SHANGHAI, July 5, 2017 /PRNewswire/ -- Yum China Holdings,
Inc. (the "Company" or "Yum China")
(NYSE: YUMC) today reported unaudited results for the second
quarter ended May 31, 2017.
Second Quarter Highlights
- Total system sales grew 7%, including growth of 8% at KFC and
7% at Pizza Hut1, excluding foreign currency translation
("F/X").
- Same-store sales grew 3%, including growth of 4% at KFC, flat
at Pizza Hut.
- Opened 90 new restaurants during the quarter.
- Total restaurant margin increased 2.7 percentage points to
15.3%, primarily due to the impact of retail tax structure reform
and also driven by same-store sales leverage, partially offset by
wage inflation and commodity inflation.
- Operating profit increased 64%, and 73% excluding F/X,
primarily due to the impact of retail tax structure reform and also
driven by same-store sales leverage. F/X negatively impacted
reported operating profit by $8
million.
- Net income increased 39% to $107
million.
- Adjusted EBITDA increased 15% to $259
million.
- Basic EPS increased 33% to $0.28
and diluted EPS increased 29% to $0.27.
1
Beginning with the quarter ended May 31, 2017, Pizza Hut Casual
Dining and Pizza Hut Home Service were combined and reported
together as the Pizza Hut reportable segment. Segment financial
information for prior periods has been re-cast to align with this
change in segments.
|
Key Results
|
Second
Quarter
|
|
|
Year to
Date
|
|
%
Change
|
|
|
%
Change
|
|
System
|
|
Same-Store
|
|
Net New
|
|
Operating
|
|
|
System
|
|
Same-Store
|
|
Net New
|
|
Operating
|
|
Sales
|
|
Sales
|
|
Units
|
|
Profit
|
|
|
Sales
|
|
Sales
|
|
Units
|
|
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yum China
|
7
|
|
3
|
|
6
|
|
64
|
|
|
6
|
|
2
|
|
6
|
|
34
|
KFC
|
8
|
|
4
|
|
5
|
|
41
|
|
|
6
|
|
3
|
|
5
|
|
20
|
Pizza Hut
|
7
|
|
-
|
|
9
|
|
157
|
|
|
8
|
|
1
|
|
9
|
|
95
|
|
Second
Quarter
|
|
|
Year to
Date
|
(in US$ million,
except
for per share data and
percentages)
|
2017
|
|
2016
|
|
%
Change
|
|
Ex F/X
|
|
|
2017
|
|
2016
|
|
%
Change
|
|
|
Reported
|
|
|
|
|
|
Reported
|
|
Ex F/X
|
Operating
Profit
|
$143
|
|
$ 87
|
|
64
|
|
73
|
|
|
$397
|
|
$
296
|
|
34
|
|
41
|
Net Income
|
$107
|
|
$ 77
|
|
39
|
|
46
|
|
|
$282
|
|
$
222
|
|
27
|
|
34
|
Adjusted
EBITDA
|
$259
|
|
$ 226
|
|
15
|
|
21
|
|
|
$579
|
|
$
505
|
|
14
|
|
21
|
Basic EPS
|
$0.28
|
|
$0.21
|
|
33
|
|
39
|
|
|
$0.73
|
|
$0.61
|
|
20
|
|
25
|
Diluted
EPS
|
$0.27
|
|
$0.21
|
|
29
|
|
35
|
|
|
$0.71
|
|
$0.61
|
|
16
|
|
23
|
Note: All comparisons
are versus the same period a year ago. Consistent with prior years,
Yum China's fiscal second quarter includes March, April and May
results. Percentages may not recompute due to rounding.
|
System sales and
same-store sales percentages exclude the impact of F/X. Adjusted
EBITDA is a non-GAAP financial measure. See Reconciliation of
Reported Results to Non-GAAP Measures included in the accompanying
tables of this release for further details.
|
CEO Comments
"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 committed to building one of the world's leading
restaurant companies, and are executing against a plan that we have
developed towards this goal. 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. We are pleased to report some
encouraging results: loyalty members for KFC and Pizza Hut have
surpassed 100 million in total, and mobile payment exceeded 40% of
our company sales in the second quarter. Over 4,900 of our
restaurants offered delivery service. Delivery sales accounted for
13% of company sales in the second quarter.
We also completed the acquisition of an 80% stake, on a fully
diluted basis, in Daojia, an online aggregator platform with two
brands focusing on higher-end
delivery market segment, for a cash consideration of
$36.7 million to the selling
shareholders and a capital contribution of $25 million to Daojia. We see this
acquisition as complementary to our existing delivery business, and
it provides valuable operational and technological expertise."
New-Unit Development and Asset Upgrade
- Opened 90 new restaurants during the second quarter, and 223
year to date.
- Remodeled 197 restaurants during the second quarter, and 229
year to date, led by KFC.
|
|
|
|
New
Units
|
|
|
Restaurant
Count
|
|
|
|
|
Second
Quarter
|
|
Year to
Date
|
|
|
As of Second
Quarter End
|
|
|
|
|
|
|
|
2017
|
|
|
2016
|
|
Yum China
|
|
|
90
|
|
223
|
|
|
|
7,685
|
|
|
|
7,246
|
|
KFC
|
|
|
62
|
|
134
|
|
|
|
5,301
|
|
|
|
5,039
|
|
Pizza Hut
|
|
|
25
|
|
64
|
|
|
|
2,122
|
|
|
|
1,949
|
|
Little Sheep, East
Dawning and Taco Bell
|
|
|
3
|
|
25
|
|
|
|
262
|
|
|
|
258
|
Total Restaurant
Count
|
|
|
|
Restaurant
Count
|
|
|
|
|
As of Second
Quarter End
|
|
|
|
|
2017
|
|
|
2016
|
|
Restaurants
|
|
|
|
7,685
|
|
|
|
7,246
|
|
Company-owned
|
|
|
|
6,103
|
|
|
|
5,800
|
|
Unconsolidated
Affiliates
|
|
|
|
854
|
|
|
|
811
|
|
Franchisees
|
|
|
|
728
|
|
|
|
635
|
Restaurant Margin
- For the second quarter, restaurant margin for Yum China increased 2.7 percentage points to
15.3%. Year to date, restaurant
margin for Yum China increased 3.1
percentage points to 18.7%. Margin expansion was primarily due to
the impact of retail tax structure reform and also driven by
same-store sales leverage, partially offset by wage inflation and
commodity inflation.
