Thanks for your attendance. I really appreciate it. As you know, my name's Andrew Rennie, CEO of DPG. Beside me is—oh, it's Richard Stuber. He's Edward Jamieson, our CFO. I want to give you our results this morning and then look forward to Q&A. First of all, I want to say thank you. Thank you to all my team and all our franchise partners and all the team members. We're about 40,000 team members in DPG now, and all their hard work is what's provided these numbers, which I'm very, very proud of. Really privileged to be part of a company and a brand that's 40 years old this year in the U.K. The brand is 65 years globally, but 40 years old in this country.
I think the one thing I'd sort of—the word I'd pick out, particularly in this crazy world at the moment, is how resilient this brand continues to be and this company is in the U.K., off the hard work of many, many franchisees and their team members over decades. My goal is that make sure that we've got a strong, robust business that continues to deliver for another 40 years at least. We're thinking about that every single day. It's not just about the here and now, but about the long-term success of this business. Okay, what do we do? First of all, we really focus on delivery. Our franchise partners and our team members really focus on the metrics, which I'll talk about later on in the presentation, that really help to underpin value for our customers.
Because at the end of the day, without that 71 million customers that we served last year, what do we have? We have nothing. We are always thinking about those customers. How do we make sure that we give better value every single day? Value is not just represented in price. It is represented in the quality of the product, which we are extremely proud of, and the quality of the service. Not many people can deliver 71 million orders in sort of 24.5 minute average delivery times. We have stores that are doing that on average in 18 minutes. It is quite incredible. As you know, we agreed a new five-year framework with our franchisees, no longer called the MOU. It is called the PGF, Profit Growth Framework, for a very good reason.
It's focused on driving profits for franchisees and for our business through growth, customer growth, and store growth. We're really proud of that. That creates stability and alignment with ourselves and our franchise partners, who are the backbone of this business. We've made really strong strategic progress with our corporate business in Ireland. One of our parameters we spoke about, I spoke about back in 2023, which I'll cover later in the presentation, is about focusing on the core. We're making money out of selling pizzas to customers like our franchisees do. We see a lot of upside in Ireland and the island of Ireland, and hence why we'll talk about later on our new acquisition or the increased shareholding in the Victa ownership in Northern Ireland there.
We've got great franchise partners in Ireland, and there's a lot more white space there than there is in the U.K. We really think we can drive that organic growth and be a bigger part of that success. We continue to have a disciplined approach to buying another business, another brand. We've got a really strong balance sheet. I'll talk more about that later on. At the end of the day, our secret sauce, we like to call it, are our people, our market position, which continues to grow even in these tough conditions. Our market share continues to grow quite significantly, particularly this last few months. Our franchise partners, they're the real differentiators that we have between, I think, many other brands.
I think of it this way: I'm steering this ship into some pretty strong headwinds this year, and this ship is in really good shape. 2024, we put in really good shape with lots of customer growth, and you saw it build each quarter by quarter. We've got a great crew, really strong, robust ship, and that's how we're going to navigate this next in 2025. I'll talk about that more soon, but first I'll hand over to Edward to talk about the numbers. Thanks very much.
Thank you, Andrew Rennie, and good morning, everybody. Our intense operational focus and our strategy is gaining traction. We're deploying capital effectively, and we're seeing attractive growth across key metrics. We finished 2024 with a strong balance sheet, important in this uncertain environment. I'm now going to run you through the key takeaways from our 2024 financial results and update you on our early trading outlook and guidance for the year ahead. In 2024, we delivered growth in order count, in like-for-like sales, in profits, and the dividend. Total system orders grew 1.7%, primarily driven by good performance in the delivery channel. Importantly, our like-for-like performance improved every quarter and was overall up 0.7% for the year. DPG's underlying EBITDA was up 6.4%, which flowed through to underlying earnings per share, which was up 13.3%, also benefiting from the lower share count.
Consistent with our progressive dividend policy, we have again increased the full-year dividend by 4.8%. This is supported by our robust free cash flow, which, while down versus last year, was flat after adjusting for working capital fluctuations. Let me now go through some of the drivers of these numbers in more detail. Turning to the next slide, on slide six, we have summarized the key data on system sales and order count. Starting on the left-hand side, you can see that our system sales and total order count were primarily driven by the delivery channel. The chart on the right-hand side shows how trading momentum accelerated throughout the year, with delivery orders growing for three consecutive quarters, a meaningful improvement after 10 consecutive quarters of declining volumes. Our collection order growth was still in growth for the overall year.
