Domino's Pizza® Announces Fourth Quarter and Fiscal 2020 Financial Results
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Domino's Pizza® Announces Fourth Quarter and Fiscal 2020 Financial Results

  • Global retail sales growth (excluding foreign currency impact and 53rd week impact) of 12.0% for the fourth quarter; 10.4% for fiscal 2020
  • U.S. same store sales growth of 11.2% for the fourth quarter; 11.5% for fiscal 2020
  • International same store sales growth of 7.3% for the fourth quarter; 4.4% for fiscal 2020
  • Global net store growth of 388 for the fourth quarter; 624 for fiscal 2020
  • Diluted EPS up 23.4% to $3.85 for the fourth quarter; up 29.6% to $12.39 for fiscal 2020
  • Company announces new two- to three-year outlook

ANN ARBOR, Mich., Feb. 25, 2021 // PRNewswire // - Domino's Pizza, Inc. (NYSE: DPZ), the largest pizza company in the world based on global retail sales, announced results for the fourth quarter and fiscal 2020, comprised of growth in global retail sales, same store sales and earnings per share. Global retail sales increased 21.7% in the fourth quarter, or 20.9% excluding the positive impact of foreign currency. Global retail sales increased 12.5% in fiscal 2020, or 13.2% excluding the negative impact of foreign currency. Global retail sales were benefited in the fourth quarter and fiscal 2020 by the inclusion of an extra, or 53rd week. Global retail sales increased 12.0% in the fourth quarter, excluding the positive impact of foreign currency and the impact of the 53rd week. Global retail sales increased 10.4% in fiscal 2020 excluding the negative impact of foreign currency and the positive impact of the 53rd week.

U.S. same store sales grew 11.2% during the quarter and 11.5% for the full year, continuing the positive sales momentum in the Company's U.S. stores business. The international business also posted positive results, with same store sales growth of 7.3% during the quarter and 4.4% for the full year. The fourth quarter marked the 108th consecutive quarter of international same store sales growth and the 39th consecutive quarter of U.S. same store sales growth. The Company had strong fourth quarter global net store growth of 388 stores, comprised of 116 net U.S. store openings and 272 net international store openings. In fiscal 2020, the Company had 624 net store openings, comprised of 229 net U.S. store openings and 395 net international store openings.

Fourth quarter diluted EPS was $3.85, up 23.4% over the prior year quarter. Fiscal 2020 diluted EPS was $12.39, up 29.6% over the prior year. Diluted EPS for both the fourth quarter and fiscal 2020 was positively impacted by the inclusion of the 53rd week, and diluted EPS for both the fourth quarter and fiscal 2019 was negatively impacted by expenses associated with the Company's November 2019 recapitalization transaction (the "2019 Recapitalization"). Fourth quarter diluted EPS, as adjusted, was $3.46, up 10.5% over the prior year quarter diluted EPS, as adjusted, of $3.13. Fiscal 2020 diluted EPS, as adjusted, was $12.01, up 25.5% over the prior year diluted EPS, as adjusted, of $9.57. Refer to the Financial Results Comparability and the Comments on Regulation G sections below for additional information.

During the fourth quarter of 2020, the Company repurchased and retired 567,807 shares of its common stock in open market repurchases under its Board of Directors-approved share repurchase program for approximately $225.0 million. Subsequent to the fourth quarter and through February 18, 2021, the Company repurchased and retired an additional 65,870 shares of common stock for a total of approximately $25.0 million. On February 24, 2021, the Company's Board of Directors authorized a new share repurchase program to repurchase up to $1.0 billion of the Company's common stock. This repurchase program replaces the remaining availability of approximately $76.6 million under the Company's previously approved $1.0 billion share repurchase program.

On February 24, 2021, the Company's Board of Directors declared a quarterly dividend of $0.94 per common share payable on March 30, 2021 to shareholders of record at the close of business on March 15, 2021. This represents an increase of 20.5% over the previous quarterly dividend amount.

"We celebrated our 60th year as a company in 2020, and while it was a challenging year in so many ways, it was also a year that saw the Domino's brand rise to the occasion all over the world," said Ritch Allison, Domino's Chief Executive Officer.  "We led with our values first and delivered an outstanding year of growth and financial performance.  This past year, a year like none other, reminded me once again that Domino's has the best group of global franchisees and team members in the restaurant business."

