Good morning. My name is Christie, and I will be your conference operator today. At this time I would like to welcome everyone to the Q3 earnings call. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be a question-and-answer session. (Operator Instructions). I will now turn the call over to Ms. Lynn Liddle.

Thanks Christie and good morning everybody. Thanks for joining us on our third quarter, very pleasant announcement, and with us today we have Mike Lawton, our Chief Financial Officer; and Patrick Doyle, our Chief Executive Officer, who have prepared comments that will follow with an open Q&A. A couple of housekeeping things; we do ask the media to be in a listen-only mode, since this is primarily an investor call, and second of all, I refer all of you to our 10-Q and our 8-K that were filed this morning and contain a Safe Harbor statement for forward-looking comments. So with that, I will turn the call over to Mike.

Thanks Lynn and good morning everyone. In the third quarter we grew our same store sales both domestically and internationally and we achieved strong store growths in our international markets. We also drove shareholder value with 22.9% adjusted EPS growth over the prior year quarter. Overall, we are really pleased with another quarter of strong results. I am going to start at the top of our results by looking at our global retail sales. Global retail sales, which are the total retail sales at franchise and company owned stores worldwide grew 8.4% when excluding the impact of foreign currency. As many of you know, currency exchange rates have had a negative impact for us this year due to the dollar strengthening against most currencies. When we include the negative currency impact, our global retail sales still grew by 4.9%. The drivers of the growth included domestic same store sales, which were up 3.3% in the third quarter, lapping a positive 3% in the prior year quarter. This was comprised of franchisee same store sales, which were up 3.6% and company owned stores, which were up by 0.5%. Our international division had another good quarter as same store sales grew 5%, lapping a very strong 8.1% last year’s quarter. We closed five net stores domestically, consisting of 10 store openings and 15 closures. For the trailing 12-month period we have opened five net stores domestically and we still expect to be modestly positive as we close out this calendar year. Our international division grew by a net 121 stores this quarter, made up of 130 store openings and nine closures. Turning to revenues, our total revenues were up $1.8 million or 0.5% from the prior year. This increase was primarily the result of two factors: First, higher international revenues due to…

Thanks for the update Mike. Some of you might be thinking you’ve heard this all before; adjusted EPS up 23% over last year, same store sales up over 3% domestically; in fact in the last 15 quarters, 12 were positive and one was flat. Internationally sales were up 5% on the same store sales basis, which is an astounding 75 consecutive quarters of positive same store sales. Well, you have heard all this before; it’s because the Domino’s model is a model of consistency. We think this steadiness is the hallmark of a business that’s reliable and growing with strong free cash flow and a franchise structure that tends to be very dependable. Our international business has continued its long string of success, with nearly 19 years of solid growth from this division. I’m confident that’s a record in the restaurant industry. Our international franchisees are clearly offering the products, service and value that resonate with customers around the world. We’ve also had other exciting news out of our international franchisees lately. Domino’s Pizza U.K. recently announced that it acquired the rights to Switzerland, Luxembourg and the option to acquire Austria. This is just a year after they bought the rights to franchise in Germany. This kind of expansion of an established and committed franchise group is great news for us and our systems. And The Economic Times awarded our franchisee in India, Jubilant Foodworks, with the title of Emerging Company of the Year. The chain has been growing sales at a nearly 50% compound annual growth rate over the past six years. They are a clear leader in the restaurant industry in India and we are proud of their many accomplishments. This includes the incredible pace of their store growth, as they currently lead our system in new units.…

(Operator Instructions). Your first question comes from the line of Michael Kelter, Goldman Sachs.

A update on the Pan Pizza launch; I wanted to kind of dig in a little bit more there and I know you don’t want to necessarily talk about numbers, but maybe you could just give us some sort of description of your early experience with the launch relative to your expectations and maybe anything that surprised either way, positive or negative.

Hey Michael. Yes, it happened in the fourth quarter, so we are not going to talk about results from that. All I’ll tell you is we think it’s a terrific product. We spent a lot of time making sure we got it right, about three years in fact, and specifics around its performance, we’ll discuss in February once we are talking about the fourth quarter. But it did launch after the end of the third quarter, so nothing that I can talk about at this point.

