Domino's Pizza Enterprises Limited (DMP) Earnings Call Transcript & Summary

Good morning, and thank you for joining the Domino's Pizza Enterprises Limited FY '26 Full Year Results Investor Call. I'm Nathan Scholz, the Chief Communications and Investor Relations Officer. This morning, you'll be hearing from Chairman Jack Cowin; Group CEO and Managing Director, Andrew Gregory; and Group COO and CFO, George Saoud. After the presentations, we will have a Q&A. Analysts will have the option to select raise hand, and then you'll be unmuted to ask a question and a follow-up. With that, I'll pass to Chairman Jack Cowin.

Good morning, and thank you for joining us. 12 months ago, I said this business needed a reset. I want to start with what we said we would do. and what we have done. We said we would rebuild franchisee profitability. Average franchisee EBITDA is up 11.3% to $105,700 a store globally in Q3 FY '26. Store margin has moved from 7.1% to 7.9%. That is real money back in the hands of the people that run our stores. It's not where it needs to be, but our Australian stores are higher than the global average at $128,000. Our target is $130,000 globally, and we will keep working until we get there. I've said before that this business is only as good as a franchisee partner's ability to make a decent income. When our franchisee partners make money, they invest. They hire better people, they look after the customer and the sales follow. What we said we would take cost out. We have actioned $67 million of annualized savings with $35.3 million of that realized in FY '26 million. We said we'd strengthened the balance sheet. Free cash flow is up $116.6 million to $164.1 million. Net leverage is 1.86x. Underlying net profit after tax is up 4% to $121.6 million, and the dividend is up 51.2% to $0.325 per share. Now to the next task, which is rebuilding profitable sales growth in FY '27. We have simplified pricing, reduced voucher dependency and move towards smarter offers and built a leaner cost base. That has strengthened store economics, but is also lowered order counts where customers have been responding mainly to discounting. We became the king of discounts. On some orders, we were selling product and not making enough for our stores. We have stopped a lot of that, and we knew when we did it, that it would cost us volume. In Western Australia, where we have run our clearest test of simpler everyday pricing. We gave up top line sales and improve store profitability substantially. A portion of the transactions were entirely dependent on too aggressive a discount. We've learned a lot through that test. Our mistake was not recognizing that we still have to promote great value. You have to grab people's attention. The work now is to promote great value profitability, simpler menus, stronger meal menu, better digital and CRM execution and customer service improvement. That rebuilds frequency without giving back the economics the team have built for FY '27. Western Australia continues to outperform the rest of the country on the key customer and profitable sales indicators we are watching. We've still got more to do, but the evidence is encouraging, and we'll adapt those lessons to apply them in a measured way across the country. I want to say something about the team because in my experience, that is what determines the outcome. Over the past 12 months, we've put in place a management team, I believe, is second to none. I want to thank our group Chief Operating Officer and Chief CFO; George Saoud, who has taken on significant leadership responsibilities in the last year. and helped lead the reset that brings us to where we are today. Andrew Gregory has joined us as Group CEO and Managing Director this month. Andrew started as a crew member in 1993, ran McDonald's in Australia and New Zealand for 8 years and most recently spent 3 years in the headquarters in Chicago. He understands the franchisee economics from both sides of the counter. As Chairman, my job from here is to support Andrew, not to run the business for him, and I'm confident he is the right person for the job. We've also renewed the Board with Judith Swales and Drew O'Malley joining this year, adding additional experience in retail and QSR. Let me finish where I started. We're in the franchise business, and we happen to sell pizza. The argument is not about who gets what slice of the pie. It's about making the pie bigger. The reset is delivered, returns are improving and FY '27 is about building profitable orders. The test from here is simple: rebuild order momentum without giving back the store economics we have just restored. I'd now like to hand over to Andrew to introduce himself and his team's plans.

