REMINDER: Our user survey closes on Friday, please submit your responses here.
I believe the half year results due late September.
ULVR is currently on a 4.9% free cash flow yield. I think a 3% free cash flow yield would not be outrageous, given the current search for yield and ULVR's ability to compound dividends and earnings above inflation. The latter would imply a share price of 7300p on TODAY's free cash flow.
I've held ULVR since 2512p in 2013.
I really hope we start to see what has long been forecast - a significant reduction of group EBITDA losses in 2020 and 2021 as we move to a projected cash flow breakeven in 2022.
Of course a trading update will just be the like for like sales.
Trading update to be released 26 June with AGM.
Agree, ijr1 - I've been topping up early this year, 6-7p.
There's a lot to be said for defensive, globally diversified Unilever - a 3.5% dividend yield backed up by a 5.3% free cashflow yield (admittedly on 2019 figures). Simply adding up the capital gain and cash dividends received, it's doubled for me since 2013.
Where did they say the accounts were 'not being signed off'? I think they merely said they were delaying announcement of the results due to the FCA and FRC guidance and their two-week moratorium on financial results.
They recently said:
'DPP announces that, whilst the Board had declared an intention to announce the Group's audited results for the year ended 31 December 2019 on 31 March 2020, it has decided to delay the announcement after considering guidance recently issued by the Financial Conduct Authority and the Financial Reporting Council. The Board has also discussed this matter with the Group's advisers.
The original reporting date falls within the two-week moratorium recommended by both bodies and the Group will, therefore, report no earlier than 6 April 2020. We are choosing not to set a revised announcement date at this time, mindful that any new commitment could be impacted by further regulatory guidance. We will commit to a new date as soon as the regulatory background becomes clearer.
In line with our announcement on 7 February 2020, the Board expects to report full year results for the year ended 31 December 2019 in line with management expectations: System Sales up 13% to approximately PLN 81m and 3% like-for-like growth in System Sales 2019 over 2018. Cash at bank as at 31 December 2019 was £3.6m; control of cash and costs remain key areas of focus for the Group.'
For current trading, they said:
'DPP therefore continues to trade, making deliveries from all of its 69 stores. The Group's high level of online ordering of delivery sales (82% in 2019), which supports online payment for food orders, is proving attractive to customers in the prevailing environment. In addition we have introduced a Contactless Delivery and Contactless Carry-out process for customers, which have been well received. Eat In dining has stopped altogether for the present.
Meanwhile, we are currently seeing reductions in the cost of ingredients, particularly in cheese - a key component of most pizzas. In addition, in recent weeks the recruitment market has improved markedly for us.
Our first priority is the health and wellbeing of our people. We follow the health and safety recommendations of the local and national authorities in Poland.
Overall, the situation is changing rapidly, and it is difficult to foresee the potential impact on our business and the further threats and opportunities that may await us. As such, there is little visibility on the potential full year outcome for our 2020 Financial Year at this time. However, for so long as we are permitted to continue to sell and deliver great pizzas to our customers we believe that we are well placed to trade relatively well during the lock down. Nevertheless, we cannot anticipate how our customers might react to circumstances, which change almost daily.'
Labour and ingredient costs are a large component of expenditure, so these comments are promising. Provided all stores can continue to operate and deliver pizza, they may do reasonably well this year.
I tried to get a quote to buy 300,000 shares today but couldn't. DPP is not liquid!
Good news Monty888 on the report from Poland - anecdotal evidence has its place and we also know that ingredient and labour costs have been reduced which is good news as well.
Following this morning's update, the full year results announcement is delayed at least until 6 April 2020 as per the guidance from the regulator. However, they did say all 69 stores are open and trading. We are dependent on whether takeaway services are continued to be permitted to operate. If people are not going to restaurants and still want something cooked for them, then Domino's Pizza seems reasonably well positioned provided they can continue to operate. Their comments on lower ingredient costs and the labour situation were also encouraging.
The results are due 31 March 2020.
