Delivering future growth - FULL YEAR 2020 Prelim Results 9 MARCH 2021
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FULL YEAR 2020 Prelim Results
Delivering future growth
9 MARCH 2021
AGENDA 1. Overview & operational update – Dominic Paul, CEO 2. Financial performance – Neil Smith, CFO 3. New strategy: Delivering future growth – Dominic Paul, CEO 4. Q&A
Strong platform to drive future growth
Operational progress and strong trading through Covid-19
• Strong trading performance
• Accelerated growth of delivery market and step-change in digital credentials
• Significant new customer acquisitions
• Transformation of the Board and Executive Leadership Team - enhanced diversity, skills & experience
• Good progress on exiting International businesses
Driving future growth
• A new strategy with ambition to deliver £1.6bn -£1.9bn of system sales in medium term
• Made an attractive offer to Domino’s franchisees to seek alignment & accelerate growth
• A new capital allocation philosophy - £88m to be returned to shareholders through dividend and
share buybacks
• New year has started well
3 Full Year Results 2020
THREE PRIORITIES IN 2020
System united behind these priorities and doing the right thing
PRIORITY 1 PRIORITY 2 PRIORITY 3
Keep serving Build Come together
our customers brand preference with our
and looking after and help franchisees during
our people our communities Covid-19
PRODUCED • £1,348m system sales, up 11.4%
GOOD RESULTS: • £101m underlying profit before tax, up 2.4% (after £9m of Covid costs)
• £99m free cash flow, up 73%
4 Full Year Results 2020
AGENDA 1. Overview & operational update – Dominic Paul, CEO 2. Financial performance – Neil Smith, CFO 3. New strategy: Delivering future growth – Dominic Paul, CEO 4. Q&A
INCOME STATEMENT
Robust trading performance generating strong underlying profit
Underlying, £m 2020 2019 • Adoption of IFRS 16 benefits EBITDA by £7.9m
UK & Ireland EBITDA 120.8 114.1 and PBT by £0.7m
Depreciation & Amortisation (16.5) (11.7) • Covid-19 related costs of £9.0m partially offset
UK & Ireland EBIT 104.3 102.4 by VAT benefit of £3.6m
German Associate EBIT 4.7 2.9 • Underlying PBT growth of £2.4m
Finance costs (7.8) (6.5)
• Adjusting for net Covid-19 impacts and IFRS 16
Profit before tax 101.2 98.8 produces PBT of £105.9m, up 7.2%
Taxation (16.9) (17.7)
• Underlying EPS of 18.2p, up 0.6p on 2019
Profit after tax 84.3 81.1
Underlying basic EPS (p) 18.2 17.6
6 Full Year Results 2020
COVID-19 RELATED COSTS
Included within underlying items
£m H1 H2 2020 • No government loans or funding; no furlough;
Supply chain operations 2.1 2.5 4.6 repaid business rates on corporate stores
Franchisee support 3.4 0.3 3.7 • UK VAT rate reduction since July generates
Charges to supply chain EBITDA 5.5 2.8 8.3 benefit sufficient to offset costs – largely via
increased royalty income
Community 0.7 0.0 0.7
Total 6.2 2.8 9.0 • Covid-19 related costs in supply chain expected
to continue throughout 2021
VAT benefit 3.6 3.6 – Will be broadly matched by benefits of
reduced VAT
7 Full Year Results 2020
ANALYSIS OF UK & IRELAND EBITDA
Strong performance given Covid-19 costs
£m 2020 2019 Key impacts on EBITDA are:
Supply chain centre EBITDA 99.3 101.4 • Supply chain EBITDA includes £8.3m of Covid-19
Net royalties 37.8 33.9 related costs
Net overheads, realty & incentives (31.9) (24.5) • Increase in net royalties from 11.4% increase in
UK corporate stores 1.6 1.3 system sales
UK investments 6.1 2.0 • Net overheads increase driven by
IFRS 16 leases 7.9 - – Investments in people to add capability and
Underlying UK & Ireland EBITDA 120.8 114.1 expertise
– Investment in data analytics and marketing
effectiveness
– Other one-off support to franchisees
• Corporate stores and JVs trading well through
year with some support from VAT reduction
8 Full Year Results 2020
