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.