We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Yum Brands Inc | NYSE:YUM | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-5.92 | -4.19% | 135.33 | 137.99 | 134.58 | 135.99 | 4,639,921 | 23:32:26 |
|
UNITED STATES
|
SECURITIES AND EXCHANGE COMMISSION
|
Washington, D. C. 20549
|
[
]
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
|
|
|
EXCHANGE ACT OF 1934
for the quarterly period ended September 3, 2016
|
|
|
|
OR
|
||
|
|
|
[ ]
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|
|
North Carolina
|
|
13-3951308
|
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
|
incorporation or organization)
|
|
Identification No.)
|
|
|
|
|
|
1441 Gardiner Lane, Louisville, Kentucky
|
|
40213
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
Registrant’s telephone number, including area code: (502) 874-8300
|
|
|
|
Page
|
|
|
No.
|
Part I.
|
Financial Information
|
|
|
|
|
|
Item 1 - Financial Statements
|
|
|
|
|
|
Condensed Consolidated Statements of Income - Quarters and Years to date ended
September 3, 2016 and September 5, 2015
|
|
|
|
|
|
Condensed Consolidated Statements of Comprehensive Income - Quarters and Years to date ended September 3, 2016 and September 5, 2015
|
|
|
|
|
|
Condensed Consolidated Statements of Cash Flows – Years to date ended
September 3, 2016 and September 5, 2015
|
|
|
|
|
|
Condensed Consolidated Balance Sheets – September 3, 2016 and December 26, 2015
|
|
|
|
|
|
Notes to Condensed Consolidated Financial Statements
|
|
|
|
|
|
Item 2 - Management’s Discussion and Analysis of Financial Condition
and Results of Operations
|
|
|
|
|
|
Item 3 - Quantitative and Qualitative Disclosures about Market Risk
|
|
|
|
|
|
Item 4 – Controls and Procedures
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
|
Part II.
|
Other Information and Signatures
|
|
|
|
|
|
Item 1 – Legal Proceedings
|
|
|
|
|
|
Item 1A – Risk Factors
|
|
|
|
|
|
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds
|
|
|
|
|
|
Item 6 – Exhibits
|
|
|
|
|
|
Signatures
|
Item 1.
|
Financial Statements
|
|
•
|
YUM China (“China” or “China Division”) which includes all operations in mainland China
|
•
|
The KFC Division which includes all operations of the KFC concept outside of China Division
|
•
|
The Pizza Hut Division which includes all operations of the Pizza Hut concept outside of China Division
|
•
|
The Taco Bell Division which includes all operations of the Taco Bell concept
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net Income – YUM! Brands, Inc.
|
|
$
|
622
|
|
|
$
|
421
|
|
|
$
|
1,352
|
|
|
$
|
1,018
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding (for basic calculation)
|
|
392
|
|
|
436
|
|
|
406
|
|
|
437
|
|
||||
Effect of dilutive share-based employee compensation
|
|
6
|
|
|
8
|
|
|
6
|
|
|
8
|
|
||||
Weighted-average common and dilutive potential common shares outstanding (for diluted calculation)
|
|
398
|
|
|
444
|
|
|
412
|
|
|
445
|
|
||||
Basic EPS
|
|
$
|
1.59
|
|
|
$
|
0.97
|
|
|
$
|
3.33
|
|
|
$
|
2.33
|
|
Diluted EPS
|
|
$
|
1.56
|
|
|
$
|
0.95
|
|
|
$
|
3.28
|
|
|
$
|
2.29
|
|
Unexercised employee stock options and stock appreciation rights (in millions) excluded from the diluted EPS computation
(a)
|
|
2.3
|
|
|
4.2
|
|
|
6.2
|
|
|
4.3
|
|
(a)
|
These unexercised employee stock options and stock appreciation rights were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented.
|
|
|
|
Shares Repurchased (thousands)
|
|
Dollar Value of Shares Repurchased
|
|
Remaining Dollar Value of Shares that may be Repurchased
|
|
|||||||||||||||||
|
Authorization Date
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
|||||||||||||
|
November 2013
|
|
—
|
|
|
|
1,779
|
|
|
|
$
|
—
|
|
|
|
$
|
133
|
|
|
|
$
|
—
|
|
|
|
|
November 2014
|
|
—
|
|
|
|
2,737
|
|
|
|
—
|
|
|
|
237
|
|
|
|
—
|
|
|
|
|||
|
December 2015
|
|
13,369
|
|
|
|
—
|
|
|
|
933
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|||
|
March 2016
|
|
2,823
|
|
|
|
—
|
|
|
|
228
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|||
|
May 2016
|
|
30,117
|
|
|
|
—
|
|
|
|
2,596
|
|
|
|
—
|
|
|
|
1,604
|
|
|
|
|||
|
Total
|
|
46,309
|
|
(a)
|
|
4,516
|
|
|
|
$
|
3,757
|
|
(a)
|
|
$
|
370
|
|
|
|
$
|
1,604
|
|
|
|
|
|
|
|
|
(a)
|
Includes the effect of
$105 million
in share repurchases (
1.2 million
shares) with trade dates prior to September 3, 2016 but cash settlement dates subsequent to September 3, 2016.
|
|
|
Translation Adjustments and Gains (Losses) From Intra-Entity Transactions of a Long-Term Nature
|
|
Pension and Post-Retirement Benefits
|
|
Derivative Instruments
|
|
Total
|
||||||||
Balance at December 26, 2015, net of tax
|
|
$
|
(109
|
)
|
|
$
|
(113
|
)
|
|
$
|
(17
|
)
|
|
$
|
(239
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Gains (losses) arising during the year classified into accumulated OCI, net of tax
|
|
(92
|
)
|
|
—
|
|
|
(20
|
)
|
|
(112
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
(Gains) losses reclassified from accumulated OCI, net of tax
|
|
—
|
|
|
5
|
|
|
22
|
|
|
27
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
OCI, net of tax
|
|
(92
|
)
|
|
5
|
|
|
2
|
|
|
(85
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Balance at September 3, 2016, net of tax
|
$
|
(201
|
)
|
|
$
|
(108
|
)
|
|
$
|
(15
|
)
|
|
$
|
(324
|
)
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
China
|
|
$
|
(4
|
)
|
|
$
|
(3
|
)
|
|
$
|
(8
|
)
|
|
$
|
(7
|
)
|
KFC Division
(a)
|
|
1
|
|
|
4
|
|
|
2
|
|
|
36
|
|
||||
Pizza Hut Division
(a)
|
|
(8
|
)
|
|
15
|
|
|
(64
|
)
|
|
52
|
|
||||
Taco Bell Division
|
|
(14
|
)
|
|
(14
|
)
|
|
(15
|
)
|
|
(21
|
)
|
||||
Worldwide
|
|
$
|
(25
|
)
|
|
$
|
2
|
|
|
$
|
(85
|
)
|
|
$
|
60
|
|
(a)
|
In 2010 we refranchised our then-remaining Company-operated restaurants in Mexico. To the extent we owned it, we did not sell the real estate related to certain of these restaurants, instead leasing it to the franchisee. During the quarter ended June 13, 2015, we initiated plans to sell this real estate and determined it was held for sale in accordance with GAAP. On September 28, 2015, subsequent to our quarter ended September 5, 2015, we sold the real estate for approximately
$58 million
. While these proceeds exceeded the book value of the real estate, the sale represented a substantial liquidation of our Mexican operations under GAAP. Accordingly, we were required to include accumulated translation losses associated with our Mexican business within our carrying value when performing impairment evaluations subsequent to determining that the real estate was held for sale. We recorded charges of
$12 million
and
$80 million
in the quarter and year to date ended September 5, 2015, respectively, representing the excess of the sum of the book value of the real estate and other related assets and our accumulated translation losses over the then-expected sales price. Consistent with the classification of the original market refranchising transaction, these charges were classified as Refranchising (Gain) Loss. Refranchising Losses of
$4 million
and
$40 million
were associated with the KFC Division for the quarter and year to date ended September 5, 2015, respectively. Refranchising Losses of
$8 million
and
$40 million
were associated with the Pizza Hut Division for the quarter and year to date ended September 5, 2015, respectively. The proceeds ultimately received for the real estate approximated our carrying value including the remaining unrecognized accumulated translation losses as of September 5, 2015.