Thanks, Jack. Good morning. I started on the 5th of August, and I'm still early in this role, but I'm not early to the QSR industry. I've already spent time listening in stores, meeting franchisees, and talking and listening to leadership from across our 12 markets. What I've seen is a business with strong foundations, a strong brand, a committed team and passionate franchisee partners who want to grow and be successful. I'm more confident in the success of this business as a result. Having said that, sales momentum is not where it needs to be. and regaining momentum and growing our baseline of average weekly order count will be the operating measure that I focus on as an absolute priority. I am clear on the current strategy to create a more sustainable business based on more consistent value that grows franchisee profitability at the same time as growing sales. Our results in growing order count will be choppy in the short term, but it must be and is our longer-term objective. It's the only way to sustainably grow income for both the franchisees and the company. The FY '26 reset that George will outline has delivered a strong foundation to build upon to this business, and it's my responsibility to continue the strong focus on cost and capital discipline, and also to build and grow the Domino's brand and business from that foundation. We know our customers want us to be great value every day, not just at particular times or for particular days of the week or even or short periods on our calendar. We will grow this business and create profitability for our franchisees if we are able to offer predictable compelling value to our customers. And of course, value is not just price. Value is great food, great pizza, great service and delivering joy with every pizza. In each of our markets, we have a strong leadership position against our direct pizza rivals, and uncertainty and challenging consumer environments are not within our control. However, our decisions and the way we show up for customers and our teams in the stores is within our control, and it's our responsibility. We control how we price, how we execute world-class marketing and how we execute in our stores with our franchisees. In each of our markets, there are QSR brands successfully driving profitable growth for their franchisees and sustainably growing market share. I'll come back later to the FY '27 priorities, but my direction is clear. We need to turn stronger foundations into profitable customer growth and better outcomes for Domino's stakeholders.