You can see how our like-for-like sales improved every quarter, and we finished the year well with Q4 like-for-like sales up 3% in what remains an uncertain environment. Andrew will cover the operational drivers of this improvement in more detail later in the presentation. Slide seven shows the year-on-year movements of system sales and DPG revenue. While system sales grew, DPG revenue was broadly flat, primarily driven by a decrease in our supply chain revenue. As I explained last year, food input prices fell in 2024. In line with our model, the benefit of these lower prices was passed through to our franchise partners. As we will see in a moment, this naturally had an impact on supply chain EBITDA as well.
Corporate stores' revenue was up, driven by the revenue from the acquisition of Shorecal in April, offset by the loss of revenue following the disposal of our corporate stores in London completed in July. Shorecal's performed well since we acquired control and in line with our expectations. EBITDA margin as a percentage of system sales was up 30 basis points to 9.1%, largely driven by the supply chain margin. Let's now look at the components of underlying EBITDA. Before I do so, let me point out we've moved to a fully allocated IFRS 16 reporting approach, and so some of the comparables have changed a little. Overall, DPG EBITDA was up 6.4% to GBP 143.4 million, with lower supply chain EBITDA more than offset by other factors, primarily growth in corporate store EBITDA and lower technology costs.
Once again, our supply chain operation delivered an outstanding performance with accuracy and availability stats of 99.97 in the year. Pete Trundley and his brilliant team continue to deliver for our franchise partners and for our customers, and I'd like to thank all of them for their hard work and effort last year. We continue to drive efficiencies in the supply chain, but we could not entirely offset the profit impact of lower revenue resulting from food price deflation. As with revenue, corporate store growth reflects the Shorecal acquisition and London store sale. As I've covered before, we've been investing substantially in the development of our technology platforms, in particular a new ERP and e-commerce system. With these programs largely complete, platform costs halved to GBP 4.4 million in FY2024.
Operationally, we've already rolled out our ERP system across half our supply chain centers and expect this will complete across the whole network by the end of H1. We expect to complete the full cutover to the new e-commerce platform in early H1. Moving to the income statement, EPS is up 13.3% based on a 6.4% increase in EBITDA, an 8.4% growth in PBT, and the benefit of a lower share count following the group's buyback activities. Looking at the line items, depreciation and amortization was GBP 3.2 million lower due to lower amortization charges from legacy IT systems. Finance costs increased GBP 3.5 million, driven by higher average levels of debt in the year, which I'll come to in a moment. Our effective tax rate has remained broadly stable at around 25.5%.
Turning next to free cash flow, a strong feature of our capital-light business and where, on an underlying basis, we again generated around GBP 100 million. The principal difference between FY2024 cash generation and the prior year was working capital. As I outlined at the results in August, there was a GBP 10.7 million outflow in H1, and as I guided, this mostly reversed in H2. Excluding the working capital swings, you can see that the group generated around GBP 100 million in each year. Non-underlying cash outflows in FY2024 were the corporation tax payable on the profit on sale of the London corporate stores and advisory costs from Shorecal. I'll now turn to how we deployed this cash generation, about how we invest, recycle, and return capital. We introduced the capital allocation framework in March 2021 and use it to make decisions on free cash flow deployment and our approach to leverage.
We continue to invest in the core business to drive long-term sustainable growth and to pay a progressive dividend to shareholders. We also continue to selectively invest in additional accretive growth opportunities, which we can partially fund through recycling capital. Finally, we assess if we have excess capital, considering our investment opportunities and leverage, and if we have, we return this to shareholders. Since 2021, we've announced nearly GBP 500 million of shareholder returns. We've increased dividends again today, and we remain committed to returning excess capital in the future. We do all of this within our target leverage range of 1.5-2.5 times. Let me now turn to how we deployed our capital in 2024. As I outlined earlier, we generated GBP 84.7 million of free cash flow in the year.
We're highly cash generative, and so we're able to both invest in the business and return to shareholders. The first priority is to invest in the core business, and to that end, we invested GBP 18.5 million in capital expenditure in the year, including the completion of work to expand our Irish supply chain center. Secondly, we paid dividends of GBP 42 million, reflecting our sustainable and progressive dividend policy, and we've grown dividends again. Combined with share buybacks executed in the year, we returned GBP 67.9 million to shareholders in 2024. Applying our disciplined approach to accretive investment and recycling capital, we spent GBP 27.1 million in the year. This comprised EUR 48.7 million in the Shorecal acquisition, GBP 11.4 million in the DP Poland stake, partially offset by a cash inflow from the disposal of the London corporate store estate.
