Domino's Pizza Enterprises Limited

For the half year ended December 2025, network sales were $2.04 billion, EBIT was $101.5 million, NPAT was $60.1 million, and free cash flow was $70.6 million. EBIT increased 1% versus the prior corresponding period and NPAT rose 2.2%; free cash flow was $40.6 million above last year. Group same-store sales were down 2.5%, and sales year-to-date including the first trading week of H2 were down 3.6%. Franchisee average store EBITDA improved 4.5% to $103,000, and total debt fell $196.1 million with net debt down $114.2 million; net leverage improved to 2.21x and interest coverage was 19.8x. Management said FY26 full-year results are expected to be in line with AGM guidance and market expectations, but in Q&A CFO George Saoud said they are looking to beat the consensus at that time. They also said the business expects 20 to 40 new stores over the next 12 to 18 months, selectively and returns-led, and that the average franchise profitability target remains around $130,000.

Jack Cowin framed the quarter as a necessary reset away from heavy discounting and toward a returns-led model. His tone was confident and combative on the strategy: he repeatedly said same-store sales are not the right short-term measure because the company is consciously trading off volume to improve franchisee economics and long-term cash generation. He highlighted the new management team, said the balance sheet is stronger, and argued that profitable promotions and stronger unit economics should ultimately restore traffic and support selective expansion.

George Saoud focused on rebuilding the foundations in pricing, cost base, leadership and capital allocation. He cited $101.5 million EBIT, $60.1 million NPAT, $70.6 million free cash flow, $196.1 million of total debt reduction, $114.2 million of net debt reduction and leverage of 2.21x, plus $55 million of cost savings actioned so far. He said the reset is being funded from within, with about $13 million gross cost savings flowing through in the half, and that the broader program is tracking to $60 million to $70 million of annualized savings with a new Phase 2 targeting another $15 million to $25 million annually. He also said the interim dividend is $0.25 per share and that capital spending was reduced, including lower digital, systems and new-store investment.

Analysts pressed management on the apparent mismatch between soft sales and the company’s upbeat guidance, and George Saoud clarified that they are still looking to beat the consensus that existed at the time of the AGM. Questions on Western Australia centered on whether the pricing trial hurts near-term EBIT; management said it does create short-term warehouse implications, but should reduce support costs and improve shareholder returns over time. Analysts also asked about the pace of same-store sales declines, the relationship with Domino’s Pizza Inc., cost-savings sharing, Japan and France profitability, possible M&A or divestments, GLP-1 adoption, and the 20 to 40 store opening target; management generally defended the reset, said the partner relationship with DPZ is supportive, and reiterated that store openings will be selective and returns-led. On the franchise profitability target, George Saoud said the average target remains around $130,000.