Yum’s China sales fall less than expected, shares rise
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Yum Brands Inc, owner of KFC and Pizza Hut, said on Wednesday that sales at established restaurants in its biggest market China fell less than feared in the fourth quarter as it fights to recover from a food scandal involving a minor supplier, and its shares jumped 2.1 percent.
Same-restaurant sales in China, Yum’s number one market for revenue and profit, fell 16 percent for the quarter that ended on 27 December on continued fallout from allegations that a former supplier used expired meat.
But the decline was less severe than the 19.4 percent drop expected by analysts polled by Consensus Metrix, and shares in Yum rose USD1.51 to USD75.16 in extended trading.
Questions & Answers
Q.Which of Yum's brands were impacted by the sales decline in China?
Which of Yum's brands were impacted by the sales decline in China?
Yum Brands Inc. Owns KFC and Pizza Hut, and these brands operate in its biggest market, China. The article states that sales fell at established restaurants there due to a food scandal, implying both were affected.
Q.What was the main reason for Yum's sales decline in China during the fourth quarter?
What was the main reason for Yum's sales decline in China during the fourth quarter?
The decline in sales was attributed to the continued fallout from allegations that a former supplier used expired meat. This food scandal significantly impacted established restaurants in Yum's primary market.
Q.How did the sales performance in China compare to analyst expectations for the fourth quarter?
How did the sales performance in China compare to analyst expectations for the fourth quarter?
Same-restaurant sales in China fell by 16 percent, which was less severe than the 19.4 percent drop expected by analysts. This beat on expectations contributed to a rise in Yum's share price.