Yum! earnings climb on strength in China

by Eric Schroeder
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LOUISVILLE, KY. — Net income at Yum! Brands, Inc. rose 73% to $458 million, equal to 99c per share on the common stock, in the first quarter ended March 24. This compared with income of $264 million, or 56c per share, in the same period a year ago.

Total revenues, meanwhile, increased 13% to $2,743 million from $2,425 million.

David C. Novak, chairman and chief executive officer of Yum!, said the company’s China business “continues to fire on all cylinders.” Yum! set a new unit development record in China with the opening of 168 new restaurants in the first quarter. Sales in the region grew 28%, while operating profit rose 14% to $256 million from $215 million.

Mr. Novak said Yum! also was pleased with its performance in the United States, where same-store sales increased 5%, including 6% growth at Taco Bell, 5% growth at Pizza Hut, and 2% growth at KFC.
Operating profit in the U.S. division was $158 million, up 27% from $123 million in the same period a year ago.

Yum! opened 123 new units in 41 countries as part of its Yum! Restaurants International division, Mr. Novak said, and operating profit in the division rose 7% to $168 million from $158 million, while system sales increased 8% during the first quarter.

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