Domino’s Pizza Group (LON:DOM) executives used the company’s full-year results call to highlight what CEO Nicola Frampton described as a “very difficult start” to the year followed by a “really solid finish,” which management said has built momentum and confidence heading into 2026.
Frampton repeatedly emphasized a renewed focus on the company’s core pizza offering while also pointing to newer initiatives—most notably the Chick & Dip launch—as a way to expand occasions and bring in new customers. The Q&A also touched on franchisee economics, the role of aggregator platforms, capital allocation, store development formats, and several cost items the company treated as non-underlying.
Pizza market softness and Domino’s share gains
In the meantime, she said Domino’s has been gaining share. Management said the company’s market share increased by 6% over the past year to more than 52% of the total pizza market. Frampton pointed to ongoing pizza innovation, referencing the upcoming “Italiano” launch in April and additional pizza-related products expected later in the year.
She added that the company is also evaluating ways to expand its total addressable market beyond its historic focus, including opportunities within broader QSR occasions that could complement pizza.
Early read on Chick & Dip: higher tickets, new customers, and dips
Management described Chick & Dip as an early-stage but encouraging initiative. Frampton said the product was launched across the full estate on February 9 and moved “above the line” in advertising on February 23, meaning only a few weeks of systemwide data were available at the time of the call.
According to Frampton, about 83% of Chick & Dip baskets also include pizza. She said the company does not believe the new offer is cannibalizing other products and that the ticket is “significantly higher” than the average ticket for pizza-only orders, which management said could indicate customers are consolidating purchases they might previously have split across aggregator platforms.
Frampton also said a “good chunk” of the remaining approximately 20% of orders—those without pizza—appear to be from new customers, attracted by chicken advertising. She characterized many of these as Gen Z customers and said early feedback on customer satisfaction has been strong.
Executives also highlighted the performance of dips alongside the chicken launch, calling them a “new flavor event.” Frampton said dips were showing “brilliant incrementality,” and added that the uplift from dips had been “more significant than chicken in some respects,” based on early performance.
On the size of the chicken opportunity, Frampton said chicken is a roughly £3 billion market and Domino’s had about 4% share before the new launch. She clarified later that this share figure reflected existing chicken sales prior to the full roll-out, with only limited contribution from a prior trial. Management declined to provide market share targets for chicken, saying it is too early and that it expects to learn more after 12–16 weeks of data, including repeat rates, and after receiving third-party market readouts.
Loyalty program: “slow burn” before conclusions
Domino’s said it is taking a cautious approach to rolling out and optimizing its loyalty program, citing the risk of customer missteps and the costs associated with loyalty mechanics. Frampton said the typical customer orders around four times per year and that loyalty impact will take time to assess, calling it an “18 months” slow burn before the company can provide meaningful indications.
Later in the call, management said the loyalty scheme has 1.8 million customers currently, while reiterating that the program will need time to mature. Executives said they had not seen deterioration in early results and suggested they would be better positioned to provide an update toward the back end of the year.
Franchisee economics, food costs, and cost mitigation
On inflation and franchisee input costs, management said food costs to franchisees in 2026 are expected to be lower year over year versus 2025, attributing much of the benefit to cheese costs tied to the milk market. Management said some of this is locked in through longer-term supplier contracts, which also provides insulation from freight risks, and said the pricing environment should support “sensible pricing decisions” into 2026.
The company also discussed franchisee profitability, noting it was not included in the presentation because franchisees were briefed after the market. Management said franchisees made an average of £161.6 thousand per store last year and that profitability declined about 4% year-over-year—better than earlier expectations of a 20%–25% reduction. Frampton said the original estimate of labor-related burdens from National Insurance changes and the National Living Wage was about £36,000 per store, and that Domino’s had mitigated roughly £20,000 of that through multiple initiatives, including labor scheduling and AI-driven sales forecasting to improve productivity.
Management said franchisee sentiment is improving and cited early chicken results and lower expected food costs as factors supporting a more positive outlook, adding that it expects franchisee profitability to return to growth in 2026 based on company guidance.
Aggregators, capital returns, and store development updates
Executives said aggregator platforms remain incremental and “table stakes.” They estimated approximately 75% incrementality from aggregators, with aggregator orders representing about 8% of total orders and 12% of delivered orders. Management described aggregator customers as typically more affluent and said they are a group Domino’s would not access as effectively otherwise. The company said it is difficult to track conversion from aggregators into the Domino’s app due to commercial arrangements, though it called aggregators a useful marketing tool and said collaboration with Uber has supported growth.
On capital returns, management said the dividend increase reflects board confidence in the strategy, while noting that incoming CFO Andrew Rennie will review the capital allocation framework. The interim CFO said that given expected capex—particularly supply chain center investments—and the company’s current positioning toward the upper end of its leverage range, there may not be “significant room” for buybacks over the next 12 months under the prior framework, though that could change following review.
Regarding store development, management discussed a smaller-format “Pod” store of 720 square feet opened in Wellington in collaboration with Motor Fuel Group. Frampton said it was driven by the availability of affordable real estate and could reduce build and operating costs, especially where a landlord funds part of the build. She said the model still requires the same planning permissions as traditional stores and does not ease that constraint. The company anticipates adding “maybe another 2 or 3” Pod-format stores into 2026, subject to site availability and planning.
Frampton said the company is also exploring travel retail and shop-in-shop opportunities, such as train stations, and is evaluating an even smaller 500-square-foot unit that would require operating model changes and labor efficiencies. She avoided offering firm store-opening guidance but indicated a level “around 25” for the year while noting a pipeline of identified sites “significantly in excess of 25.”
Finally, management addressed certain non-underlying items, including a gain on the sale of Shenton’s, which closed in December and generated £70.7 million of cash proceeds, and an impairment related to Shorecal. Executives attributed the Shorecal impairment to a changed cost environment following the November 2024 budget and to increased delivery costs in the Republic of Ireland after authorities applied employee driver models more broadly across the industry. Management also cited £6 million of transaction costs related to deals that ultimately did not proceed, adding that such activity has ceased.
About Domino’s Pizza Group (LON:DOM)
Domino’s Pizza is the UK’s leading pizza brand and a major player in the Republic of Ireland.
We are part of the global Domino’s system, the biggest pizza delivery operator in the world. We hold the exclusive master franchise rights in the UK & Ireland under a long term agreement with Domino’s Pizza International Franchising Inc, the international arm of Domino’s Pizza Inc, which owns the Domino’s brand. Our core business is the UK & Ireland, where we have a clear number one market share. We operate a world-class supply chain, making fresh dough and acting as a scale and expert wholesaler of other food and non-food supplies to our franchisees.
