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UPDATE 1-Australia's Domino's Pizza posts record annual profit

Published 16/08/2016, 09:59 am
© Reuters.  UPDATE 1-Australia's Domino's Pizza posts record annual profit
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SYDNEY, Aug 16 (Reuters) - Australian fast food chain Domino's Pizza Enterprises Ltd DMP.AX on Tuesday its annual net profit soared more than a quarter to a new record as it benefited from store openings and internet-driven efficiencies.

Net profit was A$86.6 million ($66.49 million) for the year to June 30, up 26.6 percent, the company said, adding that it expects net profit to grow about 30 percent in fiscal 2017. The underlying net profit of A$92.0 million beat analyst forecasts of A$90.6 million.

The biggest Domino's operation outside the United States has become a market favourite because of its rapid growth and adoption of internet-based booking systems. Domino's shares have doubled in the past year and tripled in the past two years.

The Sydney-listed company has also expanded in Japan and Europe, including taking a two-thirds stake with Britain's Domino's Pizza Group Plc DOM.L in Germany's Joey's Pizza this year to become that country's biggest pizza chain.

Europe pre-tax profit grew 53.5 percent as it bought 302 new stores, mostly Joey's outlets, and benefited from online services like one which lets customers track their pizza deliveries, it said. Nearly three quarters of its Netherlands orders were online.

In Australia, Domino's already dominates half the pizza delivery market and will likely grab a bigger slice of the business following the collapse of smaller rival Eagle Boys last month.

On Tuesday, the company upped its target domestic store count to 1,200, from 900. It has 576 stores currently.

"Due to the extraordinary growth being experienced in (Australia and New Zealand), the returns from investment in our programme of digital initiatives and the capacity restraints in some areas of the region, we are confident that (Domino's) has the capacity," Chief Executive Officer Don Meij said.

The company said full-year sales rose by 32 percent to A$930 million and raised its final dividend by 28 percent to 38.8 Australian cents per share.

($1 = 1.3024 Australian dollars)

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