Thank you, Andrew. Good morning, everyone, and thank you for joining us. FY '26 was a year of necessary reset for DPE. We made deliberate decisions to simplify the business, reduce costs, strengthen the balance sheet and restore franchise partner economics. Some of those decisions had a visible impact on sales and order volumes during the year. However, they've also created a more sustainable operating and financial base from which we can rebuild profitable growth. At a high level, there are 4 messages I would like you to take from today. First, the financial reset has been delivered. Second, franchise partner profitability is improving. Third, our balance sheet, liquidity and cash generation has strengthened materially. And fourth, the focus for FY '27 is clear: rebuilding profitable sales and order growth without giving back the economic gains achieved through the reset. Turning to the FY '26 financial results on Slide 6. Network sales were $3.87 billion, down 6.8%, while same-store sales declined 4.1%. This reflected the reduction in store numbers and our deliberate move away from broad, high discount promotional activity, particularly in Australia, New Zealand and Japan. Despite those sales pressures, underlying EBIT increased 1% to $20.1 million and underlying NPAT increased 4% to $121.6 million. This demonstrates the impact of our cost actions taken across the group, the stronger contributions from Europe and Asia and improved portfolio margins. It is also important to note that the EBIT result was achieved while cycling approximately $10 million less profit from store sales than in the prior year. Free cash flow, excluding divestment proceeds increased $116.6 million to $164.1 million. Net debt reduced by $227.8 million from $724.8 million to $497 million and net leverage reduced from 2.57x to 1.86x. The Board has declared a final dividend of $0.325 per share, an increase of 51.2% on the FY '25 final dividend. The dividend represents a 50% payout ratio on the second half underlying NPAT and reflects a balanced approach to shareholder returns, continued deleveraging and appropriate reinvestment back into the business. The statutory result includes a post-tax impact of $255.7 million from balance sheet write-downs and other nonrecurring items. These items principally relate to revised carrying values for France and Taiwan goodwill and intangible assets, technology assets that no longer align with our enterprise IT strategy underperforming stores and other balance sheet adjustments. While significant from an accounting perspective, these write-downs are largely noncash. They do not change the underlying operating performance cash generation or the covenant position of the group. They represent a more realistic alignment of our caring values with current performance expectations and our strategic priorities. Turning to Slide 7, geographic summary. Looking across the regions, the portfolio showed improved earnings resilience despite softer sales. In ANZ, EBIT declined 5.9% to $122.9 million. Sales were affected by the pricing and promotional reset, particularly in the decision to reduce broad discounting. Order volumes moderated, but improvements in ticket food costs and cost control, supported stronger franchise partner economics. Europe delivered EBIT growth of 2.6% to $74.9 million, a stronger performance in Benelux offset softer trading in France and also in Germany in the second half. Asia delivered EBIT growth of 19.9% to $34.7 million despite lower revenue. This improvement primarily reflected the closure of underperforming stores in Japan, menu simplification and cost discipline. Japan's corporate store network returned to positive EBITDA, while Malaysia and Singapore continue to improve from a profitable base. Global overheads also improved. This reflects the tighter cost control, disciplined head count management and lower discretionary expenditure. The key point is that the group delivered modest EBIT growth and margin expansion despite lower sales volumes. Lower revenue did not flow through to lower profit. That gives us confidence that the reset has created greater operating leverage as sales momentum improves. Turning to Slide 8, free cash flow. Free cash flow was 1 of the most important outcomes of FY '26. Free cash flow before divestments increased from $47.4 million to $164.1 million. Operating cash flow before interest and tax increased by $10.5 million to $312.6 million, supported by favorable working capital movements. Net operating cash flow increased by $59.5 million to $226.7 million, which also benefited from $44.9 million of lower tax payments primarily reflecting the timing of payments across jurisdictions. We recognize that tax timing was a meaningful contributor. However, the improvement was not solely related to tax. It also reflected better working capital management, lower interest payments and a substantial reduction in capital expenditure. Capital expenditure reduced by $48.1 million to $38.7 million, reflecting greater investment discipline that contributed to a reduction in net investing cash outflows to $5.7 million. The focus on cash is structural. We have strengthened working capital disciplines, reduced investment in lower priority activities and introduced a more rigorous returns-based approach to capital allocation. We said we would improve cash generation, and we did. Turning to Slide 9, investing activities. Within capital expenditure, digital investment reduced to $21.5 million from $44.8 million, a decline of $23.3 million. This does not mean we are stepping away from technology. It means we are moving to a more disciplined enterprise IT model with clearer prioritization, stronger commercial accountability and explicit investment cases. Our digital priorities will focus on reducing friction in the customer journey, strengthening our CRM and personalization and support in-store productivity and franchise partner execution. Looking forward, we currently anticipate digital investment in the range of $30 million to $45 million, with expenditures subject to clear business cases and alignment with the group's strategic priorities. Slide 10, debt and capital management. The stronger cash performance has translated directly into a stronger balance sheet. Net debt reduced by $227.8 million. Of this $138.9 million related to cash repayments and $88.9 million related to favorable foreign exchange translation, predominantly associated with the Japanese yen. Net leverage reduced to 1.86x, achieving our target of below 2x. Interest coverage improved to 20.6x. During FY '26, we also completed the refinancing of $1.05 billion of debt facilities. The refinancing delivered improved pricing staggered maturities and a weighted average tenure of approximately 4 years. At year-end, the group has $467.5 million of cash and undrawn committed facilities providing substantial liquidity and strategic flexibility. We are, therefore, entering