Domino's tops Q3 profit forecasts, but cuts sales guidance

10th Oct 2024 15:04

(Sharecast News) - Shares in takeaway pizza chain Domino's rose on Thursday as investors focused on forecast-beating quarterly earnings and shrugged off a reduction to sales growth forecasts for the full year.

Domino's said retail sales totalled $4.39bn for the third quarter, up from $4.22bn a year earlier, with both US and international store sales rising 5.1% year-on-year at constant exchange rates.

The Michigan-based company, which had more than 21,000 owned and franchised stores by the end of the period, reported revenues of $1.08bn when accounting for owned stores as well as franchise royalties and fees. That was also up 5.1% on last year though just shy of the $1.10bn consensus forecast.

Net income fell 0.5% to $146.9m due to higher income taxes, but diluted earnings per share were 0.2% higher at $4.19, comfortably beating the $3.64 expected by analysts.

Looking ahead, Domino's cut its global retail sales growth target from 7% to 6%, and cut its store openings projection from 825-925 to 800-850, citing a "challenging macroeconomic environment and its impact on current business trends across the globe".

Chief executive Russell Weiner said the company was operating within a "pressured global marketplace" during the third quarter, but added: "With the slate of initiatives we have in place, I am confident that we will continue to win and grow our market share across the globe for years to come."

After a brief stint in the red early on, the shares were up 2% at $421.31 by 1122 in New York.