for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Markets News

UPDATE 1-DP Eurasia earnings slump on Russia, coronavirus costs

(Adds details)

Sept 8 (Reuters) - DP Eurasia, which runs Domino’s Pizza brand in Turkey and Russia, reported a 74% fall in first-half core profit on Tuesday as the coronavirus pandemic hit its Russian operations and boosted costs.

The London-listed company said it saw its business returning back to pre-pandemic levels in its main market Turkey, where the reopening came sooner than in Russia.

However, much heavier restrictions in Moscow, including a 72-day curfew, and a stiffening competition from food delivery providers, dented margins in Russia to negative 10.5% from 4.9%.

DP said it saw 27.5% like‐for‐like growth Turkey in July and August, while the decline in Russia has slowed to 10.9% compared to a 20.1% slump in the first half.

Restaurants are one of the hardest hit sectors from the health crisis as stay-at-home and social distancing orders have stopped customers from dining out.

Its adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), excluding the effect of the IFRS 16 accounting standards, slumped to 12.1 million Turkish lira ($1.62 million) from 46.4 million lira a year before, hit by 8.6 million lira of COVID-related cots.

The coronavirus pandemic has put brakes on its rapid growth, with DP Eurasia saying it closed 11 stores net in the first half, compared to an average of 65 stores it has been opening a year between 2011 and 2019.

The group repeated that it could not provide a detailed guidance for this year given the uncertainty about the impact of the coronavirus pandemic on its markets.

DP also said it has brought Andrew Rennie, a 25-year Domino’s veteran, as board advisor.

$1 = 7.4582 liras Reporting by Anna Pruchnicka; Editing by Tomasz Janowski

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up