FRANCHISEE trading
Positive year for the system
2020* 2019 • Franchisees and their teams have worked
Store level tirelessly to remain open and trade safely
Average EBITDA £229k £145k • We have supported ability to trade safely
EBITDA margin 20% 14% – Purchasing safety equipment
Franchisee level • Reduction in NAF during initial lockdown
Average EBITDA £191k £110k
• VAT rate cut in UK in H2
EBITDA margin 17% 11%
• Community support and job creation
* UK only
Source: Extracted from submissions from franchisees
Not subject to audit by DPG or externally
9 Full Year Results 2020
SALES PERFORMANCE
Reported system sales growth aided by effect of UK VAT reduction
%
£m 2020 2019 change • UK system sales up 12.0% to £1,280.7m. LFL
UK system sales 1,280.7 1,144.0 12.0% sales growth across UK & Ireland of 10.3%
excluding splits
Ireland system sales 67.7 66.9 1.2%
Total system sales 1,348.4 1,210.9 11.4% • Supply chain revenue up 4.4% as a result of
increased system sales
Supply chain revenue 347.9 333.3 4.4% • Royalty, rental and other revenue impacted
Royalty, rental & other revenue 70.8 88.1 (19.6)% by removal of rental income under IFRS 16
of £25.4m. Excluding this, increased by
Franchise revenue 418.7 421.4 (0.6)% £8.1m due to increased royalty revenue
Corporate stores revenue 32.2 32.1 0.3%
• Corporate stores revenue of £32.2m
NAF & eCommerce 54.2 54.8 (1.1)% consistent year-on-year
Total reported revenue 505.1 508.3 (0.6)%
• EBITDA margin as % of system sales
UK & Ireland EBITDA 120.8 114.1 5.9% decreased by 0.4%
EBITDA margin % of system sales 9.0% 9.4% (0.4)% • Adjusting EBITDA margin for Covid-19 costs,
VAT rate change and IFRS 16, would
deliver margin of 9.2%
UK VAT reduction from 20% to 5% effective from July 2020
10 Full Year Results 2020UK & IRELAND TRADING PERFORMANCE
Strong system sales; order count impacted by reduced collections
Delivery & collection analysis Quarterly profile
20.0%
Total sales 15.0% 17.5%
£225.7m £88.2m
14.6%
(34.3%) £1,348.4m 10.0%
COLLECTION +11.4% 5.0%
£1,210.9m +23.7% 1.8% 5.2%
3.5%
0.0%
DELIVERY Q1 Q2 Q3 (6.0%) Q4
(5.0%) (8.2%)
(11.3%)
(10.0%)
FY 2019 fy2020
(15.0%)
LFL exc Splits Growth Total Order Count Growth
Total orders
4.9m 9.0m • Full year total sales growth of 11.4%; LFL growth of
(41.9%)
10.3%, assisted by VAT rate reduction in H2
69.2m +10.3% • Full year order count decline of 6.0% as collection
DELIVERY closed in Q2 and trading at c60% of 2019 levels in H2
65.1m – Delivery business +10.3%
COLLECTION (6.0%)
– Collection business -41.9%
FY 2019 fy2020
11 Full Year Results 2020NON-UNDERLYING & DISCONTINUED OPERATIONS
Significant reduction of charges arising from discontinued
International businesses
£m 2020 2019
• Focused on removing burden of
Discontinued International trading performance International on Group cash flow
Iceland 0.6 1.7 • Trading losses materially reduced
Norway (3.3) (11.3)
• Norway disposal completed
Switzerland (1.5) (5.4) May ’20 - loss of £10.8m
Sweden (4.5) (4.0)
• Other International impairments
Central costs (1.4) (1.8) in order to write down carry
Total trading loss (10.1) (20.8) values to expected disposal value
– Iceland impairment : £14.5m
Loss on disposal of Norway (10.8) -
– Sweden impairment : £8.1m
International impairments (22.6) (35.4) – Minimal future charges
Finance costs & tax 1.0 (0.3) expected
Total charge from discontinued operations (42.5) (56.5) • Sweden disposal expected to
Non-underlying charges (2.1) (21.8) complete May ‘21
Total charge from non-underlying & discontinued (44.6) (78.3)
12 Full Year Results 2020FREE CASH FLOW
Strong generation of free cash flow from the business
£m 2020 2019 • Strong free cash flow of £99.0m during the
Continuing operations EBITDA 125.5 117.0 year, an increase of £41.9m from £57.1m in 2019
Discontinued operations EBITDA (4.2) (15.2) • Working capital benefit primarily relates to
