Domino's ASF Presentation vF[1]

8/13/2019 Domino's ASF Presentation vF[1]

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ASF Conference

January 2012

DOMINOS PIZZA


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Forward Looking Statements

THIS PRESENTATION AND OUR ACCOMPANYING COMMENTS INCLUDE FORWARD-LOOKING STATEMENTS.

THESE STATEMENTS RELATE TO FUTURE EVENTS OR OUR FUTURE FINANCIAL PERFORMANCE AND ARE SUBJECT TO KNOWN AND UNKNOWN RISKS,UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE OUR ACTUAL RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS TODIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED BY THESE FORWARD-LOOKING STATEMENTS. THIS PRESENTATION AND OURACCOMPANYING COMMENTS DO NOT PURPORT TO IDENTIFY THE RISKS INHERENT IN AN INVESTMENT IN DOMINOS PIZZA AND FACTORS THATCOULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED IN THE FORWARD-LOOKING STATEMENTS, INCLUDEBUT ARE NOT LIMITED TO THOSE RISK FACTORS IDENTIFIED IN DOMINOS PIZZA, INC.S ANNUAL REPORT ON FORM10-K FOR THE FISCAL YEAR ENDEDJANUARY 2, 2011, AS WELL AS OTHER SEC REPORTS FILED BY DOMINOS PIZZA, INC. FROM TIME TO TIME. ALTHOUGH WE BELIEVE THAT THE

EXPECTATIONS REFLECTED IN THE FORWARD-LOOKING STATEMENTS ARE BASED UPON REASONABLE ESTIMATES AND ASSUMPTIONS, WE CANNOTGUARANTEE FUTURE RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS. WE CAUTION YOU NOT TO PLACE UNDUE RELIANCE ONFORWARD-LOOKING STATEMENTS, WHICH REFLECT OUR ESTIMATES AND ASSUMPTIONS AND SPEAK ONLY AS OF THE DATE OF THIS PRESENTATION.WE UNDERTAKE NO OBLIGATION TO UPDATE THE FORWARD-LOOKING STATEMENTS TO REFLECT SUBSEQUENT EVENTS OR CIRCUMSTANCES. INLIGHT OF THE ABOVE, YOU ARE URGED TO REVIEW THE DISCLOSURES CONTAINED IN THE DOMINOS PIZZA, INC. SEC REPORTS, INCLUDING THE RISKFACTORS CONTAINED THEREIN.

THIS PRESENTATION CONTAINS TRADE NAMES, TRADEMARKS AND SERVICE MARKS OF OTHER COMPANIES. WE DO NOT INTEND OUR USE ORDISPLAY OF OTHER PARTIES TRADE NAMES, TRADEMARKS AND SERVICE MARKS TO IMPLY A RELATIONSHIP WITH, OR ENDORSEMENT OR

SPONSORSHIP OF, THESE OTHER PARTIES.


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Domestic Business

#1 pizza delivery chain in the U.S.(1)

Highly diversified franchisee base with near exclusive focus on the Dominos brand

National brand known for its service, delivery and carryout

Value-added Supply Chain

U.S. marketing efforts have materially improved perception of food quality

International Business

International presence with stores in over 70 markets

71 consecutive quarters of positive same-store sales

Master franchisee model is highly profitable, requires low capex and generates stable cash flows

Financials

Primarily franchised business model (~96%) results in strong, consistent cash flows

Robust cash flows expected to strengthen balance sheet

Profitable Supply Chain system provides an additional source of revenue and cash flows

Key Highlights of the Dominos Story

(1) Source: The NPD Group/CREST - Year-Ending November 2010.