The net effect was a GBP 32.7 million increase in net debt to GBP 265.5 million, giving leverage of 1.93 times, in the middle of the target range of one and a half to two and a half times, so a strong balance sheet position. Today, we've announced an additional accretive investment in our Northern Irish JV for GBP 25.6 million. This is a combination of GBP 7.2 million of equity and GBP 18.4 million of debt, and on a pro forma basis takes our leverage to around 2.1 times. This increases our shareholding in the JV from 46% to 70%, further enhancing our ability to drive growth in Ireland, and Andrew Rennie will cover this in more detail later. We've guided CapEx to be circa GBP 25 million in FY2025 as we continue to invest more in our system to support sustainable growth.
We see opportunities for further automation across our supply chain center, and we are accelerating projects across our existing centers to focus on this opportunity. When we announced the new profitability and growth framework with our franchise partners, we also announced that we plan to open a fifth U.K. supply chain center. CapEx spend on this this year is expected to be around GBP 5 million on the initial work and relates to increasing the distribution capacity of our network. We also plan to invest in the continued innovation of our app to drive frequency. Finally, there will be some new store CapEx in Shorecal as we unlock the growth opportunity. Moving to outlook and guidance, we made good strategic progress during 2024, with trading momentum accelerating as the year progressed.
In the first 10 weeks of the year, our growth has been positive, with total system sales up 2.4%, total orders up 0.7%, and like-for-like sales up 0.7%, despite the U.K., economic environment remaining uncertain. We expect FY25 underlying EBITDA to be in line with current market expectations, excluding the positive impact of the Victa investment. We expect Victa to contribute around GBP 3 million to underlying EBITDA this year. We'll be EPS neutral this year with earnings accretion next year. Our full technical guidance is laid out below. Thank you, and let me now pass you back to Andrew Rennie.
Thanks, Edward. These numbers here are the ones I'm particularly proud of if we look at the year that was. Purely by focusing on operations, really relentless focus on what we do every day, how we deliver to our customers. When you see that the delivery times of sub 25 minutes, with more than 80% of our orders delivered on time, the app orders going up another couple of points, the ecosystem of our universe of our customers inside our database growing, and franchisee but are continuing to grow even after a huge impost of the national living wage last year was huge, and our franchisee still managed to get over the top of that. Extremely proud of those numbers. If we go through to the next slide, the long-term growth in core business, right? As I said before, we've been around for 40 years.
We want to be around for another 40 years. We'll be crossing over 1,400 stores this year. We'll be exceeding those numbers. That's a huge milestone. There are not many brands that are more than 1,400 stores in the U.K., and Ireland. We continue to focus on these key four points: franchisee profitability, value for money for our customers, digital, and convenience. We will talk more about those now. They are consistent. They are the same focus. We are not changing strategy. It is the same strategy we have had now since I have been here. Value for money. If you look at these metrics here, this is part of the value equation.
When people can consistently get their orders on time, that means that they're hot and they're fresh, they taste better, and they're more likely to come back to you compared to other competitors who may not be so consistent with their delivery times, etc. This is not easy. These are best-in-class numbers globally, particularly when you're talking about the scale that we have. We work very hard for this. As I said before, we've got 40,000 dominoids. We call an army of dominoids around the country who every day wake up and are passionate about making sure that customers get an incredible service. From the outside, it probably looks easy, but when you think about 80% of our orders come in 20% of the time, you're talking about hundreds of orders over a two-hour window quite often.
In the rain, the snow, the hail, you name it, our guys just keep delivering and keep providing. It's one of our IPs, if you think about it, is that we've got 40 years of this inherent knowledge that's been built up. And we're people that are inside our business that have been there 30 plus years that have just been doing it over and over again. It really is part of our magic. Moving on to the next slide. We don't forget that every day we have to look after our customers. Without those customers, we don't have a business. We're constantly focused about how do we make sure that our customers are getting better value for money. Last year, we really focused on delivery service, and you saw massive momentum throughout the year. We're really proud of that, nearly 8% in order count growth in Q4.
This year, we're going to add the extra part of that lever. We've got two parts of the engine we can drive: delivery and collection. This year, we're going to start stoking up the fires in the collection engine as well because consumers are seeking out more value, and collection is a great value offering. Now, for franchisees, it's got great margins, so it actually wins for both sides, both the franchisees and for our customers. The thing that we have that's a competitive advantage for our business is that with almost 1,400 stores, we're really close to our customers. The proximity to them is a number one driver of a collection customer's decision process. By having so many points of sale, we are closer to the customers to be able to drive this part of the business, unlike others.
