Date
7 December 2016
KFC's China sales fell sharply in the second half of last year after one its suppliers allegedly sold expired meat. The group says the business is recovering now. Photo: Bloomberg
KFC's China sales fell sharply in the second half of last year after one its suppliers allegedly sold expired meat. The group says the business is recovering now. Photo: Bloomberg

China business on the mend, says Yum Brands

Yum Brands Inc, owner of KFC and Pizza Hut chains, said on Tuesday that its business in China is recovering after a setback last summer due to problems related to a meat supplier.

Yum is making “continued progress” in China, the group’s biggest market, Reuters quoted Chief Executive Greg Creed as saying in a statement.

Same-store sales in China fell less than expected in the first quarter this year as the US-based restaurant group worked to put a scandal involving supplier Shanghai Husi Food Co. behind it.

Husi Food is alleged to have supplied expired meat to foreign fast-food chains, including McDonald’s and KFC, prompting a safety scare last year.  

“We will deliver full-year EPS growth of at least 10 percent, with a strong second half in China and solid brand-building initiatives under way at each of our divisions,” Creed was quoted as saying.

Same-store sales in China, where Yum has nearly 6,850 outlets, fell 12 percent in the company’s fiscal first quarter, an improvement from the 16 percent decline suffered in the preceding three months.

Consumer perceptions have improved in China, where sales also got a boost from KFC’s ongoing premium coffee rollout, spokesman Jonathan Blum was quoted as saying.

– Contact us at [email protected]

RC

EJI Weekly Newsletter