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UNITED STATES
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SECURITIES AND EXCHANGE COMMISSION
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Washington, D. C. 20549
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[
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
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EXCHANGE ACT OF 1934
for the quarterly period ended June 13, 2015
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OR
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[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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North Carolina
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13-3951308
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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1441 Gardiner Lane, Louisville, Kentucky
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40213
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (502) 874-8300
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Page
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No.
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Part I.
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Financial Information
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Item 1 - Financial Statements
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Condensed Consolidated Statements of Income - Quarters and Years to date ended
June 13, 2015 and June 14, 2014
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Condensed Consolidated Statements of Comprehensive Income - Quarters and Years to date ended June 13, 2015 and June 14, 2014
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Condensed Consolidated Statements of Cash Flows – Years to date ended
June 13, 2015 and June 14, 2014
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Condensed Consolidated Balance Sheets – June 13, 2015 and December 27, 2014
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Notes to Condensed Consolidated Financial Statements
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Item 2 - Management’s Discussion and Analysis of Financial Condition
and Results of Operations
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Item 3 - Quantitative and Qualitative Disclosures about Market Risk
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Item 4 – Controls and Procedures
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Report of Independent Registered Public Accounting Firm
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Part II.
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Other Information and Signatures
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Item 1 – Legal Proceedings
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Item 1A – Risk Factors
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Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds
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Item 6 – Exhibits
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Signatures
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Item 1.
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Financial Statements
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•
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YUM China (“China” or “China Division”) which includes all operations in mainland China
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•
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YUM India ("India" or "India Division") which includes all operations in India, Bangladesh, Nepal and Sri Lanka
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•
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The KFC Division which includes all operations of the KFC concept outside of China Division and India Division
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•
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The Pizza Hut Division which includes all operations of the Pizza Hut concept outside of China Division and India Division
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•
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The Taco Bell Division which includes all operations of the Taco Bell concept outside of India Division
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Quarter ended
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Year to date
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2015
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2014
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2015
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2014
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Net Income – YUM! Brands, Inc.
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$
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235
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$
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334
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$
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597
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$
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733
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Weighted-average common shares outstanding (for basic calculation)
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437
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446
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437
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446
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Effect of dilutive share-based employee compensation
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8
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9
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9
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10
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Weighted-average common and dilutive potential common shares outstanding (for diluted calculation)
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445
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455
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446
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456
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Basic EPS
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$
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0.54
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$
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0.75
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$
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1.36
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$
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1.64
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Diluted EPS
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$
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0.53
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$
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0.73
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$
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1.34
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$
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1.61
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Unexercised employee stock options and stock appreciation rights (in millions) excluded from the diluted EPS computation
(a)
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4.3
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5.9
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5.3
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6.1
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(a)
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These unexercised employee stock options and stock appreciation rights were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented.
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Shares Repurchased (thousands)
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Dollar Value of Shares Repurchased
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Remaining Dollar Value of Shares that may be Repurchased
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Authorization Date
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2015
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2014
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2015
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2014
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2015
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November 2012
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—
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2,737
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$
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—
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$
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203
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$
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—
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November 2013
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1,779
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1,270
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133
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97
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—
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November 2014
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1,901
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—
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162
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—
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838
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Total
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3,680
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(a)
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4,007
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$
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295
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(a)
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$
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300
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$
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838
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(a)
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Includes the effect of
$8 million
in share repurchases (
0.1 million
shares) with trade dates prior to
June 13, 2015
but cash settlement dates subsequent to
June 13, 2015
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Translation Adjustments and Gains (Losses) From Intra-Entity Transactions of a Long-Term Nature
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Pension and Post-Retirement Benefits
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Derivative Instruments
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Total
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Balance at December 27, 2014, net of tax
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$
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29
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$
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(210
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)
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$
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(9
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$
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(190
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)
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Gains (losses) arising during the year classified into accumulated OCI, net of tax
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(51
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)
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1
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8
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(42
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)
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(Gains) losses reclassified from accumulated OCI, net of tax
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68
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15
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(8
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75
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OCI, net of tax
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17
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16
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—
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33
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Balance at June 13, 2015, net of tax
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$
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46
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$
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(194
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)
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$
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(9
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$
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(157
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)
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Quarter ended
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Year to date
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2015
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2014
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2015
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2014
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China
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$
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(2
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$
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(5
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$
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(4
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$
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(6
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)
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KFC Division
(a)
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35
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1
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32
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—
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Pizza Hut Division
(a)
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36
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(1
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37
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(1
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Taco Bell Division
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(1
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—
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(7
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(1
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India
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—
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1
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—
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1
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Worldwide
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$
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68
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$
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(4
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$
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58
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$
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(7
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)
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(a)
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In 2010 we refranchised our then-remaining Company-operated restaurants in Mexico. To the extent we owned real estate related to these restaurants, we did not sell the real estate, but instead have leased it to the franchisee. During the quarter ended June 13, 2015 we initiated plans to sell this real estate and determined it was held for sale in accordance with GAAP. The sales price we expect to receive for this real estate exceeds its book value. However, the sale of the real estate will represent a substantial liquidation of our Mexican operations under GAAP. Accordingly, we are required to include accumulated translation losses associated with our Mexican business within our held for sale impairment evaluations. As such, we recorded a
$68 million
non-cash charge to Refranchising Loss, consisting of losses of
$36 million
and
$32 million
for our KFC and Pizza Hut Divisions, respectively. This loss represents the excess of the sum of the book value of the real estate and related assets, an insignificant amount of goodwill and our accumulated translation losses over the expected sales price. Our current expectation is that the real estate sale will close late in 2015 with limited, if any, additional pre-tax gain or loss. The sale is ultimately expected to result in a taxable gain as the anticipated proceeds will exceed the tax basis in the real estate, though the related tax expense will not be recognized until the sale closes.