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Equity (income) loss from investments in unconsolidated affiliates
|
$
|
(18
|
)
|
|
$
|
(15
|
)
|
|
$
|
(44
|
)
|
|
$
|
(31
|
)
|
Foreign exchange net (gain) loss and other
|
3
|
|
|
12
|
|
|
(6
|
)
|
|
19
|
|
||||
Other (income) expense
|
$
|
(15
|
)
|
|
$
|
(3
|
)
|
|
$
|
(50
|
)
|
|
$
|
(12
|
)
|
|
9/3/2016
|
|
12/26/2015
|
||||
Accounts and notes receivable, gross
|
$
|
460
|
|
|
$
|
393
|
|
Allowance for doubtful accounts
|
(20
|
)
|
|
(16
|
)
|
||
Accounts and notes receivable, net
|
$
|
440
|
|
|
$
|
377
|
|
|
9/3/2016
|
|
12/26/2015
|
||||
Property, plant and equipment, gross
|
$
|
7,708
|
|
|
$
|
7,832
|
|
Accumulated depreciation and amortization
|
(3,698
|
)
|
|
(3,643
|
)
|
||
Property, plant and equipment, net
|
$
|
4,010
|
|
|
$
|
4,189
|
|
|
Noncontrolling Interests
|
|
Redeemable Noncontrolling Interest
|
||||
Balance at December 26, 2015
|
$
|
58
|
|
|
$
|
6
|
|
Net Income (loss) – noncontrolling interests
|
17
|
|
|
1
|
|
||
Noncontrolling interest loss upon redemption
|
—
|
|
|
(8
|
)
|
||
Dividends declared
|
(7
|
)
|
|
—
|
|
||
Currency translation adjustments and other
|
(2
|
)
|
|
1
|
|
||
Balance at September 3, 2016
|
$
|
66
|
|
|
$
|
—
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Income tax (benefit) provision
|
$
|
(65
|
)
|
|
$
|
145
|
|
|
$
|
183
|
|
|
$
|
358
|
|
Effective tax rate
|
(11.6
|
)%
|
|
25.3
|
%
|
|
11.8
|
%
|
|
25.9
|
%
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
Revenues
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
China
|
$
|
1,883
|
|
|
$
|
1,969
|
|
|
$
|
4,774
|
|
|
$
|
4,861
|
|
KFC Division
|
723
|
|
|
721
|
|
|
2,060
|
|
|
2,109
|
|
||||
Pizza Hut Division
|
230
|
|
|
264
|
|
|
741
|
|
|
802
|
|
||||
Taco Bell Division
|
481
|
|
|
473
|
|
|
1,370
|
|
|
1,382
|
|
||||
Unallocated
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||
|
$
|
3,316
|
|
|
$
|
3,427
|
|
|
$
|
8,943
|
|
|
$
|
9,154
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
Operating Profit
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
China
(a)
|
$
|
348
|
|
|
$
|
327
|
|
|
$
|
751
|
|
|
$
|
661
|
|
KFC Division
|
160
|
|
|
144
|
|
|
469
|
|
|
459
|
|
||||
Pizza Hut Division
|
61
|
|
|
65
|
|
|
212
|
|
|
206
|
|
||||
Taco Bell Division
|
143
|
|
|
132
|
|
|
401
|
|
|
386
|
|
||||
Unallocated and Corporate General and administrative expenses
(b)
|
(80
|
)
|
|
(53
|
)
|
|
(213
|
)
|
|
(153
|
)
|
||||
Unallocated Other income (expense)
|
(3
|
)
|
|
(10
|
)
|
|
4
|
|
|
(19
|
)
|
||||
Unallocated Refranchising gain (loss)
(c)
|
25
|
|
|
(2
|
)
|
|
85
|
|
|
(60
|
)
|
||||
Operating Profit
|
$
|
654
|
|
|
$
|
603
|
|
|
$
|
1,709
|
|
|
$
|
1,480
|
|
Interest expense, net
|
(87
|
)
|
|
(32
|
)
|
|
(164
|
)
|
|
(99
|
)
|
||||
Income Before Income Taxes
|
$
|
567
|
|
|
$
|
571
|
|
|
$
|
1,545
|
|
|
$
|
1,381
|
|
(a)
|
Includes equity income from investments in unconsolidated affiliates of
$18 million
and
$15 million
for the quarters ended
September 3, 2016
and
September 5, 2015
, respectively. Includes equity income from investments in unconsolidated affiliates of
$44 million
and
$31 million
for the years to date ended
September 3, 2016
and
September 5, 2015
, respectively.
|
(b)
|
Primarily Corporate G&A expenses for the quarters ended
September 3, 2016
and
September 5, 2015
. Amounts also include costs associated with the KFC U.S. Acceleration Agreement of
$21 million
for the quarter ended
September 5, 2015
and
$17 million
and
$31 million
for the years to date ended
September 3, 2016
and
September 5, 2015
, respectively. Also included are
$10 million
and
$29 million
for the quarter and year to date ended
September 3, 2016
, respectively, related to the planned spin-off of the China business and YUM recapitalization, and
$26 million
for the quarter and
$32 million
for the year to date ended
September 3, 2016
, respectively, associated with YUM's Strategic Transformation Initiatives. See Note 4.
|
(c)
|
See the Refranchising (Gain) Loss section of Note 4.