And on a completely separate note, the international unit growth appears to be on pace for at or potentially above your 350 to 450 guidance for the year. So I guess my question is, when might you evaluate whether you need to take that guidance higher, and looking forward, will the global macro slowdown impact the pace of openings in 2013 or you feel like you might build upon the 2012 pace?

Yes, so generally we kind of look at where we are once a year and the longer-term guidance we are giving. You are right; on a trailing basis right now we are ahead of that 350 to 450 guidance. That’s obviously a good thing. If we were going to make a change, you would likely hear about it in January at our Investor Day. And I’ll tell you, as you saw and as I’ve been saying a few quarters in a row, we keep looking at the international side of this, waiting for signs of weakness to appear out there, because clearly there has been slowdown, particularly in Europe, you probably saw the U.K. already released, they were up 3.7 same store sales in the third quarter, and it’s really the same story. Things have held together nicely. We are very happy with 5% same store sales growth. Greece has continued to be weak. Spain has not been great, not horrible, but not great, but the rest of it has really held together nicely. Now I guess what’s probably more important from a store growth standpoint is we track very carefully the kind of payback period on stores around the world, including the U.S. and the best indicator of store growth over the medium term is the ROI on those stores, and it continues to be very strong in international and in fact if anything, maybe getting stronger and we think that’s what generates store growth. So as long as that trend continues, we feel pretty optimistic about store growth and as you pointed out, on a trailing 12-month basis right now, we are over the high end of our longer-term guidance.

Thank you very much.

Your next question comes from the line of John Glass with Morgan Stanley.

I wanted to ask about the composition of the comp store sales this quarter, maybe sort of thinking about it going forward, we are still talking about maybe a more favorable mix driving in over traffic and so first of all, is that a function of maybe the digital ordering, up-selling customers better, if you could comment on what the role of that is playing in this favorable mix equation. And also, how does Pan Pizza fold into it out from a mix perspective? It’s higher for a medium pizza, it’s a more expensive pizza, its obviously got more weight to it. Do you view this as more of a mix driver than it is a traffic driver?

So a couple of parts. I mean first, we are happy that we had positive orders in the third quarter. It’s something we’ve been talking about, but we are still getting some ticket growth and we really feel like the order count growth is ultimately going to be the driver of the health of the business over the long-term. In terms of Pan Pizza, yes, it’s $7.99, so it’s more expensive than the two for $5.99, but it is one pizza for $7.99 instead of two pizzas for $5.99, so there’s some kind of play in that. What I would tell you is our overall experience continues to be the same; order counts get driven by center of the plate items in the restaurant industry and for us, that’s pizza. So selling a Pan Pizza or selling two mediums for $5.99 is going to tend to do better in general on order counts than when you’re talking more about side items. And so I made that comment before and I think that still holds true and clearly there’s got to be some balance in that, because selling sides are good for the profitability at the store level and as profits are better at the store level, then ultimately that’s going to generate better returns for our franchisees, which will hopefully generate some store growth. So there’s always going to be a balance on that, but in general, I would tell you that when we are talking about pizza and promoting pizza, you are probably going to see on average a little bit more on the order count side.

Great. And then just as a follow-up, have you ever had or have you ever launched a Pan Pizza before? It’s not my recollection, but it seems that maybe sometime in the distant past you’ve done this, and is there any relevance of that experience to this time around?

Yes, we did, a long time ago. Actually it pre-dated me. I’ve been here a little over 15 years now and the answer was, I don’t think we did it right. I think we didn’t take the time to make sure that it was the best possible pizza, and it’s really why we haven’t been a player in this category. So I think the answer is we feel very good about this pizza. It’s a terrific pizza. Hopefully all of you have had it now. Hopefully, you’ve all had it more than once and we feel great about the quality and the taste of the pizza and I think when we did it in the past, I don’t think we got the product offering right.

Thank you.

Your next question comes from the line of Jeffrey Bernstein with Barclays.

