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Domino's: New pizza helping sales, traffic

ANN ARBOR Mich. While it’s still too early to tell the results of its reformulated pizza, introduced late in the fourth quarter, Domino’s Pizza said it is carrying positive momentum for sales and traffic growth into 2010 following increased same-store sales and guest counts late last year.

Net income for the Jan. 3-ended fourth quarter was $23.6 million, or 41 cents per share, compared with $11.0 million, or 19 cents a share, a year ago. Latest-quarter earnings were 30 cents on an adjusted basis, accounting for the benefit of a 53rd week in fiscal 2009 and the repurchase of debt, a 58-percent increase over adjusted earnings in the year-ago fourth quarter. Fourth-quarter revenue rose 8.1 percent compared with a year earlier, to $462.9 million, due in large part to the 53rd week and to modest gains in domestic and international same-store sales.

Same-store sales in the United States rose 0.9 percent at corporate units and 1.5 percent at franchised restaurants in the fourth quarter, Domino’s said. The chain’s international system posted a 3.9-percent jump in same-store sales, the 64th consecutive quarter of comps growth for that division. Outgoing chief executive David Brandon said the international division now accounts for nearly half of Domino’s global retail sales.

“The bold steps we have been taking to reignite our domestic system helped us gain significant traction last year,” Brandon said. “We succeeded in our primary goal of growing traffic all four quarters of 2009. Traffic growth was most significant in the fourth quarter, and this positive momentum has continued thus far in 2010, as sales and traffic have increased significantly since the launch of our new core pizza.”

The new pizza was introduced the last week of December, and before that Domino’s had a busy year of product rollouts, including Lava Crunch Cakes and additions to its Oven Baked Subs Line.

For the full fiscal 2009, Domino’s net income rose to $79.7 million, or $1.38 per share, compared with $54 million, or 93 cents per share, a year earlier. Adjusted earnings in 2009 were 87 cents a share, a 16-percent increase over adjusted earnings in 2008. Domino’s total annual revenue dipped 1.5 percent to $1.4 billion.

Domestic same-store sales rose 0.5 percent for the fiscal year, reflecting a 0.9-percent decrease at company-owned restaurants and a 0.6-percent uptick at franchised units. International same-store sales rose 4.3 percent for the year.

Ann Arbor-based Domino’s operates or franchises nearly 9,000 restaurants worldwide.

Contact Mark Brandau at [email protected].

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