|
|
Second
Quarter
|
|
|
|
Year to
Date
|
|
|
2017
|
|
|
2016
|
|
|
%
ppts
change
|
|
|
|
2017
|
|
|
2016
|
|
|
%
ppts
change
|
|
Yum China
|
|
15.3
|
%
|
|
|
12.6
|
%
|
|
|
2.7
|
|
|
|
|
18.7
|
%
|
|
|
15.6
|
%
|
|
|
3.1
|
|
KFC
|
|
16.0
|
%
|
|
|
13.8
|
%
|
|
|
2.2
|
|
|
|
|
19.4
|
%
|
|
|
17.2
|
%
|
|
|
2.2
|
|
Pizza Hut
|
|
13.9
|
%
|
|
|
10.4
|
%
|
|
|
3.5
|
|
|
|
|
17.5
|
%
|
|
|
12.4
|
%
|
|
|
5.1
|
Digital and Delivery
- Driven by our digital initiatives, we continued to strengthen
our loyalty membership programs. By the end of the second quarter,
total members in our loyalty programs surpassed 100 million,
including 83 million members for KFC and 26 million for Pizza
Hut.
- Mobile payments exceeded 40% of company sales in the second
quarter of 2017. Over $900 million in
company sales were settled by cashless payment methods during the
quarter.
- Over 4,900 restaurants across China offered delivery services
as of the end of the second quarter. Delivery contributed about 13%
of company sales in the second quarter.
Completed Acquisition of Daojia
- During the second quarter, Yum
China completed the acquisition of a controlling interest in
the holding company of DAOJIA.com.cn ("Daojia"), an established
online food delivery service provider. Founded in 2010, Daojia
targets higher-end orders in four
Tier 1 cities. Daojia also operates Sherpa's, a leading premium
food delivery platform specializing in English speaking services.
- Yum China agreed to pay cash
consideration of $36.7 million to the
sellers and made a concurrent capital contribution of $25.0 million to Daojia. As of the completion of
the acquisition, Yum China held 90%
of Daojia's outstanding shares of common stock, or 80% of its
equity interests on a fully-diluted basis. Mr. Hank Sun, founder of Daojia, will continue to
lead the business.
- The acquisition marks another step in executing Yum China's strategy to accelerate growth by
building know-how and expertise in delivery. Daojia is
complementary to Yum China's
existing delivery business, and it provides valuable operational
and technological expertise.
Share Repurchase Update
- Year to date ended May 31, 2017, we repurchased approximately 1
million shares for $39 million at an
average price of $36.27 per
share.
Conference Call
Yum China Holdings, Inc. will host a conference call to review
the Company's financial performance and strategies at
8:00 p.m. U.S. Eastern Time on
Wednesday, July 5, 2017
(8:00 a.m. Beijing/Hong Kong Time on Thursday, July 6, 2017). A copy of the
presentation will be available on the Yum China Holdings, Inc.
website, http://ir.yumchina.com.
U.S.:
|
|
+1-845-675-0437
|
Hong Kong:
|
|
+852-3018-6771
|
Mainland
China:
|
|
400-6208-038 or
800-8190-121
|
International:
|
|
+65-6713-5090
|
Passcode:
|
|
Yum China
|
A live webcast of the call may also be accessed
at http://edge.media-server.com/m/p/kdojo9ry.
A replay of the conference call may be accessed by phone at the
following numbers two hours after the call ends until 9:00 a.m. U.S. Eastern Time on Thursday, July 13, 2017 (9:00 p.m. Beijing/Hong Kong Time on Thursday, July 13, 2017):
U.S.:
|
|
+1-855-452-5696
|
International:
|
|
+61-2-8199-0299
|
Passcode:
|
|
26482181
|
The webcast and the playback can be accessed via the internet by
visiting the Yum China Holdings, Inc. website,
http://ir.yumchina.com
Forward-Looking Statements
This press release contains "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 generally can be identified by the fact
that they do not relate strictly to historical or current facts and
by the use of forward-looking words such as "expect,"
"expectation," "believe," "anticipate," "may," "could," "intend,"
"belief," "plan," "estimate," "target," "predict," "likely,"
"will," "should," "forecast," "outlook" or similar terminology.
These statements are based on current estimates and assumptions
made by us in light of our experience and perception of historical
trends, current conditions and expected future developments, as
well as other factors that we believe are appropriate and
reasonable under the circumstances, but there can be no assurance
that such estimates and assumptions will prove to be correct.
Forward-looking statements include, without limitation, statements
regarding the future business plans and earnings and performance of
Yum China, anticipated effects of
population and macroeconomic trends, the capital structure of
Yum China, and statements regarding
the anticipated synergies from the acquisition and beliefs
regarding the long-term drivers of Yum
China's business. Forward-looking statements are not
guarantees of performance and are inherently subject to known and
unknown risks and uncertainties that are difficult to predict and
could cause our actual results to differ materially from those
indicated by those statements. We cannot assure you that any of our
expectations, estimates or assumptions will be achieved. The
forward-looking statements included in this press release are only
made as of the date of this press release, and we disclaim any
obligation to publicly update any forward-looking statement to
reflect subsequent events or circumstances, except as required by
law. Numerous factors could cause our actual results to differ
materially from those expressed or implied by forward-looking
statements, including, without limitation: whether we are able to
achieve development goals at the times and in the amounts currently
anticipated, if at all, the success of our marketing campaigns and
product innovation, our ability to maintain food safety and quality
control systems, our ability to control costs and expenses,
including tax costs, changes in political, economic and regulatory
conditions in China, the fact that
the integration of Daojia may require significant time, attention
and resources, potentially diverting attention from the conduct of
our core businesses, as well as the fact that the expected
synergies from the acquisition may not be realized. In addition,
other risks and uncertainties not presently known to us or that we
currently believe to be immaterial could affect the accuracy of any
such forward-looking statements. All forward-looking statements
should be evaluated with the understanding of their inherent
uncertainty. 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.