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Quarter ended
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Year to date
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2015
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2014
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2015
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2014
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Equity (income) loss from investments in unconsolidated affiliates
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$
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(7
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)
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$
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(9
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$
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(16
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)
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$
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(22
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)
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Foreign exchange net (gain) loss and other
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1
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1
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7
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12
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Other (income) expense
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$
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(6
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)
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$
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(8
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)
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$
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(9
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)
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$
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(10
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)
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6/13/2015
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12/27/2014
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Accounts and notes receivable, gross
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$
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366
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$
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337
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Allowance for doubtful accounts
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(16
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)
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(12
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Accounts and notes receivable, net
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$
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350
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$
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325
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6/13/2015
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12/27/2014
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Property, plant and equipment, gross
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$
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8,076
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$
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8,082
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Accumulated depreciation and amortization
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(3,704
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)
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(3,584
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)
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Property, plant and equipment, net
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$
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4,372
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$
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4,498
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Noncontrolling Interests
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Reedemable Noncontrolling Interest
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Balance at December 27, 2014
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$
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57
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$
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9
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Net Income (loss) – noncontrolling interests
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—
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—
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Currency translation adjustments and other
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(1
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)
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(1
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)
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Balance at June 13, 2015
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$
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56
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$
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8
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Quarter ended
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Year to date
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||||||||||||
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2015
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2014
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2015
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2014
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||||||||
Income tax provision
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$
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102
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$
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112
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$
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213
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|
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$
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251
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Effective tax rate
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30.4
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%
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24.9
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%
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26.3
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%
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25.4
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%
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Quarter ended
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Year to date
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Revenues
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2015
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2014
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2015
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2014
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China
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$
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1,636
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$
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1,709
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$
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2,892
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$
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3,088
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KFC Division
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694
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|
754
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1,336
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1,418
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Pizza Hut Division
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264
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265
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535
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532
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Taco Bell Division
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476
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439
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907
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830
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India
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35
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|
|
37
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|
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57
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|
|
60
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||||
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$
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3,105
|
|
|
$
|
3,204
|
|
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$
|
5,727
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|
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$
|
5,928
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Quarter ended
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Year to date
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Operating Profit (loss)
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2015
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|
2014
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2015
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|
2014
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||||||||
China
(a)
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$
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144
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|
|
$
|
194
|
|
|
$
|
334
|
|
|
$
|
479
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|
KFC Division
|
152
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|
|
155
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|
|
321
|
|
|
318
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||||
Pizza Hut Division
|
60
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|
|
63
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|
|
141
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|
|
147
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|
||||
Taco Bell Division
|
140
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|
|
109
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|
|
255
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|
|
193
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|
||||
India
|
(3
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)
|
|
(1
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)
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(7
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)
|
|
(4
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)
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Unallocated and General and administrative expenses
(b)
|
(54
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)
|
|
(48
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)
|
|
(100
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)
|
|
(83
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)
|
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Unallocated Other income (expense)
|
—
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|
3
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|
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(9
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)
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(7
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)
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Unallocated Refranchising gain (loss)
(c)
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(68
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)
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|
4
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(58
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)
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|
7
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|
||||
Operating Profit
|
$
|
371
|
|
|
$
|
479
|
|
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$
|
877
|
|
|
$
|
1,050
|
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Interest expense, net
|
(33
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)
|
|
(29
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)
|
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(67
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)
|
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(62
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)
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||||
Income Before Income Taxes
|
$
|
338
|
|
|
$
|
450
|
|
|
$
|
810
|
|
|
$
|
988
|
|
(a)
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Includes equity income from investments in unconsolidated affiliates of
$7 million
and
$9 million
for the quarters ended
June 13, 2015
and
June 14, 2014
, respectively. Includes equity income from investments in unconsolidated affiliates of
$16 million
and
$22 million
for the years to date ended
June 13, 2015
and
June 14, 2014
, respectively.
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(b)
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Primarily Corporate general and administrative ("G&A") expenses. Also included are costs associated with the KFC U.S. Acceleration Agreement of
$8 million
and
$10 million
for the quarter and year to date ending June 13, 2015, respectively.
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(c)
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See the Refranchising (Gain) Loss section of Note 4.
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Quarter ended
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Year to date
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Service cost
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
8
|
|
|
$
|
8
|
|
Interest cost
|
12
|
|
|
13
|
|
|
25
|
|
|
25
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|
||||
Expected return on plan assets
|
(14
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)
|
|
(13
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)
|
|
(28
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)
|
|
(26
|
)
|
||||
Amortization of net loss
|
11
|
|
|
4
|
|
|
21
|
|
|
8
|
|
||||
Net periodic benefit cost
|
$
|
13
|
|
|
$
|
8
|
|
|
$
|
26
|
|
|
$
|
15
|
|
|
|
|
|
|
|
|
|
||||||||
Additional loss (gain) recognized due to:
|
|
|
|
|
|
|
|
||||||||
Settlement
(a)
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
5
|
|
|
|
|
|
|
|
|
|
(a)
|
Losses are a result of settlement transactions from a non-funded plan which exceeded the sum of annual service and interest costs for that plan. These losses were recorded in G&A expenses.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
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Building Powerful Brands Through Superior Marketing, Breakthrough Innovation and Compelling Value with a Foundation Built on Winning Food and World Class Operations
|
•
|
Driving Aggressive Unit Expansion Everywhere, Especially in Emerging Markets, and Building Leading Brands in Every Significant Category in China and India
|
•
|
Creating Industry Leading Returns Through Franchising and Disciplined Use of Capital, Maximizing Long-term Shareholder Value
|
•
|
YUM China (“China” or “China Division”) which includes all operations in mainland China
|
•
|
YUM India ("India" or "India Division") which includes all operations in India, Bangladesh, Nepal and Sri Lanka
|
•
|
The KFC Division which includes all operations of the KFC concept outside of China Division and India Division
|
•
|
The Pizza Hut Division which includes all operations of the Pizza Hut concept outside of China Division and India Division
|
•
|
The Taco Bell Division which includes all operations of the Taco Bell concept outside of India Division
|
•
|
The Company provides certain percentage changes excluding the impact of foreign currency translation (“FX” or “Forex”). These amounts are derived by translating current year results at prior year average exchange rates. We believe the elimination of the foreign currency translation impact provides better year-to-year comparability without the distortion of foreign currency fluctuations.
