EmailStory Stocks®
Archive
Last Update: 10-Oct-12 09:10 ET
YUM Brands serves up better than expected earnings; shares rise 4%
YUM! Brands (YUM $69.11 +3.07) reported third quarter earnings of $0.99 per share, $0.02 better than the Capital IQ consensus of $0.97, while revenues rose 9.0% year/year to $3.57 billion versus the $3.64 bln consensus. The company issued guidance for fiscal year 2012 with EPS of at least $3.24 (prior 'at least $3.22') versus the $3.26 consensus.
Worldwide Operations: Worldwide operating profit grew 18%, prior to foreign currency translation, including 22% in China, 14% at Yum! Restaurants International (YRI) and 13% in the U.S. Worldwide operating profit increased 16%, after foreign currency translation. Worldwide restaurant margin increased 1.9 percentage points to 18.9%, including increases of 0.1 percentage points in China, 1.0 percentage point at YRI and 4.6 percentage points in the U.S. Restaurant margin increased 0.6 percentage points in China excluding Little Sheep. Worldwide system sales grew 6%, prior to foreign currency translation, including 22% in China, 4% at YRI and 1% in the U.S. Worldwide system sales growth was 8%, YRI same-store sales were negatively impacted by 1 percentage point due to the timing of Ramadan.
China Division: China Division system sales increased 22%, prior to foreign currency translation. Same-store sales increased 6%, overlapping strong prior year same-store sales growth of 19%. YRI Division:
YRI Division system sales increased 4%, prior to foreign currency translation. The timing of Ramadan had an estimated negative system sales impact of about 1%; the most sizable impact was in the Middle East franchise business which experienced a negative impact of 7%. The 2011 divestiture of LJS and A&W had a negative impact of 1% on both system sales and operating profit growth. Emerging markets system sales grew 10%, driven by 7% unit growth and 5% same-store sales growth. Developed markets system sales grew 1%.
U.S. Division: U.S. Division same-store sales increased 6%, including growth of 7% at Taco Bell, 6% at Pizza Hut and 4% at KFC. Restaurant margin increased 4.6 percentage points, driven primarily by strong same-store sales growth, as well as refranchising, supply chain efficiencies, and less discounting.
Worldwide Operations: Worldwide operating profit grew 18%, prior to foreign currency translation, including 22% in China, 14% at Yum! Restaurants International (YRI) and 13% in the U.S. Worldwide operating profit increased 16%, after foreign currency translation. Worldwide restaurant margin increased 1.9 percentage points to 18.9%, including increases of 0.1 percentage points in China, 1.0 percentage point at YRI and 4.6 percentage points in the U.S. Restaurant margin increased 0.6 percentage points in China excluding Little Sheep. Worldwide system sales grew 6%, prior to foreign currency translation, including 22% in China, 4% at YRI and 1% in the U.S. Worldwide system sales growth was 8%, YRI same-store sales were negatively impacted by 1 percentage point due to the timing of Ramadan.
China Division: China Division system sales increased 22%, prior to foreign currency translation. Same-store sales increased 6%, overlapping strong prior year same-store sales growth of 19%. YRI Division:
YRI Division system sales increased 4%, prior to foreign currency translation. The timing of Ramadan had an estimated negative system sales impact of about 1%; the most sizable impact was in the Middle East franchise business which experienced a negative impact of 7%. The 2011 divestiture of LJS and A&W had a negative impact of 1% on both system sales and operating profit growth. Emerging markets system sales grew 10%, driven by 7% unit growth and 5% same-store sales growth. Developed markets system sales grew 1%.
U.S. Division: U.S. Division same-store sales increased 6%, including growth of 7% at Taco Bell, 6% at Pizza Hut and 4% at KFC. Restaurant margin increased 4.6 percentage points, driven primarily by strong same-store sales growth, as well as refranchising, supply chain efficiencies, and less discounting.