About Yum China Holdings, Inc.
Yum China Holdings, Inc. is a licensee of Yum! Brands in
mainland China. It has exclusive rights in mainland China to KFC,
China's leading quick-service restaurant brand, Pizza Hut, the
leading casual dining restaurant brand in China, and Taco Bell, which opened its first
restaurant in China at the end of
2016. Yum China also owns the Little
Sheep and East Dawning concepts outright. Yum China is well positioned for growth thanks
to its strong competitive position, integration of its brands into
Chinese popular culture and consumers' daily lives, expanding
geographic footprint in China and
existing operational expertise. It has a strong capital position,
no external debt and expects to continue growing its system sales
and profit by adding new restaurants and through growing same-store
sales. Yum China had more than 7,600
restaurants and more than 420,000 employees in over 1,100 cities at
the end of May 2017. A new generation
of younger consumers who are digitally sophisticated and brand
driven are fueling growth in consumption in China. The ongoing growth of the middle class
and urban population in China is
expected to create the world's largest market for restaurant
brands, with Yum China poised to be
the market leader.
Analysts are invited
to contact:
|
|
|
Christie Ju, Vice
President – Finance, Investor Relations, at +86 21 2407
8090
Elaine Lai, Director
– Finance, Investor Relations, at +86 21 2407 8278
|
|
|
|
Members of the media
are invited to contact:
|
|
|
Forest Liu, Director,
Public Affairs, at +86 21 2407 7505
|
Yum China
Holdings, Inc.
|
Condensed
Consolidated and Combined Summary of Results
|
(amounts in US$
million, except for number of shares and per share
amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
ended
|
|
|
% Change
|
|
Year to date
ended
|
|
|
% Change
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
1,563
|
|
|
$
|
1,558
|
|
|
|
—
|
|
|
|
$
|
2,820
|
|
|
$
|
2,836
|
|
|
|
(1)
|
|
|
Franchise fees and
income
|
|
|
31
|
|
|
|
30
|
|
|
|
6
|
|
|
|
|
58
|
|
|
|
55
|
|
|
|
6
|
|
|
Total
revenues
|
|
|
1,594
|
|
|
|
1,588
|
|
|
|
—
|
|
|
|
|
2,878
|
|
|
|
2,891
|
|
|
|
—
|
|
|
Costs and
Expenses, Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
453
|
|
|
|
462
|
|
|
|
2
|
|
|
|
|
798
|
|
|
|
847
|
|
|
|
6
|
|
|
Payroll and employee
benefits
|
|
|
358
|
|
|
|
342
|
|
|
|
(5)
|
|
|
|
|
615
|
|
|
|
587
|
|
|
|
(5)
|
|
|
Occupancy and other
operating expenses
|
|
|
513
|
|
|
|
558
|
|
|
|
8
|
|
|
|
|
879
|
|
|
|
960
|
|
|
|
8
|
|
|
Company restaurant
expenses
|
|
|
1,324
|
|
|
|
1,362
|
|
|
|
3
|
|
|
|
|
2,292
|
|
|
|
2,394
|
|
|
|
4
|
|
|
General and
administrative expenses
|
|
|
107
|
|
|
|
104
|
|
|
|
(4)
|
|
|
|
|
174
|
|
|
|
170
|
|
|
|
(2)
|
|
|
Franchise
expenses
|
|
|
15
|
|
|
|
17
|
|
|
|
12
|
|
|
|
|
28
|
|
|
|
31
|
|
|
|
11
|
|
|
Closures and
impairment expenses, net
|
|
|
17
|
|
|
|
31
|
|
|
|
47
|
|
|
|
|
17
|
|
|
|
31
|
|
|
|
47
|
|
|
Refranchising gain,
net
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
(73)
|
|
|
|
|
(2)
|
|
|
|
(4)
|
|
|
|
(67)
|
|
|
Other income,
net
|
|
|
(11)
|
|
|
|
(12)
|
|
|
|
(1)
|
|
|
|
|
(28)
|
|
|
|
(27)
|
|
|
|
7
|
|
|
Total costs and
expenses, net
|
|
|
1,451
|
|
|
|
1,501
|
|
|
|
3
|
|
|
|
|
2,481
|
|
|
|
2,595
|
|
|
|
4
|
|
|
Operating
Profit
|
|
|
143
|
|
|
|
87
|
|
|
|
64
|
|
|
|
|
397
|
|
|
|
296
|
|
|
|
34
|
|
|
Interest income,
net
|
|
|
5
|
|
|
|
2
|
|
|
|
66
|
|
|
|
|
7
|
|
|
|
4
|
|
|
|
59
|
|
|
Income Before
Income Taxes
|
|
|
148
|
|
|
|
89
|
|
|
|
64
|
|
|
|
|
404
|
|
|
|
300
|
|
|
|
34
|
|
|
Income tax
provision
|
|
|
(35)
|
|
|
|
(16)
|
|
|
NM
|
|
|
|
|
(111)
|
|
|
|
(78)
|
|
|
|
(40)
|
|
|
Net income –
including noncontrolling interests
|
|
|
113
|
|
|
|
73
|
|
|
|
55
|
|
|
|
|
293
|
|
|
|
222
|
|
|
|
32
|
|
|
Net income (loss) –
noncontrolling interests
|
|
|
6
|
|
|
|
(4)
|
|
|
NM
|
|
|
|
|
11
|
|
|
|
—
|
|
|
NM
|
|
|
Net Income – Yum
China Holdings, Inc.
|
|
$
|
107
|
|
|
$
|
77
|
|
|
|
39
|
|
|
|
$
|
282
|
|
|
$
|
222
|
|
|
|
27
|
|
|
Effective tax
rate
|
|
|
22.9
|
%
|
|
|
18.6
|
%
|
|
|
(4.3)
|
|
ppts.
