WASHINGTON (dpa-AFX) - Restaurant operator Yum! Brands Inc. (YUM) Tuesday reported an increase in profit for the third quarter, mainly due to higher revenues. However, the company's quarterly earnings and revenues fell short of Wall Street estimates, hurt largely by continued weak performance at its China division.
Moving ahead, the company lowered its full-year earnings outlook, sending its shares down by a near 16 percent in the after-hours.
Louisville, Kentucky-based Yum! Brands' third-quarter profit increased to $421 million or $0.95 per share from $404 million or $0.89 per share last year. Adjusted earnings rose to $1.00 per share from $0.87 per share last year. Analysts polled by Thomson Reuters expected earnings of $1.07 per share. Analysts' estimates typically exclude special items.
Yum Brands, the parent company of Taco Bell, KFC and Pizza Hut, total revenues grew 2 percent to $3.43 billion from $3.35 billion last year. Analysts had a consensus revenue estimate of $3.68 billion for the quarter.
China same-store sales increased just 2 percent, below analysts expectations of a 9.6 percent increase.
CEO Greg Creed said the pace of recovery in China Division is below the fast food giant's expectations.
'While it remains difficult to forecast China sales, we are now estimating full-year same-store sales to be low-single-digit negative,' the company said.
The company now expects 2015 earnings growth to be well below its target of at least 10 percent.
YUM closed Tuesday's trading at $83.42, up $0.37 or 0.45%, on the NYSE. The stock, however, dropped $14.42 or 17.29% in the after-hours trading.
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