LONDON, UK / ACCESSWIRE / October 17, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Domino's Pizza, Inc. (NYSE: DPZ), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=DPZ, following the Company's posting of its third quarter fiscal 2017 operating results on October 12, 2017. The biggest US pizza delivery chain outperformed top- and bottom-line expectation and notched its 26th consecutive quarter of positive sales growth in its domestic business, while it also recorded its 95th consecutive quarter of positive international same-store sales growth. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Earnings Reviewed

For the quarter ended September 10, 2017, Domino's revenues grew 13.6% to $643.64 million versus revenues of $566.68 million in Q3 FY16, driven by higher supply chain revenues from increased volumes. The Company noted that higher same-store sales and store count growth in its domestic and international markets also contributed to the increase in revenues. Domino's revenue numbers topped analysts' expectations of $627.4 million.

During Q3 FY17, Domino's consolidated operating margin, as a percentage of revenue increased to 30.8% from 30.7% in the prior year's same quarter, driven by the Company's global franchise business. The operating margin in Domino's Company-owned stores decreased to 23.1% from 23.5% driven primarily by increased labor rates. The Company's supply chain operating margin decreased to 10.9% from 11.1%, driven primarily by increased labor and delivery costs.

For Q3 FY17, Domino's Pizza's net income jumped 19.3% to $56.37 million versus earnings of $47.23 million in Q3 FY16, primarily driven by an increase in same-store sales growth and store count as well as higher supply chain volumes. The adoption of the new equity-based compensation accounting standard also positively impacted net income. These increases were partially offset by higher general and administrative expenses, primarily from investments in technological initiatives.

Domino's diluted EPS was $1.18 for Q3 FY17 versus $0.96 in Q3 FY16, representing a 22.9% increase on a y-o-y basis. Management noted that the as-reported diluted EPS for the reported quarter was negatively impacted by expenses related to the Company's recapitalization. The Company's adjusted diluted EPS for the reported quarter surged 32.3% to $1.27 compared to $0.96 in the prior year's same quarter. Domino's adjusted EPS exceeded Wall Street's estimates for earnings of $1.22 per share.

Store Update

During Q3 FY17, Domino's domestic same-store sales grew 8.4% on a y-o-y basis; this represents the 26th consecutive quarter of positive sales momentum in the Company's domestic business. Domino's international same-store sales advanced 5.1% during the reported quarter, marking the 95th consecutive quarter of positive international same-store sales growth.

The Company had global net store growth of 217 stores in Q3 FY17, comprising of 53 net new domestic stores, consisting of 55 store openings and two closures and 164 net new stores internationally. Domino's has added 1,182 net new stores over the trailing four quarters.

Recapitalization

On July 24, 2017, Domino's completed its recapitalization with the receipt of $1.9 billion of gross proceeds. The Company borrowed $1.6 billion of fixed-rate senior secured notes and $300.0 million of floating rate senior secured notes and entered into a new $175.0 million variable funding note facility, replacing its previous $125.0 million variable funding note facility. Domino's used a portion of the proceeds from the recapitalization to repay the remaining $910.5 million in outstanding principal and interest under its 2012 fixed rate notes on July 27, 2017.

Share Repurchase Program

Domino's Board of Directors authorized a new share repurchase program, which allows the Company to repurchase up to $1.25 billion of its common stock. The newly announced repurchase program replaced the remaining availability of approximately $136.4 million under the Company's previously approved $250.0 million share repurchase program. As part of the $1.25 billion share repurchase program, Domino's entered into a $1.0 billion Accelerated Share Repurchase (ASR) agreement with a counterparty, this was completed subsequent to the reported quarter.

In connection with the ASR agreement, Domino's will receive and retire a total of 5.22 million shares of its common stock at an average price of $191.62, including 4.56 million shares of its common stock received and retired during Q3 FY17. As of October 12, 2017, the Company had authorization for repurchases of $250.0 million remaining under its open market share repurchase program.

Furthermore, the Company's Board of Directors declared a $0.46 per share quarterly dividend for shareholders of record as of December 15, 2017, to be paid on December 29, 2017.

Stock Performance

On Monday, October 16, 2017, the stock closed the trading session at $193.19, slightly up 0.11% from its previous closing price of $192.98. A total volume of 1.98 million shares have exchanged hands, which was higher than the 3-month average volume of 1.22 million shares. Domino's Pizza's stock price rallied 9.38% in the past six months and 27.84% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have surged 21.32%. The stock is trading at a PE ratio of 38.42 and has a dividend yield of 0.95%. The stock currently has a market cap of $9.71 billion.

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