Fast food restaurant company Yum China has reported an 11% increase in net Income to $223m in the third-quarter of 2019 from $203m in the prior year period.
Yum China is a licensee of Yum! Brands in China. The company has exclusive rights in China to KFC, the country’s quick-service restaurant brand, Pizza Hut, a casual dining restaurant brand, and Taco Bell, a California-based restaurant chain serving Mexican-inspired food.
Total revenues grew 5% year over year to $2.3bn from $2.2bn. The company said total system sales increased 8% year -on-year, with growth of 10% at KFC and 3% at Pizza Hut, excluding foreign currency translation (F/X).
Operating profit registered a 11% growth year-on-year to $300m from $269m. Same-store sales grew 2% year over year, with a 3% rise at KFC and a 1% growth at Pizza Hut, excluding F/X.
In the third-quarter, the company inaugurated 231 new restaurants and remodeled 222 restaurants.
For fiscal year 2019, the company expects capital expenditures between $475m and $525m and effective tax rate below 28%.
Yum China CEO Joey Wat said: “We are pleased with our continued strong performance in the third quarter, which was driven by our competitive positioning, leading digital capabilities and ongoing innovation across the business.
“We achieved our 12th consecutive quarter of system sales growth since the spin-off, highlighting the strength of our business model and demonstrating our ability to effectively adapt to changing market conditions.
Wat talks about the future of the company: “We will continue to build on KFC’s resilient business model, cement the revitalisation of Pizza Hut, invest in the growth of our smaller brands and sharpen our industry-leading digital ecosystem, which enables us to meet customer demands and manage the business effectively.”
As of September 2019, the company had over 8,900 restaurants in more than 1,300 cities.