The following is a summary of the Yum China Holdings, Inc. (YUMC) Q1 2024 Earnings Call Transcript:
Financial Performance:
Yum China reported Q1 revenue of $3 billion, reflecting a year-over-year growth of 6%.
The company's operating profit saw an improvement, reaching $396 million.
Yum China returned $745 million to shareholders through share repurchases and dividends.
Business Progress:
The company surpassed the 15,000 store milestone, with an addition of 378 new stores in Q1 alone.
Plans are in place to add another 5,000 stores by 2026, primarily focusing on China, specifically Tier 2 cities.
The company registered a 15% year-over-year transaction growth in Q1.
Yum China aims to open 1,500 to 1,700 net new stores in 2024 and is investing in innovative store formats and food options.
KFC delivery sales increased by 14%, contributing significantly towards transaction growth.
The company plans to expand the number of mini-stores and has started campaigns, new product introductions and promotions to drive traffic.
There is an ongoing process to lower average check at "Pizza Hut" to suit a wider market and lower delivery fees to capture more small-ticket size orders.
Also, plans are in progress for aggressive growth strategy for side-by-side KCOFFEE shops in 2024.
More details: Yum China IR
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