|
•
|
System sales growth includes the results of all restaurants regardless of ownership, including company-owned, franchise, unconsolidated affiliate and license restaurants that operate our Concepts, except for non-company-owned restaurants for which we do not receive a sales-based royalty. Sales of franchise, unconsolidated affiliate and license restaurants typically generate ongoing franchise and license fees for the Company (typically at a rate of 4% to 6% of sales). Franchise, unconsolidated affiliate and license restaurant sales are not included in Company sales on the Condensed Consolidated Statements of Income; however, the franchise and license fees are included in the Company’s revenues. We believe system sales growth is useful to investors as a significant indicator of the overall strength of our business as it incorporates all of our revenue drivers, Company and franchise same-store sales as well as net unit growth.
|
•
|
Same-store sales growth is the estimated percentage change in sales of all restaurants that have been open and in the YUM system one year or more. The impact of same-store sales growth on both our Company-owned store results and Franchise and license fees and income is described elsewhere in this MD&A.
|
•
|
Company Restaurant profit ("Restaurant profit") is defined as Company sales less expenses incurred directly by our Company-owned restaurants in generating Company sales. Company restaurant margin as a percentage of sales is defined as Restaurant profit divided by Company sales. Within the Company Sales and Restaurant Profit analyses, Store Portfolio Actions represent the net impact of new unit openings, acquisitions, refranchising and store closures, and Other primarily represents the impact of same-store sales as well as the impact of changes in costs such as inflation/deflation.
|
•
|
In addition to the results provided in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") throughout this MD&A, the Company provides non-GAAP measurements which present operating results on a basis before items that we have deemed Special. The Company uses earnings before Special Items as a key performance measure of results of operations for the purpose of evaluating performance internally and Special Items are not included in any of our segment results. This non-GAAP measurement is not intended to replace the presentation of our financial results in accordance with GAAP. Rather, the Company believes that the presentation of earnings before Special Items provides additional information to investors to facilitate the comparison of past and present operations, excluding those items that the Company does not believe are indicative of our ongoing operations due to their size and/or nature.
|
•
|
The China Division opened 80 new units.
|
•
|
KFC Division system sales increased 6% and Operating Profit increased 10%. Same-store sales increased 3% and the Division opened 122 new international units.
|
•
|
Pizza Hut Division system sales increased 1% and Operating Profit declined 1%. Same-store sales were even with the prior year and the Division opened 66 new international units.
|
•
|
Taco Bell Division system sales increased 9% and Operating Profit increased 29%. Same-store sales increased 6% and the Division opened 58 new units.
|
•
|
India Division system sales were even with prior year and Operating Profit declined $2 million. Same-store sales decreased 11% and the Division opened 13 new units.
|
•
|
Foreign currency translation negatively impacted Operating Profit by $22 million.
|
•
|
Our effective tax rate increased to 25.6% from 24.9%.
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||
|
2015
|
|
2014
|
|
% B/(W)
|
|
2015
|
|
2014
|
|
% B/(W)
|
||||||||||||
Company sales
|
$
|
2,659
|
|
|
$
|
2,758
|
|
|
(4
|
)
|
|
|
$
|
4,838
|
|
|
$
|
5,050
|
|
|
(4
|
)
|
|
Franchise and license fees and income
|
446
|
|
|
446
|
|
|
—
|
|
|
|
889
|
|
|
878
|
|
|
1
|
|
|
||||
Total revenues
|
$
|
3,105
|
|
|
$
|
3,204
|
|
|
(3
|
)
|
|
|
$
|
5,727
|
|
|
$
|
5,928
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Restaurant profit
|
$
|
411
|
|
|
$
|
428
|
|
|
(4
|
)
|
|
|
$
|
793
|
|
|
$
|
869
|
|
|
(9
|
)
|
|
Restaurant margin %
|
15.5
|
%
|
|
15.5
|
%
|
|
—
|
|
ppts.
|
|
16.4
|
%
|
|
17.2
|
%
|
|
(0.8
|
)
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
General and administrative ("G&A") expenses
|
$
|
353
|
|
|
$
|
352
|
|
|
(1
|
)
|
|
|
$
|
648
|
|
|
$
|
623
|
|
|
(4
|
)
|
|
Franchise and license expenses
|
47
|
|
|
34
|
|
|
(36
|
)
|
|
|
81
|
|
|
67
|
|
|
(22
|
)
|
|
||||
Closures and impairment (income) expenses
|
24
|
|
|
21
|
|
|
(8
|
)
|
|
|
27
|
|
|
24
|
|
|
(10
|
)
|
|
||||
Refranchising (gain) loss
|
68
|
|
|
(4
|
)
|
|
NM
|
|
|
|
58
|
|
|
(7
|
)
|
|
NM
|
|
|
||||
Other (income) expense
|
(6
|
)
|
|
(8
|
)
|
|
(30
|
)
|
|
|
(9
|
)
|
|
(10
|
)
|
|
(12
|
)
|
|
||||
Operating Profit
|
$
|
371
|
|
|
$
|
479
|
|
|
(22
|
)
|
|
|
$
|
877
|
|
|
$
|
1,050
|
|
|
(16
|
)
|
|
Interest expense, net
|
33
|
|
|
29
|
|
|
(15
|
)
|
|
|
67
|
|
|
62
|
|
|
(9
|
)
|
|
||||
Income tax provision
|
102
|
|
|
112
|
|
|
8
|
|
|
|
213
|
|
|
251
|
|
|
15
|
|
|||||
Effective Tax Rate
|
30.4
|
%
|
|
24.9
|
%
|
|
(5.5
|
)
|
ppts.
|
|
26.3
|
%
|
|
25.4
|
%
|
|
(0.9)
|
ppts.
