ii view: Domino’s Pizza is footy World Cup winner

First-half results to 28 June

• System sales up 6.1% to £825 million
• Adjusted profit (EBITDA) up 3.6% to £66.2 million
• Interim dividend up 2.8% to 3.7p per share
• Net debt of £290 million, down from £307 million a year ago

Chief executive Nicola Frampton said:

“We have carried positive momentum into July and, with our major cost lines hedged through 2026 and into next year, remain confident in delivering our full-year expectations.

“We will continue to invest in the business to support our growth and franchise partner profitability, creating long-term value for all of our stakeholders."

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ii round-up:

Domino's Pizza Group (LSE:DOM) today reported first-half sales and profit progress, with the UK and Ireland operator maintaining hopes for an annual performance in line with current City forecasts.

A combination of World Cup football demand and successful launches of its Chick 'N' Dip’ chicken products and new Italiano pizza range helped grow sales 6.1% to £825 million. Half-year adjusted profit (EBITDA) climbed 3.6% to £66.2 million.

Shares in the FTSE 250 company rose 7% in UK trading to a one-year high having come into this latest news up by close to a fifth so far in 2026. McDonald's Corp (NYSE:MCD) is down by just over a tenth during that time. The FTSE 250 is up almost 9% year-to-date.

Domino’s holds the master franchise agreement to own, operate and franchise Domino's stores in the UK and the Republic of Ireland. It operates 1,410 outlets across the two nations with 11 new stores opened so far this financial year.

Trading in July had also been aided by the football World Cup, with management's full year forecasts supported by a hedging of costs through 2026 and into 2027.  

An interim dividend of 3.7p per share payable to eligible shareholders on 25 September, is up 3% from a year ago.

Group net debt of £290 million as of late June is down from £307 million a year ago. A leverage ratio, or net debt-to-adjusted profit of 2.3 times remains within management’s targeted 1.5 to 2.5 times range.

A third-quarter trading update is likely mid-November.

ii view:

The master franchise holder of the US parent company opened its first UK store in Luton in 1985. 
Geographically, the UK generated 91.3% of revenues in 2025, with the Republic of Ireland the balance of 8.7%. Group strategic focuses include strengthening its market share for chicken products, leveraging the existing customer base via the group’s loyalty programme and improving supply chain productivity.

For investors, previously increased government taxes on UK businesses continue to offer headwinds. Food costs and costs more generally, such as those for energy, can prove volatile. Competitors such as Greggs (LSE:GRG) are also offering pizzas and competing hard via online technology for delivery business, while some demand corelation with sporting events such as the football World Cup will likely make for tough comparatives going forward.

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On the upside, the category of chicken with the full launch of its Chick 'N' Dip’ product in February now offers growth opportunities. A new marketing team is now focusing campaigns on specific sporting events such as boxing matches. A focus on digital orders sees partnerships with Just Eat and Uber Eats being progressed, while a recently opened automated national supply centre in Avonmouth is expected to aid group-wide efficiency.

On balance, and while significant consumer headwinds are not to be ignored, a forecast dividend yield of over 5% is likely to keep income investors happy, while others will like the growth opportunities.  

Positives:

• Ongoing new store openings
• Product innovation

Negatives:

• Tough consumer backdrop
• Intense competition

The average rating of stock market analysts:

Hold