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Domino’s Pizza Poland (DP Poland) fights to grow

DP Poland holds the Domino’s master franchise for the eastern European country and continues to string together some impressive results.

Unlike the UK and the rest of Western Europe, Poland has not been damaged by Brexit and consumer spending remains high.

The World Bank on recently raised its forecast for Poland’s GDP growth in 2019 to 4.3%, citing rising domestic consumption. It makes the country one of the fastest growing in Asia and Europe.

This is good news for food delivery companies and with just short of 40 million inhabitants, Poland has the potential to be one of the largest pizza delivery markets.

Analysts say the quality of takeaway products is often poor in Poland. But recent figures show DP Poland is going some way to rectify this.

For the six months ended 30 June this year the group reported sales of £8.3 million, 10% higher than the prior year, while the number of orders originating online rose to 80% from 77%.

Pre-tax losses were flat at around £1.8 million.

Analysts at Peel Hunt believe the business is still on track to be earnings and cash flow breakeven by 2022.

Looking ahead, the company says it is in discussions with existing and potential sub-franchisees to open new stores across Poland.

The firm also says that the rise of delivery aggregators in Poland such as UberEats, Pizza Portal and Pyzszne would be “particularly helpful” in regions where the Domino’s brand was less well known.

Backers include Canaccord Genuity Wealth Management with a 12% stake and Irish businessman Nick Furlong with a 17% stake.

It’s current share price is 4.7p.

Source: https://www.standard.co.uk/business/market-minnows-dp-poland-looks-like-a-winner-for-domino-s-pizza-fans-a4278301.html

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