Remove contribution from timing inflow of £21m from the end of 2019
investments (10.8) (4.9)
• IFRS 16 outflow of £11m relates to cash payments
IFRS 16 – net lease payments (11.0) - and receipts for leases now not presented as
Working capital 29.1 (23.3) part of EBITDA
Dividends received 2.5 1.0 • Tax cash outflows increased by £9.0m as a result
Net interest (4.4) (5.7) of timing of UK tax payments during the year
Tax (23.1) (14.1)
Other (4.6) 2.3
Free cash flow 99.0 57.1
Free cash flow is now presented before capital expenditure, and comparatives have been restated
13 Full Year Results 2020USE OF FREE CASH
We will return £88m of cash generated to shareholders
£m 2020 2019 • Overall net debt decreased by £60.8m as a
Free cash flow 99.0 57.1 result of strong free cash flow and lower
dividend payments
Capex (19.4) (23.4)
Share transactions 13.4 (17.4) • Total capital expenditure of £19.4m reduced
from £23.4m due to lower international
Acquisitions & disposals (6.4) (2.7)
spend, and some prudence in UK & Ireland
Other 4.6 (2.9) spend due to Covid-19
Cash available for distribution 91.2 10.7
• Share transactions inflow of £13.4m primarily
Dividend paid (25.6) (44.3) relates to cash received on issue of shares
Forex on RCF (4.8) 4.3 related to the Briskas option of £12.9m
Total movement in net debt 60.8 (29.3) • Acquisitions and disposals relates to the cash
outflow on the Norway disposal
• Dividend paid of £25.6m relates to FY19 Final
Dividend
14 Full Year Results 2020NET DEBT BRIDGE
Strong cash generation from core business
Net debt /
Net debt /
Reported EBITDA
Continuing EBITDA
Inc Discontinuing
(Excl IFRS16): 1.46x
(Excl IFRS16): 1.57x
(16.9) 4.6
(7.1) (2.5) (6.4)
UK & I Funding (25.6) (4.8) (171.8)
Capex – German
13.4
106.1 International International
Associate Dividends Share (pre capex) capex Norway Forex
paid transactions disposal
(232.6)
OPENING UK & I FCF CLOSING
(pre capex)
NET DEBT NET DEBT
15 Full Year Results 2020CAPITAL ALLOCATION PHILOSOPHY
This is an asset-light, high returns business with strong free cash flow
PRIORITIES FOR CAPITAL PHILOSOPHY OUTCOMES FOR FY20
Invest in the business to drive Returns-based approach to Capital investment of £19.4m
long-term organic growth investment in core business to support business growth
Sustainable & EPS cover of at least 2x Proposed FY20
progressive dividend dividend of 9.1p (£43m)
Board to take disciplined Divestment of sub-scale
Investment in additional
approach to assessing organic international businesses and
growth opportunities
and inorganic opportunities focus on the core business
Surplus cash Return surplus cash to our £45m share buyback
shareholders launched
Strong balance sheet:
Normalised net debt / EBITDA leverage range of 1.5x - 2.5x
16 Full Year Results 20202021 GUIDANCE
For FY21 we expect:
• PBT in FY20 was held back by £5.4m of net one-offs - not expected to recur in current year
• Execution of new strategy will deliver further growth in earnings in current year
• Underlying depreciation & amortisation of £16m to £18m, including the impact of IFRS 16
• Underlying interest (excluding foreign exchange movements) of £4m to £6m
• Underlying effective tax rate of c.18% for the full year
• UK & Ireland capital expenditure of c£15m
• Net debt at FY21 year-end around £200m
17 Full Year Results 2020AGENDA 1. Overview & operational update – Dominic Paul, CEO 2. Financial performance – Neil Smith, CFO 3. New strategy: Delivering future growth – Dominic Paul, CEO 4. Q&A
We have A great foundation for delivering future growth
Brand that Leader in growing Digital is our World class High quality
customers love delivery market core business supply chain franchisees
19 Full Year Results 2020A compelling Market backdrop
An evolving market which offers growth opportunities
