Domino's Pizza UK has ended its sponsorship of ITV's Britain's Got Talent series after what it described as "outrageous" price demands.
The pizza delivery company, which had a three-year deal to sponsor the show dating from 2008, yesterday reported a fall in full-year profits but predicted orders by mobile phones were set to rise sharply. Chris Moore, the chief executive, said: "I think [ITV] started off with outrageous demands but then they came back to earth... by then we had already decided we can use the money better ourselves."
Mr Moore said that TV sponsorship placed restrictions on what it could say in a short-space of time, adding it wanted to focus more on "spot advertising" around the launch of new products. For the year to 26 December, Domino's posted a 19.3 per cent surge in total sales to £485.3m, boosted by 57 new stores and surging online revenues. But pre-tax profits fell by 14 per cent to £35.2m, including a one-off charge of £15m on its purchase of Domino's Leasing.
Domino's expects sales from mobile phones, which now account for 4 per cent of delivery orders, to rise to 25 per cent by the end of 2015. It launched an app on the Apple iPhone in September and achieved sales of more than £1m by the year's end. This is one reason why Domino's has hired Lance Batchelor, the former chief executive of Tesco Mobile, as deputy chief executive from the end of June. He is set to become chief executive when Mr Moore steps down in 2012.
For the last seven weeks, Domino's like-for-like sales growth slowed to 4.7 per cent from 11.9 per cent last year. Mr Moore said: "It is a tough market but we are a tough operator."
Meanwhile, Domino's plans to open up to 43 sites on Britain's motorways, as part of a new deal with the service station operator Moto Hospitality.