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income – including noncontrolling interests
|
$
|
236
|
|
|
$
|
338
|
|
|
(30
|
)
|
|
|
$
|
597
|
|
|
$
|
737
|
|
|
(19
|
)
|
|
Net Income (loss) – noncontrolling interests
|
1
|
|
|
4
|
|
|
86
|
|
|
|
—
|
|
|
4
|
|
|
96
|
|
|
||||
Net Income – YUM! Brands, Inc.
|
$
|
235
|
|
|
$
|
334
|
|
|
(30
|
)
|
|
|
$
|
597
|
|
|
$
|
733
|
|
|
(19
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share
(a)
|
$
|
0.53
|
|
|
$
|
0.73
|
|
|
(28
|
)
|
|
|
$
|
1.34
|
|
|
$
|
1.61
|
|
|
(17
|
)
|
|
Diluted earnings per share before Special Items
(a)
|
$
|
0.69
|
|
|
$
|
0.73
|
|
|
(5
|
)
|
|
|
$
|
1.50
|
|
|
$
|
1.60
|
|
|
(7
|
)
|
|
(a)
|
See Note 2 for the number of shares used in this calculation.
|
|
Quarter ended
|
|
|
|
|
Year to date
|
|
|
|
|||||||||
|
2015
|
|
2014
|
|
|
|
2015
|
|
2014
|
|
|
|||||||
System Sales Growth, reported
|
(2
|
)%
|
|
4
|
%
|
|
|
|
(1
|
)%
|
|
3
|
%
|
|
|
|
||
System Sales Growth, excluding FX
|
3
|
%
|
|
6
|
%
|
|
|
|
4
|
%
|
|
5
|
%
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unit Count
|
6/13/2015
|
|
|
6/14/2014
|
|
|
% Increase (Decrease)
|
|
|
|
|
|
||||||
Franchise & License
|
32,190
|
|
|
31,452
|
|
|
2
|
|
|
|
|
|
|
|||||
Company-owned
|
8,785
|
|
|
8,236
|
|
|
7
|
|
|
|
|
|
|
|||||
Unconsolidated Affiliates
|
773
|
|
|
731
|
|
|
6
|
|
|
|
|
|
|
|||||
|
41,748
|
|
|
40,419
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||
Detail of Special Items
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Losses associated with the refranchising of equity markets outside the U.S.
|
|
$
|
(73
|
)
|
|
$
|
—
|
|
|
$
|
(73
|
)
|
|
$
|
—
|
|
Costs associated with KFC U.S. Acceleration Agreement
|
|
(8
|
)
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
||||
U.S. Refranchising gain
(a)
|
|
1
|
|
|
1
|
|
|
8
|
|
|
3
|
|
||||
Other Special Items Income (Expense)
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Total Special Items Income (Expense)
|
|
(78
|
)
|
|
1
|
|
|
(73
|
)
|
|
3
|
|
||||
Tax Benefit (Expense) on Special Items
(b)
|
|
3
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
||||
Special Items Income (Expense), net of tax
|
|
$
|
(75
|
)
|
|
$
|
1
|
|
|
(72
|
)
|
|
2
|
|
||
Average diluted shares outstanding
|
|
445
|
|
|
455
|
|
|
446
|
|
|
456
|
|
||||
Special Items diluted EPS
|
|
$
|
(0.16
|
)
|
|
$
|
—
|
|
|
$
|
(0.16
|
)
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Operating Profit Before Special Items to Reported Operating Profit
|
|
|
|
|
|
|
|
|
||||||||
Operating Profit before Special Items
|
|
$
|
449
|
|
|
$
|
478
|
|
|
$
|
950
|
|
|
$
|
1,047
|
|
Special Items Income (Expense)
|
|
(78
|
)
|
|
1
|
|
|
(73
|
)
|
|
3
|
|
||||
Reported Operating Profit
|
|
$
|
371
|
|
|
$
|
479
|
|
|
$
|
877
|
|
|
$
|
1,050
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of EPS Before Special Items to Reported EPS
|
|
|
|
|
|
|
|
|
||||||||
Diluted EPS before Special Items
|
|
$
|
0.69
|
|
|
$
|
0.73
|
|
|
$
|
1.50
|
|
|
$
|
1.60
|
|
Special Items EPS
|
|
(0.16
|
)
|
|
—
|
|
|
(0.16
|
)
|
|
0.01
|
|
||||
Reported EPS
|
|
$
|
0.53
|
|
|
$
|
0.73
|
|
|
$
|
1.34
|
|
|
$
|
1.61
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Effective Tax Rate Before Special Items to Reported Effective Tax Rate
|
|
|
|
|
|
|
|
|
||||||||
Effective Tax Rate before Special Items
|
|
25.6
|
%
|
|
24.9
|
%
|
|
24.4
|
%
|
|
25.4
|
%
|
||||
Impact on Tax Rate as a result of Special Items
(b)
|
|
4.8
|
%
|
|
—
|
%
|
|
1.9
|
%
|
|
—
|
%
|
||||
Reported Effective Tax Rate
|
|
30.4
|
%
|
|
24.9
|
%
|
|
26.3
|
%
|
|
25.4
|
%
|
(a)
|
Refranchising gains and losses in the U.S. have been reflected as Special Items due to the scope of our U.S. refranchising program in recent years and the volatility in associated gains and losses.
|
(b)
|
The tax benefit (expense) was determined based upon the impact of the nature, as well as the jurisdiction of the respective individual components within Special Items.
|
|
|
Quarter ended
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
1,608
|
|
|
$
|
1,683
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
$
|
2,843
|
|
|
$
|
3,039
|
|
|
(6
|
)
|
|
|
(5
|
)
|
|
Franchise and license fees and income
|
|
28
|
|
|
26
|
|
|
2
|
|
|
|
2
|
|
|
49
|
|
|
49
|
|
|
(1
|
)
|
|
|
—
|
|
|
||||
Total revenues
|
|
$
|
1,636
|
|
|
$
|
1,709
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
$
|
2,892
|
|
|
$
|
3,088
|
|
|
(6
|
)
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
234
|
|
|
$
|
283
|
|
|
(17
|
)
|
|
|
(17
|
)
|
|
$
|
467
|
|
|
$
|
600
|
|
|
(22
|
)
|
|
|
(21
|
)
|
|
Restaurant margin %
|
|
14.6
|
%
|
|
16.8
|
%
|
|
(2.2
|
)
|
ppts.
