Domino’s Pizza Inc. Earnings: Falling Revenue Breaks Streak of Four Consecutive Increases, Profit Drops

Domino’s Pizza Inc. (NYSE:DPZ) reported its results for the first quarter. Domino’s Pizza, through its subsidiaries, is engaged in retail sales of food through Domino’s Pizza stores, sales equipment and supplies to Domino’s Pizza stores, and receipt of royalties from domestic and international Domino’s Pizza franchise.

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Domino’s Pizza Earnings Cheat Sheet for the First Quarter

Results: Net income for Domino’s Pizza Inc. fell to $20.7 million (35 cents per share) vs. $27.1 million (43 cents per share) a year earlier. This is a decline of 23.5% from the year-earlier quarter.

Revenue: Fell 1.2% to $384.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Domino’s Pizza Inc. reported adjusted net income of 47 cents per share. By that measure, the company fell short of mean estimate of 49 cents per share. It fell short of the average revenue estimate of $404.1 million.

Quoting Management: J. Patrick Doyle, Domino’s President and Chief Executive Officer, said: “On the heels of a successful recapitalization and a $3 per share special dividend, we’re continuing to report strong financial results. And, as a result of the Company’s strong cash flow characteristics, we continue to have the flexibility to deploy capital through various channels to benefit our shareholders.”

Key Stats:

Last quarter’s profit decreases breaks a four-quarter run of profit increases. In the fourth quarter of the last fiscal year, net income rose 27.9% from the year earlier, while the figure increased 33.1% in the third quarter of the last fiscal year, 11.6% in the second quarter of the last fiscal year and 10.6% in the first quarter of the last fiscal year.

A year-over-year revenue decrease last quarter snaps a streak of four consecutive quarters of revenue increases. The best quarter in that span was the third quarter of the last fiscal year, which saw revenue rise 8.3%.

After beating analyst estimates for the two previous quarters, the company fell short of forecasts. In the fourth quarter of the last fiscal year, it topped the mark by 4 cents, and in the third quarter of the last fiscal year, it was ahead by 2 cents.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the second quarter has moved up from 46 cents a share to 47 cents over the last ninety days. The average estimate for the fiscal year is $1.96 per share, a rise from $1.91 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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