Thank you. I just had a couple of questions on the follow-ups on the U.S. comp. Just wondering first of all, if you can just talk perhaps about the industry. I mean, it seems like you and your largest peers continue to surprise to the upside. I’m just wondering if you can talk about whether you are seeing now acceleration in the industry growth. I know previously you had said low single digit growth at best, but it would seem like, unless the independents are in a more severe decline that the category might be growing faster. And then my other question is just kind of a follow-up on the Pan Pizza. I know it’s early, but it sounds like with three years of test, you probably have some interesting learning. I’m just wondering whether you can share perhaps what changes took place over time. I think you mentioned one in five across the industry are sold as pan pizza. I’m just wondering kind of what your expectation is. I know you don’t want people to be as built-up as when you did the entire new pizza platform a few years ago, but kind of your thoughts on what you could have achieved. Thanks

Yes. Look, it’s a great pizza and what we’ve learned over the three years is, it takes some time to get this right. It’s a thicker pizza, and you’ve got it in the pan. It requires a little bit more heat to cook it, and so balancing that out with the rest of your menu is a little bit of a trick, and that took us some time to get that right. But other than that, I mean I’m not going to get into kind of speculation around where it’s going and kind of fourth-quarter commentary, but it’s a great pizza. And our view is at the end of the day, the quality of what you are selling is what’s going to drive sales and our learning has clearly been over the last three years, that if we come out with products that consumers are excited about and we take the time to make sure we are doing it right, then we are going to get good results out of that. And Jeff, I’ve now forgotten what your first question was. Oh industry, right.

The broader category.

Yes, so category; no, I don’t think the category is necessarily growing any faster than it was before. I think the answer is very similar to what I’ve said in the last couple of quarters, which is I think you are seeing finally some share gains by the larger players. So I think there is a little bit of growth in the category, but I think what you are seeing is the larger players are taking share from the regionals and smaller players. You have seen some of that strain out there. I think on some of those smaller players, there was a small chain out in Boston that filed recently. But overall, I think it’s about share gains from the nationals versus the regionals and smaller players.

And just lastly, can you give us an update. I know this past quarter you paid that $3 special, kind of one-time dividend. I’m just wondering your thought process. It seems like share repurchase is the primary focus, but a return to maybe a more regular dividend relative to kind of the intermittent kind of one-time or any thought around that or would you prefer to steer clear of kind of regular?

Well, no. We consider everything and the answer is, we look at things hopefully the exact same way that our investors do. We run the numbers. We look at what we think is going to generate the best overall returns for our shareholders. Clearly, again this past quarter the answer for us has been share repurchases and I guess the other thing is, like everybody else, we are kind of going to be waiting to see what the tax rate is on dividends and capital gains in January and that will play into our thinking as part of the way we look at the returns that are going to be generated for shareholders, keeping in mind that some shareholders are not going to be tax-paying entities, but we are going to run the numbers the same way we always have and it’s possible that those tax rate changes, if they happen, will then play into that as well.

Great. Thank you.

Your next question comes from the line of Brian Bittner with Oppenheimer.

You’ve really become much more focused on driving your carry out business over the last couple of quarters. Just wondering if you’ve seen any change in the mix from your carry out business thus far.

I think we’ve seen actually a little less growth on that this year and I mean overall, while we had some slightly positive orders in the third quarter, we didn’t get robust order growth yet in the third quarter, but it’s been a balance and while we did see more carry out growth in the previous couple of years, I think we’ve seen less of that this year.

Okay. With the stock buybacks, there definitely were a little bit light of where I was looking for and it seems as though you still have a lot of cash on your balance sheet. Is there any reason why you didn’t buy back more stock this quarter and you are kind of keeping a pretty healthy amount of cash on the balance sheet?

Well, we are pretty conservative about the amount of cash we keep on the balance sheet. It’s also a pretty short window in the third quarter. But no; I mean, it’s just something we are always looking at and I think we would up with a little bit more at the end of the third quarter than at the end of the second, but I wouldn’t read a lot into that.

Okay, all right. Thank you guys.

Thanks Brian

Your next question comes from the line of Joe Buckley with Bank of America.

