KFC, Pizza Hut and Taco Bell owner Yum! Brands Inc (NYSE:YUM) served up a smaller portion of earnings for the past quarter than Wall Street expected, which it blamed on geopolitical conflicts and a difficult consumer environment.
Earnings per share came in at $1.37 on an adjusted basis for the third quarter, down 5% compared to a year earlier and below the $1.41 average analyst forecast. Group costs were up 10%.
Revenues swelled 7% to $1.83 billion, which was short of the $1.90 billion expected. Same-store sales declined 2% as both KFC and Pizza Hut saw falls of 4% to offset 4% growth for Taco Bell.
CEO David Gibbs said the group's restaurants had to navigate "a complex consumer environment", with sales "impacted by pressures relating to geopolitical conflicts and challenged consumer sentiment".
However, he hailed the "twin growth engines" of Taco Bell in the US, where it significantly outperformed the wider fast-food sector, and KFC International expanding its number of units around the world by 9%, with new KFC restaurants opened in 64 countries in the quarter and nearly 150 more units added so far this year compared to last year.