Latest news with #AndrewRennie
Yahoo
12-03-2025
- Business
- Yahoo
UK's Domino's Pizza starts 2025 on a slow note as demand falters
By Raechel Thankam Job (Reuters) -Britain's Domino's Pizza Group on Tuesday posted a slower start to 2025 and forecast muted annual profit growth amid broader economic woes, sending shares down 3.8%. British firms are tackling the prospect of waning demand, as higher taxes and labour costs raise concerns about price hikes, impacting consumer spending habits. However, Britons defied a weak outlook for the economy to ramp up spending in January. Still, Domino's reported like-for-like sales growth of only 0.7% for the first ten weeks of 2025, trailing its fourth-quarter growth of 3% that was fuelled by higher orders. Total system sales - a term used in the franchising industry to represent sales of all outlets that use a brand - also grew by a slower 2.4% in the same period in 2025, compared with the preceding quarter. Shares of the company fell as much 4.4% to 280.9 pence by 1049 GMT, having risen as much as 2.3% earlier in the day in volatile trading. Despite uncertainties in the macro-environment, CEO Andrew Rennie told Reuters the company currently does not have the same inflationary pressures it had faced last year, and said it will continue to deliver the discounts it had provided last year. Rennie said Domino's will accelerate investments in automation to support growth without adding labour, to mitigate the expected impact of 3 million pounds per year from rising labour costs following the UK budget. The group, which operates under the umbrella of U.S.-based Domino's Pizza in the UK and Ireland, forecast 2025 underlying core profit to be in line with market expectations of 143-148.2 million pounds ($184.9-$191.6 million). In 2024, Domino's reported core profit of 143.4 million pounds. Separately, the company also named Ian Bull as its new chair, replacing Matt Shattock, who will be stepping down in April after five years in the role. ($1 = 0.7736 pounds) Sign in to access your portfolio
The Independent
11-03-2025
- Business
- The Independent
The price of a favourite takeaway is about to rise. Here's why
Domino's pizza prices are likely to rise this year as employment costs continue to climb, according to the company's chief executive. Andrew Rennie said that price increases will be necessary to offset the rising cost of labour. "Look, there's no doubt, I think later on in the year, there'll be some need to do that," Mr Rennie said. However, he said the exact amount of the price hike remains uncertain. Mr Rennie cited unpredictable government policies as a factor making it difficult to forecast the precise increase. The company, which employs at least 35,000 workers, is facing a significant rise in its employment bill from April onwards. Both the national minimum wage and employer national insurance contributions (NICs) are set to increase, adding to the financial pressure. Domino's has already reported a £3 million annual impact from the rise in NICs alone. The increased minimum wage will add approximately 10 per cent to franchise operators' employment costs, amounting to tens of millions of pounds. Mr Rennie said: 'It depends on what the consumer does. 'If the national living wage puts more money into consumers' pockets, and they start spending more, we may not need to do much at all. 'The trouble is, every morning we wake up there's something different being announced. We don't know what the second half of the year holds.' Meanwhile, the company wants half of the pizzas it sells to be collected by customers in future, rather than delivered. Mr Rennie said he is 'going after collection in a bigger way this year', partly to mitigate the rising costs. Domino's has thousands of delivery drivers and riders, who ferried its pizzas to customers in an average of 24-and-a-half minutes per order last year. But cutting out the delivery element would allow Domino's to make more money from each pizza. Mr Rennie said: 'Collection is very efficient for franchisees, it is a lot lower labour, so it actually brings you more margin.' Just over one-third of Domino's orders are picked up by customers in the UK and Ireland, but Mr Rennie said he wants to emulate the situation in the US, where the figure is 55 per cent. He did not put a timeframe on when it might reach the target, adding that it is 'not going to happen straight away'. Part of the plan centres around opening more stores in rural areas, which 'often have limited competition, and our strong national brand is a significant competitive advantage' compared to in cities. Mr Rennie, who once ran a 30-strong Domino's franchise in Australia, said: 'When I was a franchise I used to own all my stores in rural areas and we had some of the highest collection (of) percentages in the country. 'It's easy to park, it's easy to drive there and you save money… When we open stores in country areas right now, we have a much higher collection percentage than we do in the urban areas.' The London-listed company opened 54 stores across the UK and Ireland in 2024 and plans to open more than 50 more this year, with a target of more than 1,600 by 2028. Sales had continued to rise in the first 10 weeks of the new financial year.