All right, two questions. Patrick, could you elaborate a little bit on the market share gains by the large companies? I know you’ve talked in the past about some of the technology advantages. Is that the primary driver that you think that may have changed the game a little bit versus the regionals and the independents? And then the second question, could you just talk about media spend third quarter versus fourth? Did you keep some of your firepower in reserve so fourth quarter media spend might be stronger, especially around the Pan Pizza launch?

Yes, I’ll take the latter one first. No, I don’t think we necessarily were carrying that much more into the fourth quarter than the third. I think if I remember, somebody can check, we may have been up just slightly on our advertising fund reserves versus the prior year, but nothing really material on that Joe. And in terms of the dynamics of the share gains, it’s a really interesting one. The real change has been the digital side and so I think your theory on that is a good one. As I look at it, there have always been kind of three things that Domino’s and our national competitors have brought to the table. First, just the scale and what that means in terms of purchasing power; second is kind of brand strength and our ability to advertise and build our brands; and third is know-how around the business and systems that we’ve developed over decades that make our franchisees and store managers more successful at running the stores. And personally I would have expected you would have seen more share gains over time from those things than you saw and the answer is, really over the course of a couple of decades, you have been seeing much in the way of share movement towards the national players in the pizza category and you are now seeing it, and it’s six or eight quarters in a row I think if you look at it, and I don’t know if that’s a long term trend yet, I hope it is. But I think some of it may just have been the economic environment and the financial strength of the national players and their franchisees to kind of weather the storm and maybe come through it a bit more aggressively. And the other part of it is as you say, technology, and the better customer experience, the efficiencies that that gives us in our business, and frankly the difficulty that regional and smaller players have in putting together an ordering platform, a digital ordering platform like we have. So I don’t know the full answer and obviously, I don’t have as much insight into what competitors are doing and how their numbers look around that as I do from our own numbers, but I think it’s clearly playing into it and I think that is at least part of the reason that you are seeing some movement towards the national chains.

Thank you.

Thanks Joe.

Your next question comes from the line of Mitch Speiser with Buckingham Research.

First, on the third quarter comp. I believe you advertised sandwiches early in the quarter, and then the two for $5.99 at the end of the quarter. Can you give us a sense on if they were both on traffic drivers or if sandwiches maybe were more a driver of checks? Just trying to get a sense of where the increased order counts came from.

I mean, we don’t really get into breaking down the quarter more finally, but the answer is overall it was a good quarter and pretty much everything we were doing worked for us. So I’m not going to get into the specifics around it, but it was a pretty strong quarter overall, kind of start to finish.

Fair enough. And on the store margin, it was a big quarter of margin expansion. Cheese costs I’m sure were a big driver of that. I did notice that the labor leverage was a bit less than it has been in prior quarters. Could you maybe discuss on a go-forward basis, are some of the productivity initiatives now complete? The labor leverage that we’ve seen over prior quarters was in the north of 100 basis points. Now it’s running at about 20 basis points. Is it fair to expect that those days of 100 basis points of leverage are behind us or are there more productivity initiatives on the horizon?

We’ve certainly captured some of the opportunities that we were pursuing. But if you look at the labor productivity that we have in our corporate stores, there’s still a lot of things that we can do, but I don’t know that you’ll see those in the next quarter or two. I think what you saw this quarter is probably a more reflective of what you’ll see short term.

Okay great, thanks. And moving along, I think Mike, you gave us your food cost outlook for the year. Can you tell us what that implies for the fourth quarter?

Cheese prices have spiked up. We are currently up over $2 a pound, so we’d expect them to run higher than they did in the third quarter. But as you can see, we are still expecting a very, very manageable number in Q4, because we expect them to be up only slightly for the whole year and we were a negative versus last year in Q3. We could be flat, very slightly up Q4.

Okay great, thanks. My last question is on the new prototype store. Can you give us a sense of how many stores have this new design? And is it comping better than the overall average, and because they are such nice looking stores, are they more, I guess front and center in a trade area, and is that maybe driving the takeout part of the sales mix?