Growing Digital customer Improved
market acceleration customer experience
9.6% 2013-2019
Delivery CAGR >5 million New digital
customers
acquired in
69% Overall customer
satisfaction (OSAT)
up from 61% in 2019
the year
Delivery is a In 2020 we gained over We’ve continued to
strong channel… 5m new customers… delight our customers…
6.4% 2013-2019
Collection CAGR 90.5% Online orders
from new
customers via web
+55
NPS score improved
by 10 pts on 2019 (45)
and App channels
… and collection will … through our digital channels …and customers continue
continue to grow to recommend us
All data sourced from DPG D&I
20 Full Year Results 2020purpose
delivering a better future through food people love
1 2 3 4 5 MEDIUM TERM ambition
Nobody Turbo-charge Amplify our Uphold our Model
delivers like our collection product quality industry-leading excellence as a
Domino’s business & value scale economics franchisor £1.6bn to Add 200
£1.9bn New stores
VALUES in UK&I
System sales
We do We are We grow
We love We are
the right one and win
customers bold
thing team together
21 Full Year Results 2020We have reorganised our business to deliver the future
DOMINIC PAUL
Chief Executive Officer
Costa Coffee
Royal Caribbean
EasyJet
NEIL MARK SARAH NICOLA SCOTT MICHAEL SIMON CLIVE PETER ROBIN NADINE
SMITH GRIMES BARRON FRAMPTON BUSH VON WALLIS WEST TRUNDLEY CALEY WYNCOLL
Chief GELDERN
Chief Chief Chief Operations Chief Supply Chain Property & People
Executive Data & Group
Financial Information Marketing Director Transformation Director Business Director
Officer Insights Digital
Officer Officer Officer Director Officer Director Development
Ireland Director
New New New New New role New team New team
EI Group Parkdean Costa Coffee William Hill Domino’s Pizza Virgin Loyalty Papa John’s Halfords Associated Tesco Tesco
Compass Group Ladbrokes Boots Enterprises Nectar Loyalty YUM Restaurants British - Foods Savola Dixons
Deloitte Asda
Virgin Media Sportingbet Cadbury Dominos Australia United Biscuits Bakkavor Halfords Carphone
PWC
Domino’s Mars plc
RBS
New Zealand
22 Full Year Results 2020We are doing the right thing for…
Our customers, our people and the environment
COMMUNITIES CUSTOMERS PEOPLE ENVIRONMENT
• £8m pizza giveaways • New vegan product • Launch of Partners • Packaging waste
for key workers range launched Foundation - pizza boxes made from
80% recycled materials
• Keeping our customers • Keeping our
and 100% recyclable
safe colleagues safe
• Food waste
• £1m Teenage Cancer - 100,000 equivalent
Trust donation meals to FareShare
OUR • Further improve Board diversity to achieve 33% • Extensive healthy product offering low in salt,
female directors by end of 2021 and 40% female fat and sugar
COMMITMENTS directors by end of 2025 • In 2021, establishing science-based carbon
• Reduce cardboard usage in supply chain reduction targets
operations • Increasing our disclosure in line with Task Force
• Zero waste to landfill on Climate-Related Financial Disclosures (TCFD)
recommendations
23 Full Year Results 2020objective ONE
Nobody delivers like domino’s
The opportunity initiatives measuring SUCCESS
Domino’s is the leading Launch new digital Accelerate LFL delivery
QSR delivery brand platforms order count
- new mobile app and
Delivery market is website Reduce average
accelerating - personalize delivery times toobjective TWO
Turbocharge our collection business
The opportunity initiatives measuring SUCCESS
Collection market is Collections offers Grow collection faster
sizable and growing than delivery
Continue to develop our
We are food offerings (incl. on- Double our market
underpenetrated in the-go) share in collection
collection
Deployment of In Car
We can extend our Collection
reach to different
occasions and customer
segments
25 Full Year Results 2020objective THREE
Amplify our product quality and value
