A Taco Bell location in New York.
Scott Mlyn | CNBC
Yum Brands reported quarterly results on Wednesday that weighed on analyst expectations as U.S. consumers returned to their restaurants.
The company’s shares rose less than 1% in premarket trading.
The company reported, versus Wall Street expectations based on an analyst survey by Refinitiv:
- Earnings per share: $ 1.07 adjusted versus 87 cents expected
- Revenue: $ 1.49 billion versus $ 1.45 billion expected
The company reported that fiscal first quarter net income rose to $ 326 million, or $ 1.07 per share, from $ 83 million, or 27 cents per share, a year earlier.
Excluding refranchising profits and other items, Yum earned $ 1.07 per share, beating analysts polled by Refinitiv at 87 cents per share.
Net sales rose 18% to $ 1.49 billion, beating expectations of $ 1.45 billion. Global sales in the same store rose 9% in the quarter as the company drew comparisons to the first quarter of last year when Covid-19 began to weigh on demand.
Yum announced that it had record sales of more than $ 5 billion across the digital system, aided by accelerated growth outside of business premises. To further advance online sales, the company bought two tech startups, Tictuk and Kvantum, during the quarter. Tictuk enables customers to order groceries on social media and messaging apps, and Kvantum uses artificial intelligence for customer insights and marketing performance analysis. The financial terms for both transactions were not disclosed.
KFC’s sales in the same store increased 8%. On a two-year basis, sales in the same business remained unchanged. International sales of the fried chicken chain are returning more slowly, negatively impacted by lengthy lockdowns in some countries. However, the US division saw two-year sales growth of 11% in the same business.
Pizza Hut sales in the same store rose 12% for the quarter. On a two-year basis, sales in the same store decreased 1%. About 3% of the stores were temporarily closed in the first quarter, which hurt sales growth in the same store. The US division of Pizza Hut saw sales grow 8% on a two-year basis in the same store, while the international division saw sales decline 7% over the same period.
Taco Bell posted sales growth in the same store of 9% year-over-year and 10% on a two-year basis.
The Habit Burger Grill, which Yum acquired in the first quarter of last year, saw sales grow 13% in the same store. On a two-year basis, sales in the same store increased 3%.
Yum added 435 new Netto restaurants to its global presence during the quarter. KFC and Taco Bell increased their total number of units, but Pizza Hut’s fell.