💼 Performance Overview:
Yum China reported 4% YoY revenue growth, with operating profit up 36% YoY and same-store transactions increasing for the eighth consecutive quarter. The company expanded to 16,395 stores, reflecting 12% YoY unit growth. Operating margin improved 1.4pp YoY, driven by cost efficiencies and pricing strategies.
📊 Key Financial Metrics (YoY Growth):
▫️ Revenue: $2.60B vs. $2.49B (+4%)
▫️ Net Income: $115M vs. $97M (+18%)
▫️ Adj. EPS: $0.30 vs. $0.25 (+20%)
▫️ Gross Margin: 12.3% (+1.6pp)
▫️ Operating Margin: 5.8% (+1.4pp)
📍 Segment Breakdown:
▫️ KFC: $1.95B (+4%) – Same-store transactions +3%, delivery +16% YoY
▫️ Pizza Hut: $510M (+3%) – Operating profit +156%, restaurant margin +2.0pp
▫️ Digital Sales: $9.6B in 2024, 90% of total sales
▫️ Membership: 525M KFC & Pizza Hut members (+11% YoY), 65% of system sales
📊 Income Statement Highlights:
▫️ Same-store sales: 99% of prior year levels (improved from Q3: 97%)
▫️ Delivery Contribution: 42% of KFC sales, 42% of Pizza Hut sales
▫️ Restaurant Margin: 12.3% (+1.6pp YoY)
▫️ Operating Profit Growth: 36% YoY ($151M)
▫️ Store Openings: 534 net new stores, reaching 16,395 total stores
💰 Balance Sheet Highlights:
▫️ Total Assets: $11.12B (-7.6% YoY)
▫️ Cash & Equivalents: $723M (-35.9% YoY)
▫️ Debt: $127M (down from $168M in FY23)
▫️ Capital Return: $248M dividends, $1.24B in share repurchases (8% of shares)
📈 Future Outlook:
▫️ FY25 Store Expansion: 1,600-1,800 net new stores
▫️ CapEx: $700M - $800M planned for FY25
▫️ Capital Return: Targeting $3B to shareholders in 2025-2026
▫️ Franchise Growth: 40-50% of new KFCs, 20-30% of new Pizza Huts to be franchise-operated
▫️ Dividend Growth: Increased 50% to $0.24 per share
🔎 Key Takeaway: Yum China continues profitable growth with record store expansion, strong digital adoption, and aggressive capital returns, setting a positive trajectory for 2025.