The opportunity initiatives measuring SUCCESS
Customers love our Re-invigorate Achieve #1 customer
products innovation in pizza and NPS vs other pizza /
beyond (incl. healthy delivery players
We will drive product offerings)
innovation to stay ahead Improve perceived
of competitors Use data and insight to value for money
improve marketing to
Room to improve value reinforce our quality
for money perception and value
More targeted offers
for collection and
delivery
26 Full Year Results 2020objective FOUR
Uphold our industry-leading scale economics
The opportunity initiatives measuring SUCCESS
Consistently strong Leverage scale to drive Maintain world-class
system performance supply chain efficiencies profitability of the
relative to peers system
Deploy in-store tech to
Invest to enhance support franchisee
efficiency profitability
Further enable the
success of our
franchisees
27 Full Year Results 2020objective FIVE
Model excellence as a franchisor
The opportunity initiatives measuring SUCCESS
We will bolster our Stronger business Attract and retain the
internal capabilities review process to best talent
support franchisee
We can continue to success Be the preferred
grow through our partner for prospective
franchisees Invest in key capabilities franchisees
- data & insights
Seek to broaden our - digital / technology
franchise base - supply chain
Renew store formats to
unlock new wave of
growth
28 Full Year Results 2020investment to enhance our core business,
AND drive sustainable growth
Annual capital investment of £10m to £15m
Supply chain
• Investment to maintain world-class standards as business grows
• Capture efficiency opportunities
Technology Infrastructure
• Upgrade online platform and App
• Investment in personalisation - CRM
Store operations
• Service and efficiency of store operations
29 Full Year Results 2020What’s different in the new strategy vs current situation
Current situation New strategy
Leader in delivery and digital, but increasing
1 Revolutionised digital experience to accelerate delivery
competition from digital aggregators
2 Primary emphasis on delivery to fuel growth Accelerate delivery whilst also turbocharging collection
Varied set of discounts, focusing on large groups Tailored offers to specific customer groups / occasions
3
Marketing focus on brand building Personalized marketing that elevates quality and value
Strong operational performance, but increasing
4 Optimised supply chain, relentless pursuit of quality
cost pressure
5 Standardised offerings (products, store formats, …) Menu innovation and new store experiences
30 Full Year Results 2020Franchisee Alignment
We are stronger together
• We have engaged with our franchisees in the development of our strategic plans
• Made an attractive offer to Domino’s franchisee representatives to align their strategic and
financial interests with ours:
– Enhanced food rebate – to drive growth
– New store incentives – to encourage new openings
– Material capital investment in digital platform, CRM & supply chain
– Capability investment in marketing effectiveness, data & insights
– Modest, phased increase in NAF contribution, aligned to enhanced marketing effectiveness, and
participation in national deals
• We will make significant progress on our strategic growth plan - formal franchisee alignment
would accelerate this
• We are getting on with strategy – we will continue to engage with our franchisees
31 Full Year Results 2020We are making material progress on our strategy execution
Multiple initiatives driving our strategic programme
In 2021 2022 and beyond
1 Personalise web platform & Driving improved Launch new web platform
deploy CRM marketing effectiveness
Launch new mobile App
2 Roll out In Car Collection Targeted promotion of collections Introduce on-the-go menu items
