Domino’s Pizza(DPZ) - 2025 Q3 - Quarterly Results

Financial Performance - Total revenues for Q3 2024 increased by $52.8 million, or 5.1%, to $1,080.1 million compared to Q3 2023[5] - Income from operations rose by $9.4 million, or 5.0%, to $198.8 million in Q3 2024, with a 5.7% increase when excluding the negative impact of foreign currency exchange rates[5] - Diluted earnings per share (EPS) increased by $0.01, or 0.2%, to $4.19 in Q3 2024 despite a slight decrease in net income[6] - Net income for the quarter was $146,924, slightly down from $147,676 in the previous year, resulting in a net income margin of 13.6% compared to 14.4%[19] - The gross margin improved to 39.2% for the quarter, up from 38.8% in the same quarter last year, indicating better cost management[19] - For the three fiscal quarters ended September 8, 2024, total revenues were $3,262,502, a 6.0% increase from $3,076,386 in the prior year[20] - The company reported a net income of $414,726 for the three quarters, up from $361,826, achieving a net income margin of 12.7% compared to 11.8%[20] Cash Flow and Capital Expenditures - Free cash flow for the three fiscal quarters of 2024 was $376.1 million, up from $362.9 million in the same period of 2023[6] - Net cash provided by operating activities was $446,879, up from $422,130, reflecting a growth of 5.9% year-over-year[22] - Capital expenditures increased to $70,801 from $59,271, representing an increase of 19.5%[22] - Net cash used in investing activities was $71,895, compared to $60,014, indicating a rise of 19.8%[22] - Net cash used in financing activities decreased to $312,998 from $337,194, a reduction of 7.1%[22] - Cash and cash equivalents at the end of the period were $189,084, significantly higher than $80,879 at the end of the previous year[22] - The total cash and cash equivalents, including restricted cash, at the end of the period was $464,530, compared to $419,822, showing an increase of 10.6%[22] Store Growth and Sales Performance - Global retail sales growth (excluding foreign currency impact) was 5.1% in Q3 2024, with U.S. same store sales growth at 3.0% and international same store sales growth at 0.8%[1] - Net store growth globally was 72 in Q3 2024, with 24 net new stores in the U.S. and 48 internationally[4] - The company anticipates continued growth in same store sales and net store growth, driven by its strategic initiatives and market expansion plans[17] - Same store sales growth for international markets was reported excluding foreign currency impacts, indicating a focus on local currency performance[14] Shareholder Returns and Dividends - The company repurchased 443,302 shares for $190.0 million in Q3 2024, with a remaining authorized amount for share repurchases of $926.3 million[8] - A quarterly dividend of $1.51 per share was declared, payable on December 27, 2024[7] Tax and Leverage - The effective tax rate increased to 20.4% in Q3 2024 from 15.9% in Q3 2023, impacting net income[5] - The leverage ratio for the third quarter of 2024 was 4.9x, down from 5.5x in the same quarter of 2023[13] - The company reviews its leverage ratio quarterly to assess its capital structure and ability to meet financial obligations[12] Assets and Liabilities - Cash and cash equivalents increased to $189,084 as of September 8, 2024, from $114,098 at the end of December 31, 2023[21] - Total assets grew to $1,775,066 as of September 8, 2024, compared to $1,674,899 at the end of December 31, 2023[21] - The company’s long-term debt, less current portion, stood at $4,970,687 as of September 8, 2024, compared to $4,934,062 at the end of December 31, 2023[21] Other Financial Metrics - The total cost of sales for the quarter was $656,372, representing 60.8% of total revenues, a slight decrease from 61.2% in the previous year[19] - Interest expense, net, decreased to $(40,387) for the quarter, improving from $(42,089) in the same quarter last year[19] - The company experienced a provision for losses on accounts and notes receivable of $250, a decrease from $1,342, indicating improved receivables management[22] - The unrealized gain on investments was $(18,871), compared to $(13,267) in the previous year, reflecting a decline in investment performance[22] - Segment income for the third quarter of 2024 was $229.3 million, compared to $217.3 million in the third quarter of 2023, reflecting a year-over-year increase of approximately 5.8%[13] - Global retail sales for the trailing four quarters ended September 8, 2024, exceeded $18.9 billion[16] - The company generated over 85% of U.S. retail sales in 2023 through digital channels, showcasing the effectiveness of its digital ordering platforms[16] - The company has a significant franchise model, with independent franchise owners accounting for 99% of its stores as of the end of the third quarter of 2024[16] - The company has excluded the impact of the Russia market from its global retail sales growth metrics, considering the stores closed as of August 21, 2023[14]