(Reuters) -Domino’s Pizza Enterprises reported its maiden full-year loss on Wednesday since going public two decades ago, sending the Australian franchise operator’s shares down 20% in their steepest decline in nearly two months.
Shares of the franchise operator dropped to A$15.550, marking their lowest point since July 2. The stock was the worst performer in the ASX 200 benchmark index, which was trading largely flat, as of 0043 GMT.
Domino’s Pizza Enterprises (DMP), the brand’s biggest master franchise operator outside the United States, reported an annual loss of A$3.7 million ($2.40 million), a sharp decline from the profit of A$96 million recorded last year.
That compares with the Visible Alpha consensus of A$14.5 million profit.
On an underlying basis, annual profit slipped 4% to A$116.9 million, which also narrowly missed the Visible Alpha consensus of A$117.1 million.
The pizza chain operator also warned of a bleak start to the new financial year, with like-for-like sales declining 0.9% in the first seven weeks, in sharp contrast with the growth expectations of 3.1% in the first six months of the year.
DMP has been hit hard by ongoing weak performance in two of its key markets, Japan and France, with store closures in the latter significantly impacting its bottom line.
Waning post-pandemic demand and rising input costs in Japan further squeezed its profit in one of its biggest markets.
Earlier this year, the pizza chain operator closed 233 loss-making stores in the East Asian country.
“France continued to fall well short of expectations this year, with 32 store closures, softer sales, network-wide margin pressures,” the company said.
According to the company’s website, Domino’s currently operates 773 stores in Japan and 435 outlets in France.
($1 = 1.5389 Australian dollars)
(Reporting by Rajasik Mukherjee; Editing by Sherry Jacob-Phillips)