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Over 9,500 Units Worldwide

50% of Global Retail Sales50% of Global Retail Sales

4,496 Franchised Stores

395 Company-Owned Stores

19 Company-Owned SupplyChain Facilities

Domestic International

4,650 Franchised Stores

Currently No Company-Owned Stores

6 Company-Owned Supply ChainFacilities

As of Q3 2011

Total Units 9,541Total Units 9,541

International

49%

Domestic

51%

Franchise

96%

Company-Owned

4%

LTM Global Retail Sales $6.8 billionLTM Global Retail Sales $6.8 billion

International

50%

Domestic

50%

Franchise

95%

Company-Owned

5%


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Outlook does not constitute specific earnings guidance. Dominos does not provide quarterly or annual earnings estimates.

Long Range Outlook

+350 to +450+350 to +450

Global Net UnitsGlobal Net Units

+5% to +8%+5% to +8%

Global Retail SalesGlobal Retail Sales

+1% to +3%+1% to +3%

Domestic Same Store SalesDomestic Same Store Sales

+3% to +6%+3% to +6%

International Same Store SalesInternational Same Store Sales

Long range outlook reflects higher expected global unit growth and retail sales

$25 - $35 million$25 - $35 million

CapExCapEx

38% - 39%38% - 39%

Tax RateTax Rate


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(1) Source: The NPD Group/CREST - Year-Ending November 2010.(2) As of Q3 2011.

Domino's

20%

Other 2

Largest

National

Competitors

27%

Regional

Chains &

Independents53%

Invested approximately $1.4 billion in advertisingover the last five years the vast majority of whichwas funded by franchisees

Online ordering comprises nearly 30% of sales

#1 Pizza Delivery Company in the U.S.

Pizza Delivery Dollar Share (1)Pizza Delivery Dollar Share(1)

HighlightsHighlights

National Footprint (2)National Footprint (2)

Franchise Stores

Team USA (Company-owned) Stores


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Pizza Unit Economics

(1) As of FY 2010.

Domestic franchise model generates sustainable returns

Focused and efficient operating model

Delivery and carryout

Low cost to open / operate

$150,000 to $250,000 average cost range for new store

Small store footprint / low real estate costs

Makeline + oven + POS system

Strong cash-on-cash returns

Average reported annual EBITDA per domestic franchise between $50,000 and $75,000 (1)


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Domestic Supply Chain

Supply chain supports a strong domestic business

Sells and delivers food & equipment to U.S. franchisees

Provides consistency Produces fresh dough

System-wide ingredients & equipment

Franchise partnership

Profit-sharing agreement


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Magnitude of Commodity Costs

Input CommoditiesInput Commodities

Pricing pass-through on most items

Provides stabledollar

operating profit marginfor Supply Chain

Multi-year pricing arrangement for cheese

Lower volatility and improved budgetplanning

Expect 1% - 2% increase in food basket for2012 (1)

Sauce

Wheat

Boxes

Meat

Cheese

Key PointsKey Points

(1) Source: Derived from Companys internal and industry estimates.


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Q3 YTD Domestic Recap

YTD Q3 2011 SSS were +2.1% rolling over +11.6%in 2010, for a 2-year comp of +13.7%

Sold 56 company-owned stores to franchisees inGeorgia and Minnesota

Recent NewsRecent News

Introduced Dominos Artisan Pizza

Gourmet pizzas

Operationally friendly

Create good profit at the store level

Introduced Stuffed Cheesy Bread

Offered in three flavors

HighlightsHighlights Dominos Artisan PizzaDominos Artisan Pizza


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2,159 2,2592,382

2,523

2,9873,223

3,4693,726

4,072

4,422

2,749

4,650

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Q32011

3.7%

6.4%

4.1% 4.0%

6.1%

4.0%

6.7%

6.2%

4.3%

6.9%

7.9%

5.9%

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

YTD

Q32011

International profits driven by franchise royalties

90% of 2010 International operating income

Limited Dominos Pizza investment through master franchisee model

Five-year international retail sales CAGR of 12% (1)

International Store GrowthInternational Store Growth International Same-Store Sales Growth (2)International Same-Store Sales Growth (2)

(1) From 2005 to 2010.

