Yum China, during its Q3 2023 earnings conference call, unveiled its RGM 2.0 growth strategy, which aims to reach 20,000 stores by 2026, achieve double-digit EPS CAGR, and return $3 billion to shareholders via dividends and share repurchases. Despite anticipating a softer demand in Q4, the company remains hopeful about its long-term growth potential in China. Key takeaways from the call include:
- Yum China opened 500 net new stores in Q3, bringing its total to over 14,000.
- System sales and adjusted operating profit grew by 15% and 21% YoY, respectively.
- The company plans to track sales and cost efficiency amidst expected softening demand in Q4.
- Yum China reported a margin impact of 70 basis points, equivalent to $17 million, due to factors such as wage increase for front-line staff.
- The company generated $410 million in operating cash flow and $243 million in free cash flow in the third quarter.
- KFC's CEO, Joey Wat, announced plans to launch Chinese-style burger products.
- The company is focusing on expanding its product offerings and capturing untapped potential in lower-tier cities.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.