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Service cost
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
12
|
|
|
$
|
13
|
|
Interest cost
|
12
|
|
|
13
|
|
|
37
|
|
|
38
|
|
||||
Expected return on plan assets
|
(15
|
)
|
|
(15
|
)
|
|
(45
|
)
|
|
(43
|
)
|
||||
Amortization of net loss
|
1
|
|
|
10
|
|
|
4
|
|
|
31
|
|
||||
Amortization of prior service cost
|
2
|
|
|
1
|
|
|
4
|
|
|
1
|
|
||||
Net periodic benefit cost
|
$
|
4
|
|
|
$
|
14
|
|
|
$
|
12
|
|
|
$
|
40
|
|
|
|
|
|
|
|
|
|
||||||||
Additional loss (gain) recognized due to settlements
(a)
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
(a)
|
Losses are a result of settlement transactions from a non-funded plan which exceeded the sum of annual service and interest costs for that plan. These losses were recorded in G&A expenses.
|
Short-term Borrowings
|
|
9/3/2016
|
|
12/26/2015
|
|
|||
Current maturities of long-term debt
|
|
$
|
55
|
|
|
$
|
313
|
|
Unsecured Short-term Loan Credit Facility (the "Bridge Facility")
|
|
—
|
|
|
600
|
|
||
Other
|
|
—
|
|
|
9
|
|
||
|
|
55
|
|
|
922
|
|
||
Less current portion of debt issuance costs and discounts
|
|
(7
|
)
|
|
—
|
|
||
Short-term borrowings
|
|
$
|
48
|
|
|
$
|
922
|
|
|
|
|
|
|
||||
Long-term Debt
|
|
|
|
|
||||
Securitization Notes
|
|
$
|
2,300
|
|
|
$
|
—
|
|
Subsidiary Senior Unsecured Notes
|
|
2,100
|
|
|
—
|
|
||
Term Loan A Facility
|
|
500
|
|
|
—
|
|
||
Term Loan B Facility
|
|
2,000
|
|
|
—
|
|
||
YUM Senior Unsecured Notes
|
|
2,200
|
|
|
2,500
|
|
||
Senior Unsecured Revolving Credit Facility
|
|
—
|
|
|
701
|
|
||
Capital lease obligations
|
|
154
|
|
|
169
|
|
||
Other
|
|
9
|
|
|
—
|
|
||
|
|
9,263
|
|
|
3,370
|
|
||
Less debt issuance costs and discounts
|
|
(89
|
)
|
|
(16
|
)
|
||
Less current maturities of long-term debt
|
|
(55
|
)
|
|
(313
|
)
|
||
Long-term debt
|
|
$
|
9,119
|
|
|
$
|
3,041
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
Gains/(Losses) Recognized in OCI
|
|
(Gains)/Losses Reclassified from AOCI into Net Income
|
|
Gains/(Losses) Recognized in OCI
|
|
(Gains)/Losses Reclassified from AOCI into Net Income
|
||||||||||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate swaps
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency contracts
|
15
|
|
|
8
|
|
|
(13
|
)
|
|
(10
|
)
|
|
(16
|
)
|
|
20
|
|
|
20
|
|
|
(22
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Income tax benefit/(expense)
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
1
|
|
|
4
|
|
|
|
|
|
Fair Value
|
|
|||||||
|
|
Level
|
|
9/3/2016
|
|
12/26/2015
|
|
Condensed Consolidated Balance Sheet
|
||||
Interest Rate Swaps - Liability
|
|
2
|
|
$
|
7
|
|
|
$
|
2
|
|
|
Accounts payable and other current liabilities
|
Interest Rate Swaps - Asset
|
|
2
|
|
3
|
|
|
—
|
|
|
Other assets
|
||
Foreign Currency Contracts - Asset
|
|
2
|
|
6
|
|
|
—
|
|
|
Prepaid expenses and other current assets
|
||
Foreign Currency Contracts - Liability
|
|
2
|
|
3
|
|
|
—
|
|
|
Other liabilities and deferred credits
|
||
Foreign Currency Contracts - Asset
|
|
2
|
|
—
|
|
|
19
|
|
|
Other assets
|
||
Other Investments
|
|
1
|
|
23
|
|
|
21
|
|
|
Other assets
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
YUM China (“China” or “China Division”) which includes all operations in mainland China
|
•
|
The KFC Division which includes all operations of the KFC concept outside of China Division
|
•
|
The Pizza Hut Division which includes all operations of the Pizza Hut concept outside of China Division
|
•
|
The Taco Bell Division which includes all operations of the Taco Bell concept
|
•
|
More Focused. Four growth drivers will form the basis of YUM’s strategic plans and repeatable business model to accelerate same store sales growth and net new restaurant development at KFC, Pizza Hut and Taco Bell around the world over the long term. The Company will focus on becoming best-in-class in:
|
◦
|
Building Distinctive, Relevant Brands
|
◦
|
Developing Unmatched Franchise Operating Capability
|
◦
|
Driving Bold Restaurant Development
|
◦
|
Growing Unrivaled Culture and Talent
|
•
|
More Franchised. YUM will increase franchise restaurant ownership from 77% currently to 93% at the time of the separation of the China business to at least 98% by the end of 2018.
|
•
|
More Efficient. The Company will revamp its financial profile, improving the efficiency of its organization and cost structure globally by:
|
◦
|
Significantly reducing annual capital expenditures to approximately $100 million in 2019
|
◦
|
Significantly reducing G&A expenses over the next three years
|
◦
|
Maintaining an optimized capital structure of ~5.0x Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") leverage
|
•
|
The Company provides certain percentage changes excluding the impact of foreign currency translation (“FX” or “Forex”). These amounts are derived by translating current year results at prior year average exchange rates. We believe the elimination of the foreign currency translation impact provides better year-to-year comparability without the distortion of foreign currency fluctuations.
|
•
|
System sales growth includes the results of all restaurants regardless of ownership, including company-owned, franchise, unconsolidated affiliate and license restaurants that operate our Concepts, except for non-company-owned restaurants for which we do not receive a sales-based royalty. Sales of franchise, unconsolidated affiliate and license restaurants typically generate ongoing franchise and license fees for the Company (typically at a rate of 4% to 6% of sales). Franchise, unconsolidated affiliate and license restaurant sales are not included in Company sales on the Condensed Consolidated Statements of Income; however, the franchise and license fees are included in the Company’s revenues. We believe system sales growth is useful to investors as a significant indicator of the overall strength of our business as it incorporates all of our revenue drivers, Company and franchise same-store sales as well as net unit growth.
|
•
|
Same-store sales growth is the estimated percentage change in sales of all restaurants that have been open and in the YUM system one year or more.
|
•
|
Company Restaurant profit ("Restaurant profit") is defined as Company sales less expenses incurred directly by our Company-owned restaurants in generating Company sales. Company restaurant margin as a percentage of sales is defined as Restaurant profit divided by Company sales. Within the Company Sales and Restaurant Profit analyses, Store Portfolio Actions represent the net impact of new unit openings, acquisitions, refranchising and store closures, and Other primarily represents the impact of same-store sales as well as the impact of changes in costs such as inflation/deflation.
|
•
|
Operating Margin is Operating Profit divided by Total revenues.
