Yum! comps slip on Pizza Hut decline

 
July 14, 2009
LOUISVILLE, Ky. -- Comparable-store sales at U.S. restaurants operated by Yum! Brands Inc. declined 1 percent in the second quarter ended June 13, the company has announced. The decline was comprised mainly of an 8 percent decline at Yum's Pizza Hut restaurants, partially offset by positive growth at Taco Bell and at KFC following the launch of Kentucky Grilled Chicken.
 
Yum! operates the KFC, Pizza Hut, Taco Bell, Long John Silver's and A&W brands.
 
Comps in the company's China division fell 4 percent compared with a 14 percent increase in 2008. Comps were negatively impacted by a 2 percent system sales decline in Thailand and a 15 percent system sales decline in Taiwan.
 
Comps for the company's international division increased 1 percent. The results for the international division were negatively impacted by approximately two points due to calendar shifts compared with last year.
 
Revenues for the quarter were $2.5 billion, off 7 percent compared with revenues of $2.7 billion for the 2008 second quarter. Year-to-date revenues were $4.7 billion, off 8 percent compared with revenues of $5.1 billion for the first half of 2008.
 
Net income for the quarter was $303 million, up 35 percent compared with net income of $224 million for the 2008 second quarter. Net income for the year to date was $521 million, up 9 percent compared with net income of $478 million for the same period last year.
 
The 2009 Q2 results included the benefit of a one-time gain of $68 million due to the company's acquisition of additional ownership in the operating entity that owns the KFC business in Shanghai.
 
"Going forward, we expect to deliver 10 percent earnings per share growth for the year in spite of a challenging global economic environment and build on our seven-year track record of double-digit EPS growth," said Yum CEO David Novak in a statement. "We expect to enter 2010 with even stronger brands and competitive positions everywhere we do business.

Topics: Operations Management , Pizza Hut , Public Companies


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