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ANN ARBOR, MI-Net income plunged 55.2% for Domino’s Pizza Inc. during the third quarter that ended Sept. 9, with the company blaming increased interest expense as a result of higher borrowings and “a continued challenging domestic environment.” Total net income dropped to $10.9 million for the quarter from last year’s figure of $24.5 million, or earnings per share of 17 cents, a drop of 22 cents.

David A. Brandon, Domino’s chairman and CEO, cited “unprecedented cost pressures and a weak consumer environment” in his remarks during the company’s conference call with financial analysts Tuesday. Brandon said that the negative effects of those factors “made striking the right balance between increasing prices, while operating in a period of declining traffic, very difficult.”

Domino’s, which expanded its worldwide store count by 61 locations during the quarter and by 272 stores over the trailing four quarters, said that its operations showed a continued strong performance in international locations despite the plunge in net income. It noted that international same-store sales growth of 8.3% during the quarter, its highest in nearly three years, marked the 55th consecutive quarter of international same-store sales growth. The chain finished the quarter with 8,510 locations worldwide, compared with 8,238 locations at the end of the third quarter last year.

Brandon said that the company’s response to the current challenges include the selection of a new creative agency and the elevation of Patrick Doyle to President of Domino’s USA in order to “bring intense focus to our domestic sales challenges.” By contrast, he said that the international division posted tremendous results and its best sales showing since the first quarter of 2005.

“We are clearly navigating through a very challenging period for our company,” Brandon commented. However, he said that the company’s new leadership structure, its new advertising agency, strong international growth and expansion bode well for the future.

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