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Domino's posts 7.4% drop in profit, says CEO to retire

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Domino's posts 7.4% drop in profit, says CEO to retire
FILE PHOTO: A Domino's Pizza restaurant is seen in Los Angeles, California, U.S. July 18, 2018. REUTERS/Lucy Nicholson   -   Copyright  LUCY NICHOLSON(Reuters)
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(Reuters) – Domino’s Pizza <DOM.L>, Britain’s biggest pizza delivery chain, reported a 7.4% drop in half-year profit, hit by losses in its international business, and said Chief Executive Officer David Wild was retiring after leading the company for five years.

The company did not name a replacement for Wild, although Sky News had reported in late June that Domino’s was looking to tap Andrew Rennie, the head of the European business at Domino’s Pizza Enterprises <DMP.AX>, for the role.

Domino’s international business has been a sore spot this year as it struggles to control costs. The company also said it faced higher interest costs due to a rise in net debt.

“The performance of our International business is very challenging and trading visibility remains limited. The weakest performance was in Norway, although we also saw increasing losses in Sweden and Switzerland,” Wild said in a statement.

Underlying pretax profit at the franchise of U.S.-based Domino’s Pizza Inc <DPZ.N> was 42.3 million pounds ($51.41 million) for the six months ended June 30, compared with 45.7 million pounds a year earlier.

The company said it expects full-year net debt of 220 million pounds to 230 million pounds. In 2018, the company’s net debt stood at 203.3 million pounds.

As part of its Brexit plan, the company said it had increased its inventory levels by 7 million pounds.

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Anil D’Silva)

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