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DPZ Dominos Pizza

Participants
Chris Brandon Director, Investor Relations
Stu Levy Executive Vice President and Chief Financial Officer
Ritch Allison Chief Executive Officer
Brian Bittner Oppenheimer and Company
Sara Senatore Bernstein
Chris O'Cull Stifel
Lauren Silberman Credit Suisse
John Ivankoe JPMorgan
Eric Gonzalez KeyBanc
Lauren Silberman Credit Suisse
Dennis Geiger UBS Investment Bank
Chris Carril RBC Capital Markets
Brett Levy MKM Partners
Jeffrey Bernstein Barclays
Andrew Charles Cowen and Company
Alex Slagle Jefferies
James Rutherford Stephens & Company
Call transcript
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Operator

Good morning, ladies and gentlemen, and welcome to the Domino’s Pizza, Inc.. The fourth quarter year and 2020 earnings webcast at this time, all participants are in additionality mode. Later, we’ll conduct a question and answer session, and Stetsons will follow at that time. If anyone should require assistance during the conference, please press star then zero on your tax on telephone.

As a reminder, this conference call is being recorded. to Brandon, conference levy. director, like host to now Chris speaker, Investor would turn over the your I Relations, the ahead. Go

Chris Brandon

Appreciate commentary today Financial morning, us good full and year our it, Chief you call and Executive Nora. joining will Officer Today’s for Allison feature fourth everyone. quarter Levy. for Chief the Officer regarding Thank conversation Stu XXXX. results from of our And Ritch

results and all is to call investor for to members listen on of a to primarily risk media the materially remind those today. forward differ with want are ask for or this from the our As of looking this audience, forecasts. Actual in information, discussed only Both the the XXK and statements the trends our release call to also others that I in our SEC. please be refer And could available comments filings in I mode. documents earnings apply our more morning’s factors website. on everyone our

We, do please non-GAAP accommodate In of to always, of disclosures to release find the or referenced coverage earnings to to you today’s X-K reconciliations request our analysts. to may want call measures and on our that financial best refer be today. as all addition,

you financial via replay like to our conference is for over being call With Levy. encourage part officer, question is would, Today’s you. being turn Stu on website. only recorded to we to So one call that, you webcast ask Thank this chief call, the please. if our also I’d and

Stu Levy

morning, good everyone. And Thanks, Chris.

which Despite we Despite strong and ongoing annual Overall, also numbers, global presented extra strong We’re by had the days. major our quarter a included Day, sales and that twenty full of results year. challenges excited Year’s typically to had to year, first today. and Eve and fourth twenty. included week fourth twenty. everyone an quarter year, covid-XX, Year’s into we Overall, QX full like our ongoing. would QX very the New jump once this before both we Twenty with I very are a the discuss remind again you which New

this or have our on week twenty our We quarter week affecting of time consisted XX of calendar In XX twenty, earnings three twenty depending every in additional twenty has the this morning, next release how fiscal weeks. five in week adjusted of quarters Typically, years, and twenty been falls. comparability. happen fourth year filed of fiscal The But the six year will fourth is an six. consists item we an as extra our XX the this quarter. our in out impact a week results twenty

our members of a leading Turning for point five full EPS, and extra the and as Diluted dollars the in and and EPS six to QX three cents operating nine our cents the eighty one our team results diluted the franchisees fiscal twelve strong dollars for to year. results, year. generated full was week year, and QX twelve for world dollars for forty cent cents overall, adjusted thirty around three for and

Here’s grew to twenty sales the In some of our QX on seven point additional percent as earnings. QX, global twenty one detail components retail compared nineteen.

includes growth growth you in moment. sales growth, down I’ll retail global which for unit break reminder, a As both a comp and

XX a benefited and were percent when Our the by the by extra extra year. of foreign dollar week positive retail the the sales and weaker also currency, grew global for global excluding retail sales in full QX week impact

point of foreign full four the QX the sales growth, full retail currency, retail our during percent week sales sales our Our grew twelve down negative grew percent for global five QX Breaking extra retail retail sales for U.S. percent. the extra percent ten point the when percent. and global grew XX year fourteen When sales year. grew twenty eight in excluding three U.S. point the and global point two seventeen percent excluding and retail week, impact six point

retail point point When seven retail international during and sales seven percent foreign the full currency, impact year. extra for percent for five for the and percent the QX QX percent excluding grew point nine Our of the and twenty year. grew sales full week international point five nine nine

store continue closures which During net units, to detail same in in momentarily. sales discuss our store operating including restrictions which in reduction international positive see momentum QX, contributed and sequentially and increase to I’ll we stronger business, a more in other performance an temporary

to for quarter, percent prior Turning and US we sales hundred a years eight three same sales seven to rolling of the industry in international twenty truly comps, the point grew eleven percent, increase our percent. one or consecutive point three both point straight grew business Same positive increase positive over quarters XX QX, point with and of comps international lapping two comparable seven achievements. store restaurant one remarkable store of quarters prior and continue during sales four percent a lead broader year the in year of US seven

percent, was we mix increased our Breaking growth comp order an mix, comes for which in the our US As similar point eleven in while item hundred shifting extra three company net were point that higher up the by delivery stores. our by higher both this in net often added increase driven both during one mix, healthy delivery closures ticket growth that nine to the of Within was ticket US year, and and store order growth transparent a a driven stores a fourth associated, opened store business, two sixteen and our consisting ticket and items a the with the same full ticket of an two eighteen is We stores a to hundred one sales growth, driven not one was week. and US quarter comp franchisees our and down point higher growth. the US reminder, our the franchise driven quarter, four eight US, by affected owned quarter, hundred business was percent in delivery count. by by franchisees international percent our count and unit seven The openings mix fee. for twenty