|
•
|
In addition to the results provided in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") , the Company has provided non-GAAP measurements which present Diluted Earnings Per Share before Special Items, our Effective Tax Rate before Special Items, and Core Operating Profit. Core Operating Profit excludes Special Items and foreign currency translation and we use Core Operating Profit for the purposes of evaluating performance internally. Special Items are not included in any of our externally reported segment results, and we believe the elimination of the foreign currency translation impact provides better year-to-year comparability without the distortion of foreign currency fluctuations. These non-GAAP measurements are not intended to replace the presentation of our financial results in accordance with GAAP. Rather, the Company believes that the presentation of Diluted Earnings Per Share before Special Items, our Effective Tax Rate before Special Items, and Core Operating Profit provide additional information to investors to facilitate the comparison of past and present operations, excluding items that the Company does not believe are indicative of our ongoing operations due to their size and/or nature.
|
|
% Change
|
||||
|
System Sales
(a)
|
Same-Store Sales
|
Units
|
GAAP Operating Profit
|
Core Operating Profit
|
China Division
|
+3
|
(1)
|
+7
|
+7
|
+14
|
KFC Division
|
+7
|
+4
|
+3
|
+11
|
+19
|
Pizza Hut Division
|
Even
|
(1)
|
+1
|
(6)
|
(5)
|
Taco Bell Division
|
+5
|
+3
|
+3
|
+9
|
+9
|
Worldwide
|
+4
|
+1
|
+3
|
+8
|
+11
|
|
% Change
|
||||
|
System Sales
(a)
|
Same-Store Sales
|
Units
|
GAAP Operating Profit
|
Core Operating Profit
|
China Division
|
+5
|
+1
|
+7
|
+14
|
+20
|
KFC Division
|
+6
|
+2
|
+3
|
+2
|
+9
|
Pizza Hut Division
|
+2
|
+1
|
+1
|
+3
|
+4
|
Taco Bell Division
|
+4
|
+1
|
+3
|
+4
|
+4
|
Worldwide
|
+4
|
+1
|
+3
|
+15
|
+13
|
(a)
|
System Sales percentages as shown in tables exclude the impact of foreign currency translation.
|
•
|
Foreign currency translation negatively impacted our reported quarterly and year to date Operating Profit by $34 million and $78 million, respectively, which included $23 million and $43 million, respectively, from our China Division, and $11 million and $33 million, respectively, from our KFC Division.
|
•
|
Our GAAP effective tax rate for the quarter decreased to (11.6)% from 25.3%. Our effective tax rate for the quarter, excluding Special Items, decreased to 23.5% from 24.8%. Our year to date GAAP effective tax rate decreased to 11.8% from 25.9%. Our year to date effective tax rate, excluding Special Items, decreased to 24.3% from 24.6%.
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
% B/(W)
|
|
2016
|
|
2015
|
|
% B/(W)
|
||||||||||||
Company sales
|
$
|
2,841
|
|
|
$
|
2,968
|
|
|
(4
|
)
|
|
|
$
|
7,560
|
|
|
$
|
7,806
|
|
|
(3
|
)
|
|
Franchise and license fees and income
|
475
|
|
|
459
|
|
|
4
|
|
|
|
1,383
|
|
|
1,348
|
|
|
3
|
|
|
||||
Total revenues
|
$
|
3,316
|
|
|
$
|
3,427
|
|
|
(3
|
)
|
|
|
$
|
8,943
|
|
|
$
|
9,154
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Restaurant profit
|
$
|
570
|
|
|
$
|
539
|
|
|
5
|
|
|
|
$
|
1,411
|
|
|
$
|
1,332
|
|
|
6
|
|
|
Restaurant margin %
|
20.0
|
%
|
|
18.2
|
%
|
|
1.8
|
|
ppts.
|
|
18.7
|
%
|
|
17.1
|
%
|
|
1.6
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
General and administrative ("G&A") expenses
|
$
|
377
|
|
|
$
|
328
|
|
|
(15
|
)
|
|
|
$
|
1,028
|
|
|
$
|
976
|
|
|
(5
|
)
|
|
Franchise and license expenses
|
47
|
|
|
65
|
|
|
27
|
|
|
|
145
|
|
|
146
|
|
|
1
|
|
|
||||
Closures and impairment (income) expenses
|
7
|
|
|
3
|
|
|
(99
|
)
|
|
|
47
|
|
|
30
|
|
|
(58
|
)
|
|
||||
Refranchising (gain) loss
|
(25
|
)
|
|
2
|
|
|
NM
|
|
|
|
(85
|
)
|
|
60
|
|
|
NM
|
|
|
||||
Other (income) expense
|
(15
|
)
|
|
(3
|
)
|
|
NM
|
|
|
|
(50
|
)
|
|
(12
|
)
|
|
NM
|
|
|
||||
Operating Profit
|
$
|
654
|
|
|
$
|
603
|
|
|
8
|
|
|
|
$
|
1,709
|
|
|
$
|
1,480
|
|
|
15
|
|
|
Operating margin %
|
19.7
|
%
|
|
17.6
|
%
|
|
2.1
|
|
ppts.
|
|
19.1
|
%
|
|
16.2
|
%
|
|
2.9
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
$
|
87
|
|
|
$
|
32
|
|
|
NM
|
|
|
|
164
|
|
|
99
|
|
|
(67
|
)
|
|
||
Income tax provision
|
(65
|
)
|
|
145
|
|
|
NM
|
|
|
|
183
|
|
|
358
|
|
|
49
|
|
|
||||
Effective Tax Rate
|
(11.6
|
)%
|
|
25.3
|
%
|
|
36.9
|
|
ppts.
|
|
11.8
|
%
|
|
25.9
|
%
|
|
14.1
|
ppts.
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income – including noncontrolling interests
|
$
|
632
|
|
|
$
|
426
|
|
|
48
|
|
|
|
$
|
1,362
|
|
|
$
|
1,023
|
|
|
33
|
|
|
Net Income – noncontrolling interests
|
10
|
|
|
5
|
|
|
(81
|
)
|
|
|
10
|
|
|
5
|
|
|
(81
|
)
|
|
||||
Net Income – YUM! Brands, Inc.
|
$
|
622
|
|
|
$
|
421
|
|
|
48
|
|
|
|
$
|
1,352
|
|
|
$
|
1,018
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share
(a)
|
$
|
1.56
|
|
|
$
|
0.95
|
|
|
64
|
|
|
|
$
|
3.28
|
|
|
$
|
2.29
|
|
|
43
|
|
|
Diluted earnings per share before Special Items
(a)
|
$
|
1.09
|
|
|
$
|
1.00
|
|
|
9
|
|
|
|
$
|
2.79
|
|
|
$
|
2.50
|
|
|
12
|
|
|
(a)
|
See Note 2 for the number of shares used in this calculation.
