LOUISVILLE, Ky. (Oct. 10, 2012) — Yum! Brands Inc. on Tuesday reported that in the third quarter (which ended Sept. 8), its worldwide operating profit grew 18 percent, prior to foreign currency translation, including 22 percent in China, 14 percent at Yum! Restaurants International, and 13 percent in the U.S. After foreign currency translation, its worldwide operating profit increased 16 percent.
Yum! also reported third-quarter earnings per share (EPS) of 99 cents, excluding Special Items. Reported EPS for the quarter was $1. Yum! raised its full-year EPS growth forecast to at least 13 percent, or at least $3.24, excluding Special Items.
Yum! stock is up 8 percent today on news of its surpassing third quarter EPS expectations.
Third-quarter highlights
– Worldwide restaurant margin increased 1.9 percentage points to 18.9 percent, including increases of 0.1 percentage points in China, 1 percentage point at YRI and 4.6 percentage points in the U.S. Restaurant margin increased 0.6 percentage points in China excluding Little Sheep.
– Worldwide system sales grew 6 percent, prior to foreign currency translation, including 22 percent in China, 4 percent at YRI and 1 percent in the U.S.
– Worldwide system sales growth was 8 percent, excluding the acquisition of Little Sheep and the 2011 divestiture of Long John Silver’s and A&W All-American Restaurants, including 19 percent in China, 5 percent at YRI and 6 percent in the U.S.
– Same-store sales grew 6 percent in China, 2 percent at YRI and 6 percent in the U.S. YRI same-store sales were negatively impacted by 1 percentage point because of the timing of Ramadan.
– Strong international development continued with 394 new restaurants opened, including 192 new units in China and 181 new units at YRI; 86 percent of this development occurred in emerging markets.
– On Sept. 20, the company announced an 18 percent increase in its quarterly dividend, marking the eighth consecutive year the dividend increased at a double-digit percentage rate.
– Full-year EPS growth forecast raised to at least 13 percent, or at least $3.24, excluding Special Items.
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