If you look at things like our £4 Lunch, it still continues to drive, particularly perception about value and the collection angle that we are going to drive more and more this year, which has been omnipresent. We are circa 35% collection orders. The U.S., are 55%. There is a massive delta there that we can pick up on and grow into, I believe. We move on to the next slide, digital acceleration. I think the key message here is, one, first phase one has worked really well. We are moving to phase two to 3 million customers in our database. What does this do for us? What it does is that loyalty widens that moat on our business, makes that even more tougher to penetrate our business because we have all these people inside our ecosystem. We have got 13 million customers in our database.
We can talk to them more frequently. We can reward them now. Having that knowledge allows us to drive incrementality in frequency. That is going in a really good direction. We are really proud of the team and the digital team and all the work they have done, the marketing team. The knowledge and the data we have is quite amazing, really, when you think about it. That is going in a really good direction. We will continue to step that up this year. Next slide. Convenience, as I said before, getting closer to our customers is really important, not only from a delivery perspective, but also it is really important from a collection perspective. There is still 15% of the U.K., and Ireland that is white space. Cannot get a Domino's Pizza delivered there at the moment. We still have all this growth to go into.
The small territories continue to outperform. We have franchisees that opened, in fact, one of our franchisees opened a store about three weeks ago, broke the national new store opening sales record. Hadn't been broken in 10 years in a tiny village, about half the size of our traditional stores. It just goes to show the pent-up demand of the brand in these small towns. We cannot wait to take the brand that these people have been waiting for for 40 years to their villages. We had 21 different franchise partners open those 54 stores last year. We have a broad spectrum of franchisees doing so. It is a good balance between splitting stores, carving out stores and getting closer to customers and giving better service and new territories. We have a strong pipeline for 2025.
Like most years, it's always more back-ended because it takes a while to get the hopper filled up. We feel pretty confident about that. The ROIs of the stores are incredible. That certainly drives it. This is all underpinned, of course, by that PGF we put into place that underpins that growth in that store count. If we come on to the next slide, we're fully rolled out Uber Eats now. We've got Uber Eats and Just Eat, who've been great partners, very incremental partners, very complementary to our business. Overall, it's a small but important part because it's the incrementality. We continue to work with them in a very positive way, and I think they're pretty happy with the relationship they've got with us as well. We will continue to work with those partners and keep to leverage and maximize those relationships.
If we go on to the next slide, all the hard work of the franchisees and all their team members provide these incredible market gains. If you look at across the last couple of years, we've opened over 115 stores where others have closed sort of similar amounts. That's not an accident, right? That's through many, many years of hard work, of great service, of consistent service, consistent value. We continue to grow market share. The last couple of months have been incredibly good market share gains for us as well. In a market that's tough and up and down and all over the place, we're winning. I think it sort of, again, speaks to the strength of the brand. Next slide. If we look at our business, what we're trying to do is build a larger, more cash-generative business.
As Edward said, we basically got GBP 100 million free cash flow. We want to continue to grow that. We continue to invest in the core, the island of Ireland strategy, we think is the right thing to do because we've got more growth we can help drive there. The PGF with the franchisees has created alignment with them and also stability for themselves and ourselves through the next five years and past and beyond. The focus on the core business, as I said, with Shorecal and the corporate store disposals, we're doing what we said we would do. The small investment in Poland, we said we wanted to just invest there and wait and see. We think that there's good upside there. We continue to be confident about that investment. We continue to recycle capital, and we'll continue to do so for shareholders' benefits. Next slide.
Again, same story. Long-term sustainable growth underpinned by the PGF, we believe. This target of 1,600 is not a pipe dream. And even 2,000, I don't think is a pipe dream. I will be here to come back and cut the ribbon on 2,000 stores. I'm determined to do that. It will happen. I really believe that because the brand is just so strong and so loved in this country, loved by not only our team, but loved by our customers. It's quite incredible. The amount of times we get pulled up in shops and I get stories from people of my age talking about how they're Domino's converts and now their teenage children sort of beat them up about ordering Domino's as well. It's generational. It's quite incredible. We've got a clear plan to keep delivering on earnings, right? It's not for us.
At the end of the day, it's still about EPS and still about EBITDA, right? Delivering those two key metrics. I know I'm probably getting some people who will beat me up today. Yeah, why aren't you announcing more buybacks? That's because we have a focus on driving the EBITDA with some growth opportunities. As Edward said, if those growth opportunities don't come to fruition, and there's a few on the pipeline that we're looking at right now, we will do more buybacks like we did last year. We're pretty confident we've got some things in the pipeline that excite us greatly. Moving on to the next slide. The PGF, we've probably said enough about it already. Just for me, it's most important for the franchisees that we've put it to bed. We can focus about the core business now. It's behind us.
