Yum! Brands, Inc. (NYSE:YUM) released the results from its December quarter after closing bell, beating estimates and sending shares up as much as 5%. The company reported earnings per share of 86 cents, excluding items, for the quarter. Including items, earnings were 70 cents per share. For the full year, earnings were $2.36 per share.
Analysts had been expecting the fast food chain giant to report earnings of 80 cents per share, excluding items, on revenue of $4.3 billion for the quarter. For the full year, they were looking for earnings of $2.93 per share on $13.2 billion in revenue.
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Yum! Brands reports worldwide growth
According to this evening’s report, Yum! Brands, Inc. (NYSE:YUM) continued to see major impacts from the December 2012 poultry supply incident and reports of bird flu. However, on a global basis, the company’s system sales increased 2% before adjusting for exchange rates. That includes 5% growth at Yum! Restaurants International and 1% growth in the U.S. Same-store sales at YRI rose 1% and remained flat in the U.S.
Yum! Brands’ KFC struggles, but Pizza Hut rises
System sales in China, however, fell 4%, as increases in Pizza Hut sales in China were not enough to offset continued problems at KFC there. Same-store sales in China fell 13%. KFC same-store sales in China declined 15% for the year and 4% for the quarter. Pizza Hut same-store sales in China rose 4% for the year and 5% for the quarter.
During 2013, Yum! Brands, Inc. (NYSE:YUM) reported the opening of 740 new stores, including 282 during the fourth quarter. Internationally, the company’s franchise system opened more than 1,200 new restaurants, with 70% of them in high-growth emerging markets.
In the U.S., Taco Bell also reported its eight quarter in a row of growth in same-store sales. As of Jan. 1, the company combined their YRI and U.S. divisions into three global brand divisions: KFC, Pizza Hut and Taco Bell. The company said China and India will remain separate divisions because of “their strategic importance and enormous growth potential.”
Yum! Brands reports items
During the fourth quarter, Yum! Brands, Inc. (NYSE:YUM) bought back about $550 million in outstanding debt and recorded a special item of about $75 million, mostly because of premiums related to the transaction. That impacted earnings per share by 22 percentage points for the quarter. The company also reported a special item of $258 million in connection with the write-down of Little Sheep intangible assets in the third quarter.
Yum! Brands, Inc. (NYSE:YUM) also said they expect to “deliver at least 20% EPS growth” this year and re-establish their “track record of double-digit EPS growth.”