Fourth Quarter and Fiscal 2020 Highlights:

 

(dollars in millions, except per share data)

 

Fourth

Quarter of

2020

   

Fourth

Quarter of

2019

   

Fiscal

2020

   

Fiscal

2019

 

Net income

 

$

151.9

   

$

129.3

   

$

491.3

   

$

400.7

 

Weighted average diluted shares

   

39,463,552

     

41,422,831

     

39,640,791

     

41,923,062

 

Diluted EPS

 

$

3.85

   

$

3.12

   

$

12.39

   

$

9.56

 

Items affecting comparability (1)

   

(0.39)

     

0.01

     

(0.38)

     

0.01

 

Diluted EPS, as adjusted (1)

 

$

3.46

   

$

3.13

   

$

12.01

   

$

9.57

 
   

(1)

   Refer to the Financial Results Comparability and the Comments on Regulation G sections below for additional information.

 

  • Revenues increased $206.2 million, or 17.9%, in the fourth quarter of 2020. This increase was primarily due to higher U.S. and international retail sales resulting from same store sales growth and an increase in store counts during the trailing four quarters, resulting in higher supply chain, U.S. and international franchise and U.S. Company-owned stores revenues. The 53rd week in 2020 contributed an estimated $88.4 million to the increase in revenues.
  • Net Income increased $22.6 million, or 17.5%, in the fourth quarter of 2020. This increase was driven by higher income from operations resulting from increased U.S. and international franchise revenues as well as higher supply chain volumes. The 53rd week in the fourth quarter of 2020 had an estimated $15.2 million positive impact on net income. These increases in net income were partially offset by higher variable performance-based compensation expense and professional fees, as well as COVID-related costs, including additional compensation and enhanced sick pay for frontline workers.
  • Diluted EPS was $3.85 for the fourth quarter of 2020 versus $3.12 in the prior year quarter. This represents a $0.73, or 23.4%, increase over the prior year quarter. Diluted EPS, as adjusted, was $3.46 for the fourth quarter versus $3.13 diluted EPS, as adjusted, in the prior year quarter. This represents a $0.33, or 10.5%, increase over the prior year quarter. The increase in diluted EPS was driven by higher net income, as well as a lower weighted average diluted share count, resulting from the Company's share repurchases during the trailing four quarters. Refer to the Financial Results Comparability and the Comments on Regulation G sections below for additional information.

The table below outlines certain statistical measures utilized by the Company to analyze its performance (unaudited). Refer to the Financial Results Comparability and the Comments on Regulation G sections below for additional information.

   

Fourth

Quarter of

2020

   

Fourth

Quarter of

2019

 

Fiscal

2020

 

Fiscal

2019

Same store sales growth: (versus prior year period)

                                 

U.S. Company-owned stores

   

+ 8.1

%

   

+ 3.9

%

   

+ 11.0

%

   

+ 2.8

%

 

U.S. franchise stores

   

+ 11.4

%

   

+ 3.3

%

   

+ 11.5

%

   

+ 3.2

%

 

U.S. stores

   

+ 11.2

%

   

+ 3.4

%

   

+ 11.5

%

   

+ 3.2

%

 

International stores (excluding foreign currency impact)

   

+ 7.3

%

   

+ 1.7

%

   

+ 4.4

%

   

+ 1.9

%

 
                                   

Global retail sales growth: (versus prior year period)

                                 

U.S. stores

   

+ 22.8

%

   

+ 6.8

%

   

+17.6

%

   

+6.9

%

 

International stores

   

+ 20.7

%

   

+ 7.0

%

   

+ 7.5

%

   

+ 4.6

%

 

Total

   

+ 21.7

%

   

+ 6.9

%

   

+ 12.5

%

   

+ 5.7

%

 
                                   

Global retail sales growth: (versus prior year period,

   excluding foreign currency impact)

                                 

U.S. stores

   

+ 22.8

%

   

+ 6.8

%

   

+17.6

%

   

+6.9

%

 

International stores

   

+ 19.0

%

   

+ 8.4

%

   

+ 8.8

%

   

+ 9.0

%

 

Total

   

+ 20.9

%

   

+ 7.6

%

   

+13.2

%

   

+8.0

%

 
                                   

Global retail sales growth: (versus prior year period,

   excluding foreign currency impact and 53rd week impact)

                                 

U.S. stores

   

+ 14.3

%

   

+ 6.8

%

   