It helps drive order count growth. It is more investment into digital. It is investment into smaller towns. They are all the things that matter to us for our shareholders. They matter to our customers. They matter to our franchisees. We think that it is a win-win-win for all stakeholders. It is about driving profitability for everybody involved, not just one party. Moving ahead to the next slide. As Edward spoke about, we had the acquisition. We are already 46% shareholders of that business, so we know that business very well. We took a bigger stake there. Why? Because we believe in Ireland, in the whole of the island of Ireland. We believe the growth there. We think we can help grow faster there. I have got a great franchisee up there, Mike, who is leading the business.
We'll continue to lead it, but we'll play a bigger part in the direction of that business, which we're excited about. It also allows us to leverage infrastructure that we've already invested in Ireland. As Edward said, we've invested in the commissary over there and upgraded that. We've already got the Shorecal business. We are really, really confident and really happy about that investment. Again, it's an investment in the core. It's an investment in the business we know and understand very, very well. Rolling over to the next page, Shorecal continues to do fantastic. We are really happy. We really like and love what we see in Ireland and the upside there. We will continue to double down on that. Just an interesting point is that the previous record of organic openings in the island of Ireland previous to last year was eight stores.
Last year, we did 16. We doubled the organic growth in Ireland last year. Strong leadership there with our team in Shorecal. We are still helping to lead that with Mike up in the north. Their business partners uncertain, and they continue to be really great business partners and lean in. We are really, really happy about that. Moving on to the next slide. Not too many to go. Guardrails. Really good guardrails in place. They have always got a very clear mandate about what we can and what we cannot do. We feel like we are building a big business. We want to add to that. I think one of the things that I have misunderstood is about the infrastructure. Edward alluded to before about Pete Trundley and the team. Our supply chain is incredibly high-quality, world-class supply chain.
We think, and not only think, we know, particularly with all this automation, we're speeding up, accelerating that automation, creates more capacity. Therefore, that capacity, we can fill that capacity up not only with more Domino's stores, but with other things that really complement what we're doing. You've got to have scalability. You've got to have synergy. You've got to be profitable. There are things that we're looking at very, very closely. We've analyzed a lot of things, and we'll only take the things that really we think will have a big benefit to our business and for our shareholders. I want to reiterate what Edward said, is that our current pipeline of opportunities we're looking at, we could fund all of those with our existing balance sheet capacity. All right? We don't need to go out and raise equity like some people might assume.
Next slide. This is the slide I showed back in December 2023. I want to sort of give myself a bit of a scorecard here, how we track into what we said we would do. We said we would grow corporate stores and joint ventures, etc. We've done that with Shorecal. We've done that. We've recycled the capital out of London and put that into Ireland with our Victa investment. We continue to evaluate in a very disciplined way that second brand opportunity. We made a small investment into the international markets without doing something stupid and wasting capital. We think it's been well deployed, and we think that it's going to pay off in the near term. We feel as though that we're doing what we said we would do for the market, which is really important for us.
With that, we get down to the last two slides, which is sustainability, very important to us. We published our first-ever sustainability report in 2024. Nutritional, we've been focused on this for a couple of years now. Things like we launched the Loaded Veg, 160 calories, going really well. We've got pizzas at 190, 200 calories. We've got our Cheeky Little Pizzas at 400 calories. We're giving customers choice because of those in the family who do want a lighter meal, which is fantastic. We're able to provide that. The good thing about pizza is you can make it as healthy or as indulgent as you want. We're also focused on reducing carbon. We've put the initiatives in place there, and we've signed up to the free commitments on those.
We are also making sure that we have better products in place for packaging that are more recyclable, etc. They are very important to us. They are very important to our team members as well. We are on the train for that. The last one, discipline execution delivers growth. We continue to make progress, and we have strong momentum. This is a dynamic business that we can flex. We are going to flex more into collection this year, not taking our eye off delivery. In fact, we are going to double down on delivery. We are going to go even harder now that we have got the momentum. We are going to drive it harder. Consumers are looking for value, which we understand, right? It is a tough market out there. Collection really plays to that.