FY '27 with a stronger financial position. improved liquidity and greater capacity to invest selectively behind initiatives that can generate substantial returns. We said we would strengthen the balance sheet, and we did. Turning to Slide 12, Western Australia. I will now turn to the operational reset starting with Western Australia. WA provides an important example of both the opportunity and the execution lessons from FY '26. In September, we removed broad, high percentage discounting. That improved average ticket and store economics, but it also reduced orders more than intended. From February, the market progressively reintroduced sharper targeted carryout offers and began testing lower delivery fees. The objective was to rebuild orders while preserving the stronger economics achieved through the initial reset. The results are encouraging. WA delivered 5 months of record franchise partner EBITDA Carryout comparative sales became positive and delivery sales improved. And WA same-store sales outperformed the rest of Australia relative to the prior year. Note that we introduced a delivery fee in WA at $8.95 when we began the trial. We are now in market with a $5.95 delivery fee across WA as of 2 weeks ago, and we're seeing improved conversion. The lesson is not simply that lower prices generate volume. The lesson is that different customer occasions required more deliberate value architecture. For FY '27, we intend to apply these learnings through clearer menu pricing, targeted carryout value, more disciplined delivery fee settings and lower reliance on broad voucher led discounting. WA is not a copy and paste answer for every market. It is a playbook for how we test value, volume and margin together. But the principle is simple: clear value, targeted offers and profitable sales. Moving to Slide 13. I franchise partner economics. Strengthening franchise partner profitably has been central to the reset. Average rolling quarter 3 12-month franchise store EBITDA increased 11.3% and to $105,700, while the average store EBITDA margin increased from 7.1% to 7.9%. The improvement was driven by higher average ticket clearer pricing, lower food and packaging costs, tighter cost control and operational simplification. Franchise partner profitability increased across the major markets and particularly strong outcomes in Australia, New Zealand and Japan and continued growth in the Netherlands and Germany. The target is $130,000. We are not there yet, but the direction is right. The business only scales properly when franchise partners have the confidence and the returns to invest. Slide 14, the road map to sustainable growth. We are targeting average global franchise partner EBITDA of $130,000 over time. Reaching that level will require contributions from 3 areas: renewed customer growth, further procurement savings and improved store productivity and store execution. Importantly, this is a shared agenda with franchisees. Domino's must provide a stronger customer proposition, better technology, procurement benefits and simpler operating systems. Franchise partners must convert those initiatives into consistent execution, customer service and local growth. This page shows the levers to get from today's average franchise EBITDA of $105,700 towards the $130,000. The important point is that there is no single lever, and these initiatives are not sequential. They can move together. One lever is profitable customer growth, the right volume at the right margin, supported by clearer pricing and smarter offers. Another is procurement continuing to lower food, packaging and other input costs where we can and sharing those benefits appropriately through the system. The third is productivity and execution, better labor scheduling, simpler processes, improved store efficiency and stronger in-store execution. The model only works from both sites execute and when growth shows up in stronger store economics. This is where management's attention is because a more profitable franchisee is the engine of our business, it's better for our network growth, our customer service and shareholder returns. Slide 15, cost savings initiatives. The cost program delivered in line with our expectations. We've actioned $67 million of annualized savings across technology, central support, procurement, logistics, marketing and G&A expenses. Of that amount, $35.3 million was realized in FY '26. Two points matter. First, a meaningful share of the savings support of franchise partners through lower input costs and better store economics. Second, the savings retained by DPE helped protect earnings while we moved away from lower margin volume. That is the balance. Franchisees have to eat first and DPE also needs the right cost base. We've also identified a further $15 million to $25 million of opportunities across food and packaging and procurement, and that's subject to implementation and timing. The intent is for the additional savings to be shared between franchise partners and DPE so the benefits support both the store economics and the group resilience. This next phase is not simply about reducing costs. is about creating capacity to reinvest in customer growth while continuing to improve franchise partner economics. Slide 17, trading update. As we enter FY '27, the immediate task is to restore order frequency and profitable volume. The reset has produced healthier store economics, but also lowered order counts. We must now convert stronger unit economics into sustainable sales growth. Group same-store sales declined 2.5% in half 1 and 5.7% in half 2. With the first 7 weeks of FY '27, broadly consistent with the second half run rate at minus 5.8%. In ANZ, we'll progressively apply the lessons learned from WA with a disciplined approach to pricing, promotions and delivery fees. In Europe, the focus is on recovery transactions while preserving the benefits of our cost control. In Asia, it is to convert the healthier economics created through store rationalization and operational simplification into sustainable growth. Across the group, our approach will be evidence based. We will test initiatives market by market, measure customer response and store profitability and scale only those initiatives that deliver both. We're not providing forward earnings commentary on FY '27. To conclude, FY '26 was a year in which we made difficult but necessary choices. Sales and volumes declined, and we're not satisfied with that outcome. However, underlying earnings were resilient, franchise partner profitability improved, free cash flow strengthened materially, debt reduced and the balance sheet was reset. We now have a leaner operating base, stronger liquidity and better store economics. The challenge for FY '27 is to turn those foundation into profitable sales growth. With that, I'll hand over to Andrew to take you through his initial observations and the priorities for profitable growth. Thank you.

