Yum! Rides High on China
Yum! Brands Inc. (NYSE: YUM) reported fiscal third quarter adjusted earnings per share (EPS) of $0.99 on revenue of $3.57 billion. In the same period a year ago, the operator of KFC, Pizza Hut, and Taco Bell reported adjusted EPS of $0.83 on revenue of $2.2 billion. Fourth-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.97 EPS and $3.64 billion in revenue.
The company's chairman/CEO said:
Very strong sales and profit at all of our divisions, including China, Yum! Restaurants International, India and the U.S., drove 19% third-quarter EPS growth. Given the strength of our year-to-date results, I'm pleased to report we are raising our full-year EPS growth forecast to at least 13%, excluding Special Items.
Yum! raised its full-year 2012 adjusted EPS forecast to "at least $3.24." The consensus estimate had called for EPS of $3.26.
In China, the company opened 192 new stores and expects to open a total of at least 750 this year. Sales in China rose by a total of 22% on a constant currency basis and same-store sales rose 6%. Foreign exchange rates added $5 million to operating profits in China.
International sales were up 4% on a system wide basis and U.S. same-store sales rose 6%. In India, system-wide sales rose 29% and same-store sales rose 5%. The company expects to open more than 1,750 new stores outside the U.S. in 2012, including the 750 on tap for China.
Yum's shares are up about 3.7% in after-hours trading at $68.47. The 52-week range is $49.72 to $74.44. Thomson Reuters had a consensus analyst price target of around $76.50 before today's report.