LONDON (Alliance News) - Pizza delivery firm DP Eurasia NV said on Tuesday its profit dropped significantly in 2017 as marketing and general expenses rose, despite double-digit revenue growth.
The company - which operates as the Domino's Pizza brand master franchisee in Turkey, Russia, Azerbaijan and Georgia - reported pretax profit for the year at TRY6.8 million from TRY38.3 million the year before, equating to GBP1.2 million from GBP6.9 million.
The fall was due to general administrative expenses rising 58% to TRY109.1 million and TRY68.9 million, and marketing costs up 35% to TRY82.6 million from TRY61.3 million.
Revenue however, rose 40% to TRY633.0 million from TRY451.1 million, as system sales rose by 33%.
The number of stores increased to 643 from 567 the year before, with system sales in Turkey growing by 14%, system sales in Azerbaijan & Georgia rising by 58% and Russia more than doubled.
On a like-for-like basis, systems sales in Turkey were up 10% in the year and system sales in Russia were up by 29%.
For the first two months of 2018, like-for-like systems sales growth in Turkey was 11% and growth in Russia was 25%.
DP Eurasia expects to open 30 new stores in Turkey for 2018, with high single digit like-for-like growth, and 40-60 stores in Russia, with like-for-like growth in the low-to-mid teens.
"DP Eurasia has had another successful year and we are pleased to report good progress in our maiden annual results since becoming a public company. We have seen strong performance in both of our geographical segments. Turkey and Russia had solid top line growth driven by our store additions and like-for-like growth," said Chief Executive Officer Aslan Saranga.
"We had a strong start to 2018 in line with our expectations with like-for-like growth of 10.7% and 25.0% in Turkey and Russia, respectively, and the board remain confident in the business and its growth opportunities for the rest of the year," Saranga added.
Shares in DP Eurasia were down 2.1% at 215.50 pence on Tuesday.