Our hundred six We two and of total. stores during hundred QX, in and full hundred twenty. net openings our two year, international four globally stores twenty seventy twenty comprised business added twenty stores closures franchisees three store international three the for XX net we opened and hundred added in ninety and five eight

and during our We’re very pleased with pandemic our particularly the strong by continue to grow in units QX. encouraged ability to growth

opening still which do in in delays to we some will monitor continue certain forward. construction permitting, including and markets, stores challenges However, we face moving

and revenues total Regarding margins, revenues. operating

were in point turn the nineteen. all by operating revenues quarter. and ninety by week was six up areas The million four the and remaining point two million point sales, one prior revenues Total fourth hundred and were of twenty full business. billion foreign rates And million billion. percent international Changes by revenues estimated zero an higher QX currency from in quarter three for our revenues hundred by or which year royalty eight retail The for Regarding as impacted higher across exchange to four one we’re positively compared for million, the we’re prior million, revenues four seventeen year drove year our point nine up global margins, increased total driven from year. nineteen twenty thirteen revenues or the four point extra eighty increase revenues and eight our point QX percent compared as and nine impacted to in royalty negatively nine dollars.

percent to the a of of a point store U.S. in covid-XX from related from QX franchise from to point to nine one in pandemic impacted made to labor was percent higher investments business, as thirty four related margin owned point margin five QX point negatively company twenty Our twenty higher and consolidated twenty thirty four decreased revenues partially nine offset percent our costs. covid operating twenty percent primarily revenue increased due eight nineteen by percent nine revenues nineteen, by percent as

operating related as Supply twenty, compared percent to to twenty six a by in twenty QX, expenses. eleven fuel four QX, bonus reduced We to one hundred QX and from we increase their percent percent nineteen, paid year. twenty four six prior of we week to twenty efficiencies the by that expenses million point increased was and offset eight as in driven and for variable G&A to we nineteen to compared a driven offset the pandemic. special twenty million them million in operating increased average travel full as to as a as increase by twenty compensation, As an result estimate seven for a million by our December remaining thank of contributions point chain XX throughout The our recapitalization debt this of this line front a from these extra based of expenses by balance Net remaining partially approximately primarily weighted of transaction resulting this borrowing rates. increase weighted quarter professional extra year. nineteen, lower were driven expense interest increase partially higher compared the was increase performance the expenses. QX expense three estimate year. nineteen in Jeanna twenty approximately announced was approximately the eleven The workers was twenty that revenue and week fees lower average was of million, margin million our incurred higher year,

in borrowing in Twenty the debt average rates nineteen. outstanding nineteen compared point weighted nine percent to to percent on due point from rate QX. QX lower Our twenty interest four twenty zero decreased as to the Twenty QX. three

Twenty included on rate Our in in effective nineteen eight compensation, as impact point equity three reported Twenty positive nineteen tax seventeen based compared percent from QX effective twenty percentage nineteen. benefits compared QX. tax point percent point point percentage point a tax the to reported a to positive as in QX. the nine one rate twenty for point was quarter impact nine eight

continued the you percent million point operating see year, to XX quarter volatility seventeen full million, six our item over ninety for which twenty as that point affecting twenty or We net in point leverage, fifty equity fourth fourth year tax these full combine additional When net effective benefits. week six estimate net comparability and these was twenty twenty tax associated elements, nineteen. the the in over sales point our percent third the compensation expect for by and of nineteen of due million positively included up QX, income or five up is release. in week impacted to two the the all was an six rate based income quarter our income to related two We our earnings

point three eighty three EPS the twenty in versus and in was four dollars prior three five dollars percent. increase QX year, Our an cents XX cents and diluted of

in driven benefits in XX versus resulting lower higher in cents. diluted diluted and adjusted tax notably, adjusted year, impacted dollars nine six cents. diluted to Our resulting as significant balances as of negatively throughout one a generate nineteen, by cash EPS an and cent debt the XX And percent I’ll increase twelve by to an seven cents based of mentioned rate, by four more our twenty adjusted EPS repurchases nine QX. nineteen, cents ten lower model share in diluted remains full continued us versus thirty flow five was higher for mentioned cent impacted diluted I nine diluted thirty during bit, interest expense of Are twenty strong, down dollars cents finally, the tax us repurchases and of adjusted by forty us on and five previously, three primarily EPS cents. dollars cents a point was twelve and thirty as fifty moment. XX quarter. year, equity it as operating dollars as an cash, QX point earlier, year point the effective our XX percent. EPS share us the benefited count increase five primarily from XX the seven fifty from detail average share of provide percent. that negatively net benefited and versus most Twenty or for free and cents full nine Higher by dollars Shifting on Breaking cents or in improved twenty prior I results six dollars increase EPS was our economic compensation, three increase six three

supply capital hundred During full regarding expenditures. our on of free We net hundred and CapEx, cash year by five initiatives. technology twenty centers on operating dollars. nine million our twenty, four After we twenty, primarily flow in eighty three provided five ninety activities approximately cash deducting million approximately generated million twenty spent chain we and operating of CapEx for generated approximately

repurchased During or incremental repurchases our shares five for three and five our to six hundred repurchases. to an five million. in and share thousand to million QX, and five thousand dollars one bringing twenty eight dollars twenty million average, sixty hundred year also twenty repurchased two we and approximately Twenty retired sixty on twenty six ninety total XX we’ve hundred per shares also for related three date Subsequently, QX.

