Domino’s Australia axes discounts after 2025 full-year loss
The group reported a loss of $3.7m for FY2025.
Domino’s Pizza Enterprises (DPE) plans to reduce discount-led marketing strategies as part of its new value creation model after it reported a statutory net profit after tax (NPAT) loss of $3.7m for FY2025, a 104% decrease compared to a growth of $92.3m last year.
Network sales were down 0.9% compared to last year. Revenue was down 3.1% whilst underlying earnings before income tax (EBIT) were at $198.1m, down 4.6%.
The value creation model is part of DPE’s ‘Recipe for Growth’ plan. Early transitions of the value creation strategy is already underway in Japan and France.
The strategy also calls for targeted market actions following a strategic review and improving the effectiveness of marketing spend by achieving higher working media through cost efficiencies
For the second phase of the plan, DPE said it will accelerate growth by increasing local accountability. The company will implement a strategic reset to improve unit economics by simplifying operations, improving execution, and sharing savings from marketing and IT initiatives with franchisees. Spending will be aligned to high-value activities, with non-essential costs cut.
Stronger unit economics are expected to support store network expansion by improving franchisee returns. DPE also plans to enhance portfolio profitability by reinforcing its core business, streamlining for efficiency, improving marketing effectiveness, and selectively extending its proposition under the “Recipe for Growth” framework.
Meanwhile, DPE also plans to close unprofitable stores and strengthen procurement discipline in a bid to protect margins and improve franchisee returns.
Early this year, Domino’s closed 205 restaurants, 172 of these in Japan.
The brand is also planning to cut down on selling, general, and administrative expenses and redistribute it towards digital and working media to accelerate conversion and boost sales.
The news follows the departure of CEO and managing director Mark Van Dyck and the appointment of Jack Cowin as interim executive chairman.
“The Board acknowledges the Company hasn’t delivered the results we wanted in recent years. We take full responsibility and are focused on restoring shareholder confidence through a clear, disciplined plan to improve returns and long-term value,” Cowin said in a statement.
