Yum China's system sales up 10% in Q3
The company’s same-store sales grew 6%, with a 7% growth for KFC and flat for Pizza Hut.
For the third quarter, restaurant margin for Yum China increased 0.8% to 20.0%, primarily driven by same-store sales leverage and labor efficiency, partially offset by wage inflation and promotion costs.
Driven by its digital initiatives, Yum China continued to improve its loyalty membership programs. By the end of the third quarter, total members in its loyalty programs surpassed 120 million, including 97 million members for KFC and 30 million for Pizza Hut.
According to the financial report, mobile payments exceeded 45% of company sales in the third quarter of 2017. Over $1.2 billion in company sales were settled by cashless payment methods and delivery contributed over 14% of company sales.
Yum China’s CEO Micky Pant said, "We are pleased to report the third consecutive quarter of delivering positive same-store sales growth. With revenues exceeding $2 billion in the quarter, restaurant margin, operating profit and net income have all improved. We opened 129 new restaurants in the third quarter and we are on track to achieve our development target of 550-600 new stores in the year."
"In this quarter, our strategic initiatives on digital and delivery continued to show encouraging development, which we believe will enable our long-term growth. The connection with our over 120 million loyalty members is getting stronger. The growth in mobile payments and cashless settlement methods for sales continued to outperform previous quarters. With over 5,100 restaurants across China offering delivery service, delivery contributed over 14% of company sales in the third quarter.”
The company’s new-unit development and asset upgrade includes the opening of 129 new restaurants during the quarter, and 352 year to date. Yum has also remodeled 200 restaurants during the quarter, and 429 year to date, led by KFC.
“With our strong operating results in this third quarter and our commitment to return capital to shareholders, we believe we are well positioned to continue to increase shareholder value over the long run," Pant concluded.
