LOUISVILLE, Ky. – Shares of Yum! Brand Inc. jumped more than 5 percent after reporting positive performance in the first quarter. The company reported earnings per share, excluding special items, of 95 cents on revenues of $2.62 billion for the first quarter ended March 19, 2016.
“I’m very pleased with our results in the first quarter, including better-than-expected core operating profit growth of 21 percent, driven by 42 percent growth in our China business,” Greg Creed, CEO, said in a statement.
On a segment basis, the China division, which is on track for a spin off later this year, reported a 6 percent increase in same-store sales. An increase of 12 percent in the KFC China was partially offset by a 12 percent decline at Pizza Hut Casual Dining.
In the KFC Division, same-store sales edged 1 percent higher, while system sales climbed 5 percent, excluding foreign currency translation.
Core operating profit grew 7 percent excluding the incremental advertising expense associated with a 2015 agreement reached with KFC US franchisees. Yum! said the deal “…gave us brand marketing control, as well as an accelerated path to expanded menu offerings, improved assets and an enhanced customer experience. In connection with this agreement, we recognized a Special Items charge of $9 million during the quarter, primarily related to the funding of investments for new back-of-house equipment for franchisees.”
System sales advanced 4 percent in the Pizza Hut Division, while same-store sales were flat, Yum! reported.
Taco Bell Division reported same-store sales growth of 1 percent, compared to 6 percent a year ago. System sales climbed 3 percent on higher same-store sales growth and 3 percent unit growth, the company said.
Details about the company’s performance from its top executives will be posted subsequently on www.meatpoultry.com.