GO
Loading...

Enter multiple symbols separated by commas

Yum Brands Profit Increases, Fueled by Strong China Growth

A KFC restaurant in Boston.
Steven Senne
A KFC restaurant in Boston.

Fast-food company Yum Brands posted higher fiscal second-quarter earnings that exceeded analysts' estimates, and the company raised its full-year earnings forecast.

Yum, which owns Pizza Hut, Taco Bell and KFC, reported second-quarter earnings of 39 cents a share compared with estimates of 36 cents. Yum also boosted its full year earnings per share growth rate estimate to 12% from 11%.

Revenue of $2.37 billion beat estimates by $100 million. The company reported strong same-store sales in China, which rose by 7%, while same-store sales were flat in the U.S. Global same-store sales rose 2%.

U.S. same-store sales, a key retail measure that tracks sales at restaurants open at least a year, were flat compared with last year.

Yum's U.S. business has struggled since more than 70 people fell sick late last year because of an E. coli outbreak linked to Taco Bell restaurants in the U.S. Northeast. Federal health officials said contaminated lettuce was the likely cause.

Yum said it expects to earn at least $1.63 a share for 2007, a penny better than its previous view but in line with analysts' average estimate.

The stock gained 5% on Wednesday after UBS analyst David Palmer upgraded his rating on the stock to "buy" from "neutral."

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Jessica Alba

    The actress' company got burned after consumers came out in droves, saying the company's sunscreen doesn't provide much sun protection at all.

  • EON Sports VR

    Multiple NFL teams are now using virtual reality simulations to complement practice and, more importantly, keep players healthy.

  • What a robotic sniper might look like.

    A global arms race of robotic killing machines is inevitable if countries pursue autonomous weaponry, experts said.

U.S. Video

  • CNBC update: 400 lb grouper

    New York Attorney General Schneiderman announced retailers Wal-Mart, Sears and Amazon have agreed to keep realistic toy guns off their shelves, and a fisherman hooked a 7-foot, 412 pound grouper, reports CNBC's Sue Herera.

  • DC's fight against climate change

    President Obama is unveiling the first-ever limits on power plant carbon emissions today. Brian Deese, White House senior advisor, discusses emission targets, and investments in cleaner sources of energy to fight climate change.

  • Barnes & Noble spins off college bookstore

    Barnes & Noble is spinning off its college bookstore. Executive chairman Michael Huseby, says the company is aiming to stay relevant in the digital world.