Domino’s took just six weeks to decide it was going to quit Europe (Photo: Steve Ryan Photography / Domino’s)
As UK MPs prepare to vote on the latest Brexit deal, pizza group Domino’s is set to make a far quicker withdrawal from Europe after a disappointing performance in its foreign markets.
Outgoing chief executive David Wild said that a review, which took just six weeks, had concluded Domino’s would be better off selling its European business, which stretches across Iceland, Norway, Sweden and Switzerland.
“We have concluded that, whilst they represent attractive markets, we are not the best owners of these businesses. The board has therefore decided to exit the markets in an orderly manner,” he said.
It comes as sales in the European markets dropped 2.7 per cent to £25.2m.
Complex withdrawal deal
Wayne Brown, an analyst at Liberum, said the international exit was “likely to be complex”, but it will allow the firm to refocus on its UK and Ireland operation, which also faces challenges as a dispute with store operators drags on.
In May the company said it was holding an “open and ongoing dialogue” with its franchisees after they protested against a falling share of the profits they make for Domino’s. The dispute has disrupted plans to open new stores across the country.
Mr Wild said: “Normal working practices continue to be impacted by our franchisee dispute. As we said at our interim results, this situation is complex and we expect a resolution to take time, certainly into 2020. We remain committed to working with our franchisees to agree sustainable win-win solutions.”Read MorePound and FTSE 100 shares stumble as Brexit optimism fades
Search for new leader
Meanwhile, Domino’s is continuing its hunt for a new boss with Mr Wild, who has led the pizza delivery chain since 2014, set to step down.
The company, which has also kicked off a process to find a new chair, said its UK sales grew faster in the third quarter by 3 per cent, from 2.2 per cent in the same period last year. It comes as UK and Ireland sales reached £288.2m, a 3.9 per cent increase.
The group was also hit by competition from new players, notably Deliveroo and Uber Eats, which have eaten into a delivery market traditionally dominated by pizza.