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Reuters/Sergei Karpukhin
Who can say no to free pizza?
NEEDING DOUGH

The unluckiest Domino’s Pizza operator runs franchises in both Turkey and Russia

By Edmund Heaphy

The US stepped up economic sanctions against Turkey and Russia last week, putting a big dent in the value of both the Russian ruble and the Turkish lira. That’s bad enough if your business has operations in either country—but wildly unfortunate if both countries comprise your biggest markets.

And so shares in DP Eurasia, which runs Domino’s Pizza chains in Turkey, Russia, Azerbaijan, and Georgia, fell by almost 15% (paywall) on the London Stock Exchange yesterday. (The company was founded in Turkey but is incorporated in the Netherlands and listed in London—it’s complicated.)

The inexorable decline of the lira, which plunged to yet another all-time low against the dollar yesterday, and sharp drops for the ruble, which hit a two-year low last week, have pushed DP Eurasia’s share price down by more than 40% so far this month alone.

Around 75% of DP Eurasia’s revenue comes from Turkey, where it has more than 500 restaurants, while almost all the rest is generated in Russia, where it has around 140 outlets. Last month, the company released strong first-half sales growth, and every one of the analysts who cover the company rated it a “buy” at the time, according to FactSet. Amid economic wobbles and soaring inflation, their faith in Turkish and Russian appetites for pizza will be tested.