Domino’s Pizza Enterprises (ASX:DMP) executives used the company’s November 2025 results call to frame first-half performance as a “reset” focused on rebuilding unit economics, reducing broad-based discounting, and strengthening the balance sheet, even as that strategy pressured sales in the near term.
Leadership changes and reset priorities
Executive Chair Jack Cowin said a key step in positioning the business for the future was a revamped leadership team. The company’s incoming Group CEO, Andrew Gregory, was described as a longtime McDonald’s executive who will join later in 2025 after completing obligations to his current employer, with a transition expected “no later than early August.” Cowin also outlined several new leadership appointments across markets and functions, including new country heads and senior roles in procurement and technology, and noted Drew O’Malley (formerly CEO of Collins Foods) had been appointed as a new director.
Financial results: EBIT up modestly, free cash flow improved
Cowin said first-half EBIT was AUD 101.5 million, up 1% versus the prior corresponding period (PCP), while NPAT was AUD 60.1 million, up 2.2%. Free cash flow was AUD 70.6 million.
Saoud attributed the result to a mix of factors, including network sales of AUD 2.04 billion and a same-store sales decline of 2.5%, which he said reflected a deliberate reduction in deep discounting in ANZ and Japan and the impact of fewer stores versus the PCP. He said strong sales in Europe helped offset softer performance in ANZ. Saoud also noted a higher effective tax rate due to a greater share of earnings in higher-tax jurisdictions.
Free cash flow improved by AUD 40.6 million versus the prior year, which Saoud said was driven largely by disciplined capital management and reduced spending on technology and digital investments and new store openings. He said operating cash flow improved by around AUD 5.8 million and net leasing payments improved by AUD 4.8 million due to store closures and a smaller store base.
The interim dividend was lifted to AUD 0.25 per share, described as unfranked and not underwritten, with the dividend reinvestment plan remaining in place.
Discounting pullback weighs on sales, but franchisee profits rise
A central theme of the call was the move away from “broad discounting” and toward more targeted, economics-led promotions. Cowin said sales year to date, including the first trading week of the second half, were down 3.6% versus the prior year. He pointed to a Western Australia trial that shifted from heavy discounts to everyday pricing, which resulted in the loss of “price-driven” heavy users and lower sales, but improved franchisee profitability—an outcome management said it expected.
Management said it is now refining promotional activity to rebuild traffic “on profitable terms,” emphasizing it is not abandoning discounting but shifting to more disciplined offers. Saoud said the WA trial delivered improved ticket and margin per order while volumes moderated as expected, and he highlighted that “voucher dependency has reduced materially by more than half.”
On franchisee economics, Cowin said rolling 12-month EBITDA per store increased from AUD 98.6 thousand in FY25 to AUD 103 thousand in FY26, calling it the highest level in three years. Saoud said global average franchisee store EBITDA improved 4.5% to AUD 103 thousand, and noted that ANZ franchise profitability was more than 10% higher in January versus the prior year.
Regional performance: Europe offsets ANZ softness; Japan and France need work
Saoud said Europe produced same-store sales growth of 1.3%, offsetting an ANZ decline of 4.7%. He added that Germany and Benelux performed strongly, while ANZ, Japan, and France were softer. Group EBIT was up 1% overall, with ANZ impacted by a AUD 6.3 million decline due to lower orders; this was offset by Europe EBIT growth of AUD 7.6 million and Asia growth of AUD 1.4 million. Saoud said Asia benefited from overhead and cost control and improved margins on orders, noting the region includes many corporate stores.
In Q&A, Saoud said Japan’s store closures did not drive the level of sales recapture the company expected. He contrasted Japan’s pre-COVID performance—roughly AUD 50–53 million profit on about AUD 600 million of sales in 2019—with a more complex post-COVID operating environment that management is now working to simplify. For France, Saoud said the business was a “small loss” in the half and pointed to the need to simplify pricing tiers and marketing programs and improve franchisee alignment and execution.
Cost-out program, capex discipline, and de-leveraging
Management reiterated progress on its cost-out and simplification program. Cowin said the company remains focused on a AUD 100 million objective, while Saoud said the program is tracking to AUD 60–70 million of annualized savings, with AUD 55 million actioned to date. Saoud said savings were driven largely by headcount reductions (particularly in IT), procurement and logistics savings, and other marketing and G&A expenses. He also said the company has begun a phase II initiative targeting indirect services and further food and packaging opportunities, with expected benefits of AUD 15–25 million annually; in Q&A, management indicated the majority of those phase II benefits would flow to DPE.
On debt, Cowin said total debt was reduced by AUD 196.1 million from June to December, with net leverage reduced to 2.21x from 2.57x and average debt tenure of 4.5 years. Saoud said the company refinanced AUD 1.05 billion in new facilities with better pricing and staggered maturities, and noted an interest coverage ratio of 19.8x.
Looking ahead, Cowin said management expects FY26 full-year results to be in line with the guidance provided at the AGM and consistent with market expectations at that time; in Q&A, Saoud said the company was looking to beat the consensus referenced at the AGM. Cowin also outlined selective, returns-led expansion, stating the system expects between 20 and 40 new stores over the next 12–18 months, and reiterated that restoring positive same-store sales remains a priority—without returning to what he called “giving the shop away.”
About Domino’s Pizza Enterprises (ASX:DMP)
Domino's Pizza Enterprises Limited operates retail food outlets. The company holds franchise rights for the Domino's brand in Australia, New Zealand, Belgium, France, the Netherlands, Japan, Cambodia, Germany, Luxembourg, Denmark, Taiwan, Malaysia, and Singapore. It operates various stores. Domino's Pizza Enterprises Limited was founded in 1983 and is based in Brisbane, Australia.