|
|
Quarter ended
|
|
|
|
|
Year to date
|
|
|
|
|||||||||
|
2016
|
|
2015
|
|
|
|
2016
|
|
2015
|
|
|
|||||||
System Sales Growth, reported
|
1
|
%
|
|
—
|
%
|
|
|
|
1
|
%
|
|
—
|
%
|
|
|
|
||
System Sales Growth, excluding FX
|
4
|
%
|
|
6
|
%
|
|
|
|
4
|
%
|
|
4
|
%
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unit Count
|
9/3/2016
|
|
|
9/5/2015
|
|
|
% Increase (Decrease)
|
|
|
|
|
|
||||||
Franchise & License
|
33,400
|
|
|
32,351
|
|
|
3
|
|
|
|
|
|
|
|||||
Company-owned
|
8,873
|
|
|
8,795
|
|
|
1
|
|
|
|
|
|
|
|||||
Unconsolidated Affiliates
|
812
|
|
|
778
|
|
|
4
|
|
|
|
|
|
|
|||||
|
43,085
|
|
|
41,924
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
Detail of Special Items
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Costs associated with the planned spin-off of the China business and YUM recapitalization (See Note 4)
|
|
$
|
(10
|
)
|
|
$
|
—
|
|
|
$
|
(29
|
)
|
|
$
|
—
|
|
YUM's Strategic Transformation Initiatives
(a)
|
|
(26
|
)
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
||||
Costs associated with KFC U.S. Acceleration Agreement (See Note 4)
|
|
—
|
|
|
(21
|
)
|
|
(17
|
)
|
|
(31
|
)
|
||||
Refranchising initiatives
(b)
|
|
21
|
|
|
(4
|
)
|
|
77
|
|
|
(69
|
)
|
||||
Other Special Items Income (Expense)
|
|
1
|
|
|
(1
|
)
|
|
1
|
|
|
1
|
|
||||
Total Special Items Income (Expense) - Operating Profit
|
|
(14
|
)
|
|
(26
|
)
|
|
—
|
|
|
(99
|
)
|
||||
Tax Benefit (Expense) on Special Items
(c)
|
|
$
|
202
|
|
|
$
|
4
|
|
|
$
|
193
|
|
|
$
|
5
|
|
Special Items Income (Expense), net of tax - including noncontrolling interests
|
|
$
|
188
|
|
|
$
|
(22
|
)
|
|
193
|
|
|
(94
|
)
|
||
Special Items Income (Expense), net of tax - noncontrolling interests
(See Note 6)
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
||||
Special Items Income (Expense), net of tax - YUM! Brands, Inc.
|
|
$
|
188
|
|
|
$
|
(22
|
)
|
|
$
|
201
|
|
|
$
|
(94
|
)
|
Average diluted shares outstanding
|
|
398
|
|
|
444
|
|
|
412
|
|
|
445
|
|
||||
Special Items diluted EPS
|
|
$
|
0.47
|
|
|
$
|
(0.05
|
)
|
|
$
|
0.49
|
|
|
$
|
(0.21
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Core Operating Profit to GAAP Operating Profit
|
|
|
|
|
|
|
|
|
||||||||
Core Operating Profit
|
|
$
|
702
|
|
|
$
|
629
|
|
|
$
|
1,787
|
|
|
$
|
1,579
|
|
Special Items Income (Expense)
|
|
(14
|
)
|
|
(26
|
)
|
|
—
|
|
|
(99
|
)
|
||||
Foreign Currency Impact on Operating Profit
|
|
(34
|
)
|
|
N/A
|
|
|
(78
|
)
|
|
N/A
|
|
||||
GAAP Operating Profit
|
|
$
|
654
|
|
|
$
|
603
|
|
|
$
|
1,709
|
|
|
$
|
1,480
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Diluted EPS Before Special Items to GAAP EPS
|
|
|
|
|
|
|
|
|
||||||||
Diluted EPS before Special Items
|
|
$
|
1.09
|
|
|
$
|
1.00
|
|
|
$
|
2.79
|
|
|
$
|
2.50
|
|
Special Items EPS
|
|
0.47
|
|
|
(0.05
|
)
|
|
0.49
|
|
|
(0.21
|
)
|
||||
GAAP EPS
|
|
$
|
1.56
|
|
|
$
|
0.95
|
|
|
$
|
3.28
|
|
|
$
|
2.29
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Effective Tax Rate Before Special Items to GAAP Effective Tax Rate
|
|
|
|
|
|
|
|
|
||||||||
Effective Tax Rate before Special Items
|
|
23.5
|
%
|
|
24.8
|
%
|
|
24.3
|
%
|
|
24.6
|
%
|
||||
Impact on Tax Rate as a result of Special Items
(b)
|
|
(35.1
|
)%
|
|
0.5
|
%
|
|
(12.5
|
)%
|
|
1.3
|
%
|
||||
GAAP Effective Tax Rate
|
|
(11.6
|
)%
|
|
25.3
|
%
|
|
11.8
|
%
|
|
25.9
|
%
|
(a)
|
Costs related to YUM’s Strategic Transformation Initiatives are being classified as Special Items due to the scope of the initiatives as well as their significance and include items directly attributable to these initiatives such as severance costs, professional fees and other one-time costs that will be incurred pursuant to our strategy to become more focused, franchised and efficient. During the quarter ended September 3, 2016, YUM offered a voluntary retirement program to certain U.S. employees as a step towards becoming a leaner, more efficient organization. This program will provide separation pay and benefits to employees who elected to voluntarily separate from Yum. We incurred $26 million and $32 million of costs related to YUM’s Strategic Transformation Initiatives in the quarter and year to date ended September 3, 2016, respectively, primarily related to the U.S. Voluntary Retirement Program. We currently expect to record approximately $50 million of expenses related to these initiatives in the fourth quarter of 2016. Additionally, refranchising gains and losses incurred as we move to being at least 98% franchised will continue to be classified as Special Items (see footnote b below). See the Introduction and Overview of this MD&A for discussion of YUM's Strategic Transformation Initiatives.
|
(b)
|
We have historically recorded refranchising gains and losses in the U.S. as Special Items due to the scope of our refranchising program and the volatility in associated gains and losses. Beginning in 2016, we are also including all international refranchising gains and losses, excluding China, in Special Items. The inclusion in Special Items of these additional international refranchising gains and losses is the result of the anticipated size and volatility of refranchising initiatives outside the U.S. that will take place in connection with YUM's Strategic Transformation Initiatives. International refranchising gains and losses in the quarter and year to date ended September 5, 2015 previously not included in Special Items were not significant and have not been reclassified into Special Items. See Note 4.
|
(c)
|
The tax benefit (expense) was determined based upon the impact of the nature, as well as the jurisdiction of the respective individual pre-tax components within Special Items. Additionally, during the quarter ended September 3, 2016, we recognized a $233 million tax benefit related to previously recorded losses associated with our Little Sheep business. The tax benefit associated with these losses was able to be recognized as a result of legal entity restructuring completed in anticipation of the China spin-off. The cash tax savings associated with this benefit will be realized as we recognize future U.S. refranchising gains. $198 million of this benefit was attributed to previous Little Sheep impairment losses and as such was classified as a Special Item consistent with the classification of those historical impairments. See Note 7.