+15.0

%

   

+6.9

%

 

International stores

   

+ 9.9

%

   

+ 8.4

%

   

+ 5.9

%

   

+ 9.0

%

 

Total

   

+ 12.0

%

   

+ 7.6

%

   

+10.4

%

   

+8.0

%

 
                                               

 

   

U.S. Company-

owned Stores

   

U.S. Franchise

Stores

   

Total

U.S. Stores

   

International

Stores

   

Total

 

Store counts:

                                       

Store count at September 6, 2020

   

348

     

5,891

     

6,239

     

11,017

     

17,256

 

Openings

   

15

     

103

     

118

     

328

     

446

 

Closings (1)

   

     

(2)

     

(2)

     

(56)

     

(58)

 

Store count at January 3, 2021

   

363

     

5,992

     

6,355

     

11,289

     

17,644

 

Fourth quarter 2020 net store growth

   

15

     

101

     

116

     

272

     

388

 

Fiscal 2020 net store growth

   

21

     

208

     

229

     

395

     

624

 
   

(1)

Temporary store closures are not treated as store closures and affected stores are included in the ending store count. Based on information reported to the Company by its master franchisees, the Company estimates that as of January 3, 2021, there were fewer than 150 international stores temporarily closed.

Two- to Three-Year Outlook

The Company also announced a new two- to three-year outlook for certain business metrics. The following two- to three-year outlook does not constitute specific earnings guidance.

 

Two- to Three-Year
Outlook

 

Global retail sales growth, excluding foreign currency impact

6% – 10%

 

Global net unit growth

6% – 8%

 
 

Financial Results Comparability

Financial results for the Company can be significantly affected by changes in our capital structure, our effective tax rate, adoption of new accounting pronouncements, store portfolio changes, calendar timing and other factors. Our recapitalization transactions have historically resulted in higher net interest expense due primarily to higher net debt levels, as well as the amortization of debt issuance costs associated with the repayment of certain of the Company's notes. Additionally, repurchases and retirements of shares of the Company's common stock pursuant to our share repurchase programs have historically reduced our weighted average diluted shares outstanding.

In addition to the above factors impacting comparability, the table below presents certain other items that affect comparability between the Company's 2020 and 2019 financial results (unaudited). Management believes that including such information is critical to an understanding of the Company's financial results for the fourth quarter of 2020 and fiscal year 2020 as compared to the same periods in 2019. Refer to the Comments on Regulation G sections below for additional information.

   

Fourth Quarter Ended January 3, 2021

   

Fiscal Year Ended January 3, 2021

 

(in thousands, except per share data)

 

Pre-tax

   

After-tax

   

Diluted EPS

Impact

   

Pre-tax

   

After-tax

   

Diluted EPS

Impact

 

2020 items affecting comparability:

                                               

Estimated 53rd week impact (1)

 

$

19,161

   

$

15,201

   

$

(0.39)

   

$

19,161

   

$

15,201

   

$

(0.38)

 

Total of 2020 items

 

$

19,161

   

$

15,201

   

$

(0.39)

   

$

19,161

   

$

15,201

   

$

(0.38)

 

 

   

Fourth Quarter Ended December 29, 2019

   

Fiscal Year Ended December 29, 2019

 

(in thousands, except per share data)

 

Pre-tax

   

After-tax

   

Diluted EPS

Impact

   

Pre-tax

   

After-tax

   

Diluted EPS

Impact

 

2019 items affecting comparability:

                                               

Recapitalization expenses:

                                               

General and administrative expenses (2)

 

$

(509)

   

$

(396)

   

$

(0.01)

   

$

(509)

   

$

(396)

   

$

(0.01)

 

Total of 2019 items

 

$

(509)

   

$

(396)

   

$

(0.01)

   

$

(509)

   

$

(396)

   

$

(0.01)

 
   

(1)

Represents the estimated impact of the 53rd week in the fourth quarter and fiscal year 2020.

(2)

Represents legal, professional and administrative fees incurred in connection with the 2019 Recapitalization.


Investment in Dash Brands Ltd. 

During the second quarter of 2020, a subsidiary of the Company acquired a non-controlling interest in Dash Brands Ltd. ("Dash Brands"), for $40.0 million. Dash Brands is a privately-held company that, through its subsidiaries, serves as the Company's master franchisee in China that owns and operates Domino's Pizza stores in that market. In the first quarter of 2021, the Company consummated its second investment of $40.0 million in Dash Brands based on Dash Brands' achievement of certain performance conditions.