Having been in a few markets and being around for over 30 years, I've seen this before, I can assure you that it really helps to drive growth. I think the big thing for me is this business is resilient, right? It continues to deliver. It continues to—the thing that amazes me is that we had a net debt went from GBP 1.8 billion to GBP 1.9 billion, right, across the last 12 months. Inside of that, we had acquisitions, we had buybacks, and we had dividends. We still only moved the dial 0.1. Still a sub-2 balance sheet, really strong. I think it's sensible in times like this. Franchisees are aligned with our new PGF, so we've got stability there. We're focused on investing in the core like we've done with Shorecal and now Victa. We're really focused on the core.
We continue to recycle capital like we did with the London stores, but with some more capital, we will recycle that and continue to reinvest that in ways that will drive more growth. At the end of the day, our strength is our people and our franchise partners in this environment. People that have been around for decades have been through the tough times. This brand continues to sail through those waters with a really strong crew and a strong ship. With that, I will open the floor up to questions. Thank you very much. Over here to Ruairi.
Thanks. Ruairi from RBC.
Oh, this is loud, isn't it? First of all, on the loyalty scheme, could you give us any indication to what you've observed from customers, customer behavior? Number two, the M&A pipeline now funded from the balance sheet, what's changed in the plan there, and how have your aspirations shifted in terms of a second brand? Finally, new stores, in excess of 50 for this year, that's obviously including acceleration at Shorecal, Victa. Could you talk a little bit to the appetite in the rest of the group, please? Thank you.
Yeah, sure. We'll talk about the last point first. Look, there's appetite there. Finding stores is not easy in this market for planning, etc. It can take a couple of years sometimes. You do have to think a couple of years out with your pipeline. The plan is to do in excess of 50. Maybe it's a lot more than that, who knows? Planning is a really big variable these days. We feel confident to say 50, which will be the third year in a row above 50, which I think is pretty incredible. There's not too many brands, I think, that are outgrowing that, maybe one that I know of. That's the first one. Your other point was around the loyalty.
Look, we're seeing some really good numbers in terms of our lower users, smaller users, if you like, less frequent users, who are really engaging with the offers that we're putting out. We've kept it really simple. The team kept the amount of data we have is quite incredible. So that helps us make decisions for the future of it. But so far, with what we've launched, we're really happy with. We're just dialing it up slowly. We don't want to do a hole in the bottles because you can trip over yourself. Certainly, what we've seen so far is that there's an incrementality, particularly those lower to medium users, which is great. Did I miss any other questions, Ruairi, about M&A?
M&A.
Look, we have not changed our strategy in that. The M&A is still very clear. The board is still very clear on our capital framework. We want to get a brand that fits with us. It will be food and beverage that can be franchised, that we can apply all the synergies and leverage that we have through our commissaries, our digital, our data on consumers. I mean, we are literally, with 30 million customer base, we are literally in every second household. We have incredible market share with the Domino's brand. We will not be taking our focus off that. That is the golden goose. We are thinking about the medium to long term here. We are thinking about a brand that can become 500-800-1,000 stores in the future. We are treading very carefully.
We've got a few things we're looking at at the moment quite seriously that we think could fit that basket, but we'll jump through all the hoops to make sure they tick the boxes. We're not going to do anything silly. We feel pretty confident we'll make the right choice.
Thanks.
Thank you. Douglas Jack . Over here.
Yeah, Douglas Jack, Peel Hunt, I've got three questions, please. The first one is for Edward. The technology platform costs in 2024, there were GBP 4.4 million charged to OpEx. What's the equivalent you think would be in 2025, given all the things that are going on? How have your value for money scores moved in the year? Last question was about the average number of households per store. Where are you at now, and how does that compare to the U.S., and Australia?
Good questions. Edward, do you want to handle the first one?
Yeah, if I handle the first one. As I said, we completed the sort of the e-commerce build, and we are completing the cutover of that. The ERP we expect to deploy by the end of H1 in full. There will be very limited costs this year.
Your other two questions, Douglas Jack . First of all, the consumer research tells us that consumers think we're the best value that they have seen since 2020 from Domino's. We're sort of going back in time to create better value, which is fantastic. It comes from a combination of great value offerings that our stores are offering: GBP 4 Lunch, GBP 7.99 Collection Perfection, etc. Also the delivery service. Value is really represented by the whole package, right? As I've spoken about before, I won't bore you again, but the whole value equation is more than just the price. You can get a pretty poor product at a cheap price, and it's late, and it's cold, and it's worth nothing in effect, right? Customers are telling us through the research we get that they're very happy with that.
