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Yum China CEO to Step Down, Posts Strong Results -- Barron's Blog

6 Oct 2017 4:15 am

By Adam Routh

Yum China ( YUMC) shares rose 3% to $41.20 apiece in after hours trading after the fast food chain operator reported strong third quarter results and also announced its chief executive will step down next year.

Yum China, which is the exclusive licensee of Yum Brands in China including KFC, Taco Bell and Pizza Hut, reported 6% same-store-sales growth in the third quarter, including growth of 7% at KFC. Revenues grew 8.2% year-on-year to $2.04 billion, while net income was 9% higher at $211 million. The company also approved a cash dividend of $0.10 per share and increased its buyback program from $300 million to $550 million.

CEO Micky Pant said:

"We are pleased to report the third consecutive quarter of delivering positive same-store sales growth. With revenues exceeding $2 billion in the quarter, restaurant margin, operating profit and net income have all improved. We opened 129 new restaurants in the third quarter and we are on track to achieve our development target of 550-600 new stores in the year,"

Meanwhile, the company also announced Micky Pant, who oversaw Yum China's spin-off from Yum! Brands ( YUM), will step down as CEO and take up the roles of vice chairman of the board and senior advisor to the company with effect from March 2018. His successor will be Joey Wat, Yum China's current Chief Operating Officer.

Pant said of his successor:

"Joey is an extraordinarily talented executive and the ideal leader to become our next CEO," said Dr. Hu. "Joey has a strong track record of achieving results, and with her unique ability to translate vision and strategy into future world-class operations, I have no doubt that the Yum China business will continue to grow under her strong leadership. Leveraging the unprecedented growth opportunity that China presents, the Board and the Yum China team are confident that she is the best person to take the Company to its next level,"

Shares in Yum China are up 53% so fare this year.
 More at Barron's Asia Stocks to Watch blog, http://www.barrons.com/asia-stocks-to-watch 

(END) Dow Jones Newswires

October 06, 2017 00:15 ET (04:15 GMT)

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