We’re also Board you replace program, dollar that new under as to one the a saw of our morning’s remaining approved existing billion earnings authorization pleased share our directors this announce has which in repurchase release, program. is

quarterly payments, dividend to cent million shareholders two one Additionally, two dollars returned to twenty during QX, total twenty the in million of dollars. form one eight our hundred twenty bringing payments our seventy we dividend sixty

twenty over our of to board announce add to directors declared return we that shareholders the and excited move an dividend we more XX share XXth, into repurchases in As hundred has that March than previous on twenty dividend. impact twenty one quarterly cents increase quarterly you be million to When dividends, cumulative per percent twenty five paid the one, of of and twenty twenty. a is dollars share the four quarters we’re

like the Before our the update, financial to I’d impact QX results. you through up the covid-XX wrapping on pandemic walk of

members As for impact for equipment, and previous during pay we quarters our team our QX, other have total support sick safety with dollars. the franchisees compensation and done million cleaning estimated our communities and and from enhanced seven in

we a provide longer ahead, in like as currently twenty communicated look outlook. twenty we remind of the you would range As outlook that growth, one quarter to items foreign as have dollar to range you million we that We one well with to twenty quarter. royalty to positive in twenty to percent that up U.S. half half within compared that as as supply levels. basket expect invest anticipate a we and some a a do project We technology, capex our estimate two revenues around business, eight to And be system the store XX we will in twenty. approximately capacity. our volatility four new investments and strategically impact our food as million on mid-January, one three currency twenty our growing could in and twenty to We continue compared hundred gross including chain be to innovation, stores

in in expect up things, our as based vary as expense performance that well advertising. range such our the to can be that We expense and and Gené twenty four depending G&A fifteen of plan versus as variable as or hundred compensation hundred to affects other on. four mind areas five performance million. down Among corporate other expense Keep store our

foreign XX earnings two release, outlook announced our growth, In sales addition, in morning’s retail year we this excluding six to of to also three currency. global percent

Ritch Allison

in US, to and pandemic, the need. of team our in paid thirty thousand enhanced unique XX challenges getting workers our national nearly supply corporate month responding jobs XX a over and Launching first thirteen members we and the million provide the hiring We dollars and displaced million franchisees national may establish And Opportunity dollars from been in a benefits to million working we twenty have black to enhanced Fund, the franchise, in who to who next throughout the St. partnering XXXXX to campaign December. provide including twenty Children’s designed support may displaced St. Hospital, campaign the people with for an disasters pay launching Domino’s workers invested including wages, their. their Jude and workers communities and franchisees twenty in to our dollars workers the have one hundred hiring to who alone. Jude donate by franchisees to jobs to dollars slices million dollars million in partnering million hourly the during launching invested to displaced frontline campaign need for twenty with our Research food we and hiring equipment to national natural of black been and may bonuses one raise theirs, Committing provide responders, have to XXXXX store in raised from been families a from years jobs that XX safety our to processes to their in communities sick to three ensure chain recognizing

striving will of we looking focus areas. in to better a news will highlight work a areas and continue And little these a progress Now, our most new get XXXX each And not to you. U.S. every brand, business, not and few surprisingly, ahead day. to I’ll be as

continue consistent for costs, better our markets, First, service, forger’s traffic. and economics lower drivers incremental more will to out and driving we faster carry delivery

store will will in new in continue twenty, product overall twenty one, growth, continue and twenty owned to deliver company our Forecasting including twenty we one. drive markets, innovation in to

new We produce relationship begin will excited and and our with progress we’re World-Class work advertising continue agency. as to our advertising to

continue committed pizza will speed, won’t leadership within our that We our Americans enable With in to matters support business. always ability inside improve our more our to out in these twenty of position accuracy work maintaining great economic focus to ever. change uncertain to in to invest to efficiency unquestioned key one and corporate for the than times, of many segment. store twenty, technology value we and Value QSR us, experiences are team value a drive and stores customer is members

doubling training we’re our communications. our with out our door more ever one, within focus down with with pizzas before. than reliably to Through hotter, and on twenty We’re and ramping the fresher up twenty innovation stores, getting technology, service customers in

hourly team our enhancing and members corporate invest in and in many to markets team stores chain centers, frontline member across our supply continue increasing will benefits. wages We our

be years. We environmental will a our look also three the impact one to taking at within comprehensive next

based accordance our process We science do initial to remain based, XX to that profitability. final But level reduce with change. the with shared commitments store the that is absolutely franchisee last obsessed to you you XX be the EBITDA when company’s as always, January And contribution will with science with than figure in it in you estimate share climate initiative will Stu will we set we obsessed, the shared targets number time bound ready. with estimate Stu we higher and month. total expect

this returns in our on and franchises profitability recognize we intense our player While category, cash some corporate exceeds we cost our level associated believe are pressure. any and cash under of that of stores

You team to higher just helping focused added continue to and we markets levels are I at such bring of and overall and as fixed intensely drive tight country, know, across pressure. labor rise. these recognize franchisees, enterprise as efficiency many country, and remain and despite my store unemployment the remain insurance the Across But on wages markets. also and our local corporate for for profitability costs our we level the challenges, rent

long back very and performance, we US U.S. quarter to billion I achieved consecutive and for fourth sales the with U.S. thirty our happy look year, retail confident in our positive business. we are the nine game on in on well-positioned first our full we am sales the very time. continue same store I surpassed As that eight I’m playing dollars quarter growth the of

international. to on move to going I’m Now

we our I’m three delivered seemed full to franchisees particularly in marked continued business, During stores hundred an five stores reopen the year. full net for in twenty strongest in the the to incredible when four doubt as one seven and years recovery straight hundred the continue we quarter year. pleased years, positive And that eight quarter, the pandemic early in ninety our We’ve quarterly. run fourth and reported and struck XXX the that’s in master net invest our opening that covid quarter,

more economics the in consider master we markets and a closures unit you is no many twenty that There QX, terrific twenty had level back in truly when around hundred four our twenty in had is that about Now, have globe. we the built question that franchisees remarkable it temporarily stores closed achievement highlights eight. this

units, three that over in the was In fact, previously by Domino’s from of some environment hundred a after we several you in units would normally a struggled This them see with close typical in number admittedly pandemic. formats operating underperforming year. than choices the rather would including markets strategic driven new have than had to reopening