The Independent
11-03-2025
- Business
- The Independent
Domino's pizza prices will ‘no doubt' rise this year amid higher tax bill
The boss of Domino's said he expects to bump up prices this year amid rising employment costs. Andrew Rennie told the PA news agency the chain will 'no doubt' need to increase prices to customers at some point in 2025 to keep up with the surging cost of employing people. Domino's UK and Ireland chief executive said: 'Look, there's no doubt, I think later on in the year, there'll be some need to do that.' But 'it's hard to say' how much they will rise by, he continued, pointing to what he sees as unpredictable Government policy. The company has at least 35,000 workers but faces a growing employment bill from the start of April, as the minimum wage and employer national insurance contributions (NICs) are set to increase. Domino's has already reported a £3 million-a-year hit from the rise in NICs, while the cost of the minimum wage increase will mean a roughly 10% increase in employment costs for franchise operators, or 'tens of millions' of pounds. Mr Rennie said: 'It depends on what the consumer does. 'If the national living wage puts more money into consumers' pockets, and they start spending more, we may not need to do much at all. 'The trouble is, every morning we wake up there's something different being announced. We don't know what the second half of the year holds.' Meanwhile, the company wants half of the pizzas it sells to be collected by customers in future, rather than delivered. Mr Rennie said he is 'going after collection in a bigger way this year' partly to mitigate the rising costs. Domino's has thousands of delivery drivers and riders, who ferried its pizzas to customers in an average of 24-and-a-half minutes per order last year. But cutting out the delivery element allows it to make more money from each pizza. He said on Tuesday: 'Collection is very efficient for franchisees, it is a lot lower labour, so it actually brings you more margin.' Just over one-third of Domino's orders are picked up by customers in the UK and Ireland, but Mr Rennie said he wants to emulate the situation in the US, where the figure is 55%. He did not put a timeframe on when it might reach the 50% target, adding that it is 'not going to happen straight away'. Part of the plan centres around opening more stores in rural areas, which 'often have limited competition, and our strong national brand is a significant competitive advantage' compared to in cities. Mr Rennie, who once ran a 30-strong Domino's franchise in Australia, said: 'When I was a franchise I used to own all my stores in rural areas and we had some of the highest collection percentages in the country. 'It's easy to park, it's easy to drive there and you save money… When we open stores in country areas right now, we have a much higher collection percentage than we do in the urban areas.' The London-listed company opened 54 stores across the UK and Ireland in 2024 and plans to open more than 50 more this year, with a target of more than 1,600 by 2028. Domino's cautioned over an 'uncertain economic environment' but said sales had continued to rise in the first 10 weeks of the new financial year.
Yahoo
11-03-2025
- Business
- Yahoo
Domino's pizza prices will ‘no doubt' rise this year amid higher tax bill
The boss of Domino's said he expects to bump up prices this year amid rising employment costs. Andrew Rennie told the PA news agency the chain will 'no doubt' need to increase prices to customers at some point in 2025 to keep up with the surging cost of employing people. Domino's UK and Ireland chief executive said: 'Look, there's no doubt, I think later on in the year, there'll be some need to do that.' But 'it's hard to say' how much they will rise by, he continued, pointing to what he sees as unpredictable Government policy. The company has at least 35,000 workers but faces a growing employment bill from the start of April, as the minimum wage and employer national insurance contributions (NICs) are set to increase. Domino's has already reported a £3 million-a-year hit from the rise in NICs, while the cost of the minimum wage increase will mean a roughly 10% increase in employment costs for franchise operators, or 'tens of millions' of pounds. Mr Rennie said: 'It depends on what the consumer does. 'If the national living wage puts more money into consumers' pockets, and they start spending more, we may not need to do much at all. 'The trouble is, every morning we wake up there's something different being announced. We don't know what the second half of the year holds.' Meanwhile, the company wants half of the pizzas it sells to be collected by customers in future, rather than delivered. Mr Rennie said he is 'going after collection in a bigger way this year' partly to mitigate the rising costs. Domino's has thousands of delivery drivers and riders, who ferried its pizzas to customers in an average of 24-and-a-half minutes per order last year. But cutting out the delivery element allows it to make more money from each pizza. He said on Tuesday: 'Collection is very efficient for franchisees, it is a lot lower labour, so it actually brings you more margin.' Just over one-third of Domino's orders are picked up by customers in the UK and Ireland, but Mr Rennie said he wants to emulate the situation in the US, where the figure is 55%. He did not put a timeframe on when it might reach the 50% target, adding that it is 'not going to happen straight away'. Part of the plan centres around opening more stores in rural areas, which 'often have limited competition, and our strong national brand is a significant competitive advantage' compared to in cities. Mr Rennie, who once ran a 30-strong Domino's franchise in Australia, said: 'When I was a franchise I used to own all my stores in rural areas and we had some of the highest collection percentages in the country. 'It's easy to park, it's easy to drive there and you save money… When we open stores in country areas right now, we have a much higher collection percentage than we do in the urban areas.' The London-listed company opened 54 stores across the UK and Ireland in 2024 and plans to open more than 50 more this year, with a target of more than 1,600 by 2028. Domino's cautioned over an 'uncertain economic environment' but said sales had continued to rise in the first 10 weeks of the new financial year.
Bloomberg
11-03-2025
- Business
- Bloomberg
UK Domino's CEO Sees Labour's Wage Hike as Good for Business
Domino's Pizza Group Plc Chief Executive Officer Andrew Rennie said Labour-mandated wage increases mean UK consumers have more money in their pockets to spend on pizza. 'Customers who end up with more money in their pay package from the national living wage are also our customers, and therefore we could be the beneficiaries of that as well,' Rennie told Bloomberg News, noting that more discretionary spending could drive more volume for its business.
