Fourth Quarter System
Sales Up 21%, Operating Profit Up 170% and Core Operating Profit
Grew 324% (1)
Full Year System Sales Up 21%,
Operating Profit Up 76% to $1.1
Billion and Core Operating Profit Grew 79%
Record
2023 Results - Total Revenues of $11
Billion, Adjusted Operating Profit of $1.1 Billion and 1,697 Net New
Stores Opened
14,644 Stores in Over 2,000
Cities
SHANGHAI, Feb. 6, 2024
/PRNewswire/ -- Yum China Holdings, Inc. (the "Company" or
"Yum China") (NYSE: YUMC and HKEX:
9987) today reported unaudited results for the fourth quarter and
year ended December 31, 2023.
Fourth Quarter Highlights
- Total system sales grew 21% year over year excluding
foreign currency translation ("F/X"). Growth was mainly
attributable to 12% net new unit contribution(2), 4% same-store sales growth
and lapping temporary closures from the pandemic in the prior
year.
- Opened 542 net new stores in the fourth quarter. Total
stores reached 14,644 as of December 31,
2023. KFC reached 10,296 stores and Pizza Hut reached 3,312
stores.
- Total revenues increased 19% to $2.49 billion, or 21% excluding F/X.
- Operating profit grew 170% to $110 million. Core operating profit grew
324%.
- Restaurant margin expanded to 10.7%. Excluding items
affecting comparability at the restaurant level – the impact from
temporary relief and VAT deduction benefits in both years,
restaurant margin expanded 170 basis points.
- Diluted EPS increased 77% to $0.23. Excluding Special Items as well as
unfavorable impacts of $0.01 from F/X
and $0.04 from the mark-to-market
investment in Meituan, the increase was 164%.
- Foreign currency translation unfavorably impacted total
revenues by $36 million, operating
profit by $2 million and diluted EPS
by $0.01.
Full Year Highlights
- Total system sales grew 21% excluding F/X. Growth was
mainly attributable to 9% net new unit contribution, 7% same-store
sales growth and lapping temporary closures from the pandemic in
the prior year.
- Store count increased 13%, or 1,697 net new stores,
exceeding the full-year net new store target.
- Total revenues were up 15% to $10.98 billion, or 21% excluding F/X.
- Operating profit grew 76% to $1.1
billion. Core operating profit grew 79%.
- Restaurant margin expanded to 16.3%. Excluding items
affecting comparability at the restaurant level, restaurant margin
expanded 270 basis points.
- Diluted EPS increased 89% to $1.97. Excluding Special Items as well as
unfavorable impacts of $0.11 from F/X
and $0.04 from the mark-to-market
investment in Meituan, the increase was 101%.
- Foreign currency translation unfavorably impacted total
revenues by $589 million, operating
profit by $61 million and diluted EPS
by $0.11.
- Shareholder returns through share repurchases and cash
dividends increased 25% to $833
million.
- Digital sales(3) exceeded $9.2 billion, with digital ordering accounted for
approximately 89% of total company sales.
- Total membership of KFC and Pizza Hut exceeded 470
million, up 14% versus the prior year. Member sales accounted for
approximately 65% of KFC and Pizza Hut's system sales in the
aggregate.
(1) Core Operating Profit is defined
as Operating Profit adjusted for Special Items, further excluding
items affecting comparability and the impact of F/X. The
Company uses
Core Operating Profit for the purposes of evaluating
the performance of its core operations. Please refer to
"Reconciliation of Reported GAAP Results to Non-GAAP Measures"
included in the accompanying tables of this release for further
details.
|
(2) Net
new unit contribution refers to
sales contribution from net new stores.
|
(3) Digital sales refer to sales at
company-owned stores where orderings were placed
digitally.
|
Increasing Dividends and Stepping Up Share
Repurchases
- Yum China returned approximately
$390 million to shareholders in the
fourth quarter and $833 million for
the full year through share repurchases and cash dividends. This
stands as the highest full year return thus far in the Company's
history.
- During the fourth quarter, the Company stepped up share
repurchases, totaling 7.5 million shares of common stock for
$336 million. In 2023 the Company
repurchased 12.4 million shares, equivalent to about 3% of its
total outstanding shares. As of December 31,
2023, approximately $1.5
billion remained available for future share repurchases
under the current authorization program.
- The Company plans to significantly accelerate the return of
value to its shareholders in 2024:
- The board declared a 23% increase in cash dividend to
$0.16 per share on Yum China's common stock, payable on
March 26, 2024 to shareholders of
record as of the close of business on March
5, 2024.
- The Company plans to repurchase $1.25
billion of its common stock in 2024, through open market
transactions in the U.S. and Hong
Kong. This includes two primary components: (i) an aggregate
repurchase amount of $750 million in
2024 under the Rule 10b5-1 of the United States Securities Exchange
Act of 1934 (the "Exchange Act") in the U.S. and a similar program
in Hong Kong; and (ii) an
aggregate repurchase amount of $500
million in the first quarter of 2024 under the Rule
10b-18 of the Exchange Act in the
U.S. and through similar transactions in Hong Kong.
Key Financial Results
|
Fourth
Quarter
|
|
|
|
Full
Year
|
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex F/X
|
|
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex F/X
|
|
System Sales Growth
(4) (%)
|
|
21
|
|
|
|
(4)
|
|
|
NM
|
|
|
NM
|
|
|
|
|
21
|
|
|
|
(5)
|
|
|
NM
|
|
|
NM
|
|
Same-Store Sales Growth
(4) (%)
|
|
4
|
|
|
|
(4)
|
|
|
NM
|
|
|
NM
|
|
|
|
|
7
|
|
|
|
(7)
|
|
|
NM
|
|
|
NM
|
|
Operating Profit
($mn)
|
|
110
|
|
|
|
41
|
|
|
|
+170
|
|
|
|
+175
|
|
|
|
|
1,106
|
|
|
|
629
|
|
|
|
+76
|
|
|
|
+86
|
|
Adjusted Operating
Profit (5) ($mn)
|
|
116
|
|
|
|
40
|
|
|
|
+193
|
|
|
|
+199
|
|
|
|
|
1,121
|
|
|
|
633
|
|
|
|
+77
|
|
|
|
+87
|
|
Core Operating Profit
(5) (6) ($mn)
|
|
111
|
|
|
|
29
|
|
|
NM
|
|
|
|
+324
|
|
|
|
|
1,121
|
|
|
|
627
|
|
|
NM
|
|
|
|
+79
|
|
Net Income
($mn)
|
|
97
|
|
|
|
53
|
|
|
|
+81
|
|
|
|
+84
|
|
|
|
|
827
|
|
|
|
442
|
|
|
|
+87
|
|
|
|
+97
|
|
Adjusted Net Income
(5) ($mn)
|
|
103
|
|
|
|
52
|
|
|
|
+96
|
|
|
|
+100
|
|
|
|
|
842
|
|
|
|
446
|
|
|
|
+89
|
|
|
|
+99
|
|
Diluted Earnings
Per Common Share ($)
|
|
0.23
|
|
|
|
0.13
|
|
|
|
+77
|
|
|
|
+85
|
|
|
|
|
1.97
|
|
|
|
1.04
|
|
|
|
+89
|
|
|
|
+100
|
|
Adjusted Diluted
Earnings
Per Common Share (5) ($)
|
|
0.25
|
|
|
|
0.13
|
|
|
|
+92
|
|
|
|
+92
|
|
|
|
|
2.00
|
|
|
|
1.05
|
|
|
|
+90
|
|
|
|
+101
|
|
(4) System
sales and same-store sales percentages exclude the impact of F/X.
Effective January 1, 2018, temporary store closures are normalized
in the same-store sales calculation by excluding the period during
which stores are temporarily closed.
|
(5) See
"Reconciliation of Reported GAAP Results to Non-GAAP Measures"
included in the accompanying tables of this release for further
details.
|
(6)
Current period amounts are derived by translating results at
average exchange rates of the prior year period.
|
Note: All
comparisons are versus the same period a year ago.
|
Percentages may not
recompute due to rounding.
|
NM refers to not
meaningful.
|
CEO Comments
Joey Wat, CEO of Yum China,
commented, "2023 was a pivotal year for Yum
China. Not only did we demonstrate strong resilience during
the pandemic, but we also seized opportunities that arose from
China's reopening. In 2023, our system sales grew by 21%,
surpassing the industry's growth rate, and we set new records for
both revenue and profits. Our return to shareholders through cash
dividends and share repurchases in 2023 was the highest since
spinoff. Looking ahead, we remain very positive about the vast
growth opportunities in China.
Currently serving just one-third of China's population, our
ambitious goal is to extend our reach to half of the population by
2026. Over half of our new stores are located in lower-tier cities,
strategically positioned to capture the demand from long-term
consumption upgrades there. We are also expanding our addressable
market and capturing incremental sales across city tiers with
innovative products, engaging campaigns and a wider range of price
points. Leveraging our distinctive strengths, including brands
deeply ingrained in China,
remarkable agility and robust operational execution, we are
well-positioned to achieve our growth targets for 2024-2026 and
deliver excellent returns to our shareholders through increased
cash dividends and stepped-up share buybacks."
KFC
|
Fourth
Quarter
|
|
Full
Year
|
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex
F/X
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex
F/X
|
|
Restaurants
|
|
10,296
|
|
|
|
9,094
|
|
|
|
+13
|
|
|
NM
|
|
|
10,296
|
|
|
|
9,094
|
|
|
|
+13
|
|
|
NM
|
|
System Sales Growth
(%)
|
|
20
|
|
|
|
(1)
|
|
|
NM
|
|
|
NM
|
|
|
20
|
|
|
|
(4)
|
|
|
NM
|
|
|
NM
|
|
Same-Store Sales Growth
(%)
|
|
3
|
|
|
|
(3)
|
|
|
NM
|
|
|
NM
|
|
|
7
|
|
|
|
(7)
|
|
|
NM
|
|
|
NM
|
|
Total Revenues
($mn)
|
|
1,872
|
|
|
|
1,591
|
|
|
|
+18
|
|
|
|
+19
|
|
|
8,240
|
|
|
|
7,219
|
|
|
|
+14
|
|
|
|
+20
|
|
Operating Profit
($mn)
|
|
167
|
|
|
|
117
|
|
|
|
+43
|
|
|
|
+45
|
|
|
1,202
|
|
|
|
787
|
|
|
|
+53
|
|
|
|
+60
|
|
Core Operating Profit
($mn)
|
|
164
|
|
|
|
115
|
|
|
NM
|
|
|
|
+43
|
|
|
1,211
|
|
|
|
806
|
|
|
NM
|
|
|
|
+50
|
|
Restaurant Margin
(%)
|
|
12.0
|
|
|
|
12.7
|
|
|
|
(0.7)
|
|
|
|
(0.7)
|
|
|
17.7
|
|
|
|
15.7
|
|
|
|
+2.0
|
|
|
|
+2.0
|
|
- System sales for KFC grew
20% for the quarter and the year, primarily driven by net new unit
contribution of 12% and 9%, respectively, 3% increase in same-store
sales for the quarter and 7% increase for the year, as well as
lapping temporary closures in the prior year.
