What’s new: Fast food giant Yum China Holdings Inc. reported a 98% year-on-year rise in net profit attributable to shareholders to $206 million in the third quarter as takeout sales helped offset the impact of Covid-19 restrictions on dining-in, according to its financial statement published Wednesday.
The growth is a marked reversal from the previous two quarters, which recorded 54.1% and 56.5% year-on-year declines, respectively. Total revenue increased 5% to $2.7 billion. Same-store sales, which measures the performance of existing stores, were flat year-on-year from July through September, following four consecutive quarters of decline.
The context: Takeout and delivery sales of KFC and Pizza Hut restaurants — the flagship franchises of Yum China — increased 19% year-on-year in the third quarter, accounting for about 38% of their total revenue, four percentage points more than the same period last year.
Covid restrictions continue to loom over the company’s revenue amid a fresh wave of outbreaks. As control measures were tightened again, same-store sales fell year-on-year in September, after posting gains in the previous two months. In July and August, Yum China had an average of about 400 stores temporarily shut down or only serving takeout and delivery, but the number more than doubled in September to 900 stores and climbed further to 1,400 last month.
The franchise operator opened 239 net new stores during the third quarter, taking its total number of stores to 12,409, as of September 30.
The company’s Hong Kong-listed shares were trading down 4.26% on Thursday at HK$373.2 ($47.6) apiece.
Related: China Lockdowns Hammer Sales for Global Consumer Giants
Contact reporter Guo Yingzhe (yingzheguo@caixin.com) and editor Jonathan Breen (jonathanbreen@caixin.com)
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