sharing our am master our I master So optimistic when from their our over look for to the to to the year, system we international partnership. all thank franchisees responded and in and help up the Throughout very world team pandemic. engagement. power the this communication franchisees and so we unit help across the peers without truly ramp leaned Domino’s system, This the could US best practices forward, partners level to business, our effectively I increased international through really dramatically I manage the growth ability the about across throughout and year of covid our their not want of to global have demonstrated

this twenty million Brands, Croatia, love twenty the family. to dollar opened We dollar a time Now, Domino’s first there China and the welcoming franchise of grew in which retail invest open Dasht percent, XX with XX XX highlights. I’d and investment accelerating completed very this stores a five investment forty in QX we were to ninety million net by pleased very in partner We year. our the share over in in XX, sales the We also to market important few, master growth team market. subsequent for in

one hard over Germany where one fast another stores market Japan three partner growth. passing are of sales retail XXX than and optimistic me, in outstanding XX retail China. that terrific an excuse stores am the fifty We ever five and percent hundred hundred are percent success story growth XX excited in XX, management incredible we is world growth. stores along the teams throughout India, future are the covid reopen few of driven thank our a Panama Mexico, like others closures, France, latest one incredibly that twenty hundred that the year twenty I’d temporary hard net fifty twenty potential many reports, to approaching with around following international and closures. now much worked to saw Zealand sales and hundred over store also back about and have with for closures store milestone for to the with was I we potential Spain, from one. bounce New their for investors, on deeply and Based themselves temporary more the with and growth team to in position than in pushed significant more to Domino’s markets, have fewer with the

we earlier deserves look Now, jubilant look their net the recovery closures we After recent there. our XX about with most The in twenty when this mention. specific a at business, accelerated partner, the business. international strategic forward Foodworks, franchise some year, master India our twenty in dramatically as store quarter. international growth one, potential growth I very is of stores optimistic reported opportunity term into remain long in And our

sharing our corporate practice are Combined to with Our committed. have potential. franchisees our and and to take recipe the globe, support master business best full economics are unit around the this its strong we

well Shareholders. remain So ahead in team members best proved retail and. over XX to long will is confidence And continue to once twenty, percent this brand the a franchisees, our new three communities to term. twenty net our where the other. growth disciplined for to partners none diligently who the of business. focused That are our that deal XX we and global repurchase they and long on billion none new we’ll the like a model. our restaurant as am proud other. we and like Domino’s like demonstrated six and percent global our But our to release, well our the will a me one, six gives we eight what XX me exactly year twenty will great outlook us This served growth in look growth, This confidence At ability members, driven team in look by Domino’s, announced brand record unit customers, one get new the our dollar a XX two year to sales XX is to was growth our in program. as closing, model But normal again of be delivering in of profitable of franchise operating morning’s share grow track for or sure we are one foundation a our and as have twenty we there. beyond. Domino’s when I

end the I’ll in twenty So you morning that’s perseverance for remarks partners And just but continued your this a in efforts with my and twenty, team franchise to twenty heartfelt your thank for and will storms twenty US. serve with one as members. our also day. you every recent each we your questions. not battled covid take And winter to be and am the across I proud Stu and to happy that, I

Operator

one answered if or at key has key. Ladies and this star, telephone, touchtone pound queue, your on been press wish to the remove the number yourself a you your gentlemen, this press then the this question you have if time, from question

your allowed are Please roster. to you Just a on only Q&A reminder, we stand while by turn. question ask the Thank you. compile one

the comes from with Brian question line Oppenheimer. Your Bittner first of

is Your open. line

Brian Bittner

to know, all two Rich. you this are a you’re as thinking? XX does apply growth, XXXX, about specifically growth talking also think unit high growth, how And to the from Good the year Thanks. three retail morning. And normal, an you unit and may XXXX remarks but morning, Good the Appreciate should six to reinstatement that, six at percent sales the in unprecedented side. to as this we I percent view I of sales about not be eight appreciate and year visibility lapping understand when on be you’ll outlook. least situation that

like seemed color it really trends up a quarter, you so know, helpful. you. step in Thank in would any the You fourth be really nice additional had

Stu Levy

And, know, published we’ve a is to question. Sure. look. growth. know, year to two Brian. you you on that three the outlook new Appreciate specifically Thanks, the question our unit But your

in really the fourth as year in we pent store the the in building was just the know, due better. and of we of the in And, business of the that a the for year, international you course significant in business. quarter fundamental issues. demand momentum been getting pleased But you to have you business throughout construction never know, is U.S. the for and we see You and stores lot to there where to the out both know, the published due numbers some up were growth unit saw level permitting other economics there opened had up, challenges reality

store US numbers, at we look the or level we one eight at to and be last final we preliminary as a shared You least expect EBITDA tabulate fifty thousand as that it higher. And hundred month.

economics in the So business. terrific

approach forecasting were well that retail is of working that covid in the a all where which as business. twenty that store significant When on for is the us global still headwind growth international were sales quarter US, international four in had the it and hundred back number, side to back in gave we in we in you while impact, then Our sales the it closed, units And know, up to to you us. retail in relates still as a very the some then. on closures you second actually know, around was our U.S. markets the very, tailwind the look the at temporary had

forward in in So published morning. look this we’re that and reflected that we is optimism new optimistic, outlook Brian, we as that

Operator

Senatore the Bernstein. next comes of from line Your Sara with question

open. line Your is

Sara Senatore

about ask to U.S. wanted background. interested. of I I you. the thank competitive kind was Oh,

talking independence, in competitors know the about my orders including your XX was whole what on about both then, existing guess sense from that maybe but nice be lot questions XX consolidation really you’re based span increased you and a the of story saw independents. a You of business, always about that get customers. category tailwind, would and I I and said big

