Domino’s has seen its profit before tax fall by 35.2% year-on-year in its first half to £59.4m, leading to a drop in guidance for the rest of the financial year.

In the 26 weeks to 30 June, the takeaway pizza chain saw its total number of orders fall by 0.9%, while group revenue in the UK fell by 1.8% to £326.8m.

Furthermore, in this period Domino’s underlying EBITDA grew by 0.4% to £69m, while its interim dividend jumped by 6.1% to 3.5 pence per share.

Chief executive at Domino’s UK, Andrew Rennie, said: "Following a slow start to the year, we now have good momentum in the business with our strategic initiatives gaining traction and our trading performance accelerating steadily against strong comparatives from last year.

"In Q2 we grew orders, with a notable improvement from the middle of May and importantly have halted the trend of declining delivery orders. These are now returning to growth and this momentum has continued through June and July, helped by a good performance through the Men’s Euro Football tournament.

"In our core UK & Ireland business, we see significant opportunity for further growth through opening new stores, an exciting new loyalty trial to drive frequency and a focus on value and service, especially in the delivery channel. There is alignment with our franchise partners and tangible energy across the system to capitalise on this opportunity."

Following these results, Domino’s said that "given the slower start to H1 and the greater pass-through of food costs", it now expects its underlying EBITDA for the 2024 financial year to be at the "lower end of the current range of market expectations".

The group also said that it would launch a new £20m buyback programme "reflecting confidence in future prospects".

Investment director at AJ Bell, Russ Mould, added: "Domino’s delivered a set of results which was about as soggy as day-old pizza, guiding for full-year performance at the lower end of expectations after a slower-than-anticipated start to the first half.

"The company has also been affected by passing on a greater proportion of easing food costs to its franchise partners – presumably to help sustain a positive relationship given historic issues with franchisees.

"While a recent boost in business during the Euros football tournament is obviously welcome it is also transitory and the fear will be that a difficult first few months of 2024 are more reflective of people’s willingness and ability to shell out £20-plus on a pizza.

"The company has tried to signal some confidence in the outlook with a £20m share buyback programme but the market appears unconvinced by this for now and Domino’s really needs to serve up a strong second half to win investors round."

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