YUM China Holdings Inc., reporting for the first time as a standalone company, said Tuesday its profit beat expectations for the fourth quarter despite just missing Wall Street’s target for sales at established restaurants.
Same-store sales were flat after a 3 percent increase at KFC shops were offset by a 7 percent drop at Pizza Hut Casual Dining. Analysts polled by Consensus Metrix expected a 0.1 percent uptick in same-store sales.
Rivals McDonald’s Corp. and Starbucks Corp. reported same-store sales gains of 7.9 percent and 6 percent, respectively, from China for the latest quarter.
Yum China’s fourth-quarter net income was US$88 million, or 23 cents per share, on revenue of US$1.98 billion. Profit excluding special items was 17 cents per share.
Analysts had expected a profit of 8 cents per share on revenue of US$2.05 billion.
Chief executive officer Micky Pant said on a conference call with analysts that he was “cautiously optimistic” about the company’s business amid rising costs for labor and commodities, stiff competition and simmering protectionist sentiments.
Yum China started trading as a standalone company Nov. 1.
Prior to the separation, it had been the primary profit and sales driver for Yum Brands Inc.(SD-Agencies)