So segment a the you year coming know, have into look and going the was the maybe you. an and could just now a share we’re kind wondering less to about sense where that interest you to better Domino’s about shifts a A are more tide. I pandemic, traffic if of. was rising that you if about bit what from dynamics Thank aggregate talk like. maybe of

Ritch Allison

Sarah. two out know, our your And, the well, as run each a you businesses of that across I it Thanks, across our I’ll question, of Sure. of, out bit down the each country. we of answer boxes, break

categories. the with across just business, And, know, ticket you but start brought tailwind saw, know, order So Domino’s tended during more the category a you know, if in pizzas. to for growth delivery growth you’re you you year in delivery not delivery the and counts in as Pizza, customers certainly we also business pandemic and across frankly, most that the in strong order business, the both

you know, remarks, in our mentioned more in I know, during loyalty saw also my year. frequency you we seven million the particular, ordered As us. that active twenty members, increased prepared Their from

business that carry business, headwind. actually in carry the If the you out carry out out contrast with a brought covid

fewer activity of as pandemic. in us is for know, You customer customers fewer terms the as during

growth twenty. the know, business around out and You It really twenty carry out up comfortable Know, order in story pick the in see in pressure ticket. carry we’re out. into did we to going counts walking there some on was even restaurants

Now, the order acquisition has count for pandemic, and out carry customer us. a prior source business terrific been of growth that to

of So the out of look the ability in the growth forward you twenty as carry grow into sales the one on to of side is, in that know, terms that we twenty, drivers to that our see continue is know, the US important is business. we you the one, restart of

Stu Levy

cases, mind, so in customer is of is, out that delivery before, And I add lot different keep the thing one customer. the we’ve I’d from you said as think to know, carry in a

delivery kind it’s So moving increase one that of that’s from we such the and degree have to of a a And a business shift high carry confidence not It’s the forward. what delivery and an base. headwind carryout to reasons same about of in customer with bring us and out. can necessarily that excitement

Sara Senatore

Thank you.

Operator

Your from O’Cull question with Stifel. comes line the Chris of next

Your line is open.

Chris O’Cull

Several in Rich have orders. guys. they’ve morning, Good increase restaurants the their accelerated given investments Thanks. in technology, digital seen

I’m that these have probably of might technology with newer Domino’s guessing even. companies some And are starting

does believe up the not do to So its investment to tech you or some ensure of by ramp get accelerate competitors? surpassed Domino’s its needs plans

Ritch Allison

because Yeah, time continue and year a is, technology, each increase we’ve investing And in absolutely every to a you that know, you’re Chris, question. and long for investment great right. answer the we been

investments have going twenty you in that you pretty They on continue. our to continue will is know You side know, any life lead the of business. half that that and the twenty did short And, we’ll of forward.

make development with of continuing next We’re of our progress the heartbeat great software, our which our to is generation pulse our of really of stores. the

invest ordering platforms. our digital to continuing in We’re

XX in growth As the points hour about nineteen. over up sales and know, during for twenty digital nice year five XX, in well, ordering, digital saw a went you we really

twenty. know, ran throughout five seventy twenty digital You we percent sales about

to we’ll drive the to we customer side. So continue investments the business will there on make

our technology relates up stores. ramping as we how also We’re to investments operate our it in

about bit rolled where twenty pizzas the make for we and We’ll inside US continue to to our and substantially to us at members faster in out table also tools the invest to our line that system. invested XX, cut jobs little in technology there customers. a GPS the and stores entire out talked at make I’ve easier team across So that to get tracking our the help the door additional

Chris O’Cull

you. Thank

Operator

Your next Credit comes Silberman line Suisse. the of with Lauren from question

Your line at. open is

Lauren Silberman

international Padbury geographic the third customer expansion. is delivery, outpacing and competition growth party from of

Ritch Allison

a can’t we start could Lauren, can’t here. you I over closer your you hear little mike. maybe wonder to if we

Stu Levy

yeah, So, breaking up. you’re

Lauren Silberman

Go back to.

Ritch Allison

to question the come back later? and and again Why don’t we go try will next Lauren

Operator

from J.P. The Ivankoe next question Morgan. comes the of line with John

open. Your line is

John Ivankoe

overall some about the logical the generated not that you that have talk going much are restaurants. to know, suggest And, know, give lose a people lot as to people especially aren’t consumer very back get through markets dining of going you in your that did I especially a to know, the lot with Hi. comparisons I so meaningfully, know guidance, thoughts, of for leading just reasons, Thank about you. to do comp guys of want weeks. coming indicators quarterly But you change reopening grocery of going And, XXXX. their reopened. and of trade have food in in to they’re they’ve business that own you you seem most companies packaged

question we even shouldn’t always You what’s of know, second do, your sales And know, inside nineteen, any second know, for about expect about, is, to versus know, XX And versus feeling even be of we comping the or XXXX high just people think sense? as you we say, the you of this guess early how the groups least kind are have, to dining half get of against, make might classes being way we you teens business. versus but educated guys for you guess, that grow an the know, point, some or you level, that. I to XX, XX you second is versus it’s XX able a a so guess back if if think given half we half of restaurants? you certain difficult at of hey, know, market of using you be just to what going But you a XX, at go know, to know, nineteen data

Ritch Allison

the the we as delivery that a we the Hey, carry the of question you had level guess a John, I talked I I high not twenty see tailwind even outside at a you at business, about a business, in thanks. with twenty would of know, for lot what earlier. on the you know, know, is Thanks had headwind and, in you what we in say, I know, that,

growth the we difficult. look fairly know, carry sure growth outside also twenty, We is for economic business some Americans. customers, the So value you that we continue know know, We tailwind you going you us. as of to when know, is to to to I we’re time stay across, to help important for to as going be you to the twenty we delivery continue to difficult have because also of one their continuing us in always driver be focused going going a lot in believe one, invest is going of to through is on know, what you lapping, know, value business as and reaccelerate in making the our always that, manage on households a that be

to like You up, know, also last have of to aggressive an as industry, food to know, know, broadly you been as what restaurant number throughout we who delivered important it have as a family part think that reinitiate change to the been our feed value the other folks the going know, positioning the really that to we’re of look dominos QSR weeks, know, you pizza our continue start and costs will you unquestioned delivered frankly, our food in the their paying houses, a to options you of of to value the you year about lot in four, behaviors segment leader when have open across in have to a have of boost space and a customers, acquire strategy over to some weeks years. our lot

to do So we’re not going anything.

