Jack Cowin briefs Domino’s US parent about how the pizzamaker is turning Aussie fortunes around

Domino’s executive chair Jack Cowin, the billionaire behind Hungry Jack’s, is regularly updating the pizza chain’s US parent company to placate concerns about its rocky performance.

Domino’s US parent is keeping a close eye on developments at its Australian offshoot. Picture: AFP

Domino’s Pizza executive chair and fast-food billionaire Jack Cowin has the ear of its parent company Domino’s in America as he attempts to land a rocky turnaround of the ASX-listed pizza chain.

Mr Cowin is regularly briefing the US franchisor on the Australian arm’s strategy reinvention, its CEO succession challenge and to steady nerves about its direction.

The founder of Hungry Jack’s told The Australian in the past few days he spoke with Domino’s Pizza Inc chair David Brandon frequently.

“We talk to them all the time, we spoke just a couple of days ago and they are very supportive of what we are doing,” Mr Cowin said.

The US mothership was well aware of the issues facing the Australian Domino’s business, such as its planned closure of loss-making stores, and aim to lift franchisee profits.

“They don’t have to ask, they know. There are no secrets on this business, we communicate and we send them a monthly cheque so they have a deep-seated interest in what is going on,” Mr Cowin said.

Mr Cowin, who is also the largest shareholder in the ASX-listed Domino’s, took the role of executive chair this month on an interim basis to supplant outgoing CEO Mark van Dyck who departs in late December.

Mr van Dyck replaced veteran Domino’s boss Don Meij. His resignation surprised investors and analysts, sending the Domino’s share price diving and throwing into doubt the strategy to lift the pizzamaker out of its prolonged sales and earnings slump.

Domino’s Pizza executive chair Jack Cowin.

Mr Cowin revealed in a briefing with analysts the day after Domino’s announced Mr van Dyck’s resignation that there was a rift between the outgoing CEO and the board over the pace of change required to restore profit growth.

Mr Cowin said that while the board had agreed to a five-year plan presented by Mr van Dyck, directors demanded a faster reset after years of “unacceptable” performance.

The $US15.83bn ($2437bn) Domino’s Inc is taking a strong interest in the rehabilitation of the Australian arm, which has more than 3700 stores across 11 countries and is responsible for a large slice of the international Domino’s business.

Mr Cowin said his discussions with Mr Brandon and the US parent were positive and that they understood the core requirement that Domino’s franchise owners had to earn better profits for themselves to support a stronger public Domino’s business.

“At the end of the day these businesses are built around successful franchisees; yes you have company restaurants but the bulk of the investment, the bulk of the income, comes from franchisees,” he said.

Domino’s Inc chair David Brandon. Picture: Annette Dew

Mr Cowin said Domino’s had been given a “free kick” by Covid-19 and lockdowns during which sales boomed for the pizza chain, and it had simply expanded too fast and into too many regions.

A “correction” was now required to slim down the company and provide better focus.

That “correction” began under Mr van Dyck’s short tenure when 172 stores were closed in Japan and dozens across Europe.

These store closures were mentioned by Domino’s Inc in its recent earnings update to US investors and analysts, whereby its chief financial officer, Sandeep Reddy, said the US group was aware of the Australian businesses’ current problems.

“We actually knew about the store closures that were gonna be happening in Japan this year, and they happened in the first quarter,” Mr Reddy said on a Wall Street conference call.

“And based on events that have happened in the last few weeks, I think their executive chairman (Mr Cowin) has reiterated that the strategic plan that was outlined by the previous CEO is still very much on track, but they continue to do evaluations of where things are at, and they may come back with more colour as we go forward.”

Shares of Domino’s added 1.8 per cent to $18.45.

Originally published as Jack Cowin briefs Domino’s US parent about how the pizzamaker is turning Aussie fortunes around