|
|
|
27.4
|
%
|
|
|
26.2
|
%
|
|
|
(1.2)
|
|
ppts.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per
Common Share
|
|
$
|
0.28
|
|
|
$
|
0.21
|
|
|
|
33
|
|
|
|
$
|
0.73
|
|
|
$
|
0.61
|
|
|
|
20
|
|
|
Weighted average
shares outstanding
|
|
|
387,901,955
|
|
|
|
363,758,219
|
|
|
NM
|
|
|
|
|
387,754,681
|
|
|
|
363,758,219
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings
Per Common Share
|
|
$
|
0.27
|
|
|
$
|
0.21
|
|
|
|
29
|
|
|
|
$
|
0.71
|
|
|
$
|
0.61
|
|
|
|
16
|
|
|
Weighted average
shares outstanding
|
|
|
397,326,233
|
|
|
|
363,758,219
|
|
|
NM
|
|
|
|
|
396,679,703
|
|
|
|
363,758,219
|
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
Food and
paper
|
|
|
29.0
|
|
|
|
29.6
|
|
|
|
0.6
|
|
ppts.
|
|
|
28.3
|
|
|
|
29.9
|
|
|
|
1.6
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
22.9
|
|
|
|
21.9
|
|
|
|
(1.0)
|
|
ppts.
|
|
|
21.8
|
|
|
|
20.7
|
|
|
|
(1.1)
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
32.8
|
|
|
|
35.9
|
|
|
|
3.1
|
|
ppts.
|
|
|
31.2
|
|
|
|
33.8
|
|
|
|
2.6
|
|
ppts.
|
Restaurant
margin
|
|
|
15.3
|
%
|
|
|
12.6
|
%
|
|
|
2.7
|
|
ppts.
|
|
|
18.7
|
%
|
|
|
15.6
|
%
|
|
|
3.1
|
|
ppts.
|
Operating
margin
|
|
|
9.1
|
%
|
|
|
5.6
|
%
|
|
|
3.5
|
|
ppts.
|
|
|
14.1
|
%
|
|
|
10.5
|
%
|
|
|
3.6
|
|
ppts.
|
|
Percentages may not
recompute due to rounding.
|
|
|
|
Yum China
Holdings, Inc.
|
KFC Operating
Results
|
(amounts in US$
million)
|
(unaudited)
|
|
|
|
Quarter
ended
|
|
|
% Change
|
|
Year to date
ended
|
|
|
% Change
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
1,087
|
|
|
$
|
1,078
|
|
|
|
1
|
|
|
|
$
|
1,957
|
|
|
$
|
1,975
|
|
|
|
(1)
|
|
|
Franchise fees and
income
|
|
|
29
|
|
|
|
29
|
|
|
|
4
|
|
|
|
|
55
|
|
|
|
53
|
|
|
|
4
|
|
|
Total
revenues
|
|
|
1,116
|
|
|
|
1,107
|
|
|
|
1
|
|
|
|
|
2,012
|
|
|
|
2,028
|
|
|
|
(1)
|
|
|
Costs and
Expenses, Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
330
|
|
|
|
330
|
|
|
|
—
|
|
|
|
|
581
|
|
|
|
605
|
|
|
|
4
|
|
|
Payroll and employee
benefits
|
|
|
236
|
|
|
|
223
|
|
|
|
(5)
|
|
|
|
|
403
|
|
|
|
382
|
|
|
|
(6)
|
|
|
Occupancy and other
operating expenses
|
|
|
347
|
|
|
|
377
|
|
|
|
8
|
|
|
|
|
594
|
|
|
|
649
|
|
|
|
9
|
|
|
Company restaurant
expenses
|
|
|
913
|
|
|
|
930
|
|
|
|
2
|
|
|
|
|
1,578
|
|
|
|
1,636
|
|
|
|
4
|
|
|
General and
administrative expenses
|
|
|
39
|
|
|
|
38
|
|
|
|
(3)
|
|
|
|
|
64
|
|
|
|
62
|
|
|
|
(5)
|
|
|
Franchise
expenses
|
|
|
14
|
|
|
|
17
|
|
|
|
13
|
|
|
|
|
27
|
|
|
|
31
|
|
|
|
12
|
|
|
Closures and
impairment expenses, net
|
|
|
8
|
|
|
|
21
|
|
|
|
65
|
|
|
|
|
9
|
|
|
|
21
|
|
|
|
61
|
|
|
Other income,
net
|
|
|
(12)
|
|
|
|
(8)
|
|
|
|
36
|
|
|
|
|
(27)
|
|
|
|
(22)
|
|
|
|
21
|
|
|
Total costs and
expenses, net
|
|
|
962
|
|
|
|
998
|
|
|
|
4
|
|
|
|
|
1,651
|
|
|
|
1,728
|
|
|
|
4
|
|
|
Operating
Profit
|
|
$
|
154
|
|
|
$
|
109
|
|
|
|
41
|
|
|
|
$
|
361
|
|
|
$
|
300
|
|
|
|
20
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
Food and
paper
|
|
|
30.3
|
|
|
|
30.5
|
|
|
|
0.2
|
|
ppts.
|
|
|
29.7
|
|
|
|
30.6
|
|
|
|
0.9
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
21.7
|
|
|
|
20.7
|
|
|
|
(1.0)
|
|
ppts.
|
|
|
20.6
|
|
|
|
19.3
|
|
|
|
(1.3)
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
32.0
|
|
|
|
35.0
|
|
|
|
3.0
|
|
ppts.
|
|
|
30.3
|
|
|
|
32.9
|
|
|
|
2.6
|
|
ppts.
|
Restaurant
margin
|
|
|
16.0
|
%
|
|
|
13.8
|
%
|
|
|
2.2
|
|
ppts.
|
|
|
19.4
|
%
|
|
|
17.2
|
%
|
|
|
2.2
|
|
ppts.
|
Operating
margin
|
|
|
14.1
|
%
|
|
|
10.1
|
%
|
|
|
4.0
|
|
ppts.
|
|
|
18.4
|
%
|
|
|
15.2
|
%
|
|
|
3.2
|
|
ppts.
|
|
Percentages may not
recompute due to rounding.
|
Yum China
Holdings, Inc.