Thanks, George. I've come into a business that has done a lot of hard work through FY '26, and the platform was stronger because of it. In my first 3 weeks, I've seen stores, franchisees and met with market leadership. The strongest impression is the pride and passion people have for this brand. Franchisee partners want to grow and our teams are committed to give customers a great experience. I've also heard and seen practical opportunities to improve. We can make the customer experience easier, store execution simpler and local decisions more focused on the consumer. Our momentum is not strong enough. And both comp store sales and comp average weekly order count is below where it needs to be. We do need to do 2 things at once. We need to rebuild sales and maintain discipline on costs and capital. We must work towards providing better, more consistent and reliable value to our customers. We have to help our franchisees by making their stores easier to run by being simpler and more focused in our menu and to provide great service, whichever way the customer orders through the Domino's app or in-store interacting with our team. Our '27 priorities are clear: grow sales by turning the tide on order count, delivering a frictionless customer experience and maintaining our cost discipline to support both franchisee and DPE profitability alike. This slide sets out my priorities for '19 in FY '27. First, grow the baseline in average weekly order count. Delivering profitable growth is the operating metric I will track and be accountable for. Our stronger business relies on more customers choosing Domino's more often. We will leverage from the successful and ongoing trial in Western Australia. That trial is based on a simpler and more predictable value proposition to our customers. As a result, our stores in Western Australia are running better. They're making more money because the franchisees can more easily project sales and schedule their teams. Our marketing will become more focused on customer experience and sharing occasions with family and friends, large groups. From next month, our marketing in Australia will be more focused on that occasion and the experience of enjoying great pizza from Domino's. We'll feature our great product and a stronger brand presence in our creative. And as we've already announced, next month, all of our stores will transition and our customers will have the opportunity to choose beverages from their favorite brands here in Australia as Coca-Cola becomes our exclusive supplier. Second, improving franchisee profitability sustainably. Growth has to work for franchisee partners. The $130,000 average franchisee EBITDA ambition remains an important global benchmark. It's a multiyear objective and a focus for my team and the business. The target is a benchmark for the level of profitability needed to support franchisee confidence in sustainable new store growth over time. Franchisee profitability will not come from one lever. Primarily, however, it will come from profitable sales growth. It will also come from store execution and better store productivity and smart decisions to lower input costs responsibly, but it is a shared responsibility of both the franchisor and the franchisee and requires us to work together on this objective. Third, leading with urgency and accountability. Accountability will be fundamental to our success for my team and our market leaders who own the execution of their strategy. The purpose and objective of our market leadership teams is to intimately know their industry, their customers and then importantly, lead and work shoulder to shoulder with the franchisees to make compelling consumer-based plans and then deliver so that our customers experience those plans in real life. Many of the solutions to our challenges across the market will be consistent and we can learn more quickly and faster to share great ideas and learn from our mistakes. Importantly, local consumer tastes and segments, industry economics and competitive dynamics in the different markets mean there will be nuanced local solutions that also need to be implemented. Overall, my accountability is to lead a team to understand and listen to customers and lead and work with franchisees to deliver better outcomes and profitable growth for all of Domino's stakeholders. Thank you. George and I are now happy to take your questions.