- KFC opened a record 1,202 net new stores in 2023 and reached
10,296 stores at year-end 2023.
- Operating profit of $1.2 billion
reached a record level with increases of 43% for the quarter and
53% for the year.
- Restaurant margin was 12.0% for the quarter. Excluding items
affecting comparability at the restaurant level, restaurant margin
expanded 60 basis points, primarily due to sales leveraging, which
was partially offset by higher promotion costs and wage inflation.
Full-year restaurant margin was 17.7%. Excluding items affecting
comparability at the restaurant level, restaurant margin expanded
240 basis points, primarily driven by sales leveraging and
favorable commodity prices, partially offset by higher promotion
costs and wage inflation.
- Delivery contributed approximately 38% of KFC's Company sales
for the quarter and 36% for the year. Off-premise contributed
approximately 66% for the full year 2023, compared to 69% in 2022.
Dine-in significantly rebounded in 2023 compared to the
pandemic-impacted prior year.
Pizza Hut
|
Fourth
Quarter
|
|
Full
Year
|
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
|
|
|
|
|
%/ppts
Change
|
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex
F/X
|
|
2023
|
|
|
2022
|
|
|
Reported
|
|
|
Ex
F/X
|
|
Restaurants
|
|
3,312
|
|
|
|
2,903
|
|
|
|
+14
|
|
|
NM
|
|
|
3,312
|
|
|
|
2,903
|
|
|
|
+14
|
|
|
NM
|
|
System Sales Growth
(%)
|
|
24
|
|
|
|
(6)
|
|
|
NM
|
|
|
NM
|
|
|
20
|
|
|
|
(3)
|
|
|
NM
|
|
|
NM
|
|
Same-Store Sales Growth
(%)
|
|
6
|
|
|
|
(8)
|
|
|
NM
|
|
|
NM
|
|
|
6
|
|
|
|
(6)
|
|
|
NM
|
|
|
NM
|
|
Total Revenues
($mn)
|
|
496
|
|
|
|
404
|
|
|
|
+23
|
|
|
|
+24
|
|
|
2,246
|
|
|
|
1,960
|
|
|
|
+15
|
|
|
|
+21
|
|
Operating Profit
($mn)
|
|
5
|
|
|
|
(20)
|
|
|
NM
|
|
|
NM
|
|
|
142
|
|
|
|
70
|
|
|
|
+102
|
|
|
|
+117
|
|
Core Operating Profit
($mn)
|
|
4
|
|
|
|
(27)
|
|
|
NM
|
|
|
NM
|
|
|
143
|
|
|
|
48
|
|
|
NM
|
|
|
|
+198
|
|
Restaurant Margin
(%)
|
|
7.3
|
|
|
|
1.9
|
|
|
|
+5.4
|
|
|
|
+5.4
|
|
|
11.8
|
|
|
|
9.2
|
|
|
|
+2.6
|
|
|
|
+2.6
|
|
- System sales for Pizza Hut grew
24% for the quarter and 20% for the year, primarily driven by net
new unit contribution of 12% for the quarter and 10% for the year,
a 6% increase in same-store sales and lapping temporary closures in
the prior year.
- Pizza Hut accelerated new store openings in 2023 with a record
409 net new stores. Total stores reached 3,312 at year-end
2023.
- Operating profit increased to $5
million for the quarter, compared with an operating loss of
$20 million in the prior year period.
For the year, operating profit was $142
million, representing 102% growth.
- Restaurant margin for the quarter was 7.3%. Excluding items
affecting comparability at the restaurant level, restaurant margin
expanded 680 basis points, primarily driven by sales leveraging,
labor productivity gain, and lower rider cost. For the full year,
restaurant margin was 11.8%. Excluding items affecting
comparability at the restaurant level, restaurant margin expanded
330 basis points from the prior year, primarily driven by sales
leveraging and favorable commodity prices, which was partially
offset by wage inflation and higher promotion costs.
- Delivery contributed approximately 40% of Pizza Hut's Company
sales for the quarter and 37% for the year. Off-premise contributed
approximately 46% for the year, compared to 52% in 2022,
significantly above pre-pandemic 2019 level of 30%.
Outlook
In 2024, Yum China plans to
- Open approximately 1,500 to 1,700 net new stores.
- Make capital expenditures in the range of approximately
$700 million to $850 million.
From 2024 to 2026, Yum
China targets to
- Reach a total store count of 20,000 by 2026.
- Achieve a high-single-to-double-digit CAGR for system sales and
operating profit, and a double-digit CAGR for EPS, using 2023 as
the base year excluding F/X.
- Return a minimum of $3 billion to
shareholders through quarterly dividends and share
repurchases.
Other Updates
- Yum China was ranked number one
globally for the Restaurant & Leisure Facilities Industry in
the S&P Global 2023 Corporate Sustainability Assessment,
reflecting its unwavering commitment to environmental, social, and
governance. 2023 marked the fourth consecutive year that
Yum China was selected as a member
of both the Dow Jones Sustainability Indices: World Index and
Emerging Market Index.
- Yum China was once again named
by Top Employers Institute as a Top Employer in China for the sixth consecutive year.
Yum China was first in the
restaurant industry. This latest recognition underscores the
Company's continued dedication to providing an exceptional working
environment and experience for its people.
- Yum China has been named to the
Fortune World's Most Admired Companies list for 2024, ranked #5 in
the food service industry.
Note on Non-GAAP Measures
Reported GAAP results include items that are excluded from
non-GAAP measures. See "Reconciliation of Reported GAAP Results to
Non-GAAP Measures" and "Segment Results" within this release for
non-GAAP reconciliation details.
Conference Call
Yum China's management will hold
an earnings conference call at 7:00
p.m. U.S. Eastern Time on Tuesday,
February 6, 2024 (8:00 a.m.
Beijing/Hong Kong Time on
Wednesday, February 7, 2024).
A live webcast of the call may be accessed at
https://edge.media-server.com/mmc/p/rav3hcwk.
To join by phone, please register in advance of the conference
through the link provided below. Upon registering, you will be
provided with participant dial-in numbers, a passcode and a unique
access PIN.
Pre-registration link:
https://s1.c-conf.com/diamondpass/10035579-wp1ljg.html
A replay of the conference call will be available one hour after
the call ends until Wednesday, February 14,
2024 and may be accessed by phone using the following
numbers:
U.S.:
|
1 855 883
1031
|
Mainland
China:
|
400 1209 216
|
Hong Kong:
|
800 930 639
|
U.K.:
|
0800 031
4295
|
|
|
Replay PIN:
|
10035579
|
Additionally, this earnings release, the accompanying slides, as
well as the live and archived webcast of this conference call will
be available at Yum China's Investor Relations website at
http://ir.yumchina.com.
For important news and information regarding Yum China, including our filings with the U.S.
Securities and Exchange Commission and the Hong Kong Stock
Exchange, visit Yum China's Investor
Relations website at http://ir.yumchina.com. Yum China uses this website as a primary channel
for disclosing key information to its investors, some of which may
contain material and previously non-public information.
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, including under
"2024 Outlook." 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," "project," "likely," "will," "continue," "should,"
"forecast," "outlook," "commit" 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 strategies, growth, business plans, investments, store
openings, capital expenditures, dividend and share repurchase
plans, CAGR for system sales, operating profit and EPS, earnings,
performance and returns of Yum
China, anticipated effects of population and macroeconomic
trends, pace of recovery of Yum
China's business, the anticipated effects of our innovation,
digital and delivery capabilities and investments on growth 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 or events 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 or events 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,
changes in public health conditions, including the COVID-19
pandemic, our ability to control costs and expenses, including tax
costs, as well as changes in political, economic and regulatory
conditions in China, and those set
forth under the caption "Risk Factors" in our Annual Report on Form
10-K and subsequent Quarterly Reports on Form 10-Q). 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
caption "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in our Annual Report on Form
10-K and subsequent Quarterly Reports on Form 10-Q) for additional
detail about factors that could affect our financial and other
results.
About Yum China Holdings, Inc.
Yum China is the largest
restaurant company in China with a
mission to make every life taste beautiful. The Company has over
400,000 employees and operates over 14,000 restaurants under six
brands across 2,000 cities in China. KFC and Pizza Hut are the leading
brands in the quick-service and casual dining restaurant spaces in
China, respectively. Taco Bell
offers innovative Mexican-inspired food. Yum China has also partnered with Lavazza to
develop the Lavazza coffee concept in China. Little Sheep and Huang Ji Huang specialize in Chinese cuisine.
Yum China has a world-class,
digitalized supply chain which includes an extensive network of
logistics centers nationwide and an in-house supply chain
management system. Its strong digital capabilities and loyalty
program enable the Company to reach customers faster and serve them
better. Yum China is a Fortune 500
company with the vision to be the world's most innovative pioneer
in the restaurant industry. For more information, please visit
http://ir.yumchina.com.