3 Relaunch full menu offering Drive loyalty via pizza innovation Attract new consumers through
differentiated innovation
4 Utilise cages & dollies for Install scan & dispatch
Deploy dynamic distribution routing
SC efficiencies supply system
5 Stronger business Bolster our capabilities
Roll out new store formats
review process (e.g. in data)
32 Full Year Results 2020Summary: Delivering a better future through food people love
• A strong financial performance
• A brilliant brand and business model
• Great foundations for future growth
• Clear building blocks to deliver system sales of £1.6bn to £1.9bn
– Nobody delivers like Domino’s
– Turbocharged collection business
– Amplified product quality and value
– 200 new store openings
33 Full Year Results 2020Appendix
IFRS 16 IMPACT
• IFRS 16 was implemented in the current year. This brings previous operating leases onto the balance
sheet, as a leased asset and related liability for our directly leased assets, and a lease receivable and
payable for our ‘back to back’ property leases with our franchisees
• Previous periods are not restated due to the chosen transition methodology
• For our franchisee leases, we no longer recognise revenue and costs associated with the leases. Instead,
the receivable and liability is ‘unwound’ through interest, leading to a large gross finance income and
expense. As the leases are ‘back to back’, this has limited impact on the net finance costs
• Lease payments for our directly owned assets (warehouses, corporate stores, equipment) are not
recognised as operating costs, but instead the asset recognised is depreciated and finance costs
recognised on the liability
• On the balance sheet, a lease receivable is recognised for our franchisee leases, a right of use asset is
recognised for our lease assets, and a payable related to the amount due under both leases
35 Full Year Results 2020IFRS 16 IMPLICATIONS – 2020
P&L Balance sheet
IFRS 16
£m Pre-IFRS 16 impact Post-IFRS 16 £m 2020
Revenue 530.5 (25.4) 505.1 Right of use asset 20.1
Costs excl. depreciation (423.7) 33.3 (390.4) Lease receivable 204.7
Contribution of investments 10.8 - 10.8 Lease liability (226.5)
EBITDA 117.6 7.9 125.5 Net assets impact (1.7)
Depreciation (10.8) (5.7) (16.5)
EBIT 106.8 2.2 109.0
Net finance costs (6.3) (1.5) (7.8)
Profit before tax 100.5 0.7 101.2
Taxation (16.9) - (16.9)
Profit after tax 83.6 0.7 84.3
36 Full Year Results 2020UK & IRELAND UNIT METRICS
LFL Inc Splits (YOY Growth) Total (All Stores)
Items Per
Orders Order Product Mix YOY Order
UK & ROI Sales (Volume) (Volume) (Volume) Price Orders (m) Growth
Total
Q1 2.2% (0.6)% 1.4% 0.5% 0.9% 17.5m 1.8%
Q2 4.2% (13.3)% 18.6% (2.2)% 1.0% 15.1m (11.3)%
Q3 16.5% (7.8)% 10.4% 1.2% 12.6% 15.7m (6.0)%
Q4 14.1% (9.4)% 9.6% 0.3% 13.6% 16.8m (8.2)%
FY 9.3% (7.7)% 9.6% (0.1)% 7.4% 65.1m (6.0)%
Delivery only
Q1 3.9% 0.4% 1.3% 0.9% 1.3% 12.4m 2.5%
Q2 30.1% 19.6% 7.6% 4.6% (1.7)% 14.4m 22.4%
Q3 28.7% 9.6% 3.7% 4.5% 10.9% 12.4m 11.8%
Q4 23.2% 3.6% 4.1% 2.6% 12.8% 13.4m 5.1%
FY 21.4% 8.2% 4.1% 3.0% 6.1% 52.6m 10.3%
Collection only
Q1 (4.2)% (3.0)% 0.0% 0.0% (1.2)% 5.1m 0.0%
Q2 (93.8)% (87.8)% (7.4)% 8.3% (6.9)% 0.7m (87.2)%
Q3 (25.6)% (42.9)% 11.8% (3.8)% 9.3% 3.2m (41.5)%
Q4 (20.5)% (38.9)% 11.5% (2.9)% 9.8% 3.5m (38.1)%
FY (35.7)% (43.3)% 6.4% (2.9)% 4.1% 12.5m (41.9)%
• Average discount 39.1%, with 91.5% of orders sold on promotion
37 Full Year Results 2020UK & IRELAND SYSTEM SALES BRIDGES
UK system sales £m ROI system sales* €m
+12.0% 16.7 (7.6) +0.5%
8.8
1.9 (0.7)
Split
Immature territories 1,280.7
118.8 New store Split
store (0.8) 0.0 76.5
growth 76.1 territories
growth
LfL New Immature
exc. Splits store store
growth growth
1,144.0 LfL
exc. Splits
2019 FY 2020 FY 2019 FY 2020 FY
* The ROI system sales above are reported in Euro whereas system sales on
Slide 10 are shown in £m.