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
1,848
|
|
|
$
|
1,935
|
|
|
(4
|
)
|
|
|
1
|
|
|
|
$
|
4,684
|
|
|
$
|
4,778
|
|
|
(2
|
)
|
|
|
3
|
|
|
Franchise and license fees and income
|
|
35
|
|
|
34
|
|
|
2
|
|
|
|
9
|
|
|
|
90
|
|
|
83
|
|
|
8
|
|
|
|
14
|
|
|
||||
Total revenues
|
|
$
|
1,883
|
|
|
$
|
1,969
|
|
|
(4
|
)
|
|
|
2
|
|
|
|
$
|
4,774
|
|
|
$
|
4,861
|
|
|
(2
|
)
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
411
|
|
|
$
|
379
|
|
|
8
|
|
|
|
15
|
|
|
|
$
|
940
|
|
|
$
|
846
|
|
|
11
|
|
|
|
17
|
|
|
Restaurant margin %
|
|
22.2
|
%
|
|
19.6
|
%
|
|
2.6
|
|
ppts.
|
|
2.6
|
|
ppts.
|
|
20.1
|
%
|
|
17.7
|
%
|
|
2.4
|
|
ppts.
|
|
2.4
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
102
|
|
|
$
|
90
|
|
|
(14
|
)
|
|
|
(20
|
)
|
|
|
$
|
270
|
|
|
$
|
258
|
|
|
(5
|
)
|
|
|
(10
|
)
|
|
Operating Profit
|
|
$
|
348
|
|
|
$
|
327
|
|
|
7
|
|
|
|
14
|
|
|
|
$
|
751
|
|
|
$
|
661
|
|
|
14
|
|
|
|
20
|
|
|
Operating margin %
|
|
18.5
|
%
|
|
16.6
|
%
|
|
1.9
|
|
ppts.
|
|
2.0
|
|
ppts.
|
|
15.7
|
%
|
|
13.6
|
%
|
|
2.1
|
|
ppts.
|
|
2.2
|
|
ppts.
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
System Sales Growth, reported
|
|
(3
|
)%
|
|
7
|
%
|
|
—
|
%
|
|
(1
|
)%
|
System Sales Growth, excluding FX
|
|
3
|
%
|
|
8
|
%
|
|
5
|
%
|
|
—
|
%
|
Same-Store Sales Growth %
|
|
(1
|
)%
|
|
2
|
%
|
|
1
|
%
|
|
(6
|
)%
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
1,935
|
|
|
$
|
69
|
|
|
$
|
(41
|
)
|
|
$
|
(115
|
)
|
|
$
|
1,848
|
|
Cost of sales
|
(611
|
)
|
|
(15
|
)
|
|
80
|
|
|
32
|
|
|
(514
|
)
|
|||||
Cost of labor
|
(356
|
)
|
|
(17
|
)
|
|
(26
|
)
|
|
23
|
|
|
(376
|
)
|
|||||
Occupancy and other
|
(589
|
)
|
|
(18
|
)
|
|
25
|
|
|
35
|
|
|
(547
|
)
|
|||||
Company restaurant expenses
|
$
|
(1,556
|
)
|
|
$
|
(50
|
)
|
|
$
|
79
|
|
|
$
|
90
|
|
|
$
|
(1,437
|
)
|
Restaurant profit
|
$
|
379
|
|
|
$
|
19
|
|
|
$
|
38
|
|
|
$
|
(25
|
)
|
|
$
|
411
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
4,778
|
|
|
$
|
162
|
|
|
$
|
(3
|
)
|
|
$
|
(253
|
)
|
|
$
|
4,684
|
|
Cost of sales
|
(1,518
|
)
|
|
(37
|
)
|
|
121
|
|
|
73
|
|
|
(1,361
|
)
|
|||||
Cost of labor
|
(933
|
)
|
|
(39
|
)
|
|
(43
|
)
|
|
52
|
|
|
(963
|
)
|
|||||
Occupancy and other
|
(1,481
|
)
|
|
(45
|
)
|
|
28
|
|
|
78
|
|
|
(1,420
|
)
|
|||||
Company restaurant expenses
|
$
|
(3,932
|
)
|
|
$
|
(121
|
)
|
|
$
|
106
|
|
|
$
|
203
|
|
|
$
|
(3,744
|
)
|
Restaurant profit
|
$
|
846
|
|
|
$
|
41
|
|
|
$
|
103
|
|
|
$
|
(50
|
)
|
|
$
|
940
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
521
|
|
|
$
|
526
|
|
|
(1
|
)
|
|
|
6
|
|
|
|
$
|
1,469
|
|
|
$
|
1,525
|
|
|
(4
|
)
|
|
|
4
|
|
|
Franchise and license fees and income
|
|
202
|
|
|
195
|
|
|
4
|
|
|
|
8
|
|
|
|
591
|
|
|
584
|
|
|
1
|
|
|
|
6
|
|
|
||||
Total revenues
|
|
$
|
723
|
|
|
$
|
721
|
|
|
—
|
|
|
|
7
|
|
|
|
$
|
2,060
|
|
|
$
|
2,109
|
|
|
(2
|
)
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
76
|
|
|
$
|
68
|
|
|
11
|
|
|
|
19
|
|
|
|
$
|
215
|
|
|
$
|
213
|
|
|
1
|
|
|
|
9
|
|
|
Restaurant margin %
|
|
14.5
|
%
|
|
12.9
|
%
|
|
1.6
|
|
ppts.
|
|
1.6
|
|
ppts.
|
|
14.6
|
%
|
|
13.9
|
%
|
|
0.7
|
|
ppts.
|
|
0.6
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
89
|
|
|
$
|
96
|
|
|
7
|
|
|
|
3
|
|
|
|
$
|
259
|
|
|
$
|
275
|
|
|
6
|
|
|
|
1
|
|
|
Operating Profit
|
|
$
|
160
|
|
|
$
|
144
|
|
|
11
|
|
|
|
19
|
|
|
|
$
|
469
|
|
|
$
|
459
|
|
|
2
|
|
|
|
9
|
|
|
Operating margin %
|
|
22.2
|
%
|
|
20.0
|
%
|
|
2.2
|
|
ppts.
|
|
2.3
|
|
ppts.
|
|
22.8
|
%
|
|
21.8
|
%
|
|
1.0
|
|
ppts.
|
|
1.0
|
|
ppts.
