LOUISVILLE, Ky.--(BUSINESS WIRE)--
Yum! Brands Inc. (NYSE: YUM), in advance of its Annual Investor Meeting,
reconfirms its full-year 2012 EPS growth forecast of at least 13%, or
$3.24 per share, excluding Special Items. Yum! also announces it expects
to once again deliver at least 10% EPS growth in 2013, excluding Special
Items, which would mark twelve consecutive years of meeting or exceeding
this annual EPS growth target.
David C. Novak, Chairman and CEO, said, “I’m pleased to report we remain
on track to deliver at least 13% EPS growth this year. Our 2012 EPS
growth is driven by double-digit operating profit growth, prior to
foreign currency translation, in all three of our major operating
divisions: China, Yum! Restaurants International and the U.S. Solid
same-store sales growth at each of our divisions and record
international new-unit development highlight the quality of our growth.
“For the fourth quarter, stronger than expected operating performance
from Yum! Restaurants International and our U.S. division is offsetting
softer sales in China, where we now expect same-store sales to be
negative as we overlap 21% same-store sales growth from last year.
Full-year same-store sales growth in China is expected to be 6%. Next
year will be another strong year for our China division, given this
year’s record development of at least 800 new units and significant
innovation in the pipeline, underpinned by world class operations. We
are extremely confident Yum! China remains the best growth story in the
restaurant industry.
“Our leading, global brands are well positioned in the fastest growing
emerging markets. We remain focused on the three keys to driving
shareholder value: new-unit development, same-store sales growth and
high returns on invested capital.”
Q4 2012 UPDATE
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Strong momentum leads to record international development of at least
1,850 new units for the year, including at least: 800 new units in
China, 950 at Yum! Restaurants International (YRI), and 100 at Yum!
Restaurants India
-
Same-store sales in the fourth quarter are expected to be +4% at YRI,
+3% in the U.S., and -4% in China
-
Completed the refranchising of the Pizza Hut U.K. dine-in business of
330 restaurants on November 9, 2012
-
The fourth quarter will include an overlap headwind due to an
additional week in our 2011 fiscal year which produced a combined $26
million operating profit benefit to the U.S. and YRI
-
On November 16, 2012, the Board of Directors authorized the Company to
repurchase up to $1 billion in additional shares of common stock
through May 31, 2014
YUM! ONGOING EARNINGS GROWTH MODEL
-
Earnings per share growth of at least 10%
-
China operating profit growth of 15%, driven primarily by:
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Double-digit percentage growth in units
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Mid-teen system sales growth
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Mid-single digit same-store sales growth
-
Moderate G&A leverage
-
Yum! Restaurants International (YRI) operating profit growth of 10%
driven primarily by:
-
Net-unit growth of 3% to 4%
-
System sales growth of 6%
-
Same-store sales growth of at least 2% to 3%
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Margin improvement and G&A leverage
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U.S. Division operating profit growth of 5%
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Same-store sales growth of at least 2%
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Margin improvement and G&A leverage
2013 OVERALL GUIDANCE
Yum! expects to deliver at least 10% EPS growth in 2013, excluding
Special Items.
-
At least 1,800 new international units, including at least: 700 new
units in China, 950 at YRI, and 150 at Yum! Restaurants India
-
Estimated tax rate of about 27% with quarterly fluctuation
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Foreign currency translation expected to be flat
-
Global capital expenditures of over $1 billion
-
Interest expense expected to be flat
-
2% reduction in average diluted shares outstanding as a result of
share repurchases
-
Worldwide G&A increase of 3% due to continued growth in China
2013 REFRANCHISING PLAN
-
U.S. refranchising of about 200 units and $200 million in proceeds
mostly related to Taco Bell units. This will substantially complete
our U.S. refranchising program
-
Consistent with our transformation plan, any U.S. refranchising gains
or losses will be included in special items
2012 ANNUAL INVESTOR MEETING
The Annual Investor Meeting will be held on Thursday, December 6, 2012
from 8:45 am to 1:00 pm EST in New York City and the theme is “On the
Ground Floor of Global Growth…China and so Much More.” The company will
share its plan to continue to be the defining global company that feeds
the world, as well as present a business update and take questions on
its strategies and global expansion outlook. This meeting will be
webcast live and will also be available following the event. These can
be accessed online through the Yum! Brands Investor Relations website at http://www.yum.com/investors.
This announcement, any related announcements and the related webcast may
contain “forward-looking statements” within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. We intend all forward-looking statements to be covered by
the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Forward-looking statements can be identified by the fact
that they do not relate strictly to historical or current facts. Our
forward-looking statements are subject to risks and uncertainties, which
may cause actual results to differ materially from those projected.
Factors that can cause our actual results to differ materially include,
but are not limited to: food borne-illness or food safety issues;
economic and political conditions in the countries where we operate;
currency exchange and interest rates; our ability to attain our target
development goals; commodity, labor and other operating costs; our
ability to secure and maintain distribution and adequate supply to our
restaurants; the operational and financial success of our franchise and
license operators; the success of our refranchising strategy; pending or
future legal claims; the impact of any widespread illness; the value and
perception of our brands; publicity that may impact our business and/or
industry; government regulations; our effective tax rates; our ability
to protect the security of individually identifiable customer and
employee data; competition; and consumer preferences. You should consult
our filings with the Securities and Exchange Commission (including the
information set forth under the captions “Risk Factors” and
“Forward-Looking Statements” in our Annual Report on Form 10-K) for
additional detail about factors that could affect our financial and
other results. Forward-looking statements are based on current
expectations and assumptions and currently available data and are
neither predictions nor guarantees of future events or performance. You
should not place undue reliance on forward-looking statements, which
speak only as of the date hereof. We are not undertaking to update any
of these statements.
Yum! Brands, Inc., based in Louisville, Kentucky, is the world’s largest
restaurant company in terms of system restaurants with over 38,000
restaurants in more than 120 countries and territories. Yum! is ranked
#213 on the Fortune 500 List and generated revenues of more than $12
billion in 2011. The Company’s restaurant brands – KFC, Pizza Hut and
Taco Bell – are the global leaders of the chicken, pizza and
Mexican-style food categories. Outside the United States, the Yum!
Brands system opened approximately four new restaurants each day of the
year, making it a leader in international retail development. The
Company has consistently been recognized for its reward and recognition
culture, diversity leadership, community giving and consistent
shareholder returns.
Yum! Brands Inc.
Analysts:
Tim Jerzyk, Senior Vice President
Investor Relations, 888-298-6986
Steve Schmitt, Senior Director
Investor Relations, 888-298-6986
or
Media:
Amy Sherwood,
Vice President Public Relations, 502-874-8200
Source: Yum! Brands Inc.