Happy customers drive strong quarter for Domino's

Domestic same-store sales grew 6.7% year over year, while international sales were up 5.8%

By Julie K Balise Jul 24, 2013 4:56PM

Domino's (DPZ) customers aren't the only ones happy about the company's performance last quarter.

 

Domestic same-store sales grew 6.7% year over year, while international sales were up 5.8%. Quarterly revenue was $414 million versus $376 million in 2012. Patrick Doyle, president and chief executive of Domino's, told CNBC it was "a great quarter."

 

The company did not make any major changes during the second quarter. Doyle, who entered his current role in March 2012, said it was the brand that carried it.

 

"It's just people feeling good about what they're getting from Domino's coming back," he said in the report. "We're seeing improved frequency, retention of customers." 

The company had a net growth of 110 stores in the quarter.

 

When asked why investors chose to take the stock down 10% on what appeared to be a positive earnings report, Doyle pointed to its performance over the past 12 months.

 

He said he is not going to worry about the stock's daily fluctuations.

 

"Overall we've generated terrific returns for shareholders," he said. "We keep putting up quarters like this and the stock will take care of itself."

 

While he did not cite any examples, Doyle said there's a lot coming up in terms of technology and products for Domino's.

 

Domino's Pizza boxes (© Luke MacGregor/Newscom/Reuters)"Innovation for us now is not just about the product of the month club," he said. "It's about coming out with things that are going to really materially improve the customer's experience."

 

Such developments could help customers access the brand in a new, improved way.

 

The company is already reaching many customers through social media. Its Twitter account has nearly 270,000 followers, while its Facebook page has 8.46 million likes.

 

Domino's has bought digital media and advertised on social media, according to Doyle, who said this is "critically important" in driving brand perceptions.

 

"At the end of the day, what people are saying about us in social media is more important than what we say about ourselves," he said in the report. "That's people's friends and family and they trust them more than they trust big business, big brands."

 

Earnings for the quarter were 57 cents, a 21.3% increase over the 47 cents from the prior year quarter. The company's stock spiked Wednesday morning and steadily increased throughout the day.

 

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1Comment
Jul 25, 2013 3:27PM
avatar
Better food at a decent price with good service (nobody expects great service any more) and Domino's sales are rising. I commend them.
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