Share Repurchases

During the fourth quarter of 2020, the Company repurchased and retired 567,807 shares of its common stock in open market repurchases under its Board of Directors-approved share repurchase program for approximately $225.0 million. As of January 3, 2021, the Company's total remaining authorized amount for share repurchases under such program was approximately $101.6 million. Subsequent to the fourth quarter and through February 18, 2021, the Company repurchased and retired an additional 65,870 shares of common stock for approximately $25.0 million.

On February 24, 2021, the Company's Board of Directors authorized a new share repurchase program to repurchase up to $1.0 billion of the Company's common stock. This repurchase program replaces the remaining availability of approximately $76.6 million under the Company's previously approved $1.0 billion share repurchase program.

Liquidity

As of January 3, 2021, the Company had approximately:

  • $168.8 million of unrestricted cash and cash equivalents;
  • $4.12 billion in total debt; and
  • $157.5 million of available borrowing capacity under its 2019 Variable Funding Notes, net of letters of credit issued of $42.5 million.

Net cash provided by operating activities was $592.8 million during fiscal year 2020. The Company invested $88.8 million in capital expenditures during fiscal 2020. Free cash flow, as reconciled below to net cash provided by operating activities, as determined under accounting principles generally accepted in the United States of America ("GAAP"), was approximately $504.0 million during fiscal year 2020. Refer to the Comments on Regulation G sections below for additional information.

(in thousands)

 

Fiscal year ended

January 3, 2021

 

Net cash provided by operating activities

 

$

592,794

 

Capital expenditures

   

(88,768)

 

Free cash flow

 

$

504,026

 

Comments on Regulation G

In addition to the GAAP financial measures set forth in this press release, the Company has included non-GAAP financial measures within the meaning of Regulation G, including free cash flow metrics and measures related to items affecting comparability between fiscal quarters and other fiscal periods such as diluted EPS, as adjusted. The Company has also included metrics such as global retail sales, global retail sales growth, global retail sales growth, excluding foreign currency impact, global retail sales growth excluding foreign currency impact, and 53rd week impact and same store sales growth, which are commonly used statistical measures in the quick-service restaurant industry that are important to understanding Company performance.

The Company uses "Global retail sales" to refer to total worldwide retail sales at Company-owned and franchise stores. The Company believes global retail sales information is useful in analyzing revenues because franchisees pay royalties and advertising fees that are based on a percentage of franchise retail sales. The Company reviews comparable industry global retail sales information to assess business trends and to track the growth of the Domino's Pizza® brand. In addition, supply chain revenues are directly impacted by changes in franchise retail sales. Retail sales for franchise stores are reported to the Company by its franchisees and are not included in Company revenues. "Global retail sales growth" is calculated as the change of U.S. Dollar global retail sales against the comparable period of the prior year. "Global retail sales growth, excluding foreign currency impact" is calculated as the change of international local currency global retail sales against the comparable period of the prior year. "Global retail sales growth, excluding foreign currency impact and 53rd week impact" is calculated as the change of international local currency global retail sales against the comparable period of the prior year and excluding the global retail sales attributable to the Company's 53rd week.

The Company uses "Same store sales growth," which is calculated by including only sales from stores that also had sales in the comparable weeks of both years. International same store sales growth is calculated similarly to U.S. same store sales growth. Changes in international same store sales are reported excluding foreign currency impacts, which reflect changes in international local currency sales. The 53rd week in fiscal 2020 had no impact on reported same store sales growth amounts.

The Company uses "Diluted EPS, as adjusted," which is calculated as reported diluted EPS, adjusted for the items that affect comparability to the prior year periods. The most directly comparable financial measure calculated and presented in accordance with GAAP is diluted EPS. The Company believes that the diluted EPS, as adjusted, measure is important and useful to investors and other interested persons and that such persons benefit from having a consistent basis for comparison between reporting periods. The Company uses diluted EPS, as adjusted, to internally evaluate operating performance, to evaluate itself against its peers and in long-range planning. Additionally, the Company believes that analysts covering the Company's stock performance generally eliminate these items affecting comparability when preparing their financial models, when determining their published EPS estimates and when benchmarking the Company against its competitors.

