, service, and branding image, setting a new record. In December 2023, DPC Dash was included in the 2023 Kincentric China Best Employers, in recognition of high employee satisfaction in regarding employee engagement, agility, engaging leadership and talent focus. DPC Dash also received honorable mention for Talent Focus practices. In terms of social work in 2023, DPC Dash joined WeChat Pay’s «Caring Meal» CSR initiative among other efforts to support sanitation workers. Selected Domino’s Pizza stores in Guangzhou offered Domino’s meals to sanitation workers at RMB 0.01.

Moving forward, as the catering industry is leading economic recovery and consumer’s acceptance of pizza and tendency to delivery rises, Domino’s Pizza China will continue to strengthen its differentiation from with, among others, a continually developed and localized pizza-focused menu, unique expertise and leadership in delivery, technology focus and scalable and replicable store economic model to deliver long-term value for customers, employees, shareholders among all stakeholders.