The market gains that we're getting, big steps forward, shows that that's also playing through. Your other question was around house counts. Yeah, house counts are coming down, but there's still around 20,000 addresses per store at the moment. If you look at places like Netherlands, New Zealand, Australia, U.S., there are U.S., numbers I don't know specifically off the top of my head. I don't want to quote the wrong number, but the others I know, and they're closer to sort of 10,000, 11,000, 12,000 addresses. Almost half of what we are. If you did the exact math, that means that we should be probably 2,800 stores. We're focused on 1,600 or 1,400 this year and then 2,000. We don't want to get ahead of ourselves. Maybe when we get to 2,000, we'll really have to reevaluate that.
At the moment, we have a clear path to a couple of thousand stores quite comfortably. Thank you. Yeah, over to the front here, Richard Stuber first.
Hi, morning. Richard Stuber from Deutsche Numis. Three questions, please. The first is on franchisee profitability. I know that's a core pillar of yours. It was up 7% this year. Given sort of higher labor costs again and potentially sort of food costs and fuel costs, do you expect franchisee profitability to continue to grow again this year? Second question is on current trading like-for-likes, 0.7%. I think another sort of QSR company said that January was particularly weak. February was a lot better. Could you give any more granularity around January versus February in current trading? The third question is on the loyalty program. I know you've done a few trials going well, but how have you actually tweaked the generosity that you've given to clients, to customers?
Anything around what's changing and therefore, I guess, why it takes so long for you to roll out in full next year?
Sure. Good questions, Richard Stuber. First of all, franchisee profitability is extremely important to us because they are the backbone of this business for growth. Look, we've got a plan in place where we think we can get back to the same sort of number. If we can get back to the same sort of number with all the imposts that are coming towards us, us and ourselves, the franchisees would be grateful for that. Would we like more? Yes. Will we go after more? Yes. Getting back to that current number would be a great outcome. We have a plan. We think we can get there. We don't know what the world holds in front of us. It changes every day at the moment, but we feel pretty comfortable. We've got a plan to get there, that's for sure. Your other question was around loyalty.
Have we tweaked it? We've tweaked a little bit. I would say that we've got the offering sort of where we want it to be at the moment. It seems to be resonating with customers, but we'll continue to evaluate that, particularly as we go into this bigger group, right? We've gone from 630,000 to sort of 3 million at the moment. That's where we get a lot more data there that'll give us a lot more indication of what we do the year after. Certainly, from what we've seen, the incrementality at the moment, we're very happy with it, particularly the customers that we're targeting. Very positive. Your other question was around January, February. I think the reality is it's depending what you're rolling over has something to do with it. It's also depending on where you're spending your marketing.
January, February typically are some of our slowest months of the year. We are also saving our gunpowder for later in the year when we think strategically they will have bigger bang for our buck. Could we have driven higher sales in those months by throwing more marketing at it? Definitely, without a doubt. We decided not to do that like last year because we want to use it for certain parts of the year that we have strategic sort of initiatives. It would be wrong for me to comment which was good and which was bad. One was okay and one was better. You could say that. It is too lumpy to sort of break it out and explain why. From a strategy point of view, budgeting point of view, it was sort of as we expected. Over to the UBS team.
Thank you.
Hi from UBS. I have a couple of questions, please. In terms of the like-for-like shape for the rest of the year, where do you see the volume and price dynamic? That is the first question.
Yep. That is the first question. Yeah. We definitely see both. We had a lot of volume last year. As you know, we specifically went after volume. We actually took ticket down last year. We think because we took ticket down and we focused on growth and order count growth last year, we have the right and the ability to take both this year. We are very focused on both. Collection will be a big driver of volume. Delivery, we hope to get volume as well, but we also have the ability, we think, to take a bit of price as well later in the year. That is our key focus.
Have you taken pricing through the first three months?
No, not at this stage, no.
No. Okay. Second question, just to follow up on the point about franchise profitability, when you say you want to get to similar sort of numbers, are you talking about absolute EBITDA or are you talking about margins?
Absolutes.
Absolute. Lastly, on the M&A side, you have 2.1 times net EBITDA after the extra acquisition in Ireland. That leaves you, based on just a quick calculation, GBP 80 million-GBP 90 million, if you are guiding for GBP 270 million net by end of the year. Is that the sort of number you are looking for in terms of growth opportunities that you are willing to spend?
Yeah, I don't want to speculate on what we will or won't spend. What I'll say is that with the balance sheet we have and our cash flow, and we have the ability to recycle some capital as well, is that we have some ability to buy some things out there at the moment that aren't super expensive, to be fair, in the scheme of things. Yeah, we think it's pretty realistic and disciplined to go about it that way. We're not expecting to go anything crazy.
Thank you. Sorry, lastly, comments on activity compared to activity on loyalty. Papa John's just revamped their loyalty scheme to a lot more competitive. Do you think that affects anything on your side?
