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DP Eurasia on track to hit forecasts in 2018 as Russia and Turkey continue to gobble up pizza

The Domino's franchisee recorded double-digit growth in its two key markets in the first half, despite elections taking place in Turkey
domino's workers
DP Eurasia is the master franchisee of Domino’s in Turkey, Russia, Azerbaijan and Georgia

Russians can’t get enough Domino’s pizzas if the latest numbers from DP Eurasia N.V. (LON:DPEU) are anything to go by.

The £250mln company is the master franchisee of the popular pizza brand in Russia, as well as in Turkey, Azerbaijan and Georgia.

Strong growth in all regions

Sales were strong across all of its territories, but Russia was the standout performer. Sales in the eastern European country jumped 68.8% to 152.7mln Turkish lira (₺) (£23.9mln) in the first half of the year (H1 17: ₺90.5mln).

On a like-for-like basis, which excludes the impact of store openings and closures, Russian sales climbed 18% in the opening six months.

In Turkey, DP Eurasia’s biggest market in terms of sales, revenue climbed 15.6% year-on-year to ₺351.6mln (H1 17: 304.1mln).

Azerbaijan and Georgia make up a smaller slice of the pie, but growth was also strong there with sales soaring almost 60% to ₺6.1mln (H1 17: ₺3.9mln).

Total group sales jumped 28.1% to ₺510.4mln (H1 17: ₺398.5mln), boosted by the opening of 79 new stores compared to the same period last year.

Online ordering continues to prove a popular option, with group online system sales rising 64.5% in the half. In Russia and Turkey, DP Eurasia’s two largest markets, just shy of 60% of all orders are placed online.

On track to hit forecasts

“We are very pleased with our performance for the first half of 2018,” said chief executive Aslan Saranga.

“We were able to record double-digit like-for-like growth in both of our main markets, despite the election period in Turkey.”

He added: “We are happy to see that our advertising spend and capital expenditures on the digital front are paying off as the online portion of our business is continuing to increase.”

DP Eurasia expects full-year adjusted underlying earnings to be in line with expectations.

Shares rose 0.5% to 178p in early deals on Friday.

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