|
|
(2.2
|
)
|
ppts.
|
16.4
|
%
|
|
19.8
|
%
|
|
(3.4
|
)
|
ppts.
|
|
(3.3
|
)
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
100
|
|
|
$
|
102
|
|
|
2
|
|
|
|
2
|
|
|
$
|
168
|
|
|
$
|
164
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
Operating Profit
|
|
$
|
144
|
|
|
$
|
194
|
|
|
(26
|
)
|
|
|
(25
|
)
|
|
$
|
334
|
|
|
$
|
479
|
|
|
(30
|
)
|
|
|
(29
|
)
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
System Sales Growth, reported
|
|
(4
|
)%
|
|
21
|
%
|
|
(6
|
)%
|
|
20
|
%
|
System Sales Growth, excluding FX
|
|
(4
|
)%
|
|
21
|
%
|
|
(5
|
)%
|
|
19
|
%
|
Same-Store Sales Growth %
|
|
(10
|
)%
|
|
15
|
%
|
|
(11
|
)%
|
|
12
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
6/13/2015
|
|
6/14/2014
|
|
|
||||||
Company-owned
|
|
5,520
|
|
|
5,138
|
|
|
7
|
|
|
||
Unconsolidated Affiliates
|
|
773
|
|
|
731
|
|
|
6
|
|
|
||
Franchise & License
|
|
560
|
|
|
518
|
|
|
8
|
|
|
||
|
|
6,853
|
|
|
6,387
|
|
|
7
|
|
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
1,683
|
|
|
$
|
87
|
|
|
$
|
(161
|
)
|
|
$
|
(1
|
)
|
|
$
|
1,608
|
|
Cost of sales
|
(531
|
)
|
|
(24
|
)
|
|
40
|
|
|
—
|
|
|
(515
|
)
|
|||||
Cost of labor
|
(337
|
)
|
|
(17
|
)
|
|
21
|
|
|
—
|
|
|
(333
|
)
|
|||||
Occupancy and other
|
(532
|
)
|
|
(30
|
)
|
|
35
|
|
|
1
|
|
|
(526
|
)
|
|||||
Company restaurant expenses
|
$
|
(1,400
|
)
|
|
$
|
(71
|
)
|
|
$
|
96
|
|
|
$
|
1
|
|
|
$
|
(1,374
|
)
|
Restaurant profit
|
$
|
283
|
|
|
$
|
16
|
|
|
$
|
(65
|
)
|
|
$
|
—
|
|
|
$
|
234
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
3,039
|
|
|
$
|
155
|
|
|
$
|
(315
|
)
|
|
$
|
(36
|
)
|
|
$
|
2,843
|
|
Cost of sales
|
(949
|
)
|
|
(43
|
)
|
|
74
|
|
|
11
|
|
|
(907
|
)
|
|||||
Cost of labor
|
(578
|
)
|
|
(32
|
)
|
|
26
|
|
|
7
|
|
|
(577
|
)
|
|||||
Occupancy and other
|
(912
|
)
|
|
(53
|
)
|
|
62
|
|
|
11
|
|
|
(892
|
)
|
|||||
Company restaurant expenses
|
$
|
(2,439
|
)
|
|
$
|
(128
|
)
|
|
$
|
162
|
|
|
$
|
29
|
|
|
$
|
(2,376
|
)
|
Restaurant profit
|
$
|
600
|
|
|
$
|
27
|
|
|
$
|
(153
|
)
|
|
$
|
(7
|
)
|
|
$
|
467
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
505
|
|
|
$
|
558
|
|
|
(9
|
)
|
|
|
5
|
|
|
|
$
|
950
|
|
|
$
|
1,027
|
|
|
(7
|
)
|
|
|
6
|
|
|
Franchise and license fees and income
|
|
189
|
|
|
196
|
|
|
(3
|
)
|
|
|
7
|
|
|
|
386
|
|
|
391
|
|
|
(1
|
)
|
|
|
7
|
|
|
||||
Total revenues
|
|
$
|
694
|
|
|
$
|
754
|
|
|
(8
|
)
|
|
|
6
|
|
|
|
$
|
1,336
|
|
|
$
|
1,418
|
|
|
(6
|
)
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
78
|
|
|
$
|
72
|
|
|
8
|
|
|
|
24
|
|
|
|
$
|
146
|
|
|
$
|
133
|
|
|
10
|
|
|
|
24
|
|
|
Restaurant margin %
|
|
15.3
|
%
|
|
12.9
|
%
|
|
2.4
|
|
ppts.
|
|
2.2
|
|
ppts.
|
|
15.3
|
%
|
|
12.9
|
%
|
|
2.4
|
|
ppts.
