Yum! Brands Announces Full-Year 2010 Expectations

Reaffirms 2009 EPS Growth Forecast of 12%, Excluding Special Items

Yum! Brands Inc. (NYSE: YUM), in advance of its annual investor update meeting, reaffirms its full year 2009 EPS growth forecast of 12%, excluding special items. Yum! also announces that it expects to deliver at least 10% EPS growth in 2010, excluding special items, which would mark the ninth straight year of meeting or exceeding this annual EPS growth target.

David C. Novak, Chairman and CEO, said, ‘2009 has been a year of solid performance led by our China and Yum! Restaurants International businesses, and we remain on track to deliver 12% EPS growth. This performance has been driven by our industry leading international new unit development, favorable commodity costs, productivity gains across our businesses and a lower effective tax rate. We are also pleased that we were able to deliver an increased dividend to our shareholders as well as improve on our industry leading Return on Invested Capital (ROIC). Our biggest challenge continues to be driving same-store-sales growth in the difficult consumer environment. All indications are that 2010 will be another challenging year, and we have built our plans accordingly. We plan to deliver at least 10% EPS growth in 2010 benefiting from international new unit development, disciplined cost management, modest same-store-sales growth and favorable foreign currency translation. We believe our track record of delivering double-digit EPS growth is driving long-term value for our shareholders.’


– At least 10% EPS growth

– Continued substantial international new unit development of 1,400, including both Yum! Restaurants International (YRI) and China.

– Target profit growth, excluding foreign currency translation, of 15% in mainland China, 10% in YRI and 5% in the U.S.

– Currently estimating foreign currency translation benefit of $25-50MM.


– Full year 2009 EPS growth of 12%, excluding special items, led by full year new unit development of 1,400+ new units in China and YRI combined.

– Full year 2009 estimated system sales growth, excluding foreign currency translation, of 9% in mainland China and 5% in YRI, and same-store-sales decline of 4% in the U.S. Fourth quarter estimated same-store-sales performance of -3% in mainland China, -1% in YRI and -8% in the U.S.

– Full year 2009 negative foreign currency translation impact of about $45MM.