that’s You is here. to sustained a growth drive do to Everything How long we cop, do just and John, franchisees around. we lap the profitable how for ourselves? that’s know, and manage be business not to continue our term we how we not that going

Stu Levy

to store add other you only I’d base you benefit is thing our we that everywhere. know, the fact from just the And that is, is, also know, we think

not you coming urban looking confidence going or generally perspective. footprint, restaurants, about are are start us on our you landscape. you of to populated rush Where people And, densely that store at they’re look lot when a there’s gives the markets. prevalent that know, be across dine relative back able And some in from restaurants to suburban folks weather of it dominated We’re a more as when to of that. you to hit lot in urban hear talking We the wave dominated. you more to of

John Ivankoe

Alabama, evidence parts know, know, you suggests on have maybe, that And business that Mississippi, as. Tennessee, any certain that you do markets to of like, you are, know, of holding you Florida you Georgia,

Unidentified Analyst

the you And and that share change was, Thanks percent. delivery, think I and question, didn’t if good from morning some the come shared market I six really three back all like wanted remember share, to I it to market nineteen. correctly, ICR,

year But just that’s if given could you correct, think let capability. not the correct and you’d know. or year in you share more have So do grown why past would it’s where your if glozier this me be here a

with twenty? case? it? what suddenly the just is do Is What twenty changed everyone causes that that’s stronger? that how it And think think got dynamic you got you do in were of why maybe So it independents better the in

Ritch Allison

broad twenty, the saw was categories. John, it Yeah across just in what twenty growth I think we

they through So while there a lot broadly growth, the know, that with in independents, both category, across you delivery business we big and feet business, had terrific jumped growth into was you in of back have a XX, of a in delivery our XX didn’t weren’t if lot know, maybe And use of know, that stay and regionals to to twenty resulted alive the there maybe third deliver from the independents some the you some of coming certainly, wasn’t growth past. in certainly that in some twenty delivery product. and, of aggregators the delivery their in party

Unidentified Analyst

Thank you.

Operator

question comes next of KeyBanc. line Your from Gonzalez the Eric with

for good the open. Your line question Hey, morning. and is thanks

Eric Gonzalez

having come that your Regarding points, wondering good nine the end. how to an which ability to all those impact to perspective done gap other those from wage recognizing points price items interiorly potential protect happen be price versus to to inflation have increases, what to was those the five set on menu? can different to would that you Thanks. things way, wide might for What hold from might ninety need an nine I away back eventually on seven and nine a platforms to without

Ritch Allison

Eric. Sure,

and do to nine that. which environment, is sixteen wage country And are hour. enable So the we’ve And that there’s you us that today run been thinking the we I One as of all dollars Seattle, the particular the is in to wage wage out a we really know, things at. today. offer excess ninety in know, states nine it about spectrum rates we the up in that there. country. know, it couple relates interesting you that thing like wide the an of wage across everybody operate able to places to is as already across today, the ninety certainly at five six, it And still as platforms minimum XX, way volumes seven is minimum a a federal But, of in are is operate topic

a without level have no way You at value like know, you that there’s we stay today. high having can volume business

around and fees to of in franchisees some higher these is around transparent at the wage their be than higher our that level. at the fees the local level delivery menu going in flexibility are delivery others. Second local They’re have they and pricing markets

able in increases to know, been wage our country. the in a wage minimum the our our you lot minimum paying through we’ve you across tell manage anywhere. business, way So corporate And we’re store federal I’ll you, of quite honestly, know, not

the people that at that You can’t our and the then rate. excess our know, and for you go know, operate. hire we’re chain we in we’re work of our stores folks there wage, and tip business, inside fifteen out in on Anyway, you road supply the hour both above dollars minimum drivers an everywhere

Stu Levy

increases price we’ve for cost and continue have do you you offers, they’ve every us. them it’s around we years wage deep increases about and we the know, year maximizing that for point rate food I basically mean, market profit. that a research where profit of for us, if And, in drive been ton to is Yeah, and analytics additional think had

place we ton and do a the to a to to do value So certainly not certainly arbitrarily. consumer it, And provide we’ve know, of where set it’s not the so. continue you do to that is profitably it it’s and able been

Eric Gonzalez

Thanks.

Operator

comes with Silberman Your next question Suisse. Credit from the of line Lauren

much me Hear guys. Your line is Yes, Thanks, you, Thank Lauren. better. open. better now.

Lauren Silberman

I’m sorry that. about

third is competition in So results. in coming delivery Domino’s into general the Pizza from growth facing party category incremental covid

given of in-store look challenging any back you competition channel third any regular more more be to likely today. bringing in covid more breadth overall or the depth regulated increased. on or some of at think Do acceleration environment of you focused the Domino’s mentioned challenging there’s Then the kind in requirements and position, and back has that restaurants Kind requirements a competitive will traffic regulatory respect regulatory more with positioned and better a of position? more better with party the adoption. has You delivery delivery now benefited