38 Full Year Results 2020UK & IRELAND LFL SALES growth - 2020
Q1 Q2 Q3 Q4 FY
LFL sales growth 2020 2020 2020 2020 2020
Excluding splits
UK 4.0% 5.6% 18.3% 15.2% 10.9%
Ireland (1.7)% (5.4)% 2.0% 0.2% (1.2)%
UK & Ireland combined 3.5% 5.2% 17.5% 14.6% 10.3%
Including splits
UK 2.8% 4.7% 17.3% 14.6% 9.9%
Ireland (3.3)% (6.6)% 1.5% 0.2% (2.1)%
UK & Ireland combined 2.2% 4.2% 16.5% 14.1% 9.3%
39 Full Year Results 2020UK & IRELAND LFL SALES GROWTH – 2019
Q1 Q2 Q3 Q4 FY
LFL sales growth 2019 2019 2019 2019 2019
Excluding impact of splits
UK 3.1% 4.8% 3.0% 3.9% 3.7%
Ireland 6.8% 7.0% (0.7%) (1.0%) 3.0%
UK & Ireland combined 3.3% 4.8% 2.9% 3.5% 3.7%
Including impact of splits
UK 0.9% 2.7% 1.4% 2.6% 1.9%
Ireland 5.3% 5.5% (1.7%) (2.4%) 1.5%
UK & Ireland combined 1.1% 2.9% 1.3% 2.2% 1.9%
40 Full Year Results 2020STORE NUMBERS
27 Dec 29 Dec
£m 2020 2019
UK 1,147 1,130
Franchise 1,110 1,094
Corporate 37 36
ROI 54 54
UK & ROI total 1,201 1,184
Discontinued International
operations
Switzerland 20 21
Norway NA 56
Iceland 23 24
Sweden 14 13
41 Full Year Results 2020INTERNATIONAL PERFORMANCE (DISCONTINUED)
2020 2019
System System
£m sales EBIT sales EBIT
Iceland 29.2 0.6 36.6 1.7
Norway 9.3 (3.3) 38.3 (11.3)
Switzerland 22.1 (1.5) 20.6 (5.4)
Sweden 8.2 (4.5) 5.2 (4.0)
Central costs (1.4) (1.8)
Total trading result 68.8 (10.1) 100.7 (20.8)
Loss on disposal of Norway (10.8) -
International impairments (22.6) (35.4)
Finance costs and tax 1.0 (0.3)
Total loss from discontinued operations (42.5) (56.5)
42 Full Year Results 2020GROUP BALANCE SHEET
27 Dec 29 Dec
£m 2020 2019
Intangible assets 30.5 34.5
Property, plant and equipment 91.1 84.8
Right-of-use assets 20.1 -
Lease receivables 204.7 -
Trade and other receivables 57.4 99.1
Inventory 11.0 13.0
Market Access Fee 15.3 7.1
Investments 51.7 42.9
Cash and cash equivalents 63.4 11.1
Deferred consideration 5.7 5.7
Tax assets 3.2 -
Assets held for sale 38.1 55.7
Total Assets 592.2 353.9
43 Full Year Results 2020GROUP BALANCE SHEET (CONTINUED)
27 Dec 29 Dec
£m 2020 2019
Lease liabilities (226.5) -
Trade and other payables (90.3) (95.5)
RCF (243.6) (248.1)
Other financial liabilities - (1.3)
Tax liabilities (3.6) (6.9)
Provisions (13.5) (15.5)
Liabilities held for sale (23.5) (27.9)
Total liabilities (601.0) (395.2)
Net liabilities (8.8) (41.3)
44 Full Year Results 2020GLOSSARY
Item Definition
AWUS Average Weekly Unit Sales
ASPA Average Sales Per Address
German associate Represents our 33% associate investment in the trading operations of Domino’s Pizza Germany (also referred to as Daytona JV)
HMF Relates to Have More Fun (London) Limited, which operates 6 corporate stores in London and was acquired from a franchisee in
August 2018
International Represents our businesses in Norway, Sweden, Switzerland, Iceland and our share of the German associate.