It will be interesting if they have any comment on whether like for like trading volumes have gone up as people order takeaway deliveries (assume you cannot collect). I am not sure what containment measures the Polish government will be taking.
Are you attending the AGM, Slipperman55?
Held since 2011 at 869p. Quite happy to hold for the long term!
If the summary I've seen is correct, the volume of shares traded today was 546,000 which equates to under £33,000 if we assume an average price of 6p. DPP is not a highly liquid stock.
Definitely: better comms and true progress.
In February 2019, they targeted 83 stores by end 2020 (majority sub-franchised); 95 by end 2021 and 107 by end 2022 (63% sub-franchised). We therefore need to see 27 sub-franchisee store openings from 2020-22 inclusive and 7 corporate in that time.
Once mature, the 40 corporate stores they expect to have in 2021-22 should be generating £4,280,000 EBITDA per annum (£107,000 per corporate store, up from £80,000 in the original business case). If we see 107 stores at the end of 2022 and the group at breakeven, then this becomes a very interesting business.
And, if they cannot avoid issuing more equity, then existing shareholders deserve pre-emption rights. Not that we'd get it, on past form!
I do think we need better communication. They seem to have been making further progress in terms of subfranchising and continuing the store rollout, as well as returning to like for like sales. In the early days, they used to issue releases to mark milestone store openings.
In terms of the trading update, I think the reason one was released in December 2018 was because they had an obligation to warn that full year revenues were going to be below consensus forecasts. I *hope/assume*, therefore, that the absence of one so far indicates full year 2019 expectations will be met. And I do want to see continued progress in 2020 and a clear path to group breakeven.
Best wishes,
The volumes being traded are very low and the spread is high, as you say. At the sell price it's trading for 0.8 times est. 2019 earnings; 0.61 times est. 2020 earnings; and 0.51 times est. 2021 earnings.
There's a trading update due in December 2019. If they can show they have met or exceeded forecasts for 2019 then perhaps sentiment will change somewhat. They really need to show progress and going through 2020-21 with good momentum.
Since February 2019, when they raised equity and removed the CEO, there hasn't been any similar bad news and yet the share price has kept sliding. They have made progress on gaining sub-franchisees, 39% of the current estate is now sub-franchised, and like for like sales are rising.
Current market cap is less than this year's forecast revenue and only 0.73 times 2020 revenue estimates or .60 times 2021 revenue estimates. It's also less than net asset value. To put it in context, when the share price surged in 2016 it was then at over 10x revenue - the same rating today would give us 50p a share even with more shares in issue than there were then. We have gone from one extreme to the other, yet turnover has grown from £3.8m in 2014 to £12.7m forecast this year and £19.9m in 2021.
I can't help wondering if the market fears further equity dilution, however they do have a borrowing facility to tap once DP Polska is cash positive and the group as a whole is forecast to be EBITDA positive in 2022.
There's a short-term benefit from exiting international, I think, with those losses going away. However, it raises the question of how they exit those businesses and what they get for them? If they get cash, what do they do with it? I think there is still quite a bit of growth in the UK and Ireland to come, however they need to fix the franchisee dispute. And it begs the question about what happens, in, say, 5+ years and its core markets have less growth to offer. Perhaps DOM becomes a slower growth but highly cash generative business showering dividends and buybacks on shareholders?
They timed recent share buybacks very poorly. I wish they'd bought in the 200s!
I've held since 2010. The current share price represents a 137% capital gain and it had been touching well over 200% a year or so back. Dividend per share has compounded around 13% a year. The past is no guide to the future and all that!
GabsterX, I think the UK Dominos, then, was basically loss making from 1985 to 1995. Profits followed in 1996 then floatation in 1999. So, DP Poland is at 1994 if we use the same timescale and they aim to be cashflow positive at the equivalent of 1997. Not that this is worth anything, but helps put DPP into context with the UK one which is people's natural comparator. People don't tend to realise the long, hard slog before DOM exploded.
DP Poland's sales are growing, albeit slowly in 2019, and stronger growth is forecast in 2020 and 2021.