Yum! Brands Inc. (NYSE: YUM) reported fourth quarter and full-year 2015 results after markets closed on Wednesday. For the quarter, the fast-food restaurant operator posted adjusted diluted earnings per share (EPS) of $0.68 on revenues of $3.95 billion. In the same period a year ago, the company reported EPS of $0.61 on revenues of $4 billion. Fourth-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.66 and $4.02 billion in revenues.
For the full year Yum! reported revenues of $13.11 billion and adjusted EPS of $3.18 compared with revenues of $13.08 billion and EPS of $3.09 in 2014. Consensus estimates called for EPS of $3.17 on revenues of $13.18 billion. On a GAAP basis, EPS totaled $2.92 for the year compared with $2.32 in 2014.
Sales in China rose 7% for the quarter on a constant currency basis and 3% on a reported basis. For the full year China division sales rose 2% on a constant currency basis and were flat on a reported basis. Same-store sales in China rose 2% in the fourth quarter and full-year same-store sales rose 3% compared with 2014.
The KFC division saw sales rise 6% for the quarter and 7% in the year on a constant currency basis. Same-store sales rose 3% for the quarter and 3% for the year.
Sales at Taco Bell rose 7% for the quarter and 8% in the year. Same store sales rose 4% for the quarter and 5% for the year. Margins improved to 23.7% but operating profit fell 7% in the quarter.
In the Pizza Hut division sales grew 7% in the quarter and 2% for the year. Same-store sales rose 3% in the quarter and 2% for the year.
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The company’s CEO said:
New-unit development continues to be a bright spot for our company. We added more than 2,300 new units globally in 2015. This year we expect to open nearly 2,400 new restaurants, which means we’re opening over six new restaurants a day, laying the groundwork for future growth. With all of this in mind, we are reiterating the guidance we initially gave in December. Given the results we have seen year-to-date and the plans we have laid out for each of the brands, we’re confident in our ability to deliver 10% operating profit growth in constant currency in 2016.
Yum! expects to complete the spin-off of its China division into a separately traded franchisee of the company in 2016.
In the fourth quarter, Yum! repurchased 11.4 million shares with a total value of $830 million at an average price of $73 per share. For the year, the company repurchased 15.9 million shares worth a total of $1.2 billion at an average price of $75. Yum! reported 420 million shares outstanding as of year end.
In after-hours trading on Wednesday shares traded down about 1.5% at $71.35 in a 52-week range of $66.35 to $95.90. The consensus price target for the stock is $81.56.
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