Yum China Achieves Record-High Fourth Quarter and Announces 50% Dividend Increase
Yum China Holdings, Inc. (NYSE: YUMC; HKEX: 9987) has recently announced its unaudited results for the fourth quarter of 2024, marking a substantial achievement in the company's financial performance. The report reveals a fourth quarter in which total revenues reached a record $2.6 billion, reflecting a 4% year-over-year increase. This growth is attributed primarily to the opening of 534 new stores, which contributed to the total store count reaching 16,395 as of December 31, 2024.
In the fourth quarter, Yum China's operating profit soared by 36% year-over-year to $151 million. This notable increase includes strong core operating profit growth of 35%. The operating profit margin also expanded to 5.8%, an impressive increase of 140 basis points from the previous year, underpinned by enhanced restaurant margins and operational efficiencies.
The results show that the company has achieved eight consecutive quarters of same-store sales growth, with same-store transactions climbing by 4% year-over-year. This indicates a remarkable recovery and resilience in consumer demand for Yum China's flagship brands, KFC and Pizza Hut. Notably, same-store sales reached 99% of the prior year's levels, up from 97% in the third quarter.
For the full year of 2024, Yum China reported total revenues of $11.3 billion, which is a 3% increase compared to the previous year. Notably, the company returned a total of $1.5 billion to shareholders, which included $248 million in dividends and $1.24 billion in share repurchases.
Furthermore, the company achieved a net income of $911 million, up 10% from the previous year, while diluted earnings per share rose by 18% to $2.33. The company’s operating profit for the year increased by 5% to $1.2 billion, demonstrating resilience against economic challenges.
CEO Joey Wat emphasized the company's dual focus on operational efficiency and innovation as a key driver of its success. Various initiatives, such as Project Fresh Eye and Project Red Eye, have led to enhanced competitiveness and agility within the organization. Yum China continues to explore innovative business models and menu evolution aimed at expanding its market share. The company is on track to achieve its strategic goal of 20,000 stores by 2026 and is increasing its cash dividend by 50%, raising it to $0.24 per share, to be paid on March 27, 2025.
With a clear plan to leverage its strengths, Yum China is positioned to sustain long-term growth and create value for its shareholders. As the largest restaurant chain in China, its commitment to excellence in service and product offerings continues to drive its reputation and operational success in a highly competitive market. Analysts anticipate further expansion and profitability in the coming years, making Yum China a noteworthy contender in the global restaurant industry.
Impressive Profit Growth
In the fourth quarter, Yum China's operating profit soared by 36% year-over-year to $151 million. This notable increase includes strong core operating profit growth of 35%. The operating profit margin also expanded to 5.8%, an impressive increase of 140 basis points from the previous year, underpinned by enhanced restaurant margins and operational efficiencies.
The results show that the company has achieved eight consecutive quarters of same-store sales growth, with same-store transactions climbing by 4% year-over-year. This indicates a remarkable recovery and resilience in consumer demand for Yum China's flagship brands, KFC and Pizza Hut. Notably, same-store sales reached 99% of the prior year's levels, up from 97% in the third quarter.
Full-Year Highlights
For the full year of 2024, Yum China reported total revenues of $11.3 billion, which is a 3% increase compared to the previous year. Notably, the company returned a total of $1.5 billion to shareholders, which included $248 million in dividends and $1.24 billion in share repurchases.
Furthermore, the company achieved a net income of $911 million, up 10% from the previous year, while diluted earnings per share rose by 18% to $2.33. The company’s operating profit for the year increased by 5% to $1.2 billion, demonstrating resilience against economic challenges.
Strategic Initiatives and Future Plans
CEO Joey Wat emphasized the company's dual focus on operational efficiency and innovation as a key driver of its success. Various initiatives, such as Project Fresh Eye and Project Red Eye, have led to enhanced competitiveness and agility within the organization. Yum China continues to explore innovative business models and menu evolution aimed at expanding its market share. The company is on track to achieve its strategic goal of 20,000 stores by 2026 and is increasing its cash dividend by 50%, raising it to $0.24 per share, to be paid on March 27, 2025.
Conclusion
With a clear plan to leverage its strengths, Yum China is positioned to sustain long-term growth and create value for its shareholders. As the largest restaurant chain in China, its commitment to excellence in service and product offerings continues to drive its reputation and operational success in a highly competitive market. Analysts anticipate further expansion and profitability in the coming years, making Yum China a noteworthy contender in the global restaurant industry.
Topics Consumer Products & Retail）
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