The Company uses "Free cash flow," which is calculated as net cash provided by operating activities, less capital expenditures, both as reported under GAAP. The Company believes that the free cash flow measure is important to investors and other interested persons, and that such persons benefit from having a measure which communicates how much cash flow is available for working capital needs or to be used for repurchasing debt, making acquisitions, repurchasing common stock or paying dividends.

Safe Harbor Statement Under The Private Securities Litigation Reform Act Of 1995:

This press release contains various forward-looking statements about the Company within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act") that are based on current management expectations that involve substantial risks and uncertainties which could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. The following cautionary statements are being made pursuant to the provisions of the Act and with the intention of obtaining the benefits of the "safe harbor" provisions of the Act. These forward-looking statements generally can be identified by the use of words such as "anticipates," "believes," "could," "should," "estimates," "expects," "intends," "may," "will," "plans," "predicts," "projects," "seeks," "approximately," "potential," "outlook" and similar terms and phrases that concern our strategy, plans or intentions, including references to assumptions. These forward-looking statements address various matters including information concerning future results of operations and business strategy, our anticipated profitability, estimates in same store sales growth, the growth of our U.S. and international business, ability to service our indebtedness, our future cash flows, our operating performance, trends in our business and other descriptions of future events reflect the Company's expectations based upon currently available information and data. While we believe these expectations and projections are based on reasonable assumptions, such forward-looking statements are inherently subject to risks, uncertainties and assumptions. Important factors that could cause actual results to differ materially from our expectations are more fully described in our filings with the Securities and Exchange Commission, including under the section headed "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended January 3, 2021. Actual results may differ materially from those expressed or implied in the forward-looking statements as a result of various factors, including but not limited to: our substantial increased indebtedness as a result of the 2019 Recapitalization, 2018 Recapitalization, 2017 Recapitalization and 2015 Recapitalization and our ability to incur additional indebtedness or refinance or renegotiate key terms of that indebtedness in the future; the impact a downgrade in our credit rating may have on our business, financial condition and results of operations; our future financial performance and our ability to pay principal and interest on our indebtedness; our ability to manage difficulties associated with or related to the COVID-19 pandemic and the effects of COVID-19 on our business and supply chain; the effectiveness of our advertising, operations and promotional initiatives; the strength of our brand, including our ability to compete in the U.S. and internationally in our intensely competitive industry, including the food service and food delivery markets; the impact of social media and other consumer-oriented technologies on our business, brand and reputation; the impact of new or improved technologies and alternative methods of delivery on consumer behavior; new product, digital ordering and concept developments by us, and other food-industry competitors; our ability to maintain good relationships with and attract new franchisees and franchisees' ability to successfully manage their operations without negatively impacting our royalty payments and fees or our brand's reputation; our ability to successfully implement cost-saving strategies; our ability and that of our franchisees to successfully operate in the current and future credit environment; changes in the level of consumer spending given general economic conditions, including interest rates, energy prices and consumer confidence; our ability and that of our franchisees to open new restaurants and keep existing restaurants in operation; changes in operating expenses resulting from changes in prices of food (particularly cheese), fuel and other commodity costs, labor, utilities, insurance, employee benefits and other operating costs; the impact that widespread illness, health epidemics or general health concerns, severe weather conditions and natural disasters may have on our business and the economies of the countries where we operate; changes in foreign currency exchange rates; changes in income tax rates; our ability to retain or replace our executive officers and other key members of management and our ability to adequately staff our stores and supply chain centers with qualified personnel; our ability to find and/or retain suitable real estate for our stores and supply chain centers; changes in government legislation or regulation, including changes in laws and regulations regarding information privacy, payment methods and consumer protection and social media; adverse legal judgments or settlements; food-borne illness or contamination of products; data breaches, power loss, technological failures, user error or other cyber risks threatening us or our franchisees; the effect of war, terrorism, catastrophic events or climate change; our ability to pay dividends and repurchase shares; changes in consumer taste, spending and traffic patterns and demographic trends; actions by activist investors; changes in accounting policies; and adequacy of our insurance coverage. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur. All forward-looking statements speak only as of the date of this press release and should be evaluated with an understanding of their inherent uncertainty. Except as required under federal securities laws and the rules and regulations of the Securities and Exchange Commission, or other applicable law, we will not undertake, and specifically disclaim, any obligation to publicly update or revise any forward-looking statements to reflect events or circumstances arising after the date of this press release, whether as a result of new information, future events or otherwise. You are cautioned not to place undue reliance on the forward-looking statements included in this press release or that may be made elsewhere from time to time by, or on behalf of, us. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.