|
|
2.2
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
93
|
|
|
$
|
94
|
|
|
—
|
|
|
|
(12
|
)
|
|
|
$
|
172
|
|
|
$
|
170
|
|
|
(1
|
)
|
|
|
(11
|
)
|
|
Operating Profit
|
|
$
|
152
|
|
|
$
|
155
|
|
|
(2
|
)
|
|
|
10
|
|
|
|
$
|
321
|
|
|
$
|
318
|
|
|
1
|
|
|
|
11
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
System Sales Growth, reported
|
|
(4
|
)%
|
|
2
|
%
|
|
(2
|
)%
|
|
—
|
%
|
System Sales Growth, excluding FX
|
|
6
|
%
|
|
5
|
%
|
|
7
|
%
|
|
5
|
%
|
Same-Store Sales Growth %
|
|
3
|
%
|
|
2
|
%
|
|
4
|
%
|
|
2
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
6/13/2015
|
|
|
6/14/2014
|
|
|
|
||||
Franchise & License
|
|
12,904
|
|
|
12,624
|
|
|
2
|
|
|
||
Company-owned
|
|
1,330
|
|
|
1,282
|
|
|
4
|
|
|
||
|
|
14,234
|
|
|
13,906
|
|
|
2
|
|
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
558
|
|
|
$
|
9
|
|
|
$
|
21
|
|
|
$
|
(83
|
)
|
|
$
|
505
|
|
Cost of sales
|
(194
|
)
|
|
(5
|
)
|
|
—
|
|
|
28
|
|
|
(171
|
)
|
|||||
Cost of labor
|
(135
|
)
|
|
—
|
|
|
(4
|
)
|
|
21
|
|
|
(118
|
)
|
|||||
Occupancy and other
|
(157
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
23
|
|
|
(138
|
)
|
|||||
Company restaurant expenses
|
$
|
(486
|
)
|
|
$
|
(7
|
)
|
|
$
|
(6
|
)
|
|
$
|
72
|
|
|
$
|
(427
|
)
|
Restaurant profit
|
$
|
72
|
|
|
$
|
2
|
|
|
$
|
15
|
|
|
$
|
(11
|
)
|
|
$
|
78
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
1,027
|
|
|
$
|
15
|
|
|
$
|
42
|
|
|
$
|
(134
|
)
|
|
$
|
950
|
|
Cost of sales
|
(358
|
)
|
|
(8
|
)
|
|
(4
|
)
|
|
46
|
|
|
(324
|
)
|
|||||
Cost of labor
|
(249
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|
33
|
|
|
(222
|
)
|
|||||
Occupancy and other
|
(287
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|
37
|
|
|
(258
|
)
|
|||||
Company restaurant expenses
|
$
|
(894
|
)
|
|
$
|
(14
|
)
|
|
$
|
(12
|
)
|
|
$
|
116
|
|
|
$
|
(804
|
)
|
Restaurant profit
|
$
|
133
|
|
|
$
|
1
|
|
|
$
|
30
|
|
|
$
|
(18
|
)
|
|
$
|
146
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
145
|
|
|
$
|
142
|
|
|
2
|
|
|
|
4
|
|
|
|
$
|
289
|
|
|
$
|
282
|
|
|
2
|
|
|
|
5
|
|
|
Franchise and license fees and income
|
|
119
|
|
|
123
|
|
|
(3
|
)
|
|
|
2
|
|
|
|
246
|
|
|
250
|
|
|
(1
|
)
|
|
|
2
|
|
|
||||
Total revenues
|
|
$
|
264
|
|
|
$
|
265
|
|
|
—
|
|
|
|
3
|
|
|
|
$
|
535
|
|
|
$
|
532
|
|
|
1
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
14
|
|
|
$
|
10
|
|
|
40
|
|
|
|
38
|
|
|
|
$
|
31
|
|
|
$
|
25
|
|
|
22
|
|
|
|
21
|
|
|
Restaurant margin %
|
|
9.9
|
%
|
|
7.2
|
%
|
|
2.7
|
|
ppts.
|
|
2.4
|
|
ppts.
|
|
10.8
|
%
|
|
9.0
|
%
|
|
1.8
|
|
ppts.
|
|
1.4
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
61
|
|
|
$
|
58
|
|
|
(6
|
)
|
|
|
(12
|
)
|
|
|
$
|
118
|
|
|
$
|
107
|
|
|
(10
|
)
|
|
|
(15
|
)
|
|
Operating Profit
|
|
$
|
60
|
|
|
$
|
63
|
|
|
(4
|
)
|
|
|
(1
|
)
|
|
|
$
|
141
|
|
|
$
|
147
|
|
|
(4
|
)
|
|
|
(2
|
)
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
System Sales Growth, reported
|
|
(3
|
)%
|
|
(2
|
)%
|
|
(2
|
)%
|
|
(2
|
)%
|
System Sales Growth, excluding FX
|
|
1
|
%
|
|
(1
|
)%
|
|
2
|
%
|
|
—
|
%
|
Same-Store Sales Growth %
|
|
—
|
%
|
|
(3
|
)%
|
|
—
|
%
|
|
(2
|
)%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
6/13/2015
|
|
|
6/14/2014
|
|
|
|
||||
Franchise & License
|
|
12,778
|
|
|
12,588
|
|
|
2
|
|
|
||
Company-owned
|
|
801
|
|
|
750
|
|
|
7
|
|
|
||
|
|
13,579
|
|
|
13,338
|
|
|
2
|
|
|
|
Quarter ended
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
142
|
|
|
$
|
8
|
|
|
$
|
(2
|
)
|
|
$
|
(3
|
)
|
|
$
|
145
|
|
Cost of sales
|
(43
|
)
|
|
(2
|
)
|
|
4
|
|
|
1
|
|
|
(40
|
)
|
|||||
Cost of labor
|
(44
|
)
|
|
(2
|
)
|
|
—
|
|
|
1
|
|
|
(45
|
)
|
|||||
Occupancy and other
|
(45
|
)
|
|
(3
|
)
|
|
—
|
|
|
2
|
|
|
(46
|
)
|
|||||
Company restaurant expenses
|
$
|
(132
|
)
|
|
$
|
(7
|
)
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
(131
|
)
|
Restaurant profit
|
$
|
10
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
14
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year to date
|
||||||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
FX
|
|
2015
|
||||||||||
Company sales
|
$
|
282
|
|
|
$
|
17
|
|
|
$
|
(4
|
)
|
|
$
|
(6
|
)
|
|
$
|
289
|
|
Cost of sales
|
(85
|
)
|
|
(4
|
)
|
|
7
|
|
|
2
|
|
|
(80
|
)
|
|||||
Cost of labor
|
(87
|
)
|
|
(5
|
)
|
|
1
|
|
|
2
|
|
|
(89
|
)
|
|||||
Occupancy and other
|
(85
|
)
|
|
(6
|
)
|
|
(1
|
)
|
|
3
|
|
|
(89
|
)
|
|||||
Company restaurant expenses
|
$
|
(257
|
)
|
|
$
|
(15
|
)
|
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
(258
|
)
|
Restaurant profit
|
$
|
25
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
31
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
% B/(W)
|
|
|
|
|
|
% B/(W)
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
|
2015
|
|
2014
|
|
Reported
|
|
Ex FX
|
||||||||||||||||
Company sales
|
|
$
|
370
|
|
|
$
|
342
|
|
|
8
|
|
|
|
8
|
|
|
|
$
|
705
|
|
|
$
|
648
|
|
|
9
|
|
|
|
9
|
|
|
Franchise and license fees and income
|
|
106
|
|
|
97
|
|
|
9
|
|
|
|
9
|
|
|
|
202
|
|
|
182
|
|
|
11
|
|
|
|
11
|
|
|
||||
Total revenues
|
|
$
|
476
|
|
|
$
|
439
|
|
|
9
|
|
|
|
9
|
|
|
|
$
|
907
|
|
|
$
|
830
|
|
|
9
|
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restaurant profit
|
|
$
|
85
|
|
|
$
|
61
|
|
|
41
|
|
|
|
41
|
|
|
|
$
|
150
|
|
|
$
|
109
|
|
|
39
|
|
|
|
39
|
|
|
Restaurant margin %
|
|
23.0
|
%
|
|
17.7
|
%
|
|
5.3
|
|
ppts.
