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Sep 30, 2021
Yum China Q3 2021 Earnings Report
Results were impacted by the Delta variant outbreak, but the company demonstrated resiliency and agility.
Key Takeaways
Yum China's third-quarter results were significantly impacted by the Delta variant outbreak, which led to decreased same-store sales. Despite these challenges, the company sustained system sales growth through new store openings and digital channels. Total revenues increased 9% year over year to $2.55 billion.
Total revenues increased 9% year over year to $2.55 billion.
Opened a record of 524 new stores during the quarter.
Total system sales increased 1% year over year, excluding F/X.
Same-store sales decreased 7% year over year, excluding F/X.
Yum China
Yum China
Yum China Revenue by Segment
Revenue by Segment
KFC Revenue
CapyFin.comPizza Hut Revenue
CapyFin.com Forward Guidance
The Company expects the near-term environment to be challenging, with COVID-19 continuing to affect consumer behavior and impact same-store sales recovery. Restaurant margins in the fourth quarter are expected to be pressured by sales deleveraging, rising commodity prices, and wage inflation.
Positive Outlook
- Continue to manage costs and stay agile.
- Continue to invest with discipline in store network expansion.
- Continue to invest with discipline in supply chain.
- Continue to invest with discipline in digitalization for sustainable growth.
- Increasing gross new stores target to over 1,700.
Challenges Ahead
- COVID-19, especially the Delta variant outbreaks, will continue to affect consumer behavior and impact our same-store sales recovery.
- Fourth quarter is the seasonally lowest quarter for sales and profit margins.
- Restaurant margins in the fourth quarter and near-term to be pressured by sales deleveraging impact.
- Restaurant margins in the fourth quarter and near-term to be pressured by rising commodity prices.
- Restaurant margins in the fourth quarter and near-term to be pressured by wage inflation.
Revenue & Expenses
Visualization of income flow from segment revenue to net income