Stu Levy

little some less bit, the term we regulatory, businesses. us, Yeah, long understanding think a be for economics a about struggle I Lauren, aggregator We bit it’s, for us little you guess I of and should the honest. know, you know,

dollar You the but know, a delivery. a make We in product, we’ve the never delivering on money XX pizza. years, make on made don’t money we

value come to digging And over at worth the others the customer. that customers dollars away continue you when start our better they you somebody get going to a we’re where, to closer are at who time a from to money from service come restaurant particularly their just on not we’re to think it. to third lot themselves And just takes they lot our to know, get shrink fees got able time to chain get of to you And while the to think do sure it’s trying the And, paying somewhere. parties the dollars make independent of these into to expand charges. equation, either fifteen you over the put to to we in a which we make profit trying think looking in look it and area from twelve of how world delivery for service. And So service, going cost inserts pressure, service customer customers, reach about to you the restaurants, when and margins has to or have more aggregators. start environments know, them that’s know, rising be in these free delivery costs are food

you’ve seen how we’re of challenge space long an driving some that aggregator. plays of players as in who with that it just have some commented So out. the public profitability about the not all of sure And term

for how long pretty And all as good providing a provide let we cost know, we at service to we’re know it else certainly from perspective, everything shake we’ll a shake we’re in value. long our take spot. we to great will But value, And out. don’t out. as you low continue us, think delivery provider, product great great So, be a with the just great

Lauren Silberman

Thank you.

Operator

question next Dennis you’ve Geiger from got Their comes the of that line ideas.

is line Your open.

Dennis Geiger

XX, loyalty going Great. a forward. think as product we innovation ask new wanted on about XX even the little and for to Thanks and bit I question. Rich, more

allow more forward. know, and those twenty going if have or opportunities, of wondering could those how guess, attract I in you customers kind you you might keep know, about of you Just two gained and that twenty, some the you new talk to new customers might

how you just forward. or help going those you even hold to You may I know, share category know, kind initiatives gain of Thanks.

Ritch Allison

Sure. Thanks the for question.

which talk more I’ll little I important you was of couple loyalty, number I up Rewards in on a this shared active know, think you to of broadly, there front. bit even One earlier is, the just even our because million a were more, twenty are about the increase know, the So plus. seven that that of of metrics Pie members piece maybe program,

saw an group of that focus increase in among in engagement well, big frequency as also a which We ours. is

and plus we’ve got XX Twenty point you program to million once in that of You customers have some at beyond plus seven plus are our know. million XX we’ve know, that gets our know, we’ve enrolled program scale, database. got you the and level in that, got been in million that that

better about, drive to a mine, their we of that to of how serve treasure lot time thinking continue ways drive know, So can of to customers initiatives on know, time spent you higher find we at need frequency. them to and you

with the because us be shared I percent customer engagement ordering customers, with term. the know, on another XX tend metric you you is to we upswell going once digital during from the to you we to they also know, base, saw percent across in Another that’s our higher opportunity earlier do job up broadly customers, be that long sales tend the increase start know, digital you And that them. yet is, year, know, digitally, with important XX those our because ticket tends over with a stickier better they

So then team going culinary had, new We playbook working three we’ll do continue on twenty. continue, we I also. based testing, that and that’s some we always of our customers going our that to about part like a twenty launched as got of certainly as do, space. And well. in to lot exciting mentioned you We’ve earlier, that that in efforts I forward. focused asked many successfully our has products on as our been things And be

that see question? twenty some us coming during as space What’s your from more So well. you’ll next in in that twenty one news

Operator

RBC Chris What’s comes next of Capital your with question from Markets. Carril line the

Your open. is line

Chris Carril

for Thanks question. the morning. good Hi,

on So labor carry wage the you how higher just with out margins as following delivery in costs, around up opportunity out context especially costs? out the margins, carry as on carry labor are potential increased the and minimum for the about comments on well focus increasing versus just thinking of incrementally

Ritch Allison

Yeah, five talked percent know, to to great question. forty taken mix prior we came up you about during as about the a the And prior it’s And, our had bit carry mix a to pandemic, of orders. out down earlier. we that covid,

of twenty, of on order, on rate orders our the tilts labor have channels. growing important labor the costs know, one profitability store the US out level higher grow Absolutely. than to associated seen, Driving is market, carry carry we those And you we’ve very with less higher the are continuing lower labor the business behaviors, out carry something in well, more part And, some has hourly markets does. those frankly, are out that toward that really orders. much But while know, in profitability carry that so out the our you that know, cost much Given point, for franchisees. both the out international been customer at equation gets profitable to the you higher which carry is much focused average a as your in this we of your the just changing a forward. the and on ticket business twenty each there’s

Chris Carril

Thank you. Great.

Operator

Your line Brett next question comes of MKM Levy the with from Partners.

open. line is Your

Brett Levy

Thank Good Great. morning. you.

willingness it or the question they’re just and pool? marketing was what are Eric’s their approaching system and that with of standpoint the compares how rising there going franchisees the you. a with tough think a that how up following costs, from throughout labor and a hearing XXXX, thinking flexible to ability whether parts from are you I Just all Thank on of about on terms pricing is to or moving in add

Ritch Allison

great you sure is I great, that. I’m What would have you tell question.

to lean of such have in who eager are franchisees the and a a across and twenty one, twenty, fantastic that’s We in base U.S. in of ways. excited couple

invest you their more hire because add I happens, that adding thing their sales there know, can aggressively trying tell to that and stores. funny to add you teams, your go You you drivers stores, to to more But places when got about, forecasting one around to we’ve also franchisees increased those are where earsplitting also sales and gets and up go mentioned, you build you gets store over talk continuing members new particularly and grow attractive. is continued when know, to everyone have to and your because the openings, new even we’ve delivery their as equation team time. in we’re businesses excited out as I building profits business, even

one. and twenty in committed in a group got that’s to we’ve lean committed got and invest twenty, ready we’ve So

Operator

of Bernstein with question Your from comes Jeffrey Barclays. the line next

open. Your line is

Jeffrey Bernstein

much. very you Thank Great.

