Domino's 1Q net income up, tops expectations

ANN ARBOR (AP) -- Domino's Pizza Inc.'s fiscal fourth-quarter net income rose 28 percent as sales improved in the U.S. and abroad. The pizza chain's earnings beat Wall Street's expectations and its stock rose almost 5 percent in premarket trading. Domino's reported Tuesday that its net income rose to $30.9 million, or 52 cents per share, for the period ended Jan. 1, up from $24.2 million, or 39 cents per share, a year ago. The latest earnings topped analysts' average estimate of 49 cents per share, according to a FactSet survey. Domino's stock gained $1.62, or 4.8 percent, to $35.16 in premarket trading. Revenue rose 5 percent to $501.7 million from $480 million, but that was short of Wall Street's estimate of $514.1 million. Revenue at U.S. stores open at least a year jumped 6.8 percent, while the figure rose 4.7 percent overseas. This metric is a key indicator of a restaurant operator's health because it excludes results from stores recently opened or closed. Domino's Pizza said its full-year earnings rose 20 percent to $105.4 million, or $1.71 per share, from $87.9 million, or $1.45 per share, in the prior year. Annual revenue increased 5 percent to $1.65 billion from $1.57 billion. Revenue at U.S. stores open at least a year rose 3.5 percent and gained 6.8 percent abroad. Domino's raised the high end of its long-term guidance for revenue at international locations open at least a year. The Ann Arbor, Mich., chain expects a 3 percent to 6 percent increase, compared with a previous forecast for a 3 percent to 5 percent rise. The company maintained its long-term outlook for revenue at U.S. stores open at least a year to be up 1 percent to 3 percent. Domino's also said Tuesday that some of its subsidiaries plan to refinance outstanding debt. The company said in April 2007 that some of its subsidiaries entered a $1.85 billion securitized financing facility. The outstanding securitized debt balance was $1.45 billion as of Jan. 1. Domino's said it plans to replace this facility with a new one that will likely include about $1.48 billion fixed rate notes and $200 million variable funding notes. The original facility included $1.7 billion fixed rate notes and $150 million of variable funding notes. The new facility's proceeds will help repay the 2007 notes fully and be used for general corporate purposes such as a special dividend and buybacks. The notes offering is expected to close in the first quarter. Domino's had 9,742 franchised and company-owned stores in the U.S. and more than 70 international markets as of the fourth quarter. Published: Wed, Feb 29, 2012