|
Pizza Hut
Operating Results
|
(amounts in US$
million)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
ended
|
|
|
% Change
|
|
Year to date
ended
|
|
|
% Change
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
467
|
|
|
$
|
465
|
|
|
|
1
|
|
|
|
$
|
846
|
|
|
$
|
832
|
|
|
|
2
|
|
|
Franchise fees and
income
|
|
|
1
|
|
|
|
1
|
|
|
|
23
|
|
|
|
|
1
|
|
|
|
1
|
|
|
|
27
|
|
|
Total
revenues
|
|
|
468
|
|
|
|
466
|
|
|
|
1
|
|
|
|
|
847
|
|
|
|
833
|
|
|
|
2
|
|
|
Costs and
Expenses, Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
120
|
|
|
|
127
|
|
|
|
6
|
|
|
|
|
212
|
|
|
|
232
|
|
|
|
9
|
|
|
Payroll and employee
benefits
|
|
|
119
|
|
|
|
115
|
|
|
|
(5)
|
|
|
|
|
207
|
|
|
|
197
|
|
|
|
(5)
|
|
|
Occupancy and other
operating expenses
|
|
|
163
|
|
|
|
175
|
|
|
|
7
|
|
|
|
|
279
|
|
|
|
301
|
|
|
|
7
|
|
|
Company restaurant
expenses
|
|
|
402
|
|
|
|
417
|
|
|
|
3
|
|
|
|
|
698
|
|
|
|
730
|
|
|
|
4
|
|
|
General and
administrative expenses
|
|
|
26
|
|
|
|
26
|
|
|
|
2
|
|
|
|
|
43
|
|
|
|
43
|
|
|
|
2
|
|
|
Franchise
expenses
|
|
|
1
|
|
|
|
—
|
|
|
|
(21)
|
|
|
|
|
1
|
|
|
|
—
|
|
|
|
(13)
|
|
|
Closures and
impairment expenses, net
|
|
|
9
|
|
|
|
11
|
|
|
|
21
|
|
|
|
|
8
|
|
|
|
10
|
|
|
|
21
|
|
|
Total costs and
expenses, net
|
|
|
438
|
|
|
|
454
|
|
|
|
4
|
|
|
|
|
750
|
|
|
|
783
|
|
|
|
4
|
|
|
Operating
Profit
|
|
$
|
30
|
|
|
$
|
12
|
|
|
|
157
|
|
|
|
$
|
97
|
|
|
$
|
50
|
|
|
|
95
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
Food and
paper
|
|
|
25.8
|
|
|
|
27.5
|
|
|
|
1.7
|
|
ppts.
|
|
|
25.1
|
|
|
|
28.0
|
|
|
|
2.9
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
25.6
|
|
|
|
24.4
|
|
|
|
(1.2)
|
|
ppts.
|
|
|
24.5
|
|
|
|
23.6
|
|
|
|
(0.9)
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
34.7
|
|
|
|
37.7
|
|
|
|
3.0
|
|
ppts.
|
|
|
32.9
|
|
|
|
36.0
|
|
|
|
3.1
|
|
ppts.
|
Restaurant
margin
|
|
|
13.9
|
%
|
|
|
10.4
|
%
|
|
|
3.5
|
|
ppts.
|
|
|
17.5
|
%
|
|
|
12.4
|
%
|
|
|
5.1
|
|
ppts.
|
Operating
margin
|
|
|
6.6
|
%
|
|
|
2.6
|
%
|
|
|
4.0
|
|
ppts.
|
|
|
11.6
|
%
|
|
|
6.0
|
%
|
|
|
5.5
|
|
ppts.
|
|
Percentages may not
recompute due to rounding.
|
Yum China
Holdings, Inc.
|
Condensed
Consolidated Balance Sheets
|
(amounts in US$
million, except for number of shares)
|
|
|
|
|
|
|
|
|
|
5/31/2017
|
|
|
12/31/2016
|
|
ASSETS
|
|
(Unaudited)
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
892
|
|
|
$
|
885
|
|
Short-term
investments
|
|
|
310
|
|
|
|
79
|
|
Accounts receivable,
net
|
|
|
74
|
|
|
|
74
|
|
Inventories,
net
|
|
|
266
|
|
|
|
268
|
|
Prepaid expenses and
other current assets
|
|
|
150
|
|
|
|
120
|
|
Total Current
Assets
|
|
|
1,692
|
|
|
|
1,426
|
|
Property, plant and
equipment, net
|
|
|
1,617
|
|
|
|
1,647
|
|
Goodwill
|
|
|
103
|
|
|
|
79
|
|
Intangible assets,
net
|
|
|
105
|
|
|
|
88
|
|
Investments in
unconsolidated affiliates
|
|
|
51
|
|
|
|
71
|
|
Other
assets
|
|
|
287
|
|
|
|
254
|
|
Deferred income
taxes
|
|
|
166
|
|
|
|
162
|
|
Total
Assets
|
|
|
4,021
|
|
|
|
3,727
|
|
LIABILITIES,
REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Accounts payable and
other current liabilities
|
|
|
966
|
|
|
|
971
|
|
Income taxes
payable
|
|
|
36
|
|
|
|
33
|
|
Total Current
Liabilities
|
|
|
1,002
|
|
|
|
1,004
|
|
Capital lease
obligations
|
|
|
27
|
|
|
|
28
|
|
Other liabilities and
deferred credits
|
|
|
260
|
|
|
|
252
|
|
Total
Liabilities
|
|
|
1,289
|
|
|
|
1,284
|
|
Redeemable
Noncontrolling Interest
|
|
|
5
|
|
|
|
—
|
|
Equity
|
|
|
|
|
|
|
|
|
Common stock, $0.01
par value; 1,000,000,000 shares authorized;
386,617,759.42
shares and 383,344,835.42 shares issued at May 31, 2017
and December
31, 2016, respectively; 384,760,471 shares and 383,344,835.42
shares
outstanding at
May 31, 2017 and December 31, 2016, respectively
|
|
|
4
|
|
|
|
4
|
|
Treasury
stock
|
|
|
(59)
|
|
|
|
(20)
|
|
Additional paid-in
capital
|
|
|
2,367
|
|
|
|
2,352
|
|
Retained
earnings
|
|
|
322
|
|
|
|
40
|
|
Accumulated other
comprehensive income
|
|
|
35
|
|
|
|
1
|
|
Total Equity – Yum
China Holdings, Inc.