(2) International same store sales are calculated on a constant dollar basis, which reflects changes in international local currency sales, for storesthat have been open for at least a year.

2000 Q3 2011 Growth: 2,491 Stores

International: 35% of Income from Operations


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International Opportunity

Potential for nearly 3,000 additional restaurants in Dominos top 10 International markets

! " "

#

$% &&

' & &

() & "

* &

Source: Company estimates.


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31

140

10087

69

209

249

104

175

82

236246

346 350

228

90

147

257

0

50

100

150

200

250

300

350

400

2006 2007 2008 2009 2010 YTD Q3 2011

Pizza Hut: +966 Dominos: +1,663Papa Johns: +517

Stronger International Unit Growth Than Peers

Store Growth 2006 YTD Q3 2011Store Growth 2006 YTD Q3 2011

Source: Public filings.

Dominos added more stores between 2006 and Q3 2011 than its two largest competitors combined


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Large Public Master Franchisees

841

694

410599

2,106

JUBI

IndiaSri Lanka

DMP

AustraliaNew ZealandNetherlands

FranceBelgium

Alsea

MexicoColombia

DOM

United KingdomIrelandGermanyRest of International

As of Q3 2011.

Four publicly traded Dominos Pizza Master Franchisees make up morethan half of the total international store count


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Q3 YTD International Recap

YTD Q3 2011 SSS were +7.9% rolling over +5.8% in 2010, for a 2-year comp of +13.7%

71 consecutive quarters of positive same store sales growth nearly 18 years

2011 net store growth through Q3 2011: 228 stores

HighlightsHighlights


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(1) Free cash flow defined as cash flows from operating activities less capital expenditures.

SignificantFree Cash FlowGeneration

Dominos has a history of operating a strong and healthy business with consistentglobal retail sales growth

The Company generates significant free cash flow that allows for de-leveraging ofthe balance sheet

Generated $109 million of free cash flow in LTM Q3 2011(1)

Sustainability ofRoyalty Stream

Dominos highly franchised business model leads to a predictable and less volatilefree cash flow stream than other less franchised chains

Dominos royalty stream has remained strong throughout the recent economicdownturn

Minimal CapexRequirements

Highly franchised model requires minimal capex requirements to be funded by theCompany

Lower initial capital investment and ongoing maintenance capex relative to otherQSR concepts

Key Financial Considerations


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-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 YTD Q3 2011

Domestic International

Impressive Record of Same-Store Sales Performance

Same Store Sales 2000 to Q3 2011Same Store Sales 2000 to Q3 2011


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Total Debt to Adjusted EBITDA (1)Total Debt to Adjusted EBITDA (1)

Dominos Has Proven its Ability to Manage Leverage

(1) Adjusted EBITDA excludes non-cash compensation expense, losses/(gains) on asset disposals, losses/(gains) on debt retirements and certain other

items that affect comparability. Adjusted EBITDA data prior to 2006 derived from publicly available numbers using the same methodology (adding

back depreciation and amortization, non-cash compensation expense and loss/(gain) from asset sales to income from operations).

5.5x

4.7x

4.1x

3.2x

4.8x

3.7x

3.0x

7.2x7.7x

6.7x

5.5x5.1x

3.1x

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

8.0x

9.0x

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 LTM Q3

2011

Q3 2011 total debt / EBITDA: 5.1x

Interest only

Whole-business securitization secured with most cash flows of the company

5-year initial term with two possible 1-year extensions startingin April 2012, based on meeting a key measurement, ending in April 2014

$1.45 billion debt 5.9% blended cash interest rate


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Powerful Global Brand with more than 50 Years of:

Proven Business Model

Strong Product DemandStrong Product Demand

Strong Unit EconomicsStrong Unit Economics

Consistent Cash Flow from Franchise ModelConsistent Cash Flow from Franchise Model


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THANK YOU

Domino's ASF Presentation vF[1]

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