DP Eurasia performs well amid Turkey turbulence

(Sharecast News) - Domino's Pizza franchisee DP Eurasia posted its interim numbers for the six months ended 30 June on Tuesday, reporting a 28.1% rise in group system sales to TRY 510.4m.The London-listed company said system sales in Turkey were up 15.6% to TRY 351.6m, while Russia sales improved 68.8% to TRY 152.7m, and the Azerbaijan and Georgia geography saw sales ahead by 56.8% to TRY 3.9m.Store numbers rose by 79 across the group, to a total of 672.Revenue for the company was 32.2% higher year-on-year at TRY 380.2m, with adjusted EBITDA ahead 8% at TRY 40.3m.Adjusted net debt stood at TRY 149.5m at period end."It gives me great pleasure to announce another strong set of results for the first half of 2018, during which we have grown our top-line as well as adjusted EBITDA in both Turkey and Russia," said DP Eurasia chief executive officer Aslan Saranga."We have added 29 stores to our store count in the first half of the year and we are moving towards reaching the 700th store milestone later in 2018."In Russia, we are continuing with our regional push with planned expansions into new cities during the second half after adding Rostov, Voronezh, Kazan, and Nizhny Novgorod among other cities in the first half of the year."Saranga said online ordering continued to be the "main driver" behind the firm's like-for-like growth in both markets, with online delivery system sales reaching 59.3% of delivery system sales for the first half, and Turkey also surpassing the 50% threshold."The revamped apps launched in the second half of 2017 are continuing to contribute to this increasing online trend."In August, we launched our enhanced websites in Turkey and plan to launch them in Russia towards the end of 2018."We are also continuing with GPS tracker installations in Turkey where more than 400 stores have already been installed with the necessary hardware."Saranga said the company planned to launch that new tool for Turkey in early 2019.He said that, with respect to the macroeconomic headwinds that the firm was experiencing in Turkey, it was offsetting the impact of higher inflation by increasing its prices more frequently without any discernible negative impact on volumes."The management team continues to focus on pricing, tight control of the cost base, supporting franchisees and careful management of net indebtedness and foreign exchange exposures to ensure that we protect the business through this period of economic volatility."Historically, the business has been relatively robust in challenging economic conditions and we continue to monitor the situation closely given the uncertain short term outlook."This is my third such experience at the helm of DP Eurasia during a difficult macroeconomic environment in Turkey and on each previous occasion we have come through stronger relative to the competition due to our market leadership position, focus on value and service to the customer and resilient franchise partners."Saranga said the board was expecting the full-year adjusted EBITDA for 2018 to be in line with expectations.