Domino's to Book Liability Charge in Third Quarter
September 28 2015 - 9:00AM
Dow Jones News
Domino's Pizza Inc. said it plans to refinance some of its debt
and that costs related to an increase in workers' compensation and
liability claims would cut into earnings in its most recently-ended
quarter.
The pizza chain said that while its claims activity for workers'
compensation and for automobile and general liabilities has been
fairly steady over the past several years, the company has seen a
recent rise in the frequency and severity of claims.
As a result, Domino's plans to take a $5.7 million pretax charge
in the third quarter ended Sept. 6, which should trim about six
cents from its per-share earnings. Analysts polled by Thomson
Reuters were expecting Domino's to report 75 cents a share in
adjusted earnings for the period.
Domino's also reported strong sales growth for the third
quarter. The company said sales at domestic company-owned stores
grew 11.5%, while international sales grew 7.7%, excluding currency
impacts. The company expects to report full results Oct. 8.
Domino's has seen strong sales momentum in the U.S. lately,
while it also has pushed to grow its business overseas. In India,
for example, Domino's is one of the largest foreign-food chains,
working to stay on top by introducing products like spicy banana
pizza for local palates.
Separately, Domino's said some of its subsidiaries will issue
$1.5 billion in fixed-rate notes and use the proceeds to pay down
some $551 million worth of notes from its 2012
recapitalization.
Shares of Domino's, inactive premarket after an earlier halt,
are up 20% this year.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 28, 2015 08:45 ET (12:45 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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