Investor Relations
Contact:
|
|
|
Tel: +86 21 2407 7556 /
+852 2267 5801
IR@YumChina.com
|
Media
Contact:
|
|
|
Tel: +86 21 2407
7510
Media@YumChina.com
|
Yum China
Holdings, Inc.
|
Condensed
Consolidated Statements of Income
|
(in US$ million,
except per share data)
|
(unaudited)
|
|
|
|
Quarter
Ended
|
|
|
%
Change
|
|
Year
Ended
|
|
|
%
Change
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
2,343
|
|
|
$
|
1,975
|
|
|
|
19
|
|
|
|
$
|
10,391
|
|
|
$
|
9,110
|
|
|
|
14
|
|
|
Franchise fees and
income
|
|
|
20
|
|
|
|
16
|
|
|
|
24
|
|
|
|
|
89
|
|
|
|
81
|
|
|
|
11
|
|
|
Revenues from
transactions with franchisees
|
|
|
90
|
|
|
|
68
|
|
|
|
32
|
|
|
|
|
372
|
|
|
|
287
|
|
|
|
30
|
|
|
Other
revenues
|
|
|
40
|
|
|
|
29
|
|
|
|
37
|
|
|
|
|
126
|
|
|
|
91
|
|
|
|
39
|
|
|
Total
revenues
|
|
|
2,493
|
|
|
|
2,088
|
|
|
|
19
|
|
|
|
|
10,978
|
|
|
|
9,569
|
|
|
|
15
|
|
|
Costs and Expenses,
Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
758
|
|
|
|
630
|
|
|
|
(20)
|
|
|
|
|
3,224
|
|
|
|
2,836
|
|
|
|
(14)
|
|
|
Payroll and employee
benefits
|
|
|
678
|
|
|
|
570
|
|
|
|
(19)
|
|
|
|
|
2,725
|
|
|
|
2,389
|
|
|
|
(14)
|
|
|
Occupancy and other
operating expenses
|
|
|
654
|
|
|
|
570
|
|
|
|
(15)
|
|
|
|
|
2,752
|
|
|
|
2,604
|
|
|
|
(6)
|
|
|
Company restaurant
expenses
|
|
|
2,090
|
|
|
|
1,770
|
|
|
|
(18)
|
|
|
|
|
8,701
|
|
|
|
7,829
|
|
|
|
(11)
|
|
|
General and
administrative expenses
|
|
|
153
|
|
|
|
145
|
|
|
|
(5)
|
|
|
|
|
638
|
|
|
|
594
|
|
|
|
(7)
|
|
|
Franchise
expenses
|
|
|
8
|
|
|
|
7
|
|
|
|
(9)
|
|
|
|
|
36
|
|
|
|
34
|
|
|
|
(2)
|
|
|
Expenses for
transactions with franchisees
|
|
|
86
|
|
|
|
67
|
|
|
|
(28)
|
|
|
|
|
356
|
|
|
|
279
|
|
|
|
(28)
|
|
|
Other operating costs
and expenses
|
|
|
35
|
|
|
|
25
|
|
|
|
(38)
|
|
|
|
|
112
|
|
|
|
78
|
|
|
|
(43)
|
|
|
Closures and impairment
expenses, net
|
|
|
12
|
|
|
|
12
|
|
|
|
5
|
|
|
|
|
29
|
|
|
|
32
|
|
|
|
11
|
|
|
Other (income)
expenses, net
|
|
|
(1)
|
|
|
|
21
|
|
|
NM
|
|
|
|
|
—
|
|
|
|
94
|
|
|
|
100
|
|
|
Total costs and
expenses, net
|
|
|
2,383
|
|
|
|
2,047
|
|
|
|
(16)
|
|
|
|
|
9,872
|
|
|
|
8,940
|
|
|
|
(10)
|
|
|
Operating
Profit
|
|
|
110
|
|
|
|
41
|
|
|
|
170
|
|
|
|
|
1,106
|
|
|
|
629
|
|
|
|
76
|
|
|
Interest income,
net
|
|
|
45
|
|
|
|
33
|
|
|
|
33
|
|
|
|
|
169
|
|
|
|
84
|
|
|
|
101
|
|
|
Investment (loss)
gain
|
|
|
(17)
|
|
|
|
6
|
|
|
NM
|
|
|
|
|
(49)
|
|
|
|
(26)
|
|
|
|
(91)
|
|
|
Income Before Income
Taxes and
Equity in Net Earnings (Losses) from
Equity Method Investments
|
|
|
138
|
|
|
|
80
|
|
|
|
71
|
|
|
|
|
1,226
|
|
|
|
687
|
|
|
|
78
|
|
|
Income tax
provision
|
|
|
(33)
|
|
|
|
(24)
|
|
|
|
(39)
|
|
|
|
|
(329)
|
|
|
|
(207)
|
|
|
|
(59)
|
|
|
Equity in net earnings
(losses) from
equity method investments
|
|
|
2
|
|
|
|
2
|
|
|
|
9
|
|
|
|
|
4
|
|
|
|
(2)
|
|
|
NM
|
|
|
Net income – including
noncontrolling interests
|
|
|
107
|
|
|
|
58
|
|
|
|
81
|
|
|
|
|
901
|
|
|
|
478
|
|
|
|
88
|
|
|
Net income –
noncontrolling interests
|
|
|
10
|
|
|
|
5
|
|
|
|
(86)
|
|
|
|
|
74
|
|
|
|
36
|
|
|
|
(106)
|
|
|
Net Income – Yum
China Holdings, Inc.
|
|
$
|
97
|
|
|
$
|
53
|
|
|
|
81
|
|
|
|
$
|
827
|
|
|
$
|
442
|
|
|
|
87
|
|
|
Effective tax
rate
|
|
|
24.2
|
%
|
|
|
29.9
|
%
|
|
|
5.7
|
|
ppts.
|
|
|
26.9
|
%
|
|
|
30.1
|
%
|
|
|
3.2
|
|
ppts.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per
Common Share
|
|
$
|
0.23
|
|
|
$
|
0.13
|
|
|
|
|
|
|
$
|
1.99
|
|
|
$
|
1.05
|
|
|
|
|
|
Weighted-average shares
outstanding
(in millions)
|
|
|
411
|
|
|
|
419
|
|
|
|
|
|
|
|
416
|
|
|
|
421
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Common Share
|
|
$
|
0.23
|
|
|
$
|
0.13
|
|
|
|
|
|
|
$
|
1.97
|
|
|
$
|
1.04
|
|
|
|
|
|
Weighted-average shares
outstanding
(in millions)
|
|
|
415
|
|
|
|
423
|
|
|
|
|
|
|
|
420
|
|
|
|
425
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
Food and
paper
|
|
|
32.4
|
|
|
|
31.9
|
|
|
|
(0.5)
|
|
ppts.
|
|
|
31.0
|
|
|
|
31.1
|
|
|
|
0.1
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
29.0
|
|
|
|
28.8
|
|
|
|
(0.2)
|
|
ppts.
|
|
|
26.2
|
|
|
|
26.2
|
|
|
|
—
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
27.9
|
|
|
|
28.9
|
|
|
|
1.0
|
|
ppts.
|
|
|
26.5
|
|
|
|
28.6
|
|
|
|
2.1
|
|
ppts.
|
Restaurant
margin
|
|
|
10.7
|
%
|
|
|
10.4
|
%
|
|
|
0.3
|
|
ppts.
|
|
|
16.3
|
%
|
|
|
14.1
|
%
|
|
|
2.2
|
|
ppts.
|
Operating
margin
|
|
|
4.7
|
%
|
|
|
2.1
|
%
|
|
|
2.6
|
|
ppts.
|
|
|
10.6
|
%
|
|
|
6.9
|
%
|
|
|
3.7
|
|
ppts.
|
Percentages may not recompute due to rounding. NM refers to not
meaningful.
Yum China
Holdings, Inc.
|
KFC Operating
Results
|
(in US$
million)
|
(unaudited)
|
|
|
|
Quarter
Ended
|
|
|
%
Change
|
|
Year
Ended
|
|
|
%
Change
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
1,842
|
|
|
$
|
1,566
|
|
|
|
18
|
|
|
|
$
|
8,116
|
|
|
$
|
7,120
|
|
|
|
14
|
|
|
Franchise fees and
income
|
|
|
14
|
|
|
|
12
|
|
|
|
14
|
|
|
|
|
62
|
|
|
|
56
|
|
|
|
10
|
|
|
Revenues from
transactions with franchisees
|
|
|
12
|
|
|
|
9
|
|
|
|
35
|
|
|
|
|
45
|
|
|
|
33
|
|
|
|
37
|
|
|
Other
revenues
|
|
|
4
|
|
|
|
4
|
|
|
|
(15)
|
|
|
|
|
17
|
|
|
|
10
|
|
|
|
60
|
|
|
Total
revenues
|
|
|
1,872
|
|
|
|
1,591
|
|
|
|
18
|
|
|
|
|
8,240
|
|
|
|
7,219
|
|
|
|
14
|
|
|
Costs and Expenses,
Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
598
|
|
|
|
496
|
|
|
|
(21)
|
|
|
|
|
2,512
|
|
|
|
2,208
|
|
|
|
(14)
|
|
|
Payroll and employee
benefits
|
|
|
519
|
|
|
|
434
|
|
|
|
(20)
|
|
|
|
|
2,057
|
|
|
|
1,797
|
|
|
|
(14)
|
|
|
Occupancy and other
operating expenses
|
|
|
504
|
|
|
|
437
|
|
|
|
(15)
|
|
|
|
|
2,107
|
|
|
|
1,994
|
|
|
|
(6)
|
|
|
Company restaurant
expenses
|
|
|
1,621
|
|
|
|
1,367
|
|
|
|
(19)
|
|
|
|
|
6,676
|
|
|
|
5,999
|
|
|
|
(11)
|
|
|
General and
administrative expenses
|
|
|
60
|
|
|
|
63
|
|
|
|
5
|
|
|
|
|
263
|
|
|
|
254
|
|
|
|
(4)
|
|
|
Franchise
expenses
|
|
|
7
|
|
|
|
6
|
|
|
|
(8)
|
|
|
|
|
31
|
|
|
|
29
|
|
|
|
(2)
|
|
|
Expenses for
transactions with franchisees
|
|
|
10
|
|
|
|
8
|
|
|
|
(32)
|
|
|
|
|
39
|
|
|
|
30
|
|
|
|
(33)
|
|
|
Other operating costs
and expenses
|
|
|
4
|
|
|
|
3
|
|
|
|
(1)
|
|
|
|
|
15
|
|
|
|
7
|
|
|
|
(91)
|
|
|
Closures and impairment
expenses, net
|
|
|
3
|
|
|
|
5
|
|
|
|
47
|
|
|
|
|
12
|
|
|
|
16
|
|
|
|
28
|
|
|
Other expenses,
net
|
|
|
—
|
|
|
|
22
|
|
|
|
99
|
|
|
|
|
2
|
|
|
|
97
|
|
|
|
98
|
|
|
Total costs and
expenses, net
|
|
|
1,705
|
|
|
|
1,474
|
|
|
|
(16)
|
|
|
|
|
7,038
|
|
|
|
6,432
|
|
|
|
(9)
|
|
|
Operating
Profit
|
|
$
|
167
|
|
|
$
|
117
|
|
|
|
43
|
|
|
|
$
|
1,202
|
|
|
$
|
787
|
|
|
|
53
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
Food and
paper
|
|
|
32.5
|
|
|
|
31.7
|
|
|
|
(0.8)
|
|
ppts.
|
|
|
31.0
|
|
|
|
31.0
|
|
|
|
—
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
28.2
|
|
|
|
27.7
|
|
|
|
(0.5)
|
|
ppts.
|
|
|
25.3
|
|
|
|
25.2
|
|
|
|
(0.1)
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
27.3
|
|
|
|
27.9
|
|
|
|
0.6
|
|
ppts.
|
|
|
26.0
|
|
|
|
28.1
|
|
|
|
2.1
|
|
ppts.
|
Restaurant
margin
|
|
|
12.0
|
%
|
|
|
12.7
|
%
|
|
|
(0.7)
|
|
ppts.
|
|
|
17.7
|
%
|
|
|
15.7
|
%
|
|
|
2.0
|
|
ppts.
|
Operating
margin
|
|
|
9.1
|
%
|
|
|
7.4
|
%
|
|
|
1.7
|
|
ppts.
|
|
|
14.8
|
%
|
|
|
11.0
|
%
|
|
|
3.8
|
|
ppts.
|
Percentages may not recompute due to rounding.