TABLES TO FOLLOW

 

Domino's Pizza, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(Unaudited)

   

Fiscal Quarter Ended

 
   

January 3,

2021

   

% of

Total

Revenues

   

December 29,

2019

   

% of

Total

Revenues

 

(In thousands, except per share data)

                               

Revenues:

                               

U.S. Company-owned stores

 

$

155,749

           

$

130,534

         

U.S. franchise royalties and fees

   

167,298

             

139,155

         

Supply chain

   

791,149

             

680,149

         

International franchise royalties and fees

   

89,555

             

76,830

         

U.S. franchise advertising

   

152,816

             

123,684

         

Total revenues

   

1,356,567

     

100.0

%

   

1,150,352

     

100.0

%

Cost of sales:

                               

U.S. Company-owned stores

   

121,591

             

98,652

         

Supply chain

   

699,712

             

604,412

         

Total cost of sales

   

821,303

     

60.5

%

   

703,064

     

61.1

%

Operating margin

   

535,264

     

39.5

%

   

447,288

     

38.9

%

General and administrative

   

138,404

     

10.2

%

   

119,653

     

10.4

%

U.S. franchise advertising

   

152,816

     

11.3

%

   

123,684

     

10.8

%

Income from operations

   

244,044

     

18.0

%

   

203,951

     

17.7

%

Interest expense, net

   

(54,479)

     

(4.0)

%

   

(46,681)

     

(4.1)

%

Income before provision for income taxes

   

189,565

     

14.0

%

   

157,270

     

13.6

%

Provision for income taxes

   

37,668

     

2.8

%

   

27,943

     

2.4

%

Net income

 

$

151,897

     

11.2

%

 

$

129,327

     

11.2

%

Earnings per share:

                               

Common stock – diluted

 

$

3.85

           

$

3.12

         

 

Domino's Pizza, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(Unaudited)

 
   

Fiscal Year Ended

 
   

January 3,

2021

   

% of

Total

Revenues

   

December 29,

2019

   

% of

Total

Revenues

 

(In thousands, except per share data)

                               

Revenues:

                               

U.S. Company-owned stores

 

$

485,569

           

$

453,560

         

U.S. franchise royalties and fees

   

503,196

             

428,504

         

Supply chain

   

2,416,651

             

2,104,936

         

International franchise royalties and fees

   

249,757

             

240,975

         

U.S. franchise advertising

   

462,238

             

390,799

         

Total revenues

   

4,117,411

     

100.0

%

   

3,618,774

     

100.0

%

Cost of sales:

                               

U.S. Company-owned stores

   

379,598

             

346,168

         

Supply chain

   

2,143,320

             

1,870,107

         

Total cost of sales

   

2,522,918

     

61.3

%

   

2,216,275

     

61.2

%

Operating margin

   

1,594,493

     

38.7

%

   

1,402,499

     

38.8

%

General and administrative

   

406,613

     

9.9

%

   

382,293

     

10.6

%

U.S. franchise advertising

   

462,238

     

11.2

%

   

390,799

     

10.8

%

Income from operations

   

725,642

     

17.6

%

   

629,407

     

17.4

%

Interest expense, net

   

(170,512)

     

(4.1)

%

   

(146,770)

     

(4.1)

%

Income before provision for income taxes

   

555,130

     

13.5

%

   

482,637

     

13.3

%

Provision for income taxes

   

63,834

     

1.6

%

   

81,928

     

2.3

%

Net income

 

$

491,296

     

11.9

%

 

$

400,709

     

11.1

%

Earnings per share:

                               

Common stock – diluted

 

$

12.39

           

$

9.56

         

 

Domino's Pizza, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

 
   

January 3,

2021

   

December 29,

2019

 

(In thousands)

               

Assets

               

Current assets:

               

Cash and cash equivalents

 

$

168,821

   

$

190,615

 

Restricted cash and cash equivalents

   

217,453

     

209,269

 

Accounts receivable, net

   

244,560

     

210,260

 

Inventories

   

66,683

     

52,955

 

Prepaid expenses and other

   

24,169

     

19,129

 

Advertising fund assets, restricted

   

147,698

     

105,389

 

Total current assets

   

869,384

     

787,617

 

Property, plant and equipment, net

   

