Yum! Brands revenues dip 3% to $1.5bn in Q1

Yum! Brands, which operates KFC, Taco Bell and Pizza Hut, reported a 3% decline in revenue to $1.5bn (£1.1bn) for the first quarter ended 31 March. 

Operating profit for the group also declined by 1% to $520m (£414m), while core operating profit grew 6%.

KFC revenues declined by 8% to $632m (£503m), while sales for the division declined 4% to $105m (£83m). Operating profit increased 3% to $313m (£249m). During the period, KFC opened 509 new restaurants across 43 countries.

In addition, on April 29 the group completed the previously announced acquisition of 218 KFC franchise restaurants in the UK and Ireland.

Taco Bell performed slightly better with a 5% revenue increase to $598m (£476m), while sales also increased by 5% to $240m (£191m). Operating profit increased by 2% to $208m (£165m). U.S. system sales grew 4% and Taco Bell International system sales excluding foreign currency grew 6%. The fast food chain opened 56 new restaurants across 14 countries during the quarter.

However, Pizza Hut reported a 6% decline in revenues to $238m (£189m) and a 64% decline in sales to $2m (£1.5m). Operating profit dipped 11% to $93m (£74m). The division opened 240 new restaurants across 23 countries.

David Gibbs, CEO, said: “Despite a difficult operating environment, we delivered 6% core operating profit growth demonstrating the resilience of our business model. As expected, same-store sales were pressured this quarter, but we are encouraged by strong 2-year same-store sales growth and positive momentum exiting the quarter. 

“First-quarter unit growth was robust with over 800 new unit openings, leading to 6% unit growth and positioning us to surpass 60,000 restaurants this year. Our digital sales mix reached a new record, exceeding 50% for the first time in our history. Our world-class franchisees, globally iconic brands, and distinctive digital capabilities give me high confidence in our future growth.”