Thank you, Andrew. The first question comes from Shaun Cousins from UBS. Shaun, you can unmute.

Can you hear me now?

We can indeed.

Fantastic. I've got some questions regarding cost savings. That was a big tailwind or support '26. Will the remainder of the $100 million savings announced at the AGM. So you realized $35 million in '26. So there's $65 million to go. Will that be realized in fiscal '27, please?

George here. Thank you, Shaun. It will be realized in 2017. So it's over the 3 years to $100 million. So you'll see -- you've seen what's come through '26, '27 has got a material component to it and then in '28.

Great. And my second question is just around D&A. That was quite low in the second half, and I think you've called out amortization, I think it was $55 million in the second half. consensus estimates are around $137 million, $138 million. Should we annualize that second half D&A. It's just there's been a lot of change in your CapEx and your broader asset base. Any assistance on that number would be great.

Yes. Very good question. If you go to Note 6 of our accounts, you'll see D&A has come down significantly, as you've said. And if you go through the components of that, store closures was a big component. Both in terms of D&A around planned equipment and leases, but also with intangible assets, that's come down considerably. In addition to that, so annualizing second half would be closer to the mark. In addition to that, what you will start to see and part of going forward, we will be expensing a lot more than capitalizing when it comes to a lot of the software development costs that we've got into in the program. So you'll see a lot less in D&A going forward.

The next question comes from Tom Kierath from Barrenjoey. And thank you to Barrenjoey for hosting us this week. Tom, you can go ahead.

Can I just get some color on order count versus ticket. So your sales are tracking like-for-like down about 5%. I assume orders could be down 20% or 30% and ticket maybe up 10% or 20% in something in that range. Can you maybe just give us a bit of color to understand what's exactly happened in that like-for-like or that same-store sales number, please?

Yes, no problem, tom. Order count is more like 11%, no different to what Jack has spoken to historically and then take it up line.

Okay. Cool. And then in WA, that's obviously like the I guess, the SK for what you're doing. Are you back into positive comp growth there? Like what gives you the confidence that this is the right thing to do? Or what evidence do you have to show that you're on the right path with the strategy?

So when we compare WA to the rest of Australia, it is -- in carryout, it is comping positive. So -- and when we tested that market, so that we introduced delivery fee. And that is the channel that we need to get positive. So carryout is positive, $8.95 delivery fleet was not going as positive. We ran a trial across stores at a lower delivery fee, and we had double-digit volume growth when we did that. And so we're in market at the moment at $5.99 as a delivery fee. And it's only 2 weeks. It's early days, and we're getting positive conversion rates on our OLO system. So if we can continue to track positive on carryout and through the reduction in our delivery fees, the volumes are going up. We think that is the right direction.

But just to clarify, but WA is still negative, though, in terms of the overall state or business?

That's right at this point in time.

Just to chip in on WA, ending June, franchise profitability is up 30-odd percent. So that's a very significant change. Yes, we're down on order to come, we're down on sales. But product quality is up PSE, those numbers are all very positive. The franchisee income is up substantially. And now we have to try and figure out how do we get the order count and the sales to respond accordingly.

The next person up is Michael Simotas. Michael, you should be able to unmute now.

So look, you've done a very good job on stabilizing earnings. I think earnings at a group level have been stable for about 6 halves now. Also a very good job on cash flow and balance sheet. But if same-store sales don't improved from this level through '27, do you have enough in there to maintain earnings at the current base? Or would that be reliant on getting same-store sales growth during FY '27.

I think it does. It's Andrew here. I think the short answer to that is our plan and our objective is we need to return to grow positive sales comp over the course of the year. we've got every market with actions in place. And I think to share the way I'm thinking about what we will see as we progress to lower and lower negatives over time. There's 2 things that we're focused on. Firstly, is a simple average seasonally adjusted weak sales trend that will help us really understand and confirm that our baseline sales are moving in the right direction. There will be noise because we're tracking over 12-month anniversary of different comp levels and things like that. We have to focus on average weekly store sales and order count to drive the plan and the assumptions that we've got in the plan.

No, I think that's a good way to look at it. And when you look at where that metric is sitting right now, is it stable, improving or still deteriorating?

In most of our large markets, is stable or slightly improving, but we're not in the position to say that it's changed trajectory from a longer-term sustainable position.