Yum China
Holdings, Inc.
|
Pizza Hut Operating
Results
|
(in US$
million)
|
(unaudited)
|
|
|
|
Quarter
Ended
|
|
|
%
Change
|
|
Year
Ended
|
|
|
%
Change
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
sales
|
|
$
|
486
|
|
|
$
|
398
|
|
|
|
22
|
|
|
|
$
|
2,214
|
|
|
$
|
1,939
|
|
|
|
14
|
|
|
Franchise fees and
income
|
|
|
1
|
|
|
|
1
|
|
|
|
25
|
|
|
|
|
7
|
|
|
|
7
|
|
|
|
9
|
|
|
Revenues from
transactions with franchisees
|
|
|
1
|
|
|
|
1
|
|
|
|
9
|
|
|
|
|
4
|
|
|
|
4
|
|
|
|
11
|
|
|
Other
revenues
|
|
|
8
|
|
|
|
4
|
|
|
|
90
|
|
|
|
|
21
|
|
|
|
10
|
|
|
|
114
|
|
|
Total
revenues
|
|
|
496
|
|
|
|
404
|
|
|
|
23
|
|
|
|
|
2,246
|
|
|
|
1,960
|
|
|
|
15
|
|
|
Costs and Expenses,
Net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
restaurants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food and
paper
|
|
|
155
|
|
|
|
131
|
|
|
|
(18)
|
|
|
|
|
692
|
|
|
|
612
|
|
|
|
(13)
|
|
|
Payroll and employee
benefits
|
|
|
153
|
|
|
|
135
|
|
|
|
(14)
|
|
|
|
|
649
|
|
|
|
572
|
|
|
|
(14)
|
|
|
Occupancy and other
operating expenses
|
|
|
141
|
|
|
|
125
|
|
|
|
(13)
|
|
|
|
|
610
|
|
|
|
577
|
|
|
|
(6)
|
|
|
Company restaurant
expenses
|
|
|
449
|
|
|
|
391
|
|
|
|
(15)
|
|
|
|
|
1,951
|
|
|
|
1,761
|
|
|
|
(11)
|
|
|
General and
administrative expenses
|
|
|
29
|
|
|
|
26
|
|
|
|
(11)
|
|
|
|
|
118
|
|
|
|
110
|
|
|
|
(7)
|
|
|
Franchise
expenses
|
|
|
1
|
|
|
|
1
|
|
|
|
(13)
|
|
|
|
|
4
|
|
|
|
4
|
|
|
|
(8)
|
|
|
Expenses for
transactions with franchisees
|
|
|
1
|
|
|
|
—
|
|
|
|
(11)
|
|
|
|
|
4
|
|
|
|
3
|
|
|
|
(11)
|
|
|
Other operating costs
and expenses
|
|
|
8
|
|
|
|
3
|
|
|
|
(117)
|
|
|
|
|
19
|
|
|
|
8
|
|
|
|
(124)
|
|
|
Closures and impairment
expenses, net
|
|
|
3
|
|
|
|
3
|
|
|
|
1
|
|
|
|
|
8
|
|
|
|
4
|
|
|
|
(135)
|
|
|
Total costs and
expenses, net
|
|
|
491
|
|
|
|
424
|
|
|
|
(16)
|
|
|
|
|
2,104
|
|
|
|
1,890
|
|
|
|
(11)
|
|
|
Operating
Profit
|
|
$
|
5
|
|
|
$
|
(20)
|
|
|
NM
|
|
|
|
$
|
142
|
|
|
$
|
70
|
|
|
|
102
|
|
|
Company
sales
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
|
Food and
paper
|
|
|
32.0
|
|
|
|
32.9
|
|
|
|
0.9
|
|
ppts.
|
|
|
31.3
|
|
|
|
31.5
|
|
|
|
0.2
|
|
ppts.
|
Payroll and employee
benefits
|
|
|
31.7
|
|
|
|
33.9
|
|
|
|
2.2
|
|
ppts.
|
|
|
29.3
|
|
|
|
29.5
|
|
|
|
0.2
|
|
ppts.
|
Occupancy and other
operating expenses
|
|
|
29.0
|
|
|
|
31.3
|
|
|
|
2.3
|
|
ppts.
|
|
|
27.6
|
|
|
|
29.8
|
|
|
|
2.2
|
|
ppts.
|
Restaurant
margin
|
|
|
7.3
|
%
|
|
|
1.9
|
%
|
|
|
5.4
|
|
ppts.
|
|
|
11.8
|
%
|
|
|
9.2
|
%
|
|
|
2.6
|
|
ppts.
|
Operating
margin
|
|
|
1.1
|
%
|
|
|
(5.0)
|
%
|
|
|
6.1
|
|
ppts.
|
|
|
6.4
|
%
|
|
|
3.6
|
%
|
|
|
2.8
|
|
ppts.
|
Percentages may not recompute due to rounding. NM refers to not
meaningful.
Yum China
Holdings, Inc.
|
Condensed
Consolidated Balance Sheets
|
(in US$
million)
|
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
|
(Unaudited)
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,128
|
|
|
$
|
1,130
|
|
Short-term
investments
|
|
|
1,472
|
|
|
|
2,022
|
|
Accounts receivable,
net
|
|
|
68
|
|
|
|
64
|
|
Inventories,
net
|
|
|
424
|
|
|
|
417
|
|
Prepaid expenses and
other current assets
|
|
|
339
|
|
|
|
307
|
|
Total Current
Assets
|
|
|
3,431
|
|
|
|
3,940
|
|
Property, plant and
equipment, net
|
|
|
2,310
|
|
|
|
2,118
|
|
Operating lease
right-of-use assets
|
|
|
2,217
|
|
|
|
2,219
|
|
Goodwill
|
|
|
1,932
|
|
|
|
1,988
|
|
Intangible assets,
net
|
|
|
150
|
|
|
|
159
|
|
Long-term bank deposits
and notes
|
|
|
1,265
|
|
|
|
680
|
|
Equity
investments
|
|
|
332
|
|
|
|
361
|
|
Deferred income tax
assets
|
|
|
129
|
|
|
|
113
|
|
Other assets
|
|
|
265
|
|
|
|
248
|
|
Total
Assets
|
|
|
12,031
|
|
|
|
11,826
|
|
|
|
|
|
|
|
|
LIABILITIES,
REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
Accounts payable and
other current liabilities
|
|
|
2,164
|
|
|
|
2,096
|
|
Short-term
borrowings
|
|
|
168
|
|
|
|
2
|
|
Income taxes
payable
|
|
|
90
|
|
|
|
68
|
|
Total Current
Liabilities
|
|
|
2,422
|
|
|
|
2,166
|
|
Non-current operating
lease liabilities
|
|
|
1,899
|
|
|
|
1,906
|
|
Non-current finance
lease liabilities
|
|
|
44
|
|
|
|
42
|
|
Deferred income tax
liabilities
|
|
|
390
|
|
|
|
390
|
|
Other
liabilities
|
|
|
157
|
|
|
|
162
|
|
Total
Liabilities
|
|
|
4,912
|
|
|
|
4,666
|
|
|
|
|
|
|
|
|
Redeemable
Noncontrolling Interest
|
|
|
13
|
|
|
|
12
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
Common stock,
$0.01 par value; 1,000 million shares authorized;
407 million shares and 419
million shares issued and outstanding
at December 31, 2023 and 2022,
respectively.
|
|
|
4
|
|
|
|
4
|
|
Additional paid-in
capital
|
|
|
4,320
|
|
|
|
4,390
|
|
Retained
earnings
|
|
|
2,310
|
|
|
|
2,191
|
|
Accumulated other
comprehensive loss
|
|
|
(229)
|
|
|
|
(103)
|
|
Total Yum China
Holdings, Inc. Stockholders' Equity
|
|
|
6,405
|
|
|
|
6,482
|
|
Noncontrolling
interests
|
|
|
701
|
|
|
|
666
|
|
Total
Equity
|
|
|
7,106
|
|
|
|
7,148
|
|
Total Liabilities,
Redeemable Noncontrolling Interest and Equity
|
|
$
|
12,031
|
|
|
$
|
11,826
|
|
|
|
|
|
|
|
|
Yum China
Holdings, Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(in US$
million)
|
(unaudited)
|
|
|
|
Year
Ended
|
|
|
12/31/2023
|
|
12/31/2022
|
Cash Flows –
Operating Activities
|
|
|
|
|
|
|
|
|
Net income –
including noncontrolling interests
|
|
$
|
901
|
|
|
|
$
|
478
|
|
|
Depreciation and
amortization
|
|
|
453
|
|
|
|
|
602
|
|
|
Non-cash
operating lease cost
|
|
|
404
|
|
|
|
|
435
|
|
|
Closures and
impairment expenses
|
|
|
29
|
|
|
|
|
32
|
|
|
Investment
loss
|
|
|
49
|
|
|
|
|
26
|
|
|
Equity in net
(earnings) losses from equity method investments
|
|
|
(4)
|
|
|
|
|
2
|
|
|
Distributions of
income received from equity method investments
|
|
|
11
|
|
|
|
|
7
|
|
|
Deferred income
taxes
|
|
|
(10)
|
|
|
|
|
(20)
|
|
|
Share-based
compensation expense
|
|
|
64
|
|
|
|
|
42
|
|
|
Changes in
accounts receivable
|
|
|
(6)
|
|
|
|
|
(1)
|
|
|
Changes in
inventories
|
|
|
(19)
|
|
|
|
|
(19)
|
|
|
Changes in
prepaid expenses, other current assets and VAT assets
|
|
|
(35)
|
|
|
|
|
207
|
|
|
Changes in
accounts payable and other current liabilities
|
|
|
84
|
|
|
|
|
16
|
|
|
Changes in income
taxes payable
|
|
|
25
|
|
|
|
|
25
|
|
|
Changes in
non-current operating lease liabilities
|
|
|
(407)
|
|
|
|
|
(396)
|
|
|
Other,
net
|
|
|
(66)
|
|
|
|
|
(23)
|
|
|
Net Cash
Provided by Operating Activities
|
|
|
1,473
|
|
|
|
|
1,413
|
|
|
Cash Flows –
Investing Activities
|
|
|
|
|
|
|
|
|
Capital
spending
|
|
|
(710)
|
|
|
|
|
(679)
|
|
|
Purchases of
short-term investments, long-term bank deposits and
notes
|
|
|
(3,517)
|
|
|
|
|
(5,189)
|
|
|
Maturities of
short-term investments, long-term bank deposits and
notes
|
|
|
3,499
|
|
|
|
|
5,365
|
|
|
Acquisition of
business, net of cash acquired
|
|
|
—
|
|
|
|
|
(23)
|
|
|
Acquisition of
equity investment
|
|
|
(20)
|
|
|
|
|
—
|
|
|
Other,
net
|
|
|
5
|
|
|
|
|
4
|
|
|
Net Cash Used
in Investing Activities
|
|
|
(743)
|
|
|
|
|
(522)
|
|
|
Cash Flows –
Financing Activities
|
|
|
|
|
|
|
|
|
Proceeds from
short-term borrowings
|
|
|
264
|
|
|
|
|
2
|
|
|
Payment of
short-term borrowings
|
|
|
(100)
|
|
|
|
|
—
|
|
|
Repurchase of
shares of common stock
|
|
|
(613)
|
|
|
|
|
(466)
|
|
|
Cash dividends
paid on common stock
|
|
|
(216)
|
|
|
|
|
(202)
|
|
|
Dividends paid to
noncontrolling interests
|
|
|
(77)
|
|
|
|
|
(72)
|
|
|
Acquisitions of
noncontrolling interests
|
|
|
—
|
|
|
|
|
(113)
|
|
|
Contributions
from noncontrolling interests
|
|
|
35
|
|
|
|
|
18
|
|
|
Payment of
acquisition related holdback
|
|
|
(3)
|
|
|
|
|
(7)
|
|
|
Other,
net
|
|
|
(6)
|
|
|
|
|
(4)
|
|
|
Net Cash Used
in Financing Activities
|
|
|
(716)
|
|
|
|
|
(844)
|
|
|
Effect of
Exchange Rates on Cash, Cash Equivalents and Restricted
Cash
|
|
|
(16)
|
|
|
|
|
(53)
|
|
|
Net Decrease
in Cash, Cash Equivalents and Restricted Cash
|
|
|
(2)
|
|
|
|
|
(6)
|
|
|
Cash, Cash
Equivalents, and Restricted Cash - Beginning of Year
|
|
|
1,130
|
|
|
|
|
1,136
|
|
|
Cash, Cash
Equivalents, and Restricted Cash - End of Year
|
|
$
|
1,128
|
|
|
|
$
|
1,130
|
|
|
In this press release:
- Certain performance metrics and non-GAAP measures are presented
excluding the impact of foreign currency translation ("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 and franchise
restaurants that operate our restaurant concepts, except for
non-Company-owned restaurants for which we do not receive a
sales-based royalty. Sales of franchise restaurants typically
generate ongoing franchise fees for the Company at an average rate
of approximately 6% of system sales. Franchise restaurant sales are
not included in Company sales in the Condensed Consolidated
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.