|
|
5.3
|
|
ppts.
|
|
21.4
|
%
|
|
16.7
|
%
|
|
4.7
|
|
ppts.
|
|
4.7
|
|
ppts.
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
G&A expenses
|
|
$
|
47
|
|
|
$
|
43
|
|
|
(7
|
)
|
|
|
(8
|
)
|
|
|
$
|
90
|
|
|
$
|
88
|
|
|
(3
|
)
|
|
|
(3
|
)
|
|
Operating Profit
|
|
$
|
140
|
|
|
$
|
109
|
|
|
29
|
|
|
|
29
|
|
|
|
$
|
255
|
|
|
$
|
193
|
|
|
32
|
|
|
|
32
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
|||
System Sales Growth, reported
|
|
9
|
%
|
|
3
|
%
|
|
9
|
%
|
|
2
|
%
|
System Sales Growth, excluding FX
|
|
9
|
%
|
|
3
|
%
|
|
9
|
%
|
|
2
|
%
|
Same-Store Sales Growth %
|
|
6
|
%
|
|
2
|
%
|
|
6
|
%
|
|
1
|
%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
6/13/2015
|
|
|
6/14/2014
|
|
|
|
||||
Franchise & License
|
|
5,330
|
|
|
5,181
|
|
|
3
|
|
|
||
Company-owned
|
|
927
|
|
|
893
|
|
|
4
|
|
|
||
|
|
6,257
|
|
|
6,074
|
|
|
3
|
|
|
|
Quarter ended
|
||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
2015
|
||||||||
Company sales
|
$
|
342
|
|
|
$
|
12
|
|
|
$
|
16
|
|
|
$
|
370
|
|
Cost of sales
|
(104
|
)
|
|
(3
|
)
|
|
4
|
|
|
(103
|
)
|
||||
Cost of labor
|
(100
|
)
|
|
(4
|
)
|
|
3
|
|
|
(101
|
)
|
||||
Occupancy and other
|
(77
|
)
|
|
(4
|
)
|
|
—
|
|
|
(81
|
)
|
||||
Company restaurant expense
|
$
|
(281
|
)
|
|
$
|
(11
|
)
|
|
$
|
7
|
|
|
$
|
(285
|
)
|
Restaurant profit
|
$
|
61
|
|
|
$
|
1
|
|
|
$
|
23
|
|
|
$
|
85
|
|
|
|
|
|
|
|
|
|
||||||||
|
Year to date
|
||||||||||||||
Income / (Expense)
|
2014
|
|
Store Portfolio Actions
|
|
Other
|
|
2015
|
||||||||
Company sales
|
$
|
648
|
|
|
$
|
24
|
|
|
$
|
33
|
|
|
$
|
705
|
|
Cost of sales
|
(196
|
)
|
|
(6
|
)
|
|
5
|
|
|
(197
|
)
|
||||
Cost of labor
|
(192
|
)
|
|
(8
|
)
|
|
1
|
|
|
(199
|
)
|
||||
Occupancy and other
|
(151
|
)
|
|
(8
|
)
|
|
—
|
|
|
(159
|
)
|
||||
Company restaurant expense
|
$
|
(539
|
)
|
|
$
|
(22
|
)
|
|
$
|
6
|
|
|
$
|
(555
|
)
|
Restaurant profit
|
$
|
109
|
|
|
$
|
2
|
|
|
$
|
39
|
|
|
$
|
150
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
System Sales Growth, reported
|
|
(4
|
)%
|
|
(1
|
)%
|
|
(2
|
)%
|
|
(2
|
)%
|
System Sales Growth, excluding FX
|
|
—
|
%
|
|
8
|
%
|
|
1
|
%
|
|
9
|
%
|
Same-Store Sales Growth %
|
|
(11
|
)%
|
|
(2
|
)%
|
|
(11
|
)%
|
|
(2
|
)%
|
|
|
|
|
|
|
% Increase (Decrease)
|
|
|||||
Unit Count
|
|
6/13/2015
|
|
|
6/14/2014
|
|
|
|
||||
Franchise & License
|
|
618
|
|
|
541
|
|
|
14
|
|
|
||
Company-owned
|
|
207
|
|
|
173
|
|
|
20
|
|
|
||
|
|
825
|
|
|
714
|
|
|
16
|
|
|
|
|
Quarter ended
|
|
Year to date
|
||||||||||||||||||||
(Expense) / Income
|
|
2015
|
|
2014
|
|
% B/(W)
|
|
2015
|
|
2014
|
|
% B/(W)
|
||||||||||||
Corporate G&A expenses
|
|
$
|
(46
|
)
|
|
$
|
(48
|
)
|
|
3
|
|
|
|
$
|
(90
|
)
|
|
$
|
(83
|
)
|
|
(9
|
)
|
|
Other unallocated
|
|
(76
|
)
|
|
7
|
|
|
NM
|
|
|
|
(77
|
)
|
|
—
|
|
|
NM
|
|
|||||
Interest expense, net
|
|
(33
|
)
|
|
(29
|
)
|
|
(15
|
)
|
|
|
(67
|
)
|
|
(62
|
)
|
|
(9
|
)
|
|
||||
Income tax provision
|
|
(102
|
)
|
|
(112
|
)
|
|
8
|
|
|
|
(213
|
)
|
|
(251
|
)
|
|
15
|
|
|
||||
Effective tax rate
|
|
30.4
|
%
|
|
24.9
|
%
|
|
(5.5
|
)
|
ppts.
