Yum China sees continued pandemic problems
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Yum China Holdings Inc. warned the coronavirus would continue to create problems in the first quarter, as consumers avoid travel and officials impose rules to try to fight the spread of COVID-19.
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"Our transportation and tourist locations … will likely be more significantly impacted. In the first few days of the Chinese New Year travel season, which started in late January, the number of travelers declined over 70% year-over-year," Yum China said Wednesday.
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The operator of KFC, Pizza Hut and Taco Bell restaurants as well as other establishments in China on Wednesday reported net income rose to $151 million from $90 million the year earlier. China's profit per share increased to 35 cents from 23 cents. Adjusted earnings per share were also 35 cents, beating expectations from analysts.
Revenue rose to $2.26 billion from $2.03 billion, with the latest period ahead of the $2.17 billion consensus estimate compiled by FactSet.
The company believes the Chinese New Year holiday season will be subdued this year and noted that some cities in the country are facing quarantines. Officials have also restricted travel and large gatherings.
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"The company anticipates significant headwinds in the first quarter," Yum China said.
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