Yum Fourth-Quarter Earnings Miss Estimates as Pizza Hut Lags

Yum Brands shares fell as the owner of KFC and Taco Bell missed Wall Street's fourth-quarter-earnings expectations. Pizza Hut comparable sales declined.
Author:
Publish date:

Yum Brands (YUM) - Get Report shares fell after the owner of KFC and Taco Bell missed Wall Street's fourth-quarter-earnings expectations. The Pizza Hut chain pulled down sales.

The Louisville, Ky., company's shares at last check were down 4% to $102.50.

The quarter's net income rose 46% to $488 million, or $1.58 a share, from $334 million, or $1.04, in the year-earlier period. Adjusted earnings for the recent quarter came to $1 a share, missing the FactSet consensus of $1.13.

Revenue rose 9% to $1.69 billion, beating the FactSet-derived consensus of $1.66 billion. Same-store sales grew 2% against analysts' call for 2.1%.

While KFC and Taco Bell reported same-store-sales growth roughly in line with estimates, Pizza Hut posted a 2% decline.

Yum Brands Q4 Earnings graphic

"For the full year, we generated over $50 billion in system sales and ended the year with over 50,000 restaurants thanks to our world-class franchisees," Chief Executive David Gibbs said in a statement. 

"We delivered results consistent with our long-term growth algorithm, with same-store sales growth of 3% and net-new-unit growth of 4%."

In January, Yum Brands said it was buying the Habit Restaurants (HABT) - Get Report chain for $375 million. Gibbs, who took over as CEO last month, said "the deal should enable us to offer an exciting new investment opportunity to our existing franchisees."

On Wednesday, Yum China Holdings (YUMC) - Get Report, which was spun off from Yum Brands in 2016, warned that its 2020 sales and profit would suffer due to the spread of the deadly coronavirus. The outbreak has prompted the company to temporarily close more than 30% of its stores.

Yum China shares recently were off 0.6% to $44.19.