No. I don't look at competitors. What I've worked out 30 years ago was that I have more to lose by not focusing on what we do than we're focusing on the competitors. We focus every day about what we can do better. I can't control what competitors do, but I can control what we do. That's what we've done and it's been working. That's why our market share continues to grow. The other thing to factor into is that when you look at our store count, not only is it sort of three-four times the size, if you look at it in terms of sales, it's more than that again, all right? Our average unit sales are over double and triple in some cases. The market share we have is phenomenal. More importantly, the distribution we have is huge.
That proximity to customers, that's where our big advantage is. We have a structural difference between a lot of our competitors.
Thank you.
Thanks. Hi. Straight behind you, Katie Cousins.
Thank you. Kate Cousins from Shore Capital. It's a couple of follow-on questions, actually, from what's already been asked. In the year-to-date numbers, the price is pretty low, actually, implied price compared to what some of your peers are saying. How much is promotional activity wrapped up in that? Also, the weather impact on the year-to-date numbers, if there's been any there. Also, just on app numbers and order frequencies, how does that compare to the wider group?
Yeah, I would say that our promotional activity is the same as it was this time last year. It hasn't really changed. We've always got promotional activity going. I would say that what I've learned in this country, the weather's either shit or really shit. Excuse my French. Look, you have to take swings and roundabouts. Sometimes the weather's in your favor, sometimes it's not. The good thing is when you've got a collection and delivery business, you can sort of play to both. I wouldn't say the weather's had a huge impact on us. It tends to be controlled by what we do. When we do really good promotions, when we give really good service, when we're really on our game, we get better results. That's the reality. When we deploy our capital in marketing, etc., we can get an even bigger jump, all right?
We have to be quite strategic about where we spend that and when we spend that. As I said before, we're spending that in the right places this year because we think there's a couple of inflection points throughout the year where it's more important to invest than others. What was the other question?
Just on frequency per customer, but app versus elsewhere?
Yeah, on app, it's better on app. There's no doubt about that, as it is with loyalty as well. That's the other big advantage about loyalty. It's through app only. It helps enhance those numbers. At the moment, we're not seeing any massive changes in frequency. We can control that to a certain degree, but I haven't seen any massive changes at this stage. There's no doubt the consumer is looking for value. Thankfully, we are a really good value offering, right? Collection can really play into that this year more so than it has in the past. We think we have that extra engine to drive that.
Can still assume around about once every 12 weeks at one spot?
Yeah, yeah. Correct. Correct. Yeah. Thanks, Kate. Thanks very much. Over here.
Hi, guys. I'm Anubhav Malhotra from Panmure Liberum . A couple of questions from me, please. Firstly, on the supply chain automation investment, what sort of returns are you expecting? Maybe if you could guide us in terms of payback periods on that GBP 10 million you're investing there. On the stores in Ireland, what do you see the potential number of stores in Ireland specifically? I know you have given a target for the group as a whole, but maybe what's the plan for Ireland? In the first couple of months of this year, the order counts that you have, the like-for-like growth that you have delivered, 0.7%, does that imply your volumes are probably negative in the first two months or not really?
Yeah, the first one is no, I'd say volumes aren't negative. No, it's because we're actually tickets down a little bit. It's actually the opposite. Ireland, I won't give you a specific number because the reality is with planning, it can vary so much. I would just say that as we showed with last year, we doubled the previous record with organic openings, and we'd like to do that again. Not that I can say it doubled, but if I could hit those sort of numbers again, I'd be really happy. It's never that easy, right? It's availability of sites. Your other question was around.
Supply chain.
Supply chain, yeah. Automation. Really happy the automation is now underway. The ROIs, we do not break them out specifically, but they are anywhere because each piece has a different ROI, right? Depending on what part of automation you are doing. They are all generally between 3-5 times, right? They are pretty accretive. We are pretty excited by that. Hence why we are also accelerating that rollout. It is something that we are probably going to naturally do over four or five years. We are going to do over two or three years. We are quite happy with that. I think this other call-out is that last year we spent GBP 18.5 million on CapEx. Quite light, right? We are going to spend a bit more this year, but we are going to get automation gains from that. On that GBP 18.5 million, we upgraded one of our commissaries in Ireland as well.
I think those metrics are pretty positive.
Thank you.
You're welcome.
No more?
I'd like to thank your attendance. Thank you very much. I hope you see that in a crazy world, Domino's continues to deliver and is their one constant. So go out there and order more pizza. Thanks very much. Have a good day. Bye-bye.