Domino's profit, comparable sales rise on higher fees from franchisees

Reuters

Published Apr 26, 2018 12:36

Domino's profit, comparable sales rise on higher fees from franchisees

(Reuters) - Domino's Pizza Inc (N:DPZ) reported a 42 percent rise in quarterly profit on Thursday and comfortably beat analysts' same-store sales estimates as the pizza company earned higher royalties and fees from its franchisees.

Same-store sales at its company-owned outlets in the United States rose 6.4 percent and franchise stores posted an 8.4 percent growth, both well above Wall Street expectations.

Analysts on average were expecting same-store sales to rise 4.93 percent at company-owned U.S. stores and 5.63 percent at its franchise stores, according to Thomson Reuters I/B/E/S.

Comparable store sales in its international business rose 5 percent, beating the average analyst estimate of 4.1 percent.

Domino's benefits from the royalty fee it charges its franchise stores and the revenue it gets from ingredients and equipment it supplies to them.

Supply chain revenue from its franchisees rose 13.3 percent to $440.1 million in the quarter.

Net income rose to $88.8 million (63.6 million pounds), or $2.00 per share, in the first-quarter ended March 25, from $62.5 million, or $1.26 per share, a year earlier.