Yum China comp sales gain 3% in Q2

Yum China Holdings said comparable store sales for the second quarter jumped 3%, on the back of strong KFC revenues.

The Chinese operator of US fast food brands KFC, Pizza Hut and Taco Bell said same store sales at KFC gained 4%, while offsetting the flat Pizza comp sales for the three-month period.

Yum China said total sales for the quarter lifted 7%, including growth of 8% at KFC and 7% at Pizza Hut.

Net income surged 39% to $107 million, and operating profit increased 64%, said the Shanghai-based restaurateur.

The group said it opened 90 stores last quarter.

“I am pleased with our overall performance during the quarter, with same-store sales up 3% and system sales up 7%, on the back of continued strength at KFC. Operating profit, restaurant margin and net income all showed robust improvement.” said Micky Pant, CEO.

“We are making progress in the key themes we are investing in – loyalty programs, digital and delivery capabilities, and continued upgrade of restaurant assets and optimization of store formats.”

Yum China said its loyalty members for KFC and Pizza Hut surpassed 100 million in total, and mobile payment exceeded 40% of company sales in the second quarter.

Over 4,900 of the group’s restaurants offer delivery service with delivery sales accounting for 13% of company sales in the second quarter, it said.

In the three-month period, Yum China also completed the acquisition of its 80% stake in Daojia, the food delivery firm, “for a cash consideration of $36.7 million to the selling shareholders and a capital contribution of $25 million to Daojia,” added Pant.

“We see this acquisition as complementary to our existing delivery business, and it provides valuable operational and technological expertise,” he said.