Yum: KFC and Pizza Hut owner surges back into the black

Yum! Brands, the owner of KFC and Pizza Hut surged back into the black last year after a bumper year for its brands.

The group’s European division has reported a pre-tax profit of $317.1m (£248.2m) for 2023 having posted a pre-tax loss of $300m (£234.8m) in the prior year, according to newly-filed accounts with Companies House.

The firm is a holding company for the wider group’s investments and does not generate a turnover.

Its profit was generated through the write back of its investment in Yum! Restaurants Europe and dividends from that firm and Pizza Hut Europe.

During the year the company acquired KFC Holdings BV from a fellow group firm as part of an reorganisation within the wider group.

As a result of its huge pre-tax profit, Yum! paid a dividend of $208m (£162.8m) in the year.

The wider Yum! Brands group is headquartered in the US and includes KFC, Pizza Hut, Taco Bell and The Habit Burger Grill. The brands are operated by a separate company in China.

Yum!, which has previously owned Long John Silver’s and A&W Restaurants, was created after being spun off from PepsiCo in 1997.

The group reported a revenue of $7bn for 2023, up from $6.8bn.

‘Another remarkable year’ – Yum! Brands CEO

Speaking in February this year, CEO David Gibbs said “2023 was another remarkable year for Yum! Brands as we crossed the $60bn system sales threshold and exceeded all aspects of our long-term growth algorithm.

“We achieved 10 per cent system sales growth with broad-based strength across the globe and another record year for development, opening over 4,700 new stores.

“We also made massive strides in scaling our proprietary digital and AI-driven ecosystem in partnership with our franchisees.

“Looking to 2024, this will be a year of major milestones as we cross 30,000 restaurants at KFC, 20,000 at Pizza Hut and well over 60,000 globally for Yum!.”

CFO Chris Turner added: “Last year proved to be another great example of Yum!’s unique blend of growth and resilience.

“We delivered six per cent unit growth, 10 per cent system sales growth and 12 per cent core operating profit growth.

“Simply put, there is no other retail business that is growing across 110 different countries and opening the equivalent of a new store roughly every two hours.

“We are excited about our plans to further scale our incredible technology capabilities and loyalty programs while maintaining focus on cost control.

“I’m confident 2024 will represent another strong year of global growth and expect to deliver our long-term growth algorithm for the year.”