- Effective January 1, 2018, the
Company revised its definition of same-store sales growth to
represent the estimated percentage change in sales of food of all
restaurants in the Company system that have been open prior to the
first day of our prior fiscal year, excluding the period during
which stores are temporarily closed. We refer to these as our
"base" stores. Previously, same-store sales growth represented the
estimated percentage change in sales of all restaurants in the
Company system that have been open for one year or more, including
stores temporarily closed, and the base stores changed on a rolling
basis from month to month. This revision was made to align with how
management measures performance internally and focuses on trends of
a more stable base of stores.
- Certain comparative items in the Condensed Consolidated
Financial Statements have been reclassified to conform to the
current period's presentation to facilitate comparison.
Unit Count by Brand
KFC
|
|
12/31/2022
|
|
|
New Builds
|
|
|
Closures
|
|
|
Acquired
|
|
|
Refranchised
|
|
|
12/31/2023
|
|
Company-owned
|
|
|
8,214
|
|
|
|
1,246
|
|
|
|
(222)
|
|
|
|
2
|
|
|
|
(3)
|
|
|
|
9,237
|
|
Franchisees
|
|
|
880
|
|
|
|
193
|
|
|
|
(15)
|
|
|
|
(2)
|
|
|
|
3
|
|
|
|
1,059
|
|
Total
|
|
|
9,094
|
|
|
|
1,439
|
|
|
|
(237)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,296
|
|
Pizza Hut
|
|
12/31/2022
|
|
|
New Builds
|
|
|
Closures
|
|
|
Refranchised
|
|
|
12/31/2023
|
|
Company-owned
|
|
|
2,760
|
|
|
|
515
|
|
|
|
(118)
|
|
|
|
(2)
|
|
|
|
3,155
|
|
Franchisees
|
|
|
143
|
|
|
|
16
|
|
|
|
(4)
|
|
|
|
2
|
|
|
|
157
|
|
Total
|
|
|
2,903
|
|
|
|
531
|
|
|
|
(122)
|
|
|
|
—
|
|
|
|
3,312
|
|
Others
|
|
12/31/2022
|
|
|
New Builds
|
|
|
Closures
|
|
|
12/31/2023
|
|
Company-owned
|
|
|
187
|
|
|
|
93
|
|
|
|
(24)
|
|
|
|
256
|
|
Franchisees
|
|
|
763
|
|
|
|
142
|
|
|
|
(125)
|
|
|
|
780
|
|
Total
|
|
|
950
|
|
|
|
235
|
|
|
|
(149)
|
|
|
|
1,036
|
|
Reconciliation of Reported GAAP Results to
Non-GAAP Measures
(in millions, except per share
data)
(unaudited)
In addition to the results provided in accordance with U.S.
Generally Accepted Accounting Principles ("GAAP") in this press
release, the Company provides the following non-GAAP measures:
- Measures adjusted for Special Items, which include Adjusted
Operating Profit, Adjusted Net Income, Adjusted Earnings Per Common
Share ("EPS"), Adjusted Effective Tax Rate and Adjusted
EBITDA;
- Company Restaurant Profit ("Restaurant profit") and Restaurant
margin;
- Core Operating Profit that excludes Special Items, and further
adjusted for Items Affecting Comparability and the impact of
F/X;
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 the Company does not believe are
indicative of our core operations.
With respect to non-GAAP measures adjusted for Special Items,
the Company excludes impact from Special Items for the purpose of
evaluating performance internally and uses them as factors in
determining compensation for certain employees. Special Items are
not included in any of our segment results.
Adjusted EBITDA is defined as net income including
noncontrolling interests adjusted for equity in net earnings
(losses) from equity method investments, income tax, interest
income, net, investment gain or loss, depreciation and
amortization, store impairment charges, and Special Items. Store
impairment charges included as an adjustment item in Adjusted
EBITDA primarily resulted from our semi-annual impairment
evaluation of long-lived assets of individual restaurants, and
additional impairment evaluation whenever events or changes in
circumstances indicate that the carrying value of the assets may
not be recoverable. If these restaurant-level assets were not
impaired, depreciation of the assets would have been recorded and
included in EBITDA. Therefore, store impairment charges were a
non-cash item similar to depreciation and amortization of our
long-lived assets of restaurants. The Company believes that
investors and analyst may find it useful in measuring operating
performance without regard to such non-cash items.
Restaurant Profit is defined as Company sales less expenses
incurred directly by our Company-owned restaurants in generating
Company sales, including cost of food and paper, restaurant-level
payroll and employee benefits, rent, depreciation and amortization
of restaurant-level assets, advertising expenses, and other
operating expenses. Restaurant margin is defined as Restaurant
profit divided by Company sales. We also use Restaurant profit and
Restaurant margin for the purposes of internally evaluating the
performance of our Company-owned restaurants and we believe they
provide useful information to investors as to the profitability of
our Company-owned restaurants.
Core Operating Profit is defined as Operating Profit adjusted
for Special Items, and further excluding Items Affecting
Comparability and the impact of F/X. We consider quantitative and
qualitative factors in assessing whether to adjust for the impact
of items that may be significant or that could affect an
understanding of our ongoing financial and business performance or
trends. Items such as charges, gains and accounting changes which
are viewed by management as significantly impacting the current
period or the comparable period, due to changes in policy or other
external factors, or non-cash items pertaining to underlying
activities that are different from or unrelated to our core
operations, are generally considered "Items Affecting
Comparability." Examples of Items Affecting Comparability include,
but are not limited to: temporary relief from landlords and
government agencies, VAT deductions due to tax policy changes, and
amortization of reacquired franchise rights recognized upon
acquisitions. We believe presenting Core Operating Profit provides
additional information to further enhance comparability of our
operating results, and we use this measure for the purposes of
evaluating the performance of our core operations.
The following tables set forth the reconciliation of the most
directly comparable GAAP financial measures to the non-GAAP
financial measures. The reconciliation of GAAP Operating Profit to
Restaurant Profit and Core Operating Profit by segment is presented
in Segment Results within this release.
|
|
Quarter
Ended
|
|
|
Year
Ended
|
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Reconciliations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Profit to Adjusted Operating Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
$
|
110
|
|
|
$
|
41
|
|
|
$
|
1,106
|
|
|
$
|
629
|
|
Special Items,
Operating Profit
|
|
|
(6)
|
|
|
|
1
|
|
|
|
(15)
|
|
|
|
(4)
|
|
Adjusted Operating
Profit
|
|
$
|
116
|
|
|
$
|
40
|
|
|
$
|
1,121
|
|
|
$
|
633
|
|
Reconciliation of
Net Income to Adjusted Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income – Yum China
Holdings, Inc.
|
|
$
|
97
|
|
|
$
|
53
|
|
|
$
|
827
|
|
|
$
|
442
|
|
Special Items, Net
Income –Yum China Holdings, Inc.
|
|
|
(6)
|
|
|
|
1
|
|
|
|
(15)
|
|
|
|
(4)
|
|
Adjusted Net Income –
Yum China Holdings, Inc.