Right now, we’ve still only got a few dozen of them out there. So we are very happy with kind of the initial reaction and response to it, but I want to be careful about kind of the statistical significance of what is still fewer than 50 stores. By the end of the year we are probably going to have a much more robust sample of those stores built and we’ll get more comfortable with what it’s doing in terms of better than average lift in those stores. But the early read is certainly positive. We are happy with it. Consumers are happy with it, but I want to be careful about kind of projecting any early positives from that to a broader base until we’ve got a bigger sample out there, because you’re always going to have just that much more excitement from the early people that are adopting something and so I just want to be a little bit cautious about that, but overall, we are happy with it.

Great. Thanks very much.

Your next question comes from the line of Alvin Concepcion with Citi.

A question on the Pan Pizza launch. I mean, you mentioned one in five pizzas that are sold are pan. Of that in general, what portion of the pan pizza customers do you believe are less brand loyal and maybe willing to switch based on history?

Well, we don’t have a real history with pan yet, so we are going to find out on that. But we think we’ve got a great product. We’ve got a great pizza. The taste and quality is right. We think that the fact that we are making it fresh is a differentiator versus both the frozen pizza that people are buying in grocery stores, as well as some of our competitors and so we think it’s a compelling proposition, but time will tell.

Okay, great. And then on commodities, you mentioned 2013 is going to be higher, but manageable. What are some of the levers you’d consider pulling to manage through that? Is pricing on the table or will traffic and mix be more the key there?

Right now, I’ll tell you that we think it’s going to be as Mike said, manageable, and so we’ll see as we get closer to it. There isn’t a lot of visibility out right now for us past kind of the first half of the year and for us, so much of it is driven by cheese, that it’s a little difficult right now to peg that strongly for the full year. Cheese is a bit above where we’d expected it to be right now and our expectation is that we are probably going to see it back off somewhat, but we’ve got to see. But overall as we look at it, as Mike said, we think it’s manageable and kind of how we work through that, yet to be determined as we get a little more visibility on it.

All right, thank you.

Your next question comes from the line of Peter Saleh with Telsey Advisory Group.

Congratulations on the quarter.

Thanks Peter.

I just wanted to ask about the domestic business and just the health of the franchisees. It seems like they are in much, much better shape today than they were maybe three or four years ago. And so I guess the question is around unit growth; are you seeing franchisees coming to you and looking to expand on a unit growth basis?

Yes, they clearly are better off financially. I mean, the overall store level profits are up materially from where they were three or four years ago. Some folks are still digging out a little bit from the downturn. Good news is that availability of debt for larger players has gotten materially better, I think over the course of the past year and at very good pricing. The bad news is that availability of debt for smaller players is still pretty weak. So if you are a larger player with 20, 30, 40 stores that wants to borrow $1 million or more, there’s pretty good availability out there. If you are a two-store person looking to add a third store, debt availability is still pretty weak, and so that clearly still plays into it. And look, our franchisees are exposed to the same things that all of us are as consumers and as business people, and the environment out there is still perceived as being a little bit wobbly. So there’s still a little bit of conservatism, but we’ve got a number of folks who are certainly getting much more aggressive about either building or doing some buying, and we think that ultimately will be a positive for us.

Just a follow-up on that; can you just remind us again what percentage of your system is composed of these larger franchisees versus some of the smaller ones?

I mean on average, our franchisees are just over four stores per franchisee. So I know we have fewer than 100 franchisees who have 10 or more stores in our domestic system. So you are still looking at a system that on general is still made up of smaller entrepreneurs, small business people, and fewer larger players.

Great. Thank you very much.

Thank you.

The next question comes from the line of Mark Smith with Feltl & Company. Mark Smith - Feltl & Company: Comment on competitive pressure as we look at pricing, what you are seeing out there today, and as we start to look out to 2013, what opportunities you have to take pricing.

The consumer really decides that more than kind of the competitive situation and the answer is consumers are still relatively conservative. And to the extent to which we look at the competitive environment, I think it’s been pretty consistent over the course of the past kind of year or 18 months and from our standpoint, we are still seeing a consumer that’s being very careful with how they are spending money and we’ve got to continue to give them good value. So I don’t know that I see a whole lot of room on pricing out there. Mark Smith - Feltl & Company: Second question, can you just talk a little bit about potential health care cost changes and the impact that could have on you, but maybe more so on your franchisees and what you can do to help them?

