Domino’s has unveiled plans to introduce improved discount offers for its customers following a decline in orders during the first half of 2024. The pizza delivery giant cited a “slow start” to the year as the primary reason for the drop, which also led to a decrease in the company’s share value.
The company has cautioned that its underlying earnings are likely to fall at the “lower end” of expectations. Despite this, Domino’s is optimistic about regaining customer confidence and boosting sales through better pricing strategies. Operating 1,344 outlets across the UK and Ireland, the firm has experienced a decrease in food and energy costs, though these savings have been partially offset by an increase in the national living wage.
Domino’s CEO, Andrew Rennie, confirmed that the company is passing on the reduced food costs to customers through new discounts. “Customer confidence is improving, but we definitely think it is important for us right now to back our customers,” Rennie said.
He added that the company is rolling out more deals, such as a £4 lunch offer and a midweek 50% off promotion. Domino’s believes that these deals, combined with the quality of their product, offer great value to customers. However, the company reported a 1.8% decline in group revenues, down to £326.8 million for the six months ending June 30, compared to the same period last year.
The revenue drop was partly due to a 0.9% decrease in total orders, totaling 35.1 million, particularly during the first quarter of the year. “Following a slow start to the year, we now have good momentum in the business with our strategic initiatives gaining traction and our trading performance accelerating steadily against strong comparatives from last year,” Rennie said.
He noted that orders grew in the second quarter, with a significant improvement from mid-May, and that the trend of declining delivery orders has been halted. Rennie also mentioned that the positive trading momentum continued through June and July, boosted by strong sales during the Men’s Euro 2024 football tournament.
Domino’s growth has been further supported by its ongoing expansion plans. Last year, the company opened around 60 new branches, and they expect to surpass that figure this year with 70 more sites planned. Despite these developments, shares in Domino’s Pizza Group fell by 8%, closing at 284p.