REG - DP Poland PLC - Trading Update

DP PolandAnnouncement

14/11/2023 07:00

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RNS Number : 2971T  DP Poland PLC  14 November 2023

This announcement contains inside information for the purposes of the UK
Market Abuse Regulation and the Directors of the Company are responsible for
the release of this announcement.

 

DP Poland PLC

("DP Poland", the "Company" or the "Group")

 

Trading Update

 

 

DP Poland, the operator of pizza stores and restaurants across Poland and
Croatia, announces a trading update for Q3 2023 and trading to the end of
October.

 

Highlights

 

·    LFL System Sales in Poland increased 14.1% In Q3

·    LFL System Sales in Poland increased 34.8% in October to a new
monthly record of PLN 22.2m

·    LFL System order count in Poland grew 15.4% in Q3 and by 37.2% in
October

·    Food and labour costs remain in line with expectations

·    Croatian total System Sales grew 30% in Q3 driven by new store
openings in the prior year

·    Croatian total System Sales grew 34.4% in October with LFL System
Sales +3.3%

·    Cash at bank of £2.4m as at 30 September 2023 (£2.7m as at 30 June
2023)

 

DP Poland's Chief Executive Officer, Nils Gornall, said:

 

"We have worked hard to transform the business and its very satisfying to see
another quarter of double digit LFL sales growth in Poland. Growth in October
was an impressive 34.8% and set a new record for monthly sales of PLN 22.2m.
 

 

We are seeing the benefits of our focus to build a High Volume Mentality
business; delivering a compelling value proposition for our customers based on
fantastic quality pizza delivered quickly. We have seen a consistent
improvement in customer satisfaction ratings as we deliver on our strategy and
this is reflected in increased consumer retention and higher order counts.
These are key elements to delivering the highly profitable businesses we have
seen in other Domino's markets.

 

The Croatian business also continues to deliver strongly with a very good
performance of all stores in the network and the most recently opened store in
October is already exceeding our initial sales expectations.

 

It's fantastic to see the business begin to capitalise on the potential of the
markets we operate in, but this is only the beginning, and we expect
performance to continue improving."

 

Poland

 

 PLNm                   Q1 2023             Q2 2023             Q3 2023             October 2023
                        PLNm  % YoY change  PLNm  % YoY change  PLNm  % YoY change  PLNm     % YoY change
 Total System sales(1)  53.1  15.4%         55.0  14.4%         55.0  7.1%          22.2     32.7%

 LFL System sales(2)    52.2  19.4%         53.7  16.8%         54.3  14.1%         21.8     34.8%
 non-delivery           16.9  47.7%         18.8  6.3%          20.0  11.9%         7.0      12.2%
 delivery               35.3  9.3%          34.8  23.3%         34.3  15.5%         14.8     48.9%

 

 UnitsM                  Q1 2023               Q2 2023               Q3 2023               October 2023
                         UnitsM  % YoY change  UnitsM  % YoY change  UnitsM  % YoY change  UnitsM   % YoY change
 Total System orders(1)  1.0     4.0%          1.0     12.2%         1.0     9.1%          0.4      33.4%

 LFL System orders(2)    0.9     7.3%          1.0     15.5%         1.0     15.4%         0.4      37.2%

 

(1   )System Sales and System orders - total retail sales or orders
including sales or orders from corporate and sub-franchised stores.

(2   )Like-for-like System Sales growth in Polish Złoty, matching trading
periods for the same stores or orders growth in units, matching trading
periods for the same stores

 

Current trading remains strong, with double digit sales growth continuing and
driven largely by growth in order counts. An improved customer value
proposition, high quality pizza delivered quickly, is driving an improved
customer satisfaction rating and this is reflected in improved customer
retention numbers.

 

Total System Sales growth of 7.1% in Q3 2023 doesn't fully reflect the 14.1%
LFL sales growth in the same period as we took the decision to close some
stores that were positioned in shopping centres in order to relocate them to
more delivery efficient premises. Having fully reviewed our portfolio over the
past 12 months, it is expected that store closures have largely been
completed, positioning the company for future growth.

 

Food and labour costs remain in line with expectations.

 

Croatia

 

 (EURm)                 YTD            YTD            % change

October 2022
October 2023
vs. 2022
 Total System Sales(1)  1.4            1.9            34.4%
 LFL System Sales(2)    1.4            1.5            3.3%

( )

(1   )System Sales and System orders - total retail sales or orders
including sales or orders from corporate and sub-franchised stores.

(2   )Like-for-like System Sales growth in Euro, matching trading periods
for the same stores or orders growth in units, matching trading periods for
the same stores

(3) Difference between Total System Sales growth and LFL system sales growth
driven by 3(rd) store opening in June 2022, 4(th) store opening in June 2023
and a 5(th) store opening in October 2023

 

LFL System Sales in Croatia have shown lower growth levels than Poland due to
the high performing nature of the three existing stores in 2022. The Company
opened the 5(th) corporate store in the Croatian market in October 2023, where
sales have exceeded expectation in the first few weeks of operation.

 

The person responsible for arranging the release of this announcement on
behalf of the Company is Nils Gornall, CEO.

 

Enquiries:

DP Poland plc

Nils Gornall, CEO

Tel: +44 (0) 20 3393 6954

Email: ir@dppoland.com

 

Singer Capital Markets (Nominated Adviser and Broker)

Shaun Dobson / Jen Boorer

Tel: +44 (0) 20 7496 3000

 

Notes for editors

About DP Poland plc

DP Poland has the exclusive right to develop, operate and sub-franchise
Domino's Pizza stores in Poland and Croatia. The group operates 116 stores and
restaurants throughout cities and towns in Poland and Croatia.

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