|
|
|
2,669
|
|
|
|
2,377
|
|
Noncontrolling
interests
|
|
|
58
|
|
|
|
66
|
|
Total
Equity
|
|
|
2,727
|
|
|
|
2,443
|
|
Total Liabilities,
Redeemable Noncontrolling Interest and Equity
|
|
$
|
4,021
|
|
|
$
|
3,727
|
|
Yum China
Holdings, Inc.
|
Condensed
Consolidated and Combined Statements of Cash Flows
|
(amounts in US$
million)
|
(unaudited)
|
|
|
|
|
|
|
Year to date
ended
|
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
Cash Flows -
Operating Activities
|
|
|
|
|
|
|
|
|
Net income -
including noncontrolling interests
|
|
$
|
293
|
|
|
$
|
222
|
|
Depreciation and
amortization
|
|
|
160
|
|
|
|
171
|
|
Closures and
impairment expenses
|
|
|
17
|
|
|
|
31
|
|
Refranchising
gain
|
|
|
(2)
|
|
|
|
(4)
|
|
Deferred income
taxes
|
|
|
(1)
|
|
|
|
(29)
|
|
Equity income from
investments in unconsolidated affiliates
|
|
|
(30)
|
|
|
|
(26)
|
|
Distributions of
income received from unconsolidated affiliates
|
|
|
26
|
|
|
|
13
|
|
Share-based
compensation expense
|
|
|
10
|
|
|
|
5
|
|
Changes in accounts
receivable
|
|
|
3
|
|
|
|
(8)
|
|
Changes in
inventories
|
|
|
7
|
|
|
|
(30)
|
|
Changes in prepaid
expenses and other current assets
|
|
|
5
|
|
|
|
—
|
|
Changes in accounts
payable and other current liabilities
|
|
|
7
|
|
|
|
35
|
|
Changes in income
taxes payable
|
|
|
3
|
|
|
|
25
|
|
Other, net
|
|
|
(25)
|
|
|
|
18
|
|
Net Cash Provided
by Operating Activities
|
|
|
473
|
|
|
|
423
|
|
Cash Flows -
Investing Activities
|
|
|
|
|
|
|
|
|
Capital
spending
|
|
|
(177)
|
|
|
|
(172)
|
|
Purchase of
short-term investments
|
|
|
(229)
|
|
|
|
(54)
|
|
Proceeds from
refranchising of restaurants
|
|
|
3
|
|
|
|
13
|
|
Acquisition of
business, net of cash acquired
|
|
|
(25)
|
|
|
|
—
|
|
Other, net
|
|
|
(4)
|
|
|
|
(1)
|
|
Net Cash Used in
Investing Activities
|
|
|
(432)
|
|
|
|
(214)
|
|
Cash Flows -
Financing Activities
|
|
|
|
|
|
|
|
|
Net transfers to
Parent
|
|
|
—
|
|
|
|
(118)
|
|
Payment of capital
lease obligations
|
|
|
(1)
|
|
|
|
(1)
|
|
Repurchase of shares
of common stock
|
|
|
(30)
|
|
|
|
—
|
|
Employee stock option
proceeds
|
|
|
4
|
|
|
|
—
|
|
Other, net
|
|
|
(16)
|
|
|
|
—
|
|
Net Cash Used in
Financing Activities
|
|
|
(43)
|
|
|
|
(119)
|
|
Effect of Exchange
Rates on Cash and Cash Equivalents
|
|
|
9
|
|
|
|
(7)
|
|
Net Increase in
Cash and Cash Equivalents
|
|
|
7
|
|
|
|
83
|
|
Cash and Cash
Equivalents – Beginning of Period
|
|
|
885
|
|
|
|
425
|
|
Cash and Cash
Equivalents – End of Period
|
|
$
|
892
|
|
|
$
|
508
|
|
Reconciliation of Reported Results to Non-GAAP
Measures
(amounts in US$
million)
(unaudited)
In this press release:
- The Company provides certain percentage changes excluding the
impact of F/X. These amounts are derived by translating current
year results at prior year average exchange rates. We believe the
elimination of the F/X impact provides better year-to-year
comparability without the distortion of foreign currency
fluctuations.
- System sales growth reflects the results of all restaurants
regardless of ownership, including Company-owned, franchise and
unconsolidated affiliate restaurants that operate our concepts,
except for non-Company-owned restaurants for which we do not
receive a sales-based royalty. Sales of franchise and
unconsolidated affiliate restaurants typically generate ongoing
franchise fees for the Company at a rate of approximately 6% of
system sales. Franchise and unconsolidated affiliate restaurant
sales are not included in Company sales on the Condensed
Consolidated and Combined Statements of Income; however, the
franchise fees are included in the Company's revenues. We believe
system sales growth is useful to investors as a significant
indicator of the overall strength of our business as it
incorporates all of our revenue drivers, Company and franchise
same-store sales as well as net unit growth.
- Same-store sales growth is the estimated percentage change in
sales of all restaurants that have been open and in the Company
system one year or more.
- Company Restaurant profit ("Restaurant profit") is defined as
Company sales less expenses incurred directly by our Company-owned
restaurants in generating Company sales. Company restaurant margin
percentage is defined as Restaurant profit divided by Company
sales.