|
|
$
|
103
|
|
|
$
|
52
|
|
|
$
|
842
|
|
|
$
|
446
|
|
Reconciliation of
EPS to Adjusted EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per
Common Share
|
|
$
|
0.23
|
|
|
$
|
0.13
|
|
|
$
|
1.99
|
|
|
$
|
1.05
|
|
Special Items, Basic
Earnings Per Common Share
|
|
|
(0.02)
|
|
|
|
—
|
|
|
|
(0.03)
|
|
|
|
(0.01)
|
|
Adjusted Basic Earnings
Per Common Share
|
|
$
|
0.25
|
|
|
$
|
0.13
|
|
|
$
|
2.02
|
|
|
$
|
1.06
|
|
Diluted Earnings Per
Common Share
|
|
$
|
0.23
|
|
|
$
|
0.13
|
|
|
$
|
1.97
|
|
|
$
|
1.04
|
|
Special Items, Diluted
Earnings Per Common Share
|
|
|
(0.02)
|
|
|
|
—
|
|
|
|
(0.03)
|
|
|
|
(0.01)
|
|
Adjusted Diluted
Earnings Per Common Share
|
|
$
|
0.25
|
|
|
$
|
0.13
|
|
|
$
|
2.00
|
|
|
$
|
1.05
|
|
Reconciliation of
Effective Tax Rate to Adjusted Effective Tax Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
|
|
24.2
|
%
|
|
|
29.9
|
%
|
|
|
26.9
|
%
|
|
|
30.1
|
%
|
Impact on effective tax
rate as a result of Special Items
|
|
|
1.0
|
%
|
|
|
(0.4)
|
%
|
|
|
0.4
|
%
|
|
|
0.2
|
%
|
Adjusted effective tax
rate
|
|
|
23.2
|
%
|
|
|
30.3
|
%
|
|
|
26.5
|
%
|
|
|
29.9
|
%
|
Net income, along with the reconciliation to Adjusted EBITDA, is
presented below:
|
|
Quarter
Ended
|
|
|
Year
Ended
|
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
Reconciliation of
Net Income to Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income – Yum China
Holdings, Inc.
|
|
$
|
97
|
|
|
$
|
53
|
|
|
$
|
827
|
|
|
$
|
442
|
|
Net income –
noncontrolling interests
|
|
|
10
|
|
|
|
5
|
|
|
|
74
|
|
|
|
36
|
|
Equity in net
(earnings) losses from equity method investments
|
|
|
(2)
|
|
|
|
(2)
|
|
|
|
(4)
|
|
|
|
2
|
|
Income tax
provision
|
|
|
33
|
|
|
|
24
|
|
|
|
329
|
|
|
|
207
|
|
Interest income,
net
|
|
|
(45)
|
|
|
|
(33)
|
|
|
|
(169)
|
|
|
|
(84)
|
|
Investment loss
(gain)
|
|
|
17
|
|
|
|
(6)
|
|
|
|
49
|
|
|
|
26
|
|
Operating
Profit
|
|
|
110
|
|
|
|
41
|
|
|
|
1,106
|
|
|
|
629
|
|
Special Items,
Operating Profit
|
|
|
6
|
|
|
|
(1)
|
|
|
|
15
|
|
|
|
4
|
|
Adjusted Operating
Profit
|
|
|
116
|
|
|
|
40
|
|
|
|
1,121
|
|
|
|
633
|
|
Depreciation and
amortization
|
|
|
114
|
|
|
|
135
|
|
|
|
453
|
|
|
|
602
|
|
Store impairment
charges
|
|
|
13
|
|
|
|
14
|
|
|
|
37
|
|
|
|
51
|
|
Adjusted
EBITDA
|
|
$
|
243
|
|
|
$
|
189
|
|
|
$
|
1,611
|
|
|
$
|
1,286
|
|
Details of Special Items are presented below:
|
|
Quarter
Ended
|
|
|
Year
Ended
|
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation expense for Partner PSU
Awards(1)
|
|
$
|
(6)
|
|
|
$
|
1
|
|
|
$
|
(15)
|
|
|
$
|
(4)
|
|
Special Items,
Operating Profit
|
|
|
(6)
|
|
|
|
1
|
|
|
|
(15)
|
|
|
|
(4)
|
|
Tax effect on Special
Items(2)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Special Items, net
income – including noncontrolling interests
|
|
|
(6)
|
|
|
|
1
|
|
|
|
(15)
|
|
|
|
(4)
|
|
Special Items, net
income – noncontrolling interests
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Special Items, Net
Income –Yum China Holdings, Inc.
|
|
$
|
(6)
|
|
|
$
|
1
|
|
|
$
|
(15)
|
|
|
$
|
(4)
|
|
Weighted-average
Diluted Shares Outstanding (in millions)
|
|
|
415
|
|
|
|
423
|
|
|
|
420
|
|
|
|
425
|
|
Special Items, Diluted
Earnings Per Common Share
|
|
$
|
(0.02)
|
|
|
$
|
—
|
|
|
$
|
(0.03)
|
|
|
$
|
(0.01)
|
|
(1) In February
2020, the Company granted Partner PSU Awards to select
employees who were deemed critical to the Company's execution of
its strategic operating plan. These PSU awards will only vest if
threshold performance goals are achieved over a four-year
performance period, with the payout ranging from 0% to 200% of the
target number of shares subject to the PSU awards. Partner PSU
Awards were granted to address increased competition for executive
talent, motivate transformational performance and encourage
management retention. Given the unique nature of these grants, the
Compensation Committee does not intend to grant similar, special
grants to the same employees during the performance period. The
impact from these special awards is excluded from metrics that
management uses to assess the Company's performance.
(2) The tax expense was determined based upon
the nature, as well as the jurisdiction, of each Special Item at
the applicable tax rate.
Operating Profit, along with the reconciliation to Core
Operating Profit, is presented below:
|
Quarter
ended
|
|
|
% Change
|
|
Year
ended
|
|
|
%
Change
|
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
|
12/31/2023
|
|
|
12/31/2022
|
|
|
B/(W)
|
|
Reconciliation of
Operating Profit to Core Operating Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
$
|
110
|
|
|
$
|
41
|
|
|
|
170
|
|
|
|
$
|
1,106
|
|
|
$
|
629
|
|
|
|
76
|
|
|
|
Special Items,
Operating Profit
|
|
6
|
|
|
|
(1)
|
|
|
|
|
|
|
|
15
|
|
|
|
4
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
$
|
116
|
|
|
$
|
40
|
|
|
|
193
|
|
|
|
$
|
1,121
|
|
|
$
|
633
|
|
|
|
77
|
|
|
|
Items Affecting
Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary relief from
landlords(1)
|
|
(1)
|
|
|
|
(12)
|
|
|
|
|
|
|
|
(11)
|
|
|
|
(39)
|
|
|
|
|
|
|
Temporary relief from
government agencies(2)
|
|
(3)
|
|
|
|
(14)
|
|
|
|
|
|
|
|
(7)
|
|
|
|
(48)
|
|
|
|
|
|
|
VAT
deductions(3)
|
|
(2)
|
|
|
|
(8)
|
|
|
|
|
|
|
|
(44)
|
|
|
|
(16)
|
|
|
|
|
|
|
Amortization of
reacquired franchise rights(4)
|
|
—
|
|
|
|
23
|
|
|
|
|
|
|
|
2
|
|
|
|
97
|
|
|
|
|
|
|
F/X impact
|
|
1
|
|
|
|
—
|
|
|
|
|
|
|
|
60
|
|
|
|
—
|
|
|
|
|
|
|
Core Operating
Profit
|
$
|
111
|
|
|
$
|
29
|
|
|
|
324
|
|
|
|
$
|
1,121
|
|
|
$
|
627
|
|
|
|
79
|
|
|
|
(1) In relation to the effects of the COVID-19 pandemic,
the Company was granted lease concessions from landlords. The lease
concessions were primarily in the form of rent reduction over the
period of time when the Company's restaurant business was adversely
impacted. Such concessions were primarily recognized as a reduction
of Occupancy and other operating expenses within Company restaurant
expenses included in the Condensed Consolidated Statement of Income
in the period the concession was granted.
(2) In relation to the effects of the COVID-19 pandemic,
the government issued a policy in 2020 on reducing enterprise
social security contribution, and the Company recorded one-time
relief of $11 million and
$33 million, respectively, for the
fourth quarter and year ended December 31,
2022. In addition, this also includes government subsidies
for employee benefits and providing training to employees, with
higher amounts received during 2022 impacted by the COVID-19
pandemic. The temporary relief was primarily recognized as a
reduction to Payroll and employee benefits within Company
restaurant expenses included in the Condensed Consolidated
Statement of Income.
(3) Pursuant to the tax policy issued by relevant
government authorities, general VAT taxpayers in certain industries
that meet certain criteria are allowed to claim an additional 10%
or 15% input VAT, which will be used to offset their VAT payables.
This VAT policy was further extended to December 31, 2023 but the additional deduction
was reduced to 5% or 10% respectively. VAT deductions were
primarily recorded as a reduction to Food and paper and Occupancy
and other operating expenses within Company restaurant expenses
included in the Condensed Consolidated Statements of Income. Based
on the information currently available to the Company, such
preferential policy is not expected to be extended.
(4) As a result of the acquisition of our previously
unconsolidated joint ventures of Hangzhou KFC, Suzhou KFC and Wuxi
KFC, $66 million, $61 million and $61
million of the purchase price were allocated to intangible
assets related to reacquired franchise rights, respectively, which
were amortized over the remaining franchise contract period of 1
year, 2.4 years and 5 years, respectively. The reacquired franchise
rights were fully amortized as of March 31,
2023. The amortization was recorded in Other (Income)
Expenses, net included in the Condensed Consolidated Statements of
Income.
Yum China
Holdings, Inc.
|
Segment
Results
|
(in US$
million)
|
(unaudited)
|
|
|
|
Quarter Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
Company
sales
|
|
$
|
1,842
|
|
|
$
|
486
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,343
|
|
Franchise fees and
income
|
|
|
14
|
|
|
|
1
|
|
|
|
5
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20
|
|
Revenues from
transactions with franchisees(2)
|
|
|
12
|
|
|
|
1
|
|
|
|
18
|
|
|
|
59
|
|
|
|
—
|
|
|
|
90
|
|
Other
revenues
|
|
|
4
|
|
|
|
8
|
|
|
|
156
|
|
|
|
12
|
|
|
|
(140)
|
|
|
|
40
|
|
Total
revenues
|
|
$
|
1,872
|
|
|
$
|
496
|
|
|
$
|
194
|
|
|
$
|
71
|
|
|
$
|
(140)
|
|
|
$
|
2,493
|
|
Company restaurant
expenses
|
|
|
1,621
|
|
|
|
449
|
|
|
|
20
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,090
|
|
General and
administrative expenses
|
|
|
60
|
|
|
|
29
|
|
|
|
11
|
|
|
|
53
|
|
|
|
—
|
|
|
|
153
|
|
Franchise
expenses
|
|
|
7
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
Expenses for
transactions with franchisees(2)
|
|
|
10
|
|
|
|
1
|
|
|
|
17
|
|
|
|
58
|
|
|
|
—
|
|
|
|
86
|
|
Other operating costs
and expenses
|
|
|
4
|
|
|
|
8
|
|
|
|
151
|
|
|
|
12
|
|
|
|
(140)
|
|
|
|
35
|
|
Closures and impairment
expenses, net
|
|
|
3
|
|
|
|
3
|
|
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
Other expenses
(income), net
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
(1)
|
|
Total costs and
expenses, net
|
|
|
1,705
|
|
|
|
491
|
|
|
|
205
|
|
|
|
122
|
|
|
|
(140)
|
|
|
|
2,383
|
|
Operating Profit
(Loss)
|
|
$
|
167
|
|
|
$
|
5
|
|
|
$
|
(11)
|
|
|
$
|
(51)
|
|
|
$
|
—
|
|
|
$
|
110
|
|
Reconciliation of GAAP Operating Profit to Restaurant
Profit
|
|
Quarter Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
167
|
|
|
$
|
5
|
|
|
$
|
(11)
|
|
|
$
|
(51)
|
|
|
$
|
—
|
|
|
$
|
110
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise fees and
income
|
|
|
14
|
|
|
|
1
|
|
|
|
5
|
|
|
|
—
|
|
|
|
—
|
|
|
|
20
|
|
Revenues from
transactions with franchisees(2)
|
|
|
12
|
|
|
|
1
|
|
|
|
18
|
|
|
|
59
|
|
|
|
—
|
|
|
|
90
|
|
Other
revenues
|
|
|
4
|
|
|
|
8
|
|
|
|
156
|
|
|
|
12
|
|
|
|
(140)
|
|
|
|
40
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
|
60
|
|
|
|
29
|
|
|
|
11
|
|
|
|
53
|
|
|
|
—
|
|
|
|
153
|
|
Franchise
expenses
|
|
|
7
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
Expenses for
transactions with franchisees(2)
|
|
|
10
|
|
|
|
1
|
|
|
|
17
|
|
|
|
58
|
|
|
|
—
|
|
|
|
86
|
|
Other operating costs
and expenses
|
|
|
4
|
|
|
|
8
|
|
|
|
151
|
|
|
|
12
|
|
|
|
(140)
|
|
|
|
35
|
|
Closures and impairment
expenses, net
|
|
|
3
|
|
|
|
3
|
|
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
Other expenses
(income), net
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
(1)
|
|
Restaurant profit
(loss)
|
|
$
|
221
|
|
|
$
|
37
|
|
|
$
|
(5)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
253
|
|
Company
sales
|
|
|
1,842
|
|
|
|
486
|
|
|
|
15
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,343
|
|
Restaurant margin
%
|
|
|
12.0
|
%
|
|
|
7.3
|
%
|
|
|
(35.9)
|
%
|
|
N/A
|
|
|
N/A
|
|
|
|
10.7
|
%
|
Reconciliation of GAAP Operating Profit to Core Operating
Profit
|
|
Quarter Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
167
|
|
|
$
|
5
|
|
|
$
|
(11)
|
|
|
$
|
(51)
|
|
|
$
|
—
|
|
|
$
|
110
|
|
Special Items,
Operating Profit
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6
|
|
|
|
—
|
|
|
|
6
|
|
Adjusted Operating
Profit
|
|
$
|
167
|
|
|
$
|
5
|
|
|
$
|
(11)
|
|
|
$
|
(45)
|
|
|
$
|
—
|
|
|
$
|
116
|
|
Items Affecting
Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary relief from
landlords
|
|
|
(1)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
Temporary relief from
government agencies
|
|
|
(2)
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3)
|
|
VAT
deductions
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2)
|
|
Amortization of
reacquired franchise rights
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
F/X impact
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
1
|
|
Core Operating Profit
(Loss)
|
|
$
|
164
|
|
|
$
|
4
|
|
|
$
|
(11)
|
|
|
$
|
(46)
|
|
|
$
|
—
|
|
|
$
|
111
|
|
|
|
Quarter Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
Company
sales
|
|
$
|
1,566
|
|
|
$
|
398
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,975
|
|
Franchise fees and
income
|
|
|
12
|
|
|
|
1
|
|
|
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16
|
|
Revenues from
transactions with franchisees(2)
|
|
|
9
|
|
|
|
1
|
|
|
|
10
|
|
|
|
48
|
|
|
|
—
|
|
|
|
68
|
|
Other
revenues
|
|
|
4
|
|
|
|
4
|
|
|
|
156
|
|
|
|
11
|
|
|
|
(146)
|
|
|
|
29
|
|
Total
revenues
|
|
$
|
1,591
|
|
|
$
|
404
|
|
|
$
|
180
|
|
|
$
|
59
|
|
|
$
|
(146)
|
|
|
$
|
2,088
|
|
Company restaurant
expenses
|
|
|
1,367
|
|
|
|
391
|
|
|
|
15
|
|
|
|
—
|
|
|
|
(3)
|
|
|
|
1,770
|
|
General and
administrative expenses
|
|
|
63
|
|
|
|
26
|
|
|
|
10
|
|
|
|
46
|
|
|
|
—
|
|
|
|
145
|
|
Franchise
expenses
|
|
|
6
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
Expenses for
transactions with franchisees(2)
|
|
|
8
|
|
|
|
—
|
|
|
|
11
|
|
|
|
48
|
|
|
|
—
|
|
|
|
67
|
|
Other operating costs
and expenses
|
|
|
3
|
|
|
|
3
|
|
|
|
151
|
|
|
|
11
|
|
|
|
(143)
|
|
|
|
25
|
|
Closures and impairment
expenses, net
|
|
|
5
|
|
|
|
3
|
|
|
|
4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
Other expenses
(income), net
|
|
|
22
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
21
|
|
Total costs and
expenses, net
|
|
|
1,474
|
|
|
|
424
|
|
|
|
191
|
|
|
|
104
|
|
|
|
(146)
|
|
|
|
2,047
|
|
Operating Profit
(Loss)
|
|
$
|
117
|
|
|
$
|
(20)
|
|
|
$
|
(11)
|
|
|
$
|
(45)
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Reconciliation of GAAP Operating Profit to Restaurant
Profit
|
|
Quarter Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
117
|
|
|
$
|
(20)
|
|
|
$
|
(11)
|
|
|
$
|
(45)
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise fees and
income
|
|
|
12
|
|
|
|
1
|
|
|
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16
|
|
Revenues from
transactions with franchisees(2)
|
|
|
9
|
|
|
|
1
|
|
|
|
10
|
|
|
|
48
|
|
|
|
—
|
|
|
|
68
|
|
Other
revenues
|
|
|
4
|
|
|
|
4
|
|
|
|
156
|
|
|
|
11
|
|
|
|
(146)
|
|
|
|
29
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
|
63
|
|
|
|
26
|
|
|
|
10
|
|
|
|
46
|
|
|
|
—
|
|
|
|
145
|
|
Franchise
expenses
|
|
|
6
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
Expenses for
transactions with franchisees(2)
|
|
|
8
|
|
|
|
—
|
|
|
|
11
|
|
|
|
48
|
|
|
|
—
|
|
|
|
67
|
|
Other operating costs
and expenses
|
|
|
3
|
|
|
|
3
|
|
|
|
151
|
|
|
|
11
|
|
|
|
(143)
|
|
|
|
25
|
|
Closures and impairment
expenses, net
|
|
|
5
|
|
|
|
3
|
|
|
|
4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
Other expenses
(income), net
|
|
|
22
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
21
|
|
Restaurant profit
(loss)
|
|
$
|
199
|
|
|
$
|
7
|
|
|
$
|
(4)
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
205
|
|
Company
sales
|
|
|
1,566
|
|
|
|
398
|
|
|
|
11
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,975
|
|
Restaurant margin
%
|
|
|
12.7
|
%
|
|
|
1.9
|
%
|
|
|
(42.6)
|
%
|
|
N/A
|
|
|
N/A
|
|
|
|
10.4
|
%
|
Reconciliation of GAAP Operating Profit to Core Operating
Profit
|
|
Quarter Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
117
|
|
|
$
|
(20)
|
|
|
$
|
(11)
|
|
|
$
|
(45)
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Special Items,
Operating Profit
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
(1)
|
|
Adjusted Operating
Profit
|
|
$
|
117
|
|
|
$
|
(20)
|
|
|
$
|
(11)
|
|
|
$
|
(46)
|
|
|
$
|
—
|
|
|
$
|
40
|
|
Items Affecting
Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary relief from
landlords
|
|
|
(10)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(12)
|
|
Temporary relief from
government agencies
|
|
|
(10)
|
|
|
|
(4)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(14)
|
|
VAT
deductions
|
|
|
(5)
|
|
|
|
(1)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(8)
|
|
Amortization of
reacquired franchise rights
|
|
|
23
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
23
|
|
F/X impact
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Core Operating Profit
(Loss)
|
|
$
|
115
|
|
|
$
|
(27)
|
|
|
$
|
(13)
|
|
|
$
|
(46)
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
|
Year Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
Company
sales
|
|
$
|
8,116
|
|
|
$
|
2,214
|
|
|
$
|
61
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,391
|
|
Franchise fees and
income
|
|
|
62
|
|
|
|
7
|
|
|
|
20
|
|
|
|
—
|
|
|
|
—
|
|
|
|
89
|
|
Revenues from
transactions with franchisees(2)
|
|
|
45
|
|
|
|
4
|
|
|
|
74
|
|
|
|
249
|
|
|
|
—
|
|
|
|
372
|
|
Other
revenues
|
|
|
17
|
|
|
|
21
|
|
|
|
624
|
|
|
|
44
|
|
|
|
(580)
|
|
|
|
126
|
|
Total
revenues
|
|
$
|
8,240
|
|
|
$
|
2,246
|
|
|
$
|
779
|
|
|
$
|
293
|
|
|
$
|
(580)
|
|
|
$
|
10,978
|
|
Company restaurant
expenses
|
|
|
6,676
|
|
|
|
1,951
|
|
|
|
76
|
|
|
|
—
|
|
|
|
(2)
|
|
|
|
8,701
|
|
General and
administrative expenses
|
|
|
263
|
|
|
|
118
|
|
|
|
43
|
|
|
|
214
|
|
|
|
—
|
|
|
|
638
|
|
Franchise
expenses
|
|
|
31
|
|
|
|
4
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
36
|
|
Expenses for
transactions with franchisees(2)
|
|
|
39
|
|
|
|
4
|
|
|
|
67
|
|
|
|
246
|
|
|
|
—
|
|
|
|
356
|
|
Other operating costs
and expenses
|
|
|
15
|
|
|
|
19
|
|
|
|
614
|
|
|
|
42
|
|
|
|
(578)
|
|
|
|
112
|
|
Closures and impairment
expenses, net
|
|
|
12
|
|
|
|
8
|
|
|
|
9
|
|
|
|
—
|
|
|
|
—
|
|
|
|
29
|
|
Other expenses
(income), net
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
Total costs and
expenses, net
|
|
|
7,038
|
|
|
|
2,104
|
|
|
|
810
|
|
|
|
500
|
|
|
|
(580)
|
|
|
|
9,872
|
|
Operating Profit
(Loss)
|
|
$
|
1,202
|
|
|
$
|
142
|
|
|
$
|
(31)
|
|
|
$
|
(207)
|
|
|
$
|
—
|
|
|
$
|
1,106
|
|
Reconciliation of GAAP Operating Profit to Restaurant
Profit
|
|
Year Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
1,202
|
|
|
$
|
142
|
|
|
$
|
(31)
|
|
|
$
|
(207)
|
|
|
$
|
—
|
|
|
$
|
1,106
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise fees and
income
|
|
|
62
|
|
|
|
7
|
|
|
|
20
|
|
|
|
—
|
|
|
|
—
|
|
|
|
89
|
|
Revenues from
transactions with franchisees(2)
|
|
|
45
|
|
|
|
4
|
|
|
|
74
|
|
|
|
249
|
|
|
|
—
|
|
|
|
372
|
|
Other
revenues
|
|
|
17
|
|
|
|
21
|
|
|
|
624
|
|
|
|
44
|
|
|
|
(580)
|
|
|
|
126
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
|
263
|
|
|
|
118
|
|
|
|
43
|
|
|
|
214
|
|
|
|
—
|
|
|
|
638
|
|
Franchise
expenses
|
|
|
31
|
|
|
|
4
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
36
|
|
Expenses for
transactions with franchisees(2)
|
|
|
39
|
|
|
|
4
|
|
|
|
67
|
|
|
|
246
|
|
|
|
—
|
|
|
|
356
|
|
Other operating costs
and expenses
|
|
|
15
|
|
|
|
19
|
|
|
|
614
|
|
|
|
42
|
|
|
|
(578)
|
|
|
|
112
|
|
Closures and impairment
expenses, net
|
|
|
12
|
|
|
|
8
|
|
|
|
9
|
|
|
|
—
|
|
|
|
—
|
|
|
|
29
|
|
Other expenses
(income), net
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
Restaurant profit
(loss)
|
|
$
|
1,440
|
|
|
$
|
263
|
|
|
$
|
(15)
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
1,690
|
|
Company
sales
|
|
|
8,116
|
|
|
|
2,214
|
|
|
|
61
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,391
|
|
Restaurant margin
%
|
|
|
17.7
|
%
|
|
|
11.8
|
%
|
|
|
(25.1)
|
%
|
|
N/A
|
|
|
N/A
|
|
|
|
16.3
|
%
|
Reconciliation of GAAP Operating Profit to Core Operating
Profit
|
|
Year Ended
12/31/2023
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
1,202
|
|
|
$
|
142
|
|
|
$
|
(31)
|
|
|
$
|
(207)
|
|
|
$
|
—
|
|
|
$
|
1,106
|
|
Special Items,
Operating Profit
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
|
|
—
|
|
|
|
15
|
|
Adjusted Operating
Profit
|
|
$
|
1,202
|
|
|
$
|
142
|
|
|
$
|
(31)
|
|
|
$
|
(192)
|
|
|
$
|
—
|
|
|
$
|
1,121
|
|
Items Affecting
Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary relief from
landlords
|
|
|
(9)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(11)
|
|
Temporary relief from
government agencies
|
|
|
(5)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7)
|
|
VAT
deductions
|
|
|
(36)
|
|
|
|
(6)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(44)
|
|
Amortization of
reacquired franchise rights
|
|
|
2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2
|
|
F/X impact
|
|
|
57
|
|
|
|
11
|
|
|
|
(2)
|
|
|
|
(6)
|
|
|
|
—
|
|
|
|
60
|
|
Core Operating Profit
(Loss)
|
|
$
|
1,211
|
|
|
$
|
143
|
|
|
$
|
(35)
|
|
|
$
|
(198)
|
|
|
$
|
—
|
|
|
$
|
1,121
|
|
|
|
Year Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
Company
sales
|
|
$
|
7,120
|
|
|
$
|
1,939
|
|
|
$
|
51
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,110
|
|
Franchise fees and
income
|
|
|
56
|
|
|
|
7
|
|
|
|
18
|
|
|
|
—
|
|
|
|
—
|
|
|
|
81
|
|
Revenues from
transactions with franchisees(2)
|
|
|
33
|
|
|
|
4
|
|
|
|
39
|
|
|
|
211
|
|
|
|
—
|
|
|
|
287
|
|
Other
revenues
|
|
|
10
|
|
|
|
10
|
|
|
|
563
|
|
|
|
42
|
|
|
|
(534)
|
|
|
|
91
|
|
Total
revenues
|
|
$
|
7,219
|
|
|
$
|
1,960
|
|
|
$
|
671
|
|
|
$
|
253
|
|
|
$
|
(534)
|
|
|
$
|
9,569
|
|
Company restaurant
expenses
|
|
|
5,999
|
|
|
|
1,761
|
|
|
|
70
|
|
|
|
—
|
|
|
|
(1)
|
|
|
|
7,829
|
|
General and
administrative expenses
|
|
|
254
|
|
|
|
110
|
|
|
|
46
|
|
|
|
184
|
|
|
|
—
|
|
|
|
594
|
|
Franchise
expenses
|
|
|
29
|
|
|
|
4
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
34
|
|
Expenses for
transactions with franchisees(2)
|
|
|
30
|
|
|
|
3
|
|
|
|
35
|
|
|
|
211
|
|
|
|
—
|
|
|
|
279
|
|
Other operating costs
and expenses
|
|
|
7
|
|
|
|
8
|
|
|
|
557
|
|
|
|
39
|
|
|
|
(533)
|
|
|
|
78
|
|
Closures and impairment
expenses, net
|
|
|
16
|
|
|
|
4
|
|
|
|
12
|
|
|
|
—
|
|
|
|
—
|
|
|
|
32
|
|
Other expenses
(income), net
|
|
|
97
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3)
|
|
|
|
—
|
|
|
|
94
|
|
Total costs and
expenses, net
|
|
|
6,432
|
|
|
|
1,890
|
|
|
|
721
|
|
|
|
431
|
|
|
|
(534)
|
|
|
|
8,940
|
|
Operating Profit
(Loss)
|
|
$
|
787
|
|
|
$
|
70
|
|
|
$
|
(50)
|
|
|
$
|
(178)
|
|
|
$
|
—
|
|
|
$
|
629
|
|
Reconciliation of GAAP Operating Profit to Restaurant
Profit
|
|
Year Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
787
|
|
|
$
|
70
|
|
|
$
|
(50)
|
|
|
$
|
(178)
|
|
|
$
|
—
|
|
|
$
|
629
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise fees and
income
|
|
|
56
|
|
|
|
7
|
|
|
|
18
|
|
|
|
—
|
|
|
|
—
|
|
|
|
81
|
|
Revenues from
transactions with franchisees(2)
|
|
|
33
|
|
|
|
4
|
|
|
|
39
|
|
|
|
211
|
|
|
|
—
|
|
|
|
287
|
|
Other
revenues
|
|
|
10
|
|
|
|
10
|
|
|
|
563
|
|
|
|
42
|
|
|
|
(534)
|
|
|
|
91
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
|
254
|
|
|
|
110
|
|
|
|
46
|
|
|
|
184
|
|
|
|
—
|
|
|
|
594
|
|
Franchise
expenses
|
|
|
29
|
|
|
|
4
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
34
|
|
Expenses for
transactions with franchisees(2)
|
|
|
30
|
|
|
|
3
|
|
|
|
35
|
|
|
|
211
|
|
|
|
—
|
|
|
|
279
|
|
Other operating costs
and expenses
|
|
|
7
|
|
|
|
8
|
|
|
|
557
|
|
|
|
39
|
|
|
|
(533)
|
|
|
|
78
|
|
Closures and impairment
expenses, net
|
|
|
16
|
|
|
|
4
|
|
|
|
12
|
|
|
|
—
|
|
|
|
—
|
|
|
|
32
|
|
Other expenses
(income), net
|
|
|
97
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3)
|
|
|
|
—
|
|
|
|
94
|
|
Restaurant profit
(loss)
|
|
$
|
1,121
|
|
|
$
|
178
|
|
|
$
|
(19)
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1,281
|
|
Company
sales
|
|
|
7,120
|
|
|
|
1,939
|
|
|
|
51
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,110
|
|
Restaurant margin
%
|
|
|
15.7
|
%
|
|
|
9.2
|
%
|
|
|
(37.6)
|
%
|
|
N/A
|
|
|
N/A
|
|
|
|
14.1
|
%
|
Reconciliation of GAAP Operating Profit to Core Operating
Profit
|
|
Year Ended
12/31/2022
|
|
|
|
KFC
|
|
|
Pizza
Hut
|
|
|
All Other
Segments
|
|
|
Corporate
and
Unallocated(1)
|
|
|
Elimination
|
|
|
Total
|
|
GAAP Operating Profit
(Loss)
|
|
$
|
787
|
|
|
$
|
70
|
|
|
$
|
(50)
|
|
|
$
|
(178)
|
|
|
$
|
—
|
|
|
$
|
629
|
|
Special Items,
Operating Profit
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
|
—
|
|
|
|
4
|
|
Adjusted Operating
Profit
|
|
$
|
787
|
|
|
$
|
70
|
|
|
$
|
(50)
|
|
|
$
|
(174)
|
|
|
$
|
—
|
|
|
$
|
633
|
|
Items Affecting
Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary relief from
landlords
|
|
|
(32)
|
|
|
|
(6)
|
|
|
|
(1)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(39)
|
|
Temporary relief from
government agencies
|
|
|
(34)
|
|
|
|
(14)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(48)
|
|
VAT
deductions
|
|
|
(12)
|
|
|
|
(2)
|
|
|
|
(2)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(16)
|
|
Amortization of
reacquired franchise rights
|
|
|
97
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
97
|
|
F/X impact
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Core Operating Profit
(Loss)
|
|
$
|
806
|
|
|
$
|
48
|
|
|
$
|
(53)
|
|
|
$
|
(174)
|
|
|
$
|
—
|
|
|
$
|
627
|
|
The above tables reconcile segment information, which is based
on management responsibility, with our Condensed Consolidated
Statements of Income.
(1) Amounts have not been allocated to any segment for
purpose of making operating decision or assessing financial
performance as the transactions are deemed corporate revenues and
expenses in nature.
(2) Primarily includes revenues and associated expenses of
transactions with franchisees derived from the Company's central
procurement model whereby the Company centrally purchases
substantially all food and paper products from suppliers and then
sells and delivers to KFC and Pizza Hut restaurants, including
franchisees.
View original
content:https://www.prnewswire.com/news-releases/yum-china-reports-fourth-quarter-results-increases-dividend-by-23-and-steps-up-2024-share-repurchases-to-1-25-billion-302054729.html
SOURCE Yum China Holdings, Inc.