Stock:
Symbol Lookup
Register | Login My Watchlist | My Account | Logout
History
to View Your Portfolio

Pre Market | Dow Jones | Gold | Newsletters | Learn


Weakness in China Hurts Yum Brands, Profits Slip 5.3% (YUM)

Tuesday, February 5, 2013 4:24 AM
Yum BrandsFast food chain, Yum! Brands Inc. (NYSE: YUM) reported late on Monday that its fiscal fourth-quarter profits fell 5.3% as same-store-sales in China were impacted by sluggishness in the economy, higher food costs and Chinese government’s assessment of chicken supplies in the country which brought negative publicity for its KFC brand. The Company also warned that earnings per share growth (EPS) is very unlikely in this fiscal as same-store-sales are expected to decline in China and it will take some time to win over consumers’ confidence, Yum Brands said. Shares slumped 4.6% in aftermarket trading on Monday. For the fiscal 2013, Yum Brands expects earnings to decline by mid single digit percentage point. While EPS in the first half of fiscal 2013 is expected to drop significantly, it is expected to grow in the second half of the current fiscal. “Although we cannot predict how long it will take to restore sales, we are steadfast in our belief that the power and popularity of the KFC brand in China will ultimately drive a full sales recovery,” said Chairman and Chief Executive David C. Novak to analysts and investors in a conference call. Yum Brands, which is parent company of three globally renowned brands such as KFC, Pizza Hut and Taco Bell, has seen its domestic business picking up with comparable-store-sales witnessing steady growth since previous four quarters, thanks to improving macroeconomic environment and some new introductions such as Doritos Locos Tacos at Taco Bell. Even though operating earnings in the domestic business slipped 5.8%, same-store sales rose 3% in the fourth quarter. China, which accounts for nearly half of company’s entire annual profits, remains a cause for concern. Same-store sales in China plunged 6%, as poor publicity the chicken industry received following government’s review of China poultry supplies dented Yum Brands’ KFC operations in China during the last two weeks of December. On consolidated basis, Yum reported net profit of $337 million or 72 cents a share, compared with $356 million or 75 cents a share, in the year-earlier quarter. After excluding onetime expenses adjusted earnings or non-GAAP earnings rose to 82 cents a share. Revenue during the period rose 1% to $4.14 billion. Analysts’ consensus estimate was for earnings of 82 cents a share on revenue of $4.12 billion, according to a data compiled by Thomson Reuters.  
PRINT

FREE Options Trading Lessons
I'll show you how to unlock HUGE Gains with Options Trading
Let's make 2016 the year you get RICH!

Latest Headlines

American Airlines' CEO contract scrapped but he will stay in roleAmerican Airlines' CEO contract scrapped but he will stay in role
(Reuters) - American Airlines Group Inc said it terminated Chief Executive Douglas Parker`s employment agreement on his request. Parker will no longer be contractually entitled to receive a set leve...
Political uncertainty fails to dent Spanish economic growth in first-quarterPolitical uncertainty fails to dent Spanish economic growth in first-quarter
MADRID (Reuters) - Spain`s economy expanded at a faster-than-expected pace in the first quarter of 2016, official data showed on Friday, despite politicians failing to form a government after a Decemb...
Tame U.S. inflation bolsters Fed caution on rate hikesTame U.S. inflation bolsters Fed caution on rate hikes
WASHINGTON (Reuters) - U.S. inflation barely rose in March as consumer spending remained tepid, making it less likely that the Federal Reserve will be able to follow through on its projected two int...
A river runs through it - Amazon's profit surge sweeps away doubtsA river runs through it - Amazon's profit surge sweeps away doubts
(Reuters) - The source of Amazon.com`s namesake river may be uncertain, but there`s no doubt about where the online retailer`s surging revenue is flowing from - just about everywhere. Amazon.com Inc...
OPEC oil output near record high in April as Iran, Iraq growth offsets outages: Reuters surveyOPEC oil output near record high in April as Iran, Iraq growth offsets outages: Reuters survey
LONDON (Reuters) - OPEC`s oil output rose in April to close to the highest level in recent history, a Reuters survey found on Friday, as production increases led by Iran and Iraq more than offset a ...

Loading Headlines...
 

Stock Market

Track the stock market today with the latest news and information on all things investing! Watch your stocks perform throughout the day and watch the breaking stock market news.

Feedback | disclaimer | privacy policy

Stock Market News

The Stock Market is ever changing. Keep up on your stock market news.

Stock Market Newsletters

Read up on your favorite stock market newsletters.

{localized={en_US=Terry}, preferredLocale={country=US, language=en}} {localized={en_US=Scott}, preferredLocale={country=US, language=en}}

Terry Scott
CEO of StockMarketWatch

View Profile


Learn the Stock Market

Sharper your stock trading skills with our stock market education section.

Be a Better
Trader, Today
arrow
PreMarket PRO Our New Streaming Realtime Pre-Market Product -- Click Here to Learn More