Yum China Holdings, Inc. (NYSE: YUMC and HKEX: 9987) announced its unaudited results for the fourth quarter and full year ending December 31, 2023.
Fourth Quarter Highlights:
- Total system sales, excluding foreign currency translation, increased by 21% year over year, primarily driven by a 12% net new unit contribution, 4% growth in same-store sales, and the recovery from pandemic-related closures.
- 542 net new stores were opened during the fourth quarter, bringing the total store count to 14,644 as of December 31, 2023, with KFC reaching 10,296 stores and Pizza Hut reaching 3,312 stores.
- Total revenues rose by 19% to $2.49 billion, or 21% excluding foreign currency translation.
- Operating profit surged by 170% to $110 million, with core operating profit experiencing a 324% growth.
- Restaurant margin expanded to 10.7%, or by 170 basis points excluding items affecting comparability.
- Diluted EPS increased by 77% to $0.23, or by 164% excluding special items and certain unfavorable impacts.
Full Year Highlights:
- Total system sales grew by 21% excluding foreign currency translation, mainly due to a 9% net new unit contribution, 7% growth in same-store sales, and recovery from pandemic closures.
- The company exceeded its full-year net new store target, increasing store count by 13%.
- Total revenues increased by 15% to $10.98 billion, or 21% excluding foreign currency translation.
- Operating profit grew by 76% to $1.1 billion, with core operating profit experiencing a 79% growth.
- Restaurant margin expanded to 16.3%, or by 270 basis points excluding items affecting comparability.
- Diluted EPS increased by 89% to $1.97, or by 101% excluding special items and certain unfavorable impacts.
Other Highlights:
- Shareholder returns through share repurchases and cash dividends increased by 25% to $833 million for the full year, the highest in the company’s history.
- In the fourth quarter, the company repurchased 7.5 million shares of common stock for $336 million, and in 2023, it repurchased 12.4 million shares.
- The board declared a 23% increase in cash dividend to $0.16 per share on Yum China’s common stock, payable on March 26, 2024.
- The company plans to repurchase $1.25 billion of its common stock in 2024, including $750 million under Rule 10b5-1 of the U.S. Securities Exchange Act of 1934 and $500 million in the first quarter of 2024 under Rule 10b-18 of the Exchange Act.
