Dominos Financial Analysis

Running head: Dominos Financial Analysis 0
Dominos Financial Analysis

Dominos Financial Analysis 1
Table of Contents
Introduction......................................................................................................................................2
Overview..........................................................................................................................................2
Ratio analysis Literature Review.....................................................................................................3
Benefits........................................................................................................................................3
Limitations...................................................................................................................................4
Ratio Analysis in detail....................................................................................................................5
Gearing / Capital Structure ratios.................................................................................................5
Investors’ ratios............................................................................................................................6
Profitability ratios........................................................................................................................6
Activity / Efficiency ratios...........................................................................................................7
Liquidity ratios.............................................................................................................................8
Recommendations and Conclusions................................................................................................9
References......................................................................................................................................10

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Introduction
Financial performance is the ultimate aspect of determining the whether the company is
performing above the standard set by the industry or below the standard set by the industry. This
indicates the level at which the company is and wants to reach in the future. The below report
talks about the overview of the Dominos and the study of the ratios has been undertaken to give
the essence of the financial strength and the weakness of the company.
Overview
Dominos Pizza is an American based food chain which was found in the year 1960. The
headquarters of the corporation are Dominos Farms Office Park in Ann Arbor, Michigan. In
terms of the sales the chain became one of the most popular pizza seller companies in the world.
The company was founded by James Monaghan and Tom Monaghan.
Dominos belong to the food industry providing the fast food to all kinds of the people. In term so
the location the company is operating at 13811 locations presently and with the team of 14100 of
the company owned office. The company opened its first international outlet in Winnipeg,
Manitoba, Canada. Also in the same year Dominos opened its 100th store in Vancouver. By 2014
the company was spread among 6000 international locations (Morning Star, 2018).
In terms of the nature of the business Dominos does not label itself as the fast food chain and
intends to deliver the fresh quality food at the fast pace. The business is operating as the agencies
and franchises. Earlier Dominos was not having the facility of the restaurant to eat and only
provide the pizzas of the finest quality ingredients. Not only the company is ambitious in
majority of the franchisees owning more than 100 stores, the business continues to grow

Dominos Financial Analysis 3
eventually. The world class training program and the consistent food quality is what makes the
dominos an exception fast food chain, having the award winning food service team (Morning
Star, 2018).
Ratio analysis Literature Review
Accursing to (Isard, et al 2017) Ratio Analysis is a quantitative analysis of information presented
in the financial statement. Ratio analysis is used to evaluate different aspects of the company
such as the liquidity position of the company, the efficiency, the solvency and the profitability of
the business.
In view of (Loughran and McDonald, 2016) the ratio analysis is needed only to measure the
financial performance of the company from all the aspects. Measuring of the profitability is an
important and the critical aspect and also helps the firm get to know the weak areas against the
benchmark set by the company. The overall financial strength of the company can be determined
by the usage of the ratio analysis technique. The fiscal position of the company can be
determined through the ratio analysis technique
Benefits
Ratios analysis assists in validating or disapproving the business decisions such as investing,
financing and operating decisions of the organization. The financial statements are cumulated
into the figure that can be compared with the previous year, thus giving the helping hand to
evaluate the financial position of the firm.
According to (Weygandt, Kimmel, and Kieso, 2015) The accounting statements simplify the
financial data into the simpler ratios on the basis of the following categories such as liquidity,
efficiency, solvency and the profitability of the business.