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Domino’s Pizza posts profit rise

The company improves e-commerce sales.

Domino’s Pizza Group, which operates 748 stores in the UK, the Republic of Ireland and Germany, has posted a profit of £15.37m for the first half ended 24 June 2012, compared to £13.03bn for the same period last year.

Revenue increased by 10.3 per cent to £112.7m, while gross profit was £41.54m . E-commerce sales grew by 43.4 per cent to £121.2m .

Diluted earnings per share were £9.54 , while earnings before interest, taxation, depreciation and amortisation, before exceptionals, were up 10.6 per cent to £24.2m.

Sales made by franchisees from all stores in the UK, Republic of Ireland and Germany to the public (system sales) increased by 11 per cent to £286.9m.

During the period, the company opened 23 new stores with one closure and have a full pipeline for the coming half. The company created over 600 new jobs in stores.

Like-for-like sales “(LFL) in the UK increased 5.7 per cent, while LFL sales in the Republic of Ireland, in euros, up by 2.9 per cent. Online system sales grew by 43.4 per cent to £121.2m.

Like-for-like sales are sales in stores that were open before 26 December 2010, excluding stores in Germany.

Lance Batchelor, CEO of Domino’s Pizza Group, said: “I am delighted to be able to report such a strong set of half year results. Coming on top of a solid start to the year during the first three months of 2012, we have delivered like-for-like sales growth of 5.2 per cent across the system in the first half.

“In addition, it has been a very busy and successful first half for our emerging German business with four new stores opened. Our franchisees have made the most of the opportunities presented by a combination of rain, sport and national celebrations and delivered some great figures during the second quarter.

“The coming months should provide a real opportunity for our business. We have great new locations coming into play in the UK, our 1-2-1 marketing programme is showing encouraging returns and the opportunity in Germany is looking better by the day. Add to this the best franchisees in the business and the future looks bright.

“Trading since the half year end has continued in line with our expectations. While the consumer backdrop remains tough we are confident about the future and our expectations for the year as a whole remain unchanged.”

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.