Stock:
Symbol Lookup
Register | Login
...
History
...
...

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 2015 the year you get RICH!

Latest Headlines

CEO of Ashley Madison parent company steps downCEO of Ashley Madison parent company steps down
TORONTO (Reuters) - Noel Biderman, the chief executive of infidelity website Ashley Madison`s parent company, has left the company effective immediately, Avid Life Media said on Friday. "This change...
U.S. consumer sentiment falls in AugustU.S. consumer sentiment falls in August
NEW YORK (Reuters) - U.S. consumer sentiment fell in August, a survey released on Friday showed. The University of Michigan`s final August reading on the overall index on consumer sentiment came in ...
BNY Mellon glitch disrupted pricing on nearly 5 percent of U.S. fundsBNY Mellon glitch disrupted pricing on nearly 5 percent of U.S. funds
(Reuters) - BNY Mellon Corp`s <BK.N> computer glitch this week disrupted pricing on nearly 5 percent of U.S. mutual funds and exchange-traded funds, according to data from Morningstar Inc and ...
BNY Mellon glitch disrupted pricing on nearly 5 percent of US fundsBNY Mellon glitch disrupted pricing on nearly 5 percent of US funds
(Reuters) - BNY Mellon Corp`s <BK.N> computer glitch this week disrupted pricing on nearly 5 percent of U.S. mutual funds and exchange-traded funds, according to data from Morningstar Inc and Li...
Investors still in the dark as cyber threat growsInvestors still in the dark as cyber threat grows
LONDON/BOSTON (Reuters) - Investors are being poorly served by a haphazard approach from fund managers to the growing threat of cyber crime damaging the companies in which they invest, with a lack o...

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.


Learn the Stock Market

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