Yum China Holdings, Inc., backed by private equity firm Primavera Capital Group and Ant Financial Services Group, opened 575 new restaurants during 2016, or a 5% net growth, to reach over 7,500 restaurants in total in the country, it said today.
However, same-store sales were flat, with an increase of 3% at KFC, offset by a decline of 7% at Pizza Hut Casual Dining.
"We continue to focus on our long-term growth formula: new unit development, same-store sales growth, and continued restaurant margin improvement. Right now, our top priority is consistently delivering positive same-store sales growth," said Micky Pant, CEO at Yum China, in a statement.
Yum China recorded a 31% year-on-year increase in operating profit to US$640 million in the full year of 2016, primarily due to positive impact from retail tax structure reform in the country, while foreign currency translation negatively impacted operating profit by US$36 million.
Yum China is a licensee of Yum! Brands, Inc. and has exclusive rights in Mainland China to the KFC, Pizza Hut, and Taco Bell brands.
Last year, the company separated from parent Yum Brands and began a U.S. trading debut as an independent company, following a US$460 million capital injection from Primavera and Ant Financial in September 2016.
At the same time, Yum China appointed Joey Wat, formerly chief executive of the company’s KFC business, as president and chief operating officer of Yum China. He will continue to oversee the KFC business, as well as taking control of the company’s Pizza Hut Casual Dining and Pizza Hut Home Service brands.