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Yum still rebuilding after China scandal

Yum Brands' sales declined in Q1, but Taco Bell's breakfast is a hit.

April 24, 2015

Yum Brands, the parent company of Taco Bell, KFC and Pizza Hut, reported Tuesday that its same-store sales in China dropped 16 percent for Q4 and were also down 14 percent in Q3 of 2014.

While Chief Executive Greg Creed admitted that sales declined in China by 12 percent during Q1 of this year, he said they weren't as low as expected in the country's established restaurants. The brand is still recovering from allegations of improper meat handling at OSI Group's Shanghai Husi Food Co Ltd.

Yum is making continued progress in China, Creed said during Tuesday's earnings call. He also said the company expects to deliver full-year EPS growth of at least 10 percent and will continue to build the brand in China, where it has 6,850 establishments.

Taco Bell winning at breakfast

Taco Bell reported a 9-percent increase in sales, and 6 percent came from same-store sales growth via its new breakfast menu.

 "Taco Bell continued to go from strength to strength with 6 percent same-store sales growth, led by industry-leading innovation and a solid breakfast platform," Creed said during the earnings call.

Overall, Yum reported a profit of $362 million, or 81 cents per share, for Q1, down 9 percent from $399 million the year before.