In addition to the results provided in accordance with US
Generally Accepted Accounting Principles ("GAAP") in this press
release, the Company provides non-GAAP measures which present
Operating Profit before Special Items, Diluted Earnings Per Common
Share before Special Items, Effective tax rate before Special Items
and Adjusted EBITDA, which we define as net income including
noncontrolling interests adjusted for income tax, interest income,
depreciation, amortization and other items, including store
impairment charges. Special Items consist of provision for losses
associated with the sale of the aircraft and impact of the
redemption of the Little Sheep noncontrolling interest which are
described in (a), (b) and (c) in the accompanying notes. The
Company excludes impact from Special Items for the purpose of
evaluating performance internally. Special Items are not included
in any of our segment results. These non-GAAP measures are not
intended to replace the presentation of our financial results in
accordance with GAAP. Rather, the Company believes that the
presentation of these non-GAAP measures provides additional
information to investors to facilitate the comparison of past and
present results, excluding those items that we do not believe are
indicative of our ongoing operations due to their nature. These
non-GAAP measures should not be considered in isolation or as a
substitute for GAAP financial results, but should be read in
conjunction with the unaudited Condensed Consolidated and Combined
Summary of Results and other information presented herein. A
reconciliation of these non-GAAP measures to the most directly
comparable GAAP measures follows.
|
|
Quarter
ended
|
|
Year to date
ended
|
Detail of Special
Items
|
|
5/31/2017
|
|
5/31/2016
|
|
5/31/2017
|
|
5/31/2016
|
Provision for loss
associated with sale of aircraft(a)
|
|
$
|
—
|
|
|
|
$
|
(1)
|
|
|
|
$
|
—
|
|
|
|
$
|
(1)
|
|
|
Special Items Expense
- Operating Profit
|
|
|
—
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
|
(1)
|
|
|
Special Items
Expense, net of tax of nil
-
including noncontrolling interests
|
|
|
—
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
|
(1)
|
|
|
Special Items
Expense, net of tax of nil
-
noncontrolling interests(b)
|
|
|
—
|
|
|
|
|
(8)
|
|
|
|
|
—
|
|
|
|
|
(8)
|
|
|
Special Items Income,
net of tax of nil
-
Yum China Holdings, Inc.
|
|
$
|
—
|
|
|
|
$
|
7
|
|
|
|
$
|
—
|
|
|
|
$
|
7
|
|
|
Weighted average
diluted shares outstanding
|
|
|
397,326,233
|
|
|
|
|
363,758,219
|
|
|
|
|
396,679,703
|
|
|
|
|
363,758,219
|
|
|
Special Items Diluted
Earnings Per Common Share
|
|
$
|
—
|
|
|
|
$
|
0.02
|
|
|
|
$
|
—
|
|
|
|
$
|
0.02
|
|
|
Reconciliation of
Reported Operating Profit to
Operating Profit Before Special Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Operating
Profit
|
|
$
|
143
|
|
|
|
$
|
87
|
|
|
|
$
|
397
|
|
|
|
$
|
296
|
|
|
Special Items Expense
- Operating Profit
|
|
|
—
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
|
(1)
|
|
|
Operating Profit
before Special Items
|
|
$
|
143
|
|
|
|
$
|
88
|
|
|
|
$
|
397
|
|
|
|
$
|
297
|
|
|
Reconciliation of
Reported EPS to EPS Before
Special Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Diluted
Earnings Per Common Share
|
|
$
|
0.27
|
|
|
|
$
|
0.21
|
|
|
|
$
|
0.71
|
|
|
|
$
|
0.61
|
|
|
Special Items Diluted
Earnings Per Common Share
|
|
|
—
|
|
|
|
|
0.02
|
|
|
|
|
—
|
|
|
|
|
0.02
|
|
|
Diluted Earnings Per
Common Share before Special Items
|
|
$
|
0.27
|
|
|
|
$
|
0.19
|
|
|
|
$
|
0.71
|
|
|
|
$
|
0.59
|
|
|
Reconciliation of
Reported Effective Tax Rate to
Effective Tax Rate Before Special Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported effective
tax rate
|
|
|
22.9
|
%
|
|
|
|
18.6
|
%
|
|
|
|
27.4
|
%
|
|
|
|
26.2
|
%
|
|
Effective tax rate
before Special Items(c)
|
|
|
22.9
|
%
|
|
|
|
18.6
|
%
|
|
|
|
27.4
|
%
|
|
|
|
26.2
|
%
|
|
|
(a)
During the quarter ended May 31, 2016, we recognized a loss of $1
million associated with the sale of the aircraft.
|
(b)
During the quarter ended May 31, 2016, the Little Sheep founding
shareholders sold their remaining 7% Little Sheep ownership
interest to the Company pursuant to their redemption rights. The
difference between the purchase price of less than $1 million,
which was determined using a non-fair value based formula pursuant
to the agreement governing the redemption rights, and the carrying
value of their redeemable noncontrolling interests was recorded as
an $8 million loss attributable to noncontrolling
interests.
|
(c)
Impact on effective tax rate as a result of Special Items was
nil.
|
Reconciliation
of Net Income to Adjusted EBITDA
|
(amounts in US$
million)
|
(unaudited)
|
Net income, along
with the reconciliation to Adjusted EBITDA, is presented
below.
|
|
|
|
|
|
|
|
|
|
Quarter
ended
|
|
|
Year to date
ended
|
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
|
5/31/2017
|
|
|
5/31/2016
|
|
Reconciliation of
Net Income to Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) –
noncontrolling interests
|
|
$
|
6
|
|
|
$
|
(4)
|
|
|
$
|
11
|
|
|
$
|
—
|
|
Net Income – Yum
China Holdings, Inc.
|
|
|
107
|
|
|
|
77
|
|
|
|
282
|
|
|
|
222
|
|
Income tax
provision
|
|
|
35
|
|
|
|
16
|
|
|
|
111
|
|
|
|
78
|
|
Interest income,
net
|
|
|
(5)
|
|
|
|
(2)
|
|
|
|
(7)
|
|
|
|
(4)
|
|
Operating
Profit
|
|
|
143
|
|
|
|
87
|
|
|
|
397
|
|
|
|
296
|
|
Depreciation and
amortization
|
|
|
96
|
|
|
|
103
|
|
|
|
160
|
|
|
|
171
|
|
Store impairment
charges
|
|
|
20
|
|
|
|
35
|
|
|
|
22
|
|
|
|
37
|
|
Special Items Expense
– Operating Profit
|
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
1
|
|
Adjusted
EBITDA
|
|
$
|
259
|
|
|
$
|
226
|
|
|
$
|
579
|
|
|
$
|
505
|
|
Yum China
Holdings, Inc.
