Business

Aug 18, 2017

Former market darling Domino’s low on dough

Domino's pizza has transformed from a corporate darling into somewhat of a disappointment. What led to the fast food turnaround?

Adam Schwab — Business director and commentator

Adam Schwab

Business director and commentator

domino's

Well, that escalated quickly. In the space of a week, the CEO of Australia's largest company has announced he'll resign and a former market darling has turned into a villain. The share price of Domino’s, which only two years ago was valued at around $8 billion by the market, has fallen by almost 50%, wiping around $800 million from the wealth of its chairman, “Hungry” Jack Cowin, and $100 million from the bank balance of CEO Don Meij. On Tuesday alone more than 20% or $1 billion was wiped from the high-tech pizza franchisor’s market capitalisation.

The cause of Domino’s rapid fall was a worse-than-expected profit announcement, with Meij telling investors that the company would grow earnings by only 28% in 2017. While most companies would give their right leg for that sort of growth, Domino’s announcement went down about as well as a salmonella-laced Hawaiian pizza for numerous reasons.

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4 comments

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4 thoughts on “Former market darling Domino’s low on dough

  1. rumtytum

    Could the writer of this sentence: “Aside from the dubious earnings number, the key issue facing Domino’s is the viability of its model going forward. ”
    please tell me what the viability of its model would be going backward?

    1. Woopwoop

      “Going forward” is bizspeak for “in future”. Do try to keep up.

      1. rumtytum

        I thought I was supposed to “reach out” going forward, but tell me, how much sense does it make to use “going forward”, or “in the future” or any other equivalent term? Could you tell me about the viability of the business model “going backward”? My point, which I’m insufficiently businesslike to make in a form that’s understood by you, is that “going forward” is not just superfluous, but nonsensical. Does that make business sense?

      2. AR

        Re garbled text & typos, the score for cReiky today is at least 4, mostly curse of W/P as phrases are moved about but syntax not altered to suit.
        I don’t read some sections, like the TV ratings, so there may be more.

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