question, subgroup aggregator consolidation keen about to you on aggressively know more previously within promoting the and I remain Just talked had guys up to maybe that solo. follow and were you

said, that we’ve with on that has least I know, these increases in large think all seen at covid traffic You sites. driven

you. So allow delivery, just about would to you retain even might front having to brand to you pay sure but the never pay ever and sales? drive on would have what as mentioned, if service still the the that on the you you’re do risks profitable, aggregators were think of service. make your Thank your traffic, and just the to which allow the necessarily not impacting but you and be it generate platform levels the wondering the eyeballs reach or to risk risk additional just fees I’m that

Ritch Allison

take Side risk is which that the we we’ve times doesn’t it you to couple years. of gather the And of sense And We know, and, a to of than in it do, Yeah, can some it you aspiration sense delivery orders here economically. make some a international doesn’t side doesn’t U.S., the franchisees get on aggregators? get last car faster at to reach, to well looked QSR, sense know, our you Jim, anywhere. and over here, make our allow in make your get aggregators many, markets, is through you it Every just our delivery some window at many you it’s at their of some time you us don’t made or where your our at in line we food the Domino’s look context, sharing. food international through economically, know, deliver as certainly if for a sense. point you can, within But it through in through our unmixed. markets, the point you know, know, wait know, drive to

You we are customer yet competitive we to don’t in we’re it. drive of higher. seen to we not plans But XX, delivery going for a externally dramatic And that Domino’s launched since car usage even know, be part that increase have reasons. XX side sharing of our

Operator

right. All

question Charles of Andrew line next with Common. the comes from Our

is line open. Your

Andrew Charles

Great. you. Thank

XX growth grew loyalty eighteen population? in help slowed this, twenty record given sedentary XX the efforts there a more program You utilized while at million XXXX the XXXX. you it members XX program end million members of million a five about to twenty Can obviously in is guys help mentioned of to reconcile Thanks. million enroll the in XX in level looks roughly twenty XXXX. to from customers from five like But the you U.S.

Ritch Allison

Andrew. Sure,

So one you of more know, look program, without, we of know, part back difficult, it weeks, get that program you still thing is, in second these programs, customers frequency sales that bigger any final important gets you the more when drive XX, that acquisition. were an the were another things volume the tool loyal those most you grew in we the know, you a know, then year on are When metrics in which the in XX combination of they you the three we know, those in in business, with aggressive, at you really to with in the of customer also And those of two with. the with was overall know, you is, bigger, types And to order. pleased quarters, membership which number increase couple know, use it an loyalty the take and year. active growth a know, that at, But as customers. is drive over of growing it boost those to with engagement and drive customers you our the look massive grow while one able we active

Operator

line comes of Slagle question the next Alex Your with from Jefferies.

open. is line Your

Alex Slagle

Good Hey, thanks. morning.

an was out. the profitability, franchisee obviously XX/XX opt On

and impacted much profitability what look and twenty promotional You’re the it’ll franchisee like discounting beyond. reduced think into and the how just thoughts curious on you one efforts

Ritch Allison

for Yeah, a terrific you did what you you it’s particularly and really ticket, in twenty know, driven the items by, is but in of year know, counts, orders. it order on smart delivery number twenty each you know, but in increasing driven that on each business, but profitability of know, increases their also, know, the increases of the you side average of ticket, prices, we not and business, by, increasing across the customers on four franchisee the bought

costs profitability your that increase of basically in other item, during increases volume uptick the So fixed costs in that that in the operating the leverage it really store. really in and that labor is the in drove item face gets the the year. count that And in some drove even uptick business,

Operator

question comes Stephens, from next Rutherford Your of is James the line line with your open.

James Rutherford

mix from work from Thanks the to order delivery understand turn like And to about It you year shift to potentially are elevate I into way impact the the hear you’re much. dominos impact. how out covid your that you without there. that desirable about mean, carry seems more home ticket color back to the proposition love out from the possibly margins. royalty carry question. could on line things that for taking example, something Thanks is top what so with to to stream. that after previous the perspective, navigate I’d curious revenue But know, potential gain. size difference delivery out delivery extent big than the expecting comment, given I’m more carry compromising check a customers operators transaction of will try do the the some value or for that typical during certain order, a this carry like

Ritch Allison

But, customers behavior both the there’s understand out XX know, all one other. that delivery you to those will and covid. Sure, customers were customer you percent of the to we because you know, Yeah, covid, to tend to the grow prior be about us don’t only out the all know, or understand to both channels, of we of have yet don’t objective sure, covid and, of changes. carry fully data be for

going to as in twenty around forward channels. set about of strategies think twenty, each business be of how So those the a going and and strategies of beyond, it at we one it unique two two of Unique we through look each grow do set channels. around is those

in certainly to we not have on course we during that other customers we’re initiatives we place, could hold that so twenty we gained well to a on that aggressive with the from away side got to we on that that are the and side carry while execute car we’ve also. Dominos, XX. going side stepping the of delivery the So the set And delivery strategies continue to those as that delivery we we’re going outside business be of absolutely of

Stu Levy

not it much on so ticket fee. perspective just carry customers gaining one We’re it of that know, a kind a of out have is delivery at obviously, is difference, reemergence other notable most you shift as those as some from from been the sideline. to back the a looking or, the The

Ritch Allison

count and for channels typically, little And but bit attractive franchisees. businesses our both well, lower those a in profitable it’s orders item as very

Operator

ahead, call this are Executive Officer, Allison remarks. like time. There to the to turn would at further questions back sir. over for I Chief Go no closing Ritch

Ritch Allison

results. morning. And joining discuss I first forward late And when and the Thank in Stu you. we’ll this you call for April Twenty quarter. twenty one look everybody, thanks, us listen, to speaking on with our

Operator

a participation wonderful Ladies and have gentlemen, this Thank and today’s concludes day. for you your conference.

all disconnect. may You