|
Segment
Results
|
(amounts in US$
million)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
5/31/2017
|
KFC
|
|
|
Pizza Hut
|
|
|
Others
|
|
|
Corporate
|
|
|
Total
|
|
and
|
Unallocated
|
Total
revenues
|
$
|
1,116
|
|
|
$
|
468
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
1,594
|
|
Company restaurant
expenses
|
|
913
|
|
|
|
402
|
|
|
|
9
|
|
|
|
—
|
|
|
|
1,324
|
|
General and
administrative expenses
|
|
39
|
|
|
|
26
|
|
|
|
2
|
|
|
|
40
|
|
|
|
107
|
|
Franchise
expenses
|
|
14
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
Closures and
impairment expenses, net
|
|
8
|
|
|
|
9
|
|
|
|
—
|
|
|
|
—
|
|
|
|
17
|
|
Refranchising gain,
net
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
(1)
|
|
Other income,
net
|
|
(12)
|
|
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
(11)
|
|
|
|
962
|
|
|
|
438
|
|
|
|
12
|
|
|
|
39
|
|
|
|
1,451
|
|
Operating Profit
(Loss)
|
$
|
154
|
|
|
$
|
30
|
|
|
$
|
(2)
|
|
|
$
|
(39)
|
|
|
$
|
143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended 5/31/2016
|
KFC
|
|
|
Pizza Hut
|
|
|
Others
|
|
|
Corporate
|
|
|
Total
|
|
and
|
Unallocated
|
Total
revenues
|
$
|
1,107
|
|
|
$
|
466
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
1,588
|
|
Company restaurant
expenses
|
|
930
|
|
|
|
417
|
|
|
|
15
|
|
|
|
—
|
|
|
|
1,362
|
|
General and
administrative expenses
|
|
38
|
|
|
|
26
|
|
|
|
3
|
|
|
|
37
|
|
|
|
104
|
|
Franchise
expenses
|
|
17
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
17
|
|
Closures and
impairment expenses, net
|
|
21
|
|
|
|
11
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
31
|
|
Refranchising gain,
net
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
(1)
|
|
Other income,
net
|
|
(8)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(4)
|
|
|
|
(12)
|
|
|
|
998
|
|
|
|
454
|
|
|
|
17
|
|
|
|
32
|
|
|
|
1,501
|
|
Operating Profit
(Loss)
|
$
|
109
|
|
|
$
|
12
|
|
|
$
|
(2)
|
|
|
$
|
(32)
|
|
|
$
|
87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The above tables
reconcile segment information with our Condensed Consolidated and
Combined Summary of Results.
Corporate and unallocated expenses comprise items that are not
allocated to segments for performance reporting
purposes.
|
|
The Corporate and
Unallocated column in the above tables includes, among other
amounts, all amounts that we have deemed Special Items.
See Reconciliation of Reported Results to Non-GAAP
Measures.
|
Yum China
Holdings, Inc.
|
Segment
Results
|
(amounts in US$
million)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year to date ended
5/31/2017
|
|
KFC
|
|
|
Pizza Hut
|
|
|
Others
|
|
|
Corporate
|
|
|
Total
|
|
and
|
Unallocated
|
Total
revenues
|
|
$
|
2,012
|
|
|
$
|
847
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
2,878
|
|
Company restaurant
expenses
|
|
|
1,578
|
|
|
|
698
|
|
|
|
16
|
|
|
|
—
|
|
|
|
2,292
|
|
General and
administrative expenses
|
|
|
64
|
|
|
|
43
|
|
|
|
4
|
|
|
|
63
|
|
|
|
174
|
|
Franchise
expenses
|
|
|
27
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
28
|
|
Closures and
impairment expenses, net
|
|
|
9
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
17
|
|
Refranchising gain,
net
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2)
|
|
|
|
(2)
|
|
Other income,
net
|
|
|
(27)
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
(28)
|
|
|
|
|
1,651
|
|
|
|
750
|
|
|
|
19
|
|
|
|
61
|
|
|
|
2,481
|
|
Operating Profit
(Loss)
|
|
$
|
361
|
|
|
$
|
97
|
|
|
$
|
—
|
|
|
$
|
(61)
|
|
|
$
|
397
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year to date ended
5/31/2016
|
|
KFC
|
|
|
Pizza Hut
|
|
|
Others
|
|
|
Corporate
|
|
|
Total
|
|
and
|
Unallocated
|
Total
revenues
|
|
$
|
2,028
|
|
|
$
|
833
|
|
|
$
|
30
|
|
|
$
|
—
|
|
|
$
|
2,891
|
|
Company restaurant
expenses
|
|
|
1,636
|
|
|
|
730
|
|
|
|
28
|
|
|
|
—
|
|
|
|
2,394
|
|
General and
administrative expenses
|
|
|
62
|
|
|
|
43
|
|
|
|
4
|
|
|
|
61
|
|
|
|
170
|
|
Franchise
expenses
|
|
|
31
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
31
|
|
Closures and
impairment expenses, net
|
|
|
21
|
|
|
|
10
|
|
|
|
—
|
|
|
|
—
|
|
|
|
31
|
|
Refranchising gain,
net
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(4)
|
|
|
|
(4)
|
|
Other income,
net
|
|
|
(22)
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
(4)
|
|
|
|
(27)
|
|
|
|
|
1,728
|
|
|
|
783
|
|
|
|
31
|
|
|
|
53
|
|
|
|
2,595
|
|
Operating Profit
(Loss)
|
|
$
|
300
|
|
|
$
|
50
|
|
|
$
|
(1)
|
|
|
$
|
(53)
|
|
|
$
|
296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The above tables
reconcile segment information with our Condensed Consolidated and
Combined Summary of Results.
Corporate and unallocated expenses comprise items that are not
allocated to segments for performance reporting
purposes.
|
|
The Corporate and
Unallocated column in the above tables includes, among other
amounts, all amounts that we have deemed Special Items.
See Reconciliation of Reported Results to Non-GAAP
Measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/yum-china-reports-q2-same-store-sales-growth-of-3-and-operating-profit-growth-of-64-loyalty-members-surpassed-100-million-mobile-payment-exceeded-40-of-total-company-sales-300483327.html
SOURCE Yum China Holdings, Inc