News blog

Global Brands

BY: Andrew Hore |
POSTED: 05/05/2010 |

Switzerland-based Domino’s Pizza master franchisee Global Brands, where former Portsmouth Football Club owner Alexandre Gaydamak is a major shareholder, has reported a strong rise in sales in recent months but it is a long way from making a profit.

Sales were flat at CHF11.8m in 2009 but since then there has been a rising trend. Adding pasta dishes and other variations to the standard pizza menu is helping to build sales. Price reductions also appear to have increased volumes. A like-for-like 19% year-on-year increase in April is impressive. The increase was 7.4% in January and sales have risen by a larger percentage in each month since then.

Global’s loss of CHF3m in 2009 was similar to the year before. That includes exceptional charges of CHF800,000, relating to store closures and ending the contracts of the former management. Two loss-making stores at Renes and Muttenz were closed near to the end of 2009. Muttenz was closed within one year of opening.

There was net cash of just over CHF800,000 at the end of 2009 but cash is still flowing out of the business. Global has raised £90,000 since the end of 2009. Gaydamak has loaned CHF1m to Global through his firm NobleRock Capital. The interest rate is 7% and the conversion price is 1.7p a share. This loan can be drawn down at any time up until 30 June 2011. Any drawn down amount will be converted into shares at that date. Gaydamak’s shareholding could increase from 41.6% to up to 55.8%.

Global plans to open five more stores in 2010. The first is in Hongg and the rest will be around Zurich and Geneva. Global owns the franchise rights to Domino’s Pizza in Switzerland, Luxembourg and Liechtenstein. The plan is to have 50 stores, of which 30 would be franchised, in Switzerland.

At 2.25p a share, up 0.7p on the day, Global is valued at £2.49m.

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