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Yum! Brands Inc, the owner of the Pizza Hut, Taco Bell and KFC restaurant chains, said fourth- quarter profit fell 12 per cent as sales slowed in China.Subscribe to The Hospitality Knowledge & Career E-Mag |www.hospemag.com by EmailNet income declined to $204 million, or 43 cents a diluted share, from $231 million, or 44 cents, a year earlier. Sales rose 3.7 per cent to $3.38 billion, the Louisville, Kentucky- based company said in a statement.
The global recession is curbing revenue in China, which accounts for about a third of Yum’s sales. Chief executive officer David Novak opened 504 stores there last year, out of a total of 1,495 new overseas locations.
Sales in stores in Mainland China open at least a year rose 1 per cent in the quarter, compared with 17 per cent a year earlier. System-wide sales in the China division, which includes Taiwan and Thailand, rose 23 per cent.
In December, Novak, forecast profit growth of 15 to 20 per cent this year in its China division and 15 per cent in the US. Meanwhile, Yum plans to open another 1,400 locations outside the US in 2009.
Novak is relying on international expansion to maintain profit as sales in the US slow amid mounting job losses, declining home values and tighter lending restrictions.
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