Ann Arbor-based Domino’s Pizza Inc. today announced sales grew 12.4 percent to $8.9 billion in 2014 due to a variety of factors, including the addition of new stores, a major franchise renovation program, and advances in e-commerce sales.
“Fundamental strength, with a growing global store base, robust sales, and technological innovation, continues to truly drive the business,” says J. Patrick Doyle, Domino’s president and CEO. “Franchisees are both energized and financially sound, which is fueling our store reimage program, sales, and store growth.”
Last year, the company recorded global net unit growth of 743 stores, comprised of 81 new U.S. stores and a record 662 net new stores internationally. Overall, the pizza maker, founded in 1960, operates more than 11,600 stores in over 75 international markets.
In the fourth quarter, Domino’s had global retail sales of over $2.8 billion, comprised of $1.3 billion in the U.S. and $1.5 billion internationally. Overall, franchise owners accounted for nearly 97 percent of Domino’s Pizza stores as of the fourth quarter.
Doyle says an emphasis on technology innovation helped Domino’s generate approximately 50 percent of U.S. sales from its digital channels at the end of 2014, and reached an estimated run rate of $4 billion annually in global digital sales.
In turn, the pizza maker recently launched its ordering app for iPad, adding to an existing ordering app that covers nearly 95 percent of the U.S. smartphone market. Last June, the company debuted voice ordering for its iPhone and Android apps, a technology first within both traditional and e-commerce retail.
The company reported fourth quarter revenue grew 13.5 percent over the prior year period due to higher supply chain volumes and commodity prices (cheese and meats). There were also increased sales of equipment to stores as Domino’s reimaging program continues.
Net income was up $3.4 million for the fourth quarter versus last year, which was driven by domestic and international same store sales growth, as well as increased supply chain volumes, Doyle says.
Domino’s deployed free cash flow totaling approximately $147 million in fiscal 2014. This includes $82.4 million in share repurchases, $52.8 million in quarterly dividend payments, and $11.8 million in required principal payments on long-term debt.