-=Yum China (YUMC) provides business update: Delta variant significantly impacted restaurant industry

 

Yum China provides business update: Delta variant impacted 16 provinces, significantly impacted the restaurant industry; adjusted operating profit expected to be reduced by 50-60% in Q3

• At the peak of the outbreak in August 2021, more than 500 stores in 17 provinces were closed or offered only takeaway and delivery services.
• Same-store sales in August 2021 declined by mid-teens percentage year over year, or close to an approximately -20% decline compared to August 2019.
  • This was mainly due to a same-store dine-in sales decline in that month of approximately -20% to -30%, and a sharp drop in sales at co's transportation and tourist locations of approximately -40% to -50% year over year, also on a same-store basis.
• While the outbreak has subsided in recent days and restaurant traffic is gradually recovering, operations continue to be heavily impacted, and the co expects a recovery of same-store sales to take time.
• Adjusted operating profit, which excludes special items, may be reduced by approximately 50% to 60% for the third quarter of 2021.
• Co added, "YUMC will accelerate its store network expansion, expecting to open 1,300 gross new stores in 2021, strengthen offerings for dine-in, delivery, takeaway and retail, and invest in digital and technology."