Yum China’s net profit climbs by 10% YoY to $911m in 2024

Its net profit for Q4 2024 also increased by 18.6% to $115m.

Yum China’s net profit increased by 18.6% year-on-year (YoY) to $115m in Q4 2024 and by 10.1% to $911m in FY 2024, due to strong margin expansion.

Total revenue grew by 4% and 3% YoY to $2.6b and $11.3b in Q424 and FY24, respectively, driven by new store openings.

Overall same-store sales (SSS) fell by 1% YoY in Q4 2024.

Moreover, KFC and Pizza Hut’s ticket sizes fell by 4% and 10% YoY to $5.20 (RMB38) and $10.67 (RMB78) in Q4 2024, respectively, whilst their transaction volumes rose 3% and 9% YoY, leading to their same-store sales dropping by 1% and 2% YoY, respectively.

Management said in a conference call on 6 February that it plans to stabilise KFC’s ticket size in 2025 and to further reduce Pizza Hut’s ticket size to attract more value customers.

They also said that they expect revenue to rise by 5.4% YoY in FY 2025F, mainly driven by new store openings. Management targets to open 1,600 to 1,800 new stores in FY 2025F.

Additionally, Yum China anticipates that the proportion of franchised stores in KFC and Pizza Hut's net new store openings will increase from 30% and 10% in Q4 2024 to 40-50% and 20-30%, respectively, over the next five years.

Management said it will further explore new store formats, like mini-KFC stores in lower-tier cities, side-by-side K coffee stores, and Pizza Hut WOW stores, to broaden its customer base, offer more diversified products, and create cross-selling opportunities to drive growth.

In FY 2024, the number of K coffee stores reached 700, and management targets to reach 1,300 stores by end-FY 2025F.

(US$1 = RMB7.31)