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
System Sales Growth, reported
|
|
3
|
%
|
|
(6
|
)%
|
|
1
|
%
|
|
(3
|
)%
|
System Sales Growth, excluding FX
|
|
7
|
%
|
|
6
|
%
|
|
6
|
%
|
|
7
|
%
|
Same-Store Sales Growth %
|
|
4
|
%
|
|
3
|
%
|
|
2
|
%
|
|
3
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
9/3/2016
|
|
|
9/5/2015
|
|
|
|
||||
Franchise & License
|
|
13,576
|
|
|
13,142
|
|
|
3
|
|
|
||
Company-owned
|
|
1,489
|
|
|
1,552
|
|
|
(4
|
)
|
|
||
|
|
15,065
|
|
|
14,694
|
|
|
3
|
|
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
526
|
|
|
$
|
9
|
|
|
$
|
23
|
|
|
$
|
(37
|
)
|
|
$
|
521
|
|
Cost of sales
|
(182
|
)
|
|
(3
|
)
|
|
(6
|
)
|
|
13
|
|
|
(178
|
)
|
|||||
Cost of labor
|
(124
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|
8
|
|
|
(121
|
)
|
|||||
Occupancy and other
|
(152
|
)
|
|
2
|
|
|
(6
|
)
|
|
10
|
|
|
(146
|
)
|
|||||
Company restaurant expenses
|
$
|
(458
|
)
|
|
$
|
(2
|
)
|
|
$
|
(16
|
)
|
|
$
|
31
|
|
|
$
|
(445
|
)
|
Restaurant profit
|
$
|
68
|
|
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
(6
|
)
|
|
$
|
76
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
1,525
|
|
|
$
|
24
|
|
|
$
|
35
|
|
|
$
|
(115
|
)
|
|
$
|
1,469
|
|
Cost of sales
|
(526
|
)
|
|
(9
|
)
|
|
(6
|
)
|
|
42
|
|
|
(499
|
)
|
|||||
Cost of labor
|
(354
|
)
|
|
(5
|
)
|
|
(11
|
)
|
|
24
|
|
|
(346
|
)
|
|||||
Occupancy and other
|
(432
|
)
|
|
1
|
|
|
(10
|
)
|
|
32
|
|
|
(409
|
)
|
|||||
Company restaurant expenses
|
$
|
(1,312
|
)
|
|
$
|
(13
|
)
|
|
$
|
(27
|
)
|
|
$
|
98
|
|
|
$
|
(1,254
|
)
|
Restaurant profit
|
$
|
213
|
|
|
$
|
11
|
|
|
$
|
8
|
|
|
$
|
(17
|
)
|
|
$
|
215
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
106
|
|
|
$
|
141
|
|
|
(25
|
)
|
|
|
(24
|
)
|
|
|
$
|
363
|
|
|
$
|
430
|
|
|
(16
|
)
|
|
|
(14
|
)
|
|
Franchise and license fees and income
|
|
124
|
|
|
123
|
|
|
1
|
|
|
|
3
|
|
|
|
378
|
|
|
372
|
|
|
2
|
|
|
|
4
|
|
|
||||
Total revenues
|
|
$
|
230
|
|
|
$
|
264
|
|
|
(13
|
)
|
|
|
(11
|
)
|
|
|
$
|
741
|
|
|
$
|
802
|
|
|
(8
|
)
|
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
4
|
|
|
$
|
11
|
|
|
(70
|
)
|
|
|
(71
|
)
|
|
|
$
|
30
|
|
|
$
|
42
|
|
|
(29
|
)
|
|
|
(30
|
)
|
|
Restaurant margin %
|
|
3.1
|
%
|
|
7.8
|
%
|
|
(4.7
|
)
|
ppts.
|
|
(4.8
|
)
|
ppts.
|
|
8.2
|
%
|
|
9.8
|
%
|
|
(1.6
|
)
|
ppts.
|
|
(1.9
|
)
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
57
|
|
|
$
|
60
|
|
|
7
|
|
|
|
5
|
|
|
|
$
|
163
|
|
|
$
|
180
|
|
|
10
|
|
|
|
7
|
|
|
Operating Profit
|
|
$
|
61
|
|
|
$
|
65
|
|
|
(6
|
)
|
|
|
(5
|
)
|
|
|
$
|
212
|
|
|
$
|
206
|
|
|
3
|
|
|
|
4
|
|
|
Operating margin %
|
|
26.7
|
%
|
|
24.7
|
%
|
|
2.0
|
|
ppts.
|
|
1.8
|
|
ppts.
|
|
28.6
|
%
|
|
25.7
|
%
|
|
2.9
|
|
ppts.
|
|
2.6
|
|
ppts.
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
System Sales Growth, reported
|
|
(2
|
)%
|
|
(3
|
)%
|
|
—
|
%
|
|
(2
|
)%
|
System Sales Growth, excluding FX
|
|
—
|
%
|
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
Same-Store Sales Growth %
|
|
(1
|
)%
|
|
1
|
%
|
|
1
|
%
|
|
—
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
9/3/2016
|
|
|
9/5/2015
|
|
|
|
||||
Franchise & License
|
|
13,543
|
|
|
13,243
|
|
|
2
|
|
|
||
Company-owned
|
|
636
|
|
|
799
|
|
|
(20
|
)
|
|
||
|
|
14,179
|
|
|
14,042
|
|
|
1
|
|
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
141
|
|
|
$
|
(35
|
)
|
|
$
|
2
|
|
|
$
|
(2
|
)
|
|
$
|
106
|
|
Cost of sales
|
(40
|
)
|
|
11
|
|
|
(1
|
)
|
|
1
|
|
|
(29
|
)
|
|||||
Cost of labor
|
(44
|
)
|
|
12
|
|
|
(4
|
)
|
|
—
|
|
|
(36
|
)
|
|||||
Occupancy and other
|
(46
|
)
|
|
9
|
|
|
(1
|
)
|
|
1
|
|
|
(37
|
)
|
|||||
Company restaurant expenses
|
$
|
(130
|
)
|
|
$
|
32
|
|
|
$
|
(6
|
)
|
|
$
|
2
|
|
|
$
|
(102
|
)
|
Restaurant profit
|
$
|
11
|
|
|
$
|
(3
|
)
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2016
|
||||||||||
Company sales
|
$
|
430
|
|
|
$
|
(70
|
)
|
|
$
|
11
|
|
|
$
|
(8
|
)
|
|
$
|
363
|
|
Cost of sales
|
(120
|
)
|
|
21
|
|
|
(4
|
)
|
|
3
|
|
|
(100
|
)
|
|||||
Cost of labor
|
(133
|
)
|
|
22
|
|
|
(8
|
)
|
|
3
|
|
|
(116
|
)
|
|||||
Occupancy and other
|
(135
|
)
|
|
19
|
|
|
(4
|
)
|
|
3
|
|
|
(117
|
)
|
|||||
Company restaurant expenses
|
$
|
(388
|
)
|
|
$
|
62
|
|
|
$
|
(16
|
)
|
|
$
|
9
|
|
|
$
|
(333
|
)
|
Restaurant profit
|
$
|
42
|
|
|
$
|
(8
|
)
|
|
$
|
(5
|
)
|
|
$
|
1
|
|
|
$
|
30
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
|
2016
|
|
2015
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
366
|
|
|
$
|
366
|
|
|
—
|
|
|
|
—
|
|
|
|
$
|
1,044
|
|
|
$
|
1,073
|
|
|
(3
|
)
|
|
|
(3
|
)
|
|
Franchise and license fees and income
|
|
115
|
|
|
107
|
|
|
8
|
|
|
|
8
|
|
|
|
326
|
|
|
309
|
|
|
6
|
|
|
|
6
|
|
|
||||
Total revenues
|
|
$
|
481
|
|
|
$
|
473
|
|
|
2
|
|
|
|
2
|
|
|
|
$
|
1,370
|
|
|
$
|
1,382
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
79
|
|
|
$
|
81
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
$
|
226
|
|
|
$
|
231
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Restaurant margin %
|
|
21.7
|
%
|
|
22.1
|
%
|
|
(0.4
|
)
|
ppts.