Okay. And can I just confirm something on the cost savings? Maybe just ask Shaun's question in a slightly different way. So you realized $35-odd million of cost savings in FY '26. If we look at what will actually hit the system in '27 based on what you've said, it will look like it will be a fairly similar number. Is that the right way to think about it?

Directionally, that is the right way to think of it. And just remember, it's system profit. So it's for us.

The next up is Bryan Raymond from JPMorgan. Bryan, you can unmute and go ahead now.

First one is just on the trading update. I just check if there's any sort of people World Cup impact there, particularly given the time zone in Europe was not too bad, I would have thought for the dinner occasion or late on occasion? So just wanting to understand if that was a help at all in the period.

Yes, there was -- the markets have told us, and it obviously depends which teams are playing and which markets we're talking about some of the markets or the teams from those parts were exited relatively early from the World Cup as well. So there was some benefit, but it was relatively short term and not material.

Okay. Great. And then just on the Coca-Cola transition, is that something that is expected to drive ticket or like in terms -- or items? Is there any way to sort of quantify what that might do for the overall business?

Yes. The simple metric we track on beverage incident in terms of orders. So we think we've got significant headroom. Currently, we run about 34% incidents where a customer orders that they also order of beverage in that transaction. And if we only regain back to where we were previously. We've got 6% or 7% incidence improvement from our customers ordering at that normal level. And we think there's significant upside. It's clear Coca-Cola is Australia's customers' favorite choice for beverages.

Yes. excellent. And then just final one, big picture question, like from the McDonald's background you've got there, a lot of focus on product and daypart, et cetera. Obviously, daypart's a little bit different in the pizza business but how are you thinking about product? That doesn't seem feature a lot in the commentary today is a lot about pricing and procurement and cost out, et cetera. But the actual product itself, like that doesn't seem to get a lot of focus. So I just wonder if that's something you've got any observations on you might like to make a changes to, et cetera?

Yes. It is too early to be definitive. But I think one opportunity we have, there is a tendency in this business, which exists a lot -- across a lot of to focus on limited time offers and new news and things like that. What this business needs, not only in the area of product quality, but across many of the different initiatives are things that go into the stores that have longer-term platform like impact in a positive sense. And so we can do a great 6-week promotion and get a sugar hit, and we should still continue to do those where they make sense. But what I am working with on the team is to try and understand how we can put in platform-like improvements to our core offers, it actually also makes it easier for our stores to run if we're not chopping and changing all the time. And so next month, one of the other things we're doing is launching a new range of pizza as a permanent menu addition. So it's not a new permanent menu addition that hits the target of family and group occasions, so large group family occasion, and we're going to relaunch the New York range into the market in Australia, and we're really confident on the quality messaging that we can take into that launch. But also, as I said, it becomes a permanent addition to the menu versus the short-term limited time offer.

The next up is Elijah Mayr. Elijah, you should be able to unmute there?

Apologies. Can you hear me now? .

We can indeed.

Just firstly, on the franchise profitability. You noted earlier just for WA, you had the data up to the end of June and strong profitability growth there. Do you have the data up to end of June, for the wider group or at least maybe ANZ just to give us a little bit of a trend in that profitability in that last quarter?

Yes. It is the same trajectory, Elijah. We did have a challenge with Intel system, which is down through in Europe. But since we've got the data coming through, it is the same trajectory as quarter 3.

Same trajectory is an improvement or same trajectory as in line?

An improvement, yes, in line.

And then maybe just secondly, at the first half result, you noted around 20 to 40 new stores growth over the next 12 to 18 months, did in the second half. What are your expectations currently?

Roughly the same, no material differences or movements for the next year.

The next up to speak is Craig Woolford. Craig, you should be able to unmute.

Can I ask a question firstly about you choose priorities here. Like obviously, there's a focus on growing average weekly orders and franchisee profitability. How do you choose a trade-off there between that and DPE profitability? Is there a clear reference that growing order orders is the #1 priority?