Food & Beverage

Taco Bell ticks up Yum Brands Q3 results

Photo: Taco Bell/File

October 29, 2020

Yum Brands revealed third-quarter results Thursday that made clear the power of the Taco Bell brand for the Louisville, Kentucky-based company. Worldwide system sales for Yum grew 1% for the quarter that ended Sept. 30, thanks in large part to a 5% lift in Taco Bell sales, excluding foreign currency translation, a release said.

The story was not as rosy for the systemwide sales results at sister brands of KFC — which reported a 1% drop — and Pizza Hut, which endured a 4% global decrease the quarter.

Meanwhile, same-store sales for the company fell 2% for the quarter, despite a 2% increase in net-new units.

"Third-quarter results were encouraging, demonstrating the resilience of the Yum! portfolio as Yum! generated year-over-year core operating profit growth, continued to reopen temporarily closed restaurants and achieved global same-store sales growth of approximately flat, in aggregate, for our open store base," CEO David Gibbs, said in the release.

Other Q3 results include:

• 14% increase in Q3 GAAP EPS to 92 cents.
• 27% increase in Q3 EPS excluding special items, to $1.01.
• 4% drop in KFC same-store sales worldwide.
• 3% drop in Pizza Hut same-store sales worldwide.
• 3% increase in Taco Bell same-store sales worldwide.
• 2% net unit growth year-over-year.

"For the second consecutive quarter, digital sales increased by more than $1 billion over the prior year and set a single-quarter record of $4 billion," Gibbs said. "I'm confident that by continuing to leverage our unmatched scale and champion the technology-centric customer experience, we will drive global growth, enhance unit-level economics and maximize long-term value for all of our stakeholders."

Also of note, the company said it recorded $8 million of pre-tax investment income related to the change in fair value of its investment in Grubhub, which resulted in a 2-cent benefit to Q3 EPS and year-over-year EPS growth of 17 cents. The company disposed of its Grubhub investment during the third-quarter for $206 million.

Yum Brands Inc. has over 50,000 restaurants in more than 150 countries and territories.