297,364

     

242,881

 

Operating lease right-of-use assets

   

228,268

     

228,785

 

Other assets

   

172,152

     

122,809

 

Total assets

 

$

1,567,168

   

$

1,382,092

 

Liabilities and stockholders' deficit

               

Current liabilities:

               

Current portion of long-term debt

 

$

2,855

   

$

43,394

 

Accounts payable

   

94,499

     

111,101

 

Operating lease liabilities

   

35,861

     

33,318

 

Advertising fund liabilities

   

141,175

     

101,921

 

Other accrued liabilities

   

196,429

     

164,097

 

Total current liabilities

   

470,819

     

453,831

 

Long-term liabilities:

               

Long-term debt, less current portion

   

4,116,018

     

4,071,055

 

Operating lease liabilities

   

202,268

     

202,731

 

Other accrued liabilities

   

78,468

     

70,234

 

Total long-term liabilities

   

4,396,754

     

4,344,020

 

Total stockholders' deficit

   

(3,300,405)

     

(3,415,759)

 

Total liabilities and stockholders' deficit

 

$

1,567,168

   

$

1,382,092

 

 

Domino's Pizza, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 
   

Fiscal Year Ended

 
   

January 3,

2021

   

December 29,

2019

 

(In thousands)

               

Cash flows from operating activities:

               

Net income

 

$

491,296

   

$

400,709

 

Adjustments to reconcile net income to net cash provided by operating activities:

               

Depreciation and amortization

   

65,038

     

59,930

 

Loss on sale/disposal of assets

   

2,922

     

2,023

 

Amortization of debt issuance costs

   

5,526

     

4,748

 

Provision (benefit) for deferred income taxes

   

14,424

     

(3,297)

 

Non-cash equity-based compensation expense

   

24,244

     

20,265

 

Excess tax benefits from equity-based compensation

   

(60,364)

     

(25,735)

 

Provision for losses on accounts and notes receivable

   

2,134

     

1,195

 

Changes in operating assets and liabilities

   

18,797

     

47,120

 

Changes in advertising fund assets and liabilities, restricted

   

28,777

     

(10,008)

 

Net cash provided by operating activities

   

592,794

     

496,950

 

Cash flows from investing activities:

               

Capital expenditures

   

(88,768)

     

(85,565)

 

Purchase of investments

   

(40,000)

     

 

Proceeds from sale of assets

   

174

     

12,258

 

Maturities of advertising fund investments, restricted

   

     

50,152

 

Other

   

(333)

     

(4,699)

 

Net cash used in investing activities

   

(128,927)

     

(27,854)

 

Cash flows from financing activities:

               

Proceeds from issuance of long-term debt

   

158,000

     

675,000

 

Repayments of long-term debt and finance lease obligations

   

(202,058)

     

(92,085)

 

Proceeds from exercise of stock options

   

30,970

     

13,064

 

Purchases of common stock

   

(304,590)

     

(699,007)

 

Tax payments for restricted stock upon vesting

   

(6,803)

     

(5,951)

 

Payments of common stock dividends and equivalents

   

(121,925)

     

(105,715)

 

Cash paid for financing costs

   

     

(8,098)

 

Net cash used in financing activities

   

(446,406)

     

(222,792)

 

Effect of exchange rate changes on cash

   

761

     

201

 

Change in cash and cash equivalents, restricted cash and cash equivalents

   

18,222

     

246,505

 
                 

Cash and cash equivalents, beginning of period

   

190,615

     

25,438

 

Restricted cash and cash equivalents, beginning of period

   

209,269

     

166,993

 

Cash and cash equivalents included in advertising fund assets, restricted,

   beginning of period

   

84,040

     

44,988

 

Cash and cash equivalents, restricted cash and cash equivalents and

   cash and cash equivalents included in advertising fund assets, restricted,

   beginning of period

   

483,924

     

237,419

 
                 

Cash and cash equivalents, end of period

   

168,821

     

190,615

 

Restricted cash and cash equivalents, end of period

   

217,453

     

209,269

 

Cash and cash equivalents included in advertising fund assets, restricted,

   end of period

   

115,872

     

84,040

 

Cash and cash equivalents, restricted cash and cash equivalents and cash and

   cash equivalents included in advertising fund assets, restricted,

   end of period

 

$

502,146

   

$

483,924

 

SOURCE Domino's Pizza, Inc.

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