|
|
(0.4
|
)
|
ppts.
|
|
21.6
|
%
|
|
21.6
|
%
|
|
—
|
|
ppts.
|
|
—
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
49
|
|
|
$
|
50
|
|
|
4
|
|
|
|
4
|
|
|
|
$
|
140
|
|
|
$
|
141
|
|
|
1
|
|
|
|
1
|
|
|
Operating Profit
|
|
$
|
143
|
|
|
$
|
132
|
|
|
9
|
|
|
|
9
|
|
|
|
$
|
401
|
|
|
$
|
386
|
|
|
4
|
|
|
|
4
|
|
|
Operating margin %
|
|
29.8
|
%
|
|
27.8
|
%
|
|
2.0
|
|
ppts.
|
|
2.0
|
|
ppts.
|
|
29.3
|
%
|
|
27.9
|
%
|
|
1.4
|
|
ppts.
|
|
1.4
|
|
ppts.
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
System Sales Growth, reported
|
|
5
|
%
|
|
7
|
%
|
|
4
|
%
|
|
8
|
%
|
System Sales Growth, excluding FX
|
|
5
|
%
|
|
7
|
%
|
|
4
|
%
|
|
8
|
%
|
Same-Store Sales Growth %
|
|
3
|
%
|
|
4
|
%
|
|
1
|
%
|
|
5
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
9/3/2016
|
|
|
9/5/2015
|
|
|
|
||||
Franchise & License
|
|
5,610
|
|
|
5,398
|
|
|
4
|
|
|
||
Company-owned
|
|
901
|
|
|
923
|
|
|
(2
|
)
|
|
||
|
|
6,511
|
|
|
6,321
|
|
|
3
|
|
|
|
Quarter ended
|
||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
2016
|
||||||||
Company sales
|
$
|
366
|
|
|
$
|
(7
|
)
|
|
$
|
7
|
|
|
$
|
366
|
|
Cost of sales
|
(100
|
)
|
|
3
|
|
|
1
|
|
|
(96
|
)
|
||||
Cost of labor
|
(101
|
)
|
|
2
|
|
|
(6
|
)
|
|
(105
|
)
|
||||
Occupancy and other
|
(84
|
)
|
|
1
|
|
|
(3
|
)
|
|
(86
|
)
|
||||
Company restaurant expense
|
$
|
(285
|
)
|
|
$
|
6
|
|
|
$
|
(8
|
)
|
|
$
|
(287
|
)
|
Restaurant profit
|
$
|
81
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
79
|
|
|
|
|
|
|
|
|
|
||||||||
|
Year to date
|
||||||||||||||
Income / (Expense)
|
2015
|
|
Store Portfolio Actions
|
|
Other
|
|
2016
|
||||||||
Company sales
|
$
|
1,073
|
|
|
$
|
(27
|
)
|
|
$
|
(2
|
)
|
|
$
|
1,044
|
|
Cost of sales
|
(298
|
)
|
|
9
|
|
|
19
|
|
|
(270
|
)
|
||||
Cost of labor
|
(300
|
)
|
|
8
|
|
|
(10
|
)
|
|
(302
|
)
|
||||
Occupancy and other
|
(244
|
)
|
|
6
|
|
|
(8
|
)
|
|
(246
|
)
|
||||
Company restaurant expense
|
$
|
(842
|
)
|
|
$
|
23
|
|
|
$
|
1
|
|
|
$
|
(818
|
)
|
Restaurant profit
|
$
|
231
|
|
|
$
|
(4
|
)
|
|
$
|
(1
|
)
|
|
$
|
226
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||
(Expense) / Income
|
|
2016
|
|
2015
|
|
% B/(W)
|
|
2016
|
|
2015
|
|
% B/(W)
|
||||||||||||
Corporate G&A expenses
|
|
$
|
(80
|
)
|
|
$
|
(32
|
)
|
|
NM
|
|
|
|
$
|
(196
|
)
|
|
$
|
(122
|
)
|
|
(61
|
)
|
|
Unallocated franchise and license fees and income
|
|
(1
|
)
|
|
—
|
|
|
NM
|
|
|
|
(2
|
)
|
|
—
|
|
|
NM
|
|
|
||||
Unallocated franchise and license expenses
|
|
1
|
|
|
(21
|
)
|
|
NM
|
|
|
|
(15
|
)
|
|
(31
|
)
|
|
49
|
|
|
||||
Unallocated refranchising gain (loss) (See Note 4)
|
|
25
|
|
|
(2
|
)
|
|
NM
|
|
|
|
85
|
|
|
(60
|
)
|
|
NM
|
|
|
||||
Other unallocated
|
|
(3
|
)
|
|
(10
|
)
|
|
67
|
|
|
|
4
|
|
|
(19
|
)
|
|
NM
|
|
|
||||
Interest expense, net
|
|
(87
|
)
|
|
(32
|
)
|
|
NM
|
|
|
|
(164
|
)
|
|
(99
|
)
|
|
(67
|
)
|
|
||||
Income tax benefit (provision) (See Note 7)
|
|
65
|
|
|
(145
|
)
|
|
NM
|
|
|
|
(183
|
)
|
|
(358
|
)
|
|
49
|
|
|
||||
Effective tax rate (See Note 7)
|
|
(11.6
|
)%
|
|
25.3
|
%
|
|
36.9
|
|
ppts.
|
|
11.8
|
%
|
|
25.9
|
%
|
|
14.1
|
|
ppts.
|
/s/ KPMG LLP
|
Louisville, Kentucky
|
October 11, 2016
|
Fiscal Periods
|
|
Total number of shares purchased
(thousands)
|
|
Average price paid per share
|
|
Total number of shares purchased as part of publicly announced plans or programs
(thousands)
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs
(millions)
|
6/12/16-7/9/16
|
|
8,329
|
|
$83.13
|
|
8,329
|
|
$3,005
|
|
|
|
|
|
|
|
|
|
7/10/16-8/6/16
|
|
7,920
|
|
$88.37
|
|
7,920
|
|
$2,305
|
|
|
|
|
|
|
|
|
|
8/7/16-9/3/16
|
|
7,766
|
|
$90.12
|
|
7,766
|
|
$1,604
|
Total
|
|
24,015
|
|
$87.12
|
|
24,015
|
|
$1,604
|
|
YUM! BRANDS, INC.
|
|
(Registrant)
|
Date:
|
October 11, 2016
|
/s/ David E. Russell
|
|
|
Vice President, Finance and Corporate Controller
|
|
|
(Principal Accounting Officer)
|
1 Year Yum Brands Chart |
1 Month Yum Brands Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions