Yum posts sudden fall in revenue as KFC, dish Hut struggle

Yum Brands Iraqi National Congress (YUM.N) reportable associate degree sudden come by fourth-quarter revenue as each its KFC and dish Hut edifice retailers struggled to grow, hurt partly by the robust dollar.

The company, that is spinning off its China business this year, aforesaid total revenue fell to $3.95 billion within the quarter complete Dec. 26, from nearly $4 billion a year earlier.

Analysts on the average were expecting sales to rise to $4.02 billion, per Thomson Reuters I/B/E/S.

The company's shares swaybacked one.4 p.c to $71.45 in extended commercialism on Wednesday.

Yum Brands gets regarding 0.5 its sales from China. however that business has been enclosed by food scandals and selling missteps for the past 2 years, whereas the corporate conjointly faces powerful competition from nimbler rivals within the us.

The company's sales at established restaurants in China rose a pair of p.c, increasing for less than the second time in six quarters. it absolutely was conjointly marginally on top of analysts' estimates of a one.9 p.c increase, per analysis firm agreement Metrix.

The increase in KFC's and dish Hut's system sales within the fourth quarter was identical as within the third quarter – up six p.c at KFC and a couple of p.c at dish Hut.

But, Conlumino analyst Hakon Helgesen aforesaid KFC system sales fell five p.c within the latest quarter, together with the impact of a robust dollar, whereas dish Hut system sales declined a pair of p.c.

"One of the key problems for each brands is that the comparatively slim growth at intervals the us," Helgesen aforesaid.

"Both suffer from the challenge of maturity and, whereas they continue to be widespread, the rather tired nature of the brands and an absence of meaning menu innovation means that they struggle to contend against rivals ..."

Sales at dish Hut restaurants open for over thirteen months rose one p.c within the quarter, but analysts' estimates of a one.5 p.c rise.

"Without the boost to growth provided by China, the bequest business can have to be compelled to work abundant more durable to change its connection," Helgesen aforesaid.

Yum Brands aforesaid it absolutely was heading in the right direction to finish the spinoff of its China business by the tip of the year.

The company reportable a profit of $275 million, or sixty three cents per share, within the latest quarter, compared with a loss of $86 million, or twenty cents per share, a year earlier.

Excluding things, it earned  sixty eight per share, beating analysts' estimates of sixty six cents.