After its IPO, Domino's reported a decline in second quarter earnings with net income of $15.9 million, compared with $17.5 million from the second quarter of 2003. Despite increased cheese costs, Domino's did not attribute the decline to higher operating costs but rather to increased interest expense from a debt incurred from the company's recapitalization in 2003. According to Domino's, the increase in cheese costs is generally covered by increasing its product prices to its franchisees, who then raise the pizza prices to consumers.
Posted by franchiselawblog at July 28, 2004 10:36 AM