Yes, I think that the real answer on that is there are a whole lot of rules that are still kind of being worked through in DC and how much or how little we are going to get affected by PPACA is really going to be a function of those rules. So as they look at look-back periods and definitions of full-time or part-time and just a lot of things that still need to be worked through, that’s really going to drive the answer on it. So it’s certainly something we are watching very carefully and I think until those rules are kind of settled, I can’t give you a real tight answer because that’s still going to drive a fair amount of variability on what that answer is going to be. Mark Smith - Feltl & Company: Would you say that this is been over-hanged for a potential domestic unit growth at this point with your franchisees or are they not as concerned about it right now?

No, I guess what I’d say is the overhang if you will, is uncertainty around the market in total. So it’s not around that as much as it’s around the overall economy, around what’s going to happen with tax rates. Just all of these things, I think kind of weigh on all of us and there’s a reasonable amount of uncertainty out there right now and so until we know what tax rates are going to be, until the election is over, until kind of rules are resolved on healthcare reform, all of those things, there’s some uncertainty out there and I think people, once there is more certainly, one way or the other people will get a little bit more aggressive again. Mark Smith - Feltl & Company: Perfect. Thank you.

Thank you.

The next question comes from the line of John Ivankoe with JPMorgan.

Yes, I’m (inaudible) for John. Two questions if I could; the first is on digital sales. Patrick, you discussed I think a 40% number on a one-third of order transactions in the U.S. I wanted to clarify what the difference was there. And then you touched on it, kind of as a driver of share of sales gains, but as the digital sales continue to potentially increase as a percent of orders, I wanted to get a sense for how you think about the labor or other productivity savings that you’ve achieved at the store level and how to think about that going forward.

Yes, so the answer is 40% of our delivery sales are digital and about a third of our total sales are digital. So clearly, as people are at home or at the office ordering, they are more likely to do it than if they are going to pick it up. And a little bit under 10% of our customers actually just walk into a store and order there on the spot and then wait for their pizza. So that’s a small part of our business, but that plays into kind of that mix differential as well. So in terms of labor, the answer is some of the improvements in labor efficiency that you’ve seen have clearly come from a higher mix of digital orders and we are well into the range on those orders that that incremental business going to digital will drive some labor efficiencies. I’ll tell you when we were first getting this going in digital, we didn’t see it as much for the first 10% or 15% of sales as we thought we were going to and then you could start to see it hitting. And in hindsight I guess it makes sense, until you kind of carved off enough of those orders, you look at it and say, are you really going to cut out hours from your schedule, and the answer is, we didn’t see as much of it early I think as maybe we thought we were going to. But at this level, it clearly drives some efficiencies for us and I’ll expect that that will continue as it grows.

Okay, and then switching gears a bit, I mean, as you think about free cash flow for 2013, how is the CapEx kind of shaping up? I mean, is it something to think about within kind of that long-term range of $25 million to $35 million?

We are in the process of putting budgets together, but at this point I would continue to work with those numbers in your model and we will give a further update on that in our Investor Day in January.

Got it. Thanks a lot.

(Operator Instructions). Your next question comes from the line of Steve Anderson with Miller Tabak.

Can you hear me?

Yes, I can.

Okay, just wanted to touch base with you. You gave some results for same-restaurant sales in the U.K. Have you been providing any results for India or when can we expect that to be released?

I don’t believe that they have released yet. And I think they are -- we are checking, but I think they are a couple of weeks.

They are a calendar quarter.

Yes, they are on a calendar quarter, so I think they are a couple of weeks out. But it’s Jubilant Foodworks and unless we can look it up faster than I can stall to give you the answer…

November 7.

November 7, I stalled long enough.

Okay, great. So I guess at that time, we can get some color on the new unit openings as well?

Well, you will get it from them.

Yes great. All right, thank you.

There are no further questions from the phone lines at this time.

Terrific. Well, I appreciate everybody getting on the call today. I look forward to reporting our fourth quarter results to you in February of next year. Thanks everybody.

Thank you for participating in today’s call. You may now disconnect.