Emerging markets drive Yum growth

YUM Brands, Inc. (NYSE: YUM), which includes fast-food chains KFC, Taco Bell and Pizza Hut, said 86% of 249 new restaurants outside the United States are in emerging markets, which include Malaysia, the Philippines and Thailand. Worldwide system sales grew 4%; worldwide restaurant margin increased 3.3 percentage points to 19.2%; and worldwide operating profit increased 22%, the group said.

Operations in China and India remain separate divisions given their strategic importance and enormous growth potential, Yum said. China Division system sales increased 17%, driven by 7% unit growth and 9% same-store sales growth; restaurant margin increased 6.8 percentage points to 23.4% and operating profit increased 80%. India Division system sales increased 21%, driven by 25% unit growth which was partially offset by a 1% same-store sales decline. Operating profit declined $1 million.

David C. Novak, chairman and CEO, said, “In summary, Yum! Brands is off to a strong start this year. We expect to achieve EPS growth of at least 20% in 2014 and look forward to re-establishing our track record of consistently delivering double-digit EPS growth in the years ahead.”