London Relates to the corporate stores held following the acquisition of SMP and HMF and subsequent corporate store openings and
Corporate Stores closures
eCommerce fund The fund used to recharge costs for the development and maintenance of our eCommerce platform with franchisees
MAC Marketing Advisory Committee, which is a committee attended by both the Group and Franchisee representatives to monitor
and discuss the use of the NAF and eCommerce funds
Maintenance capex Represents routine replacement or significant enhancement capital expenditure on our capital investments, which is not
considered growth or strategic investment capital expenditure
NAF National Advertising Fund
SMP Relates to Sell More Pizza Limited, which operated 25 stores in London and was acquired from a franchisee in October 2017
45 Full Year Results 2020ALTERNATIVE PERFORMANCE MEASURES
Location in release of
Item Definition reconciliation to GAAP measure
OVERALL TERMINOLOGY
Non-underlying items Items that are material in size, unusual or infrequent in nature, and are Group income statement, note 5
disclosed separately as non-underlying items in the notes to the accounts.
Constant currency basis Restating prior year results to the current year’s average exchange rates Not applicable
to remove volatility of foreign exchange from the reported results
PROFIT MEASURES
Group operating profit before tax Group operating profit before tax excluding non-underlying items Group income statement, note 2
excluding non-underlying items
Net interest before non-underlying items Group finance costs excluding non-underlying items Group income statement, note 2
Underlying profit before taxation Group profit before tax excluding non-underlying items Group income statement, note 2
Underlying profit for the period Group profit after taxation excluding non-underlying items Group income statement
Earnings before Interest and Tax (EBIT) EBIT is directly comparable to underlying operating profit Not applicable
Non-underlying items Items that are material in size, unusual or infrequent in nature, and are Group income statement, note 4
disclosed separately as non-underlying items in the notes to the accounts.
Underlying basic EPS Group EPS excluding non-underlying items Note 7
46 Full Year Results 2020ALTERNATIVE PERFORMANCE MEASURES
Location in release of
Item Definition reconciliation to GAAP measure
REVENUE MEASURES
System sales System sales represent the sum of all sales made by both franchised and
Not applicable
corporate stores to consumers.
Like-for-like (LFL) sales growth LFL excluding splits sales performance is calculated for UK & Ireland
excluding splits against a comparable 52 week period in the prior year for mature stores
Not applicable
which were not in territories split in the year or comparable period. Mature
stores are defined as those opened prior to 30th December 2018.
Like-for-like (LFL) sales growth LFL including splits sales performance is calculated for UK & Ireland against
including splits a comparable 52 week period in the prior year for mature stores, including Not applicable
those which were in territories split in the year or comparable period.
47 Full Year Results 2020FORWARD-LOOKING STATEMENTS CAUTION These 2020 annual results, our interim results, our Annual Report and the Domino's Pizza website may contain certain "forward-looking statements" with respect to Domino's Pizza Group pie and the Group's financial condition, results of operations and business, and certain of Domino's Pizza Group pie's and the Group's plans, strategy, objectives, goals and expectations with respect to these items and the economies and markets in which Domino's Pizza Group pie operates. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as "anticipates", "aims", "due", "could", "may", "should", "expects", "believes", "intends", "plans", "targets", "goal" or "estimates". By their very nature, forward-looking statements are inherently unpredictable, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. Many of these assumptions, risks and uncertainties relate to factors that are beyond the Group's ability to control or estimate precisely. There are a number of such factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, changes in the economies and markets in which the Group operates; changes in the legal, regulatory and competition frameworks in which the Group operates; changes in the markets from which the Group raises finance; changes in interest and exchange rates; the impact of legal or other proceedings against, or which affect, the Group; changes in accounting practices and interpretation of accounting standards under IFRS; and changes in our principal risks and uncertainties. Any written or verbal forward-looking statements made in these annual results, our interim results, our Annual Report or the Domino's website, or made subsequently, which are attributable to Domino's Pizza Group pie or any other member of the Group or persons acting on their behalf are expressly qualified in their entirety by the factors referred to above. Each forward-looking statement speaks only as of the date of these annual results, our interim results or our Annual Report, or on the date the forward-looking statement is made. Domino’s Pizza Group does not intend to update any forward-looking statements. 48 Full Year Results 2020
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