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LONDON (Alliance News) - DP Poland PLC, the Domino's Pizza franchise in Poland, Tuesday said that its losses widened in the first half of the year, but reported a 64% rise in its gross profit, due to new store openings and increased advertising.
DP Poland, which has the exclusive right to develop, operate and sub-franchise Domino's Pizza stores in Poland, said that its net loss widened slightly to GBP1.7 million, from GBP1.6 million a year earlier, due to an increase in marketing and promotion investment. As the company has been trading for just over two and a half years, it said that it expects to reach breakeven in 18 months, and sales maturity in 36 months.
The company said that it will open its first sub-franchised store in Warsaw next month, as well as its first store outside of the capital. DP Poland said that it still plans to open 20 new stores in 2013 and 2014, both corporate and sub-franchised. It also said that it hopes its new S2 store format will enhance the chances of those stores hitting profitability in a reasonable time frame.
It reported first half revenues of GBP1.5 million, compared with GBP745,00 in the prior year.
DP Poland reported a gross profit of GBP617,000, compared with GBP133,000 a year earlier, boosted by a number of new store openings in the first half of 2012, as well as price promotions and increased advertising.
"While we have experienced the inevitable challenges of launching a new concept in a new market, I believe that we now have the store formats and the trading and operational experience in place to make this business a continued success in the coming years," said Chief Executive, Peter Shaw, in a statement.
DP Poland shares were 2% higher mid morning Tuesday, trading at 18.10 pence per share.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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