|
|
26.3
|
%
|
|
25.4
|
%
|
|
(0.9
|
)
|
ppts.
|
/s/ KPMG LLP
|
Louisville, Kentucky
|
July 21, 2015
|
Fiscal Periods
|
|
Total number of shares purchased
(thousands)
|
|
Average price paid per share
|
|
Total number of shares purchased as part of publicly announced plans or programs
(thousands)
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs
(millions)
|
3/22/15-4/18/15
|
|
597
|
|
$79.38
|
|
597
|
|
$936
|
|
|
|
|
|
|
|
|
|
4/19/15-5/16/15
|
|
569
|
|
$87.75
|
|
569
|
|
$886
|
|
|
|
|
|
|
|
|
|
5/17/15-6/13/15
|
|
518
|
|
$91.74
|
|
518
|
|
$838
|
Total
|
|
1,684
|
|
$86.01
|
|
1,684
|
|
$838
|
|
YUM! BRANDS, INC.
|
|
(Registrant)
|
Date:
|
July 21, 2015
|
/s/ David E. Russell
|
|
|
Vice President, Finance and Corporate Controller
|
|
|
(Principal Accounting Officer)
|
(a)
|
For the Performance Period that begins in the year in which the Participant’s Date of Termination occurs, the Participant will receive the number of shares of Stock with respect to that Performance Period that the Participant would have received if the Change in Control did not occur during the Performance Period and the target level performance had been achieved for the entire Performance Period, but subject to a pro rata reduction to reflect the portion of the Performance Period after the Date of Termination.
|
(b)
|
For Performance Periods that begin before the year in which the Participant’s Date of Termination occurs (and that have not ended before the Change in Control), the Participant will receive the number of shares of Stock that the Participant would have received with respect to each of those Performance Periods if, for the respective Performance Period, the performance achieved was at the greater of (A) the target level of performance, or (B) the Projected Level of performance; provided that, regardless of whether clause (A) or (B) applies, the number of shares of Stock to be distributed will be subject to a pro rata reduction to reflect the portion of the respective Performance Period after the Date of Termination.
|
(a)
|
The Plan, as amended and restated, shall be effective as of January 1, 2013.
|
(b)
|
In the event of Plan termination, the terms of the Plan shall remain in effect as long as any Units under it are outstanding.
|
(a)
|
Date of Termination. The term "Date of Termination" means the date of the Participant’s termination of employment with the Company and its affiliates.
|
(b)
|
Fair Market Value. The term “Fair Market Value” has the meaning set forth in the LTIP, provided that the determination shall be made using the closing price on the applicable date.
|
(c)
|
Performance Period. The term “Performance Period” means a three consecutive calendar year period as designated by the Committee, or such other period determined by the Committee.
|
(d)
|
Retirement. The term “Retirement” shall have the meaning used in the YUM! Retirement Plan, as in effect on the date of the Participant's Date of Termination. However, in the absence of such Retirement Plan being applicable to be Participant, "Retirement" shall mean the occurrence of the Participant's Date of Termination on or after the Participant's attainment of age 55 and 10 years of service.
|
(a)
|
and if the Participant is a specified employee (within the meaning of Code Section 409A(a)(2)(B) and if any such payment or benefit is required to be made or provided prior to the first day of the seventh month following the Participant’s Date of Termination (or other separation from service or termination of employment), such payment or benefit shall be delayed until the first day of the seventh month following the Participant’s Date of Termination (or other separation from service); and
|
(b)
|
the determination as to whether a Participant has had a termination of employment (or separation from service) shall be made in accordance with the provisions of Code Section 409A and the guidance issued thereunder without application of any alternative levels of reductions of bona fide services permitted thereunder.
|
(a)
|
the value of 33% of the Participant’s target bonus for the first year of the Performance Period, as determined by the Committee, and rounded to the nearest $5,000; divided by
|
(b)
|
the Fair Market Value of a share of Stock on the date the Committee grants such Units.
|
(a)
|
the sum of the number of Units granted to the Participant for the Performance Period, plus the number of additional Units attributable to dividends allocated to the Participant for that Performance Period in accordance with subsection 2.3; multiplied by
|
(b)
|
the Performance Multiplier for that Performance Period determined in accordance with the following schedule.
|
|
|
Description
|
Registration Statement Number
|
|
|
Form S-3
|
|
|
|
YUM! Direct Stock Purchase Program
|
333-46242
|
Debt Securities
|
333-188216
|
|
|
Form S-8
|
|
|
|
Restaurant Deferred Compensation Plan
|
333-36877, 333-32050
|
Executive Income Deferral Program
|
333-36955
|
SharePower Stock Option Plan
|
333-36961
|
YUM! Brands 401(k) Plan
|
333-36893, 333-32048, 333-109300
|
YUM! Brands, Inc. Restaurant General Manager
|
|
Stock Option Plan
|
333-64547
|
YUM! Brands, Inc. Long-Term Incentive Plan
|
333-32052, 333-109299, 333-170929
|
|
|
|
|
/s/ KPMG LLP
Louisville, Kentucky
|
July 21, 2015
|
1.
|
I have reviewed this report on Form 10-Q of YUM! Brands, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant, as of, and for, the periods presented in this report.
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
July 21, 2015
|
/s/ Greg Creed
|
|
|
Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-Q of YUM! Brands, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant, as of, and for, the periods presented in this report.
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
July 21, 2015
|
/s/ Patrick J. Grismer
|
|
|
Chief Financial Officer
|
1.
|
the Periodic Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
July 21, 2015
|
/s/ Greg Creed
|
|
|
Chief Executive Officer
|
1.
|
the Periodic Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
July 21, 2015
|
/s/ Patrick J. Grismer
|
|
|
Chief Financial Officer
|