On November 1, 2023, Yum Brands Inc (YUM, Financial) released its earnings report for the third quarter ended September 30, 2023. The company reported a 10% growth in worldwide system sales, excluding foreign currency translation, with 6% same-store sales growth and 6% unit growth. The third-quarter GAAP operating profit grew by 12% and the core operating profit grew by 16%. The GAAP EPS for the third quarter was $1.46 and the EPS excluding Special Items was $1.44.
Financial Highlights
Yum Brands Inc (YUM, Financial) reported a Q3 record of over 1,100 gross new units. The company's twin growth engines, KFC International and Taco Bell U.S., led the way, with KFC showing broad-based strength across both developed and emerging markets. The company set another digital sales record this quarter, with digital sales exceeding $7 billion and digital mix over 45%.
The company's GAAP operating profit grew by 12% and core operating profit grew by 16%. However, foreign currency translation unfavorably impacted divisional operating profit by $5 million.
Performance by Division
Yum Brands Inc (YUM, Financial) reported that worldwide system sales grew by 10%, excluding foreign currency translation, with KFC at 12%, Taco Bell at 11%, and Pizza Hut at 4%. Unit count increased by 6% driven by 1,130 gross new units, a Q3 record.
KFC Division opened 664 gross new restaurants across 57 countries. Taco Bell Division opened 74 gross new restaurants across 13 countries. Pizza Hut Division opened 383 gross new restaurants across 33 countries. The Habit Burger Grill Division opened 9 gross new restaurants this quarter.
CEO's Commentary
David Gibbs, CEO, said “We're incredibly pleased to report yet another excellent quarter with 10% system sales growth driven by 6% same-store sales growth and 6% unit growth with a Q3 record of over 1,100 gross new units. Our twin growth engines, KFC International and Taco Bell U.S., led the way, with KFC showing broad-based strength across both developed and emerging markets. With our strong year-to-date performance, we continue to expect that our full-year 2023 results will outperform on all aspects of our long-term growth algorithm. We set another digital sales record this quarter, with the next leg of our digital growth planned through enhancements of our customer insights platforms and expansions of our global loyalty programs. The exceptional performance of our teams and franchisees gives us confidence in sustaining our top and bottom line momentum in the years ahead.”
Yum Brands Inc (YUM, Financial) continues to demonstrate strong financial performance, with significant growth in system sales and unit growth. The company's focus on digital growth and customer insights platforms, along with the expansion of global loyalty programs, are expected to drive further growth in the future.
Explore the complete 8-K earnings release (here) from Yum Brands Inc for further details.
