LONDON (ShareCast) - (Sharecast News) - Pizza delivery company Dominos reinstated a deferred dividend but said the risk of a second lockdown meant an interim payout would be suspended as it reported a fall in underlying profits due to Covid-19 costs.


The company posted a 5.5% increase in revenues to £628.9m in the 26 weeks to June 28 as Britons turned to takeaways with restaurants forced to close in March.

Underlying pre-tax profit fell 4.6% to £47.6m, including £6.2m of costs related to the coronavirus pandemic. Trading in the first weeks of the second half improved as outlets reopened, Premier League football returned the government cut sales tax on hot food and people chose to stay in the UK for holidays.

The deferred full-year dividend of 5.56p per share, worth £26m, would now be paid next month, the company said on Tuesday.

"There remains considerable uncertainty ahead, including the risk of a second lockdown and an expected decline in consumer spending. Given this backdrop, the board believes it is important to maintain balance sheet resilience and we are therefore not proposing an additional interim dividend payment at this time," it added.

"With lockdown restrictions easing, our incremental Covid-19 related costs are declining and we expect approximately £2m of such costs in the second half, all of which will be in the supply chain."

"The macroeconomic, consumer and competitive backdrop for the second half of the year contain considerable uncertainties and it is too early to conclude on how consumer behaviour will evolve."

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