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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

August 6, 2024
________________________
YUM! BRANDS, INC.
(Exact name of registrant as specified in its charter)

Commission file number 1-13163

North Carolina13-3951308
(State or other jurisdiction of(I.R.S. Employer
incorporation or organization)Identification No.)
1441 Gardiner Lane,Louisville,Kentucky40213
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code:(502)874-8300
Former name or former address, if changed since last report:N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act
 Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
 Common Stock, no par valueYUMNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Section 2 – Financial Information

Item 2.02      Results of Operations and Financial Condition

On August 6, 2024, YUM! Brands, Inc. ("YUM") issued a press release announcing financial results for the quarter ended June 30, 2024.  A copy of the press release is attached hereto as Exhibit 99.1.


Section 9 – Financial Statements and Exhibits

    Item 9.01      Financial Statements and Exhibits

(c)Exhibits
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


   YUM! BRANDS, INC. 
   (Registrant) 



Date:August 6, 2024 /s/ David E. Russell 
   Sr. Vice President, Finance and Corporate Controller 
   (Principal Accounting Officer) 


newyumlogos3a.jpg
NEWS

Yum! Brands Reports Second-Quarter Results
+6% GAAP Operating Profit Growth and +10% Core Operating Profit Growth
Taco Bell Same-Store Sales Growth +5%; KFC Unit Growth +8%


Louisville, KY (August 6, 2024) - Yum! Brands, Inc. (NYSE: YUM) today reported results for the second-quarter ended June 30, 2024. Worldwide system sales, excluding foreign currency translation, grew 3% including a 1% same-store sales decline. Second-quarter GAAP operating profit grew 6% and second-quarter core operating profit grew 10%. Second-quarter GAAP EPS was $1.28 and second-quarter EPS excluding Special Items was $1.35. Our year-over-year EPS excluding Special Items results reflect a $0.20 negative impact from a higher current year tax rate and lower investment income. Foreign currency translation also unfavorably impacted our EPS by $0.03.

DAVID GIBBS COMMENTS
David Gibbs, CEO, said “I’m incredibly pleased with how well our teams have managed through a challenging operating environment to deliver a 10% increase in Core Operating Profit. Our twin growth engines of Taco Bell U.S. and KFC International combined delivered 5% system sales growth led by 8% unit growth. Second-quarter results most clearly showcased the power of the Taco Bell brand thanks to unmatched, crave-worthy innovation and a successful menu expansion to a new platform offering, Cantina Chicken. Based on our first half results, we continue to expect to deliver at least 8% Core Operating Profit growth this year. Meanwhile, as we progress into the next phase of our technology and digital journey, we are laying the groundwork for another promising year in 2025 as evidenced by the expansion of drive-thru Voice AI technology at Taco Bell.”

SECOND-QUARTER HIGHLIGHTS
•Worldwide system sales grew 3%, excluding foreign currency translation, with KFC at 2%, Taco Bell at 7% and Pizza Hut flat.
•Unit count increased 5% including 894 gross new units in the quarter.
•Robust digital sales of nearly $8 billion, with digital mix over 50%.
•GAAP operating profit grew 6%, and core operating profit grew 10%.
•Foreign currency translation unfavorably impacted divisional operating profit by $12 million.
Reported Results% Change
System Sales
Ex F/X		Same-Store SalesUnitsGAAP Operating Profit
Core
Operating Profit1
KFC Division+2(3)+8+3+6
Taco Bell Division+7+5+3+10+10
Pizza Hut DivisionEven(3)+3+4+6
Worldwide+3(1)+5+6+10
Second-QuarterYear-to-Date
20242023% Change20242023% Change
GAAP EPS$1.28$1.46(12)$2.38$2.51(5)
Less Special Items EPS1
$(0.07)$0.05NM$(0.12)$0.05NM
EPS Excluding Special Items$1.35$1.41(4)$2.50$2.46+1

1 See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further detail of Core Operating Profit and Special Items.
All comparisons are versus the same period a year ago.

System sales growth figures exclude foreign currency translation ("F/X") and core operating profit growth figures exclude F/X and Special Items. Special Items are not allocated to any segment and therefore only impact worldwide GAAP results. See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further details.

Digital system sales includes all transactions at system restaurants where consumers utilize ordering interaction that is primarily facilitated by automated technology.
Yum! Brands, Inc. • 1900 Colonel Sanders Lane • Louisville, KY 40213 • P: 502 874-8300 • investors.yum.com



KFC DIVISION

Second-QuarterYear-to-Date
%/ppts Change%/ppts Change
20242023ReportedEx F/X20242023ReportedEx F/X
Restaurants30,68928,500+8N/A30,68928,500+8N/A
System Sales ($MM)8,2268,298(1)+216,35416,355Even+3
Same-Store Sales Growth (%)(3)+13NMNM(3)+11NMNM
Franchise and Property Revenues ($MM)405416(3)Even802828(3)(1)
Operating Profit ($MM)334326+3+6647631+3+6
Operating Margin (%)46.647.7(1.1)(0.4)48.046.0+2.0+2.7

Second-Quarter (% Change)Year-to-Date (% Change)
InternationalU.S.InternationalU.S.
System Sales Growth Ex F/X+3(7)+5(7)
Same-Store Sales Growth(3)(5)(2)(6)

•KFC Division opened 598 gross new restaurants across 57 countries.
•Foreign currency translation unfavorably impacted operating profit by $10 million.

KFC Markets1
Percent of KFC System Sales2
System Sales Growth Ex F/X
Second-Quarter
(% Change)		Year-to-Date
(% Change)
China27%+5+7
United States15%(7)(7)
Europe11%+9+8
Asia10%(10)(8)
Australia7%+3+4
Latin America7%+20+21
United Kingdom6%(3)(2)
Middle East / Turkey / North Africa6%(11)(8)
Africa5%+10+10
Thailand2%+8+8
Canada2%+5+4
India2%+9+10
1Refer to investors.yum.com/financial-information/financial-reports/ for a list of the countries within each of the markets.
2Reflects Full Year 2023.
Yum! Brands, Inc. • 1900 Colonel Sanders Lane • Louisville, KY 40213 • P: 502 874-8300 • investors.yum.com


TACO BELL DIVISION
Second-QuarterYear-to-Date
%/ppts Change%/ppts Change
20242023ReportedEx F/X20242023ReportedEx F/X
Restaurants8,5658,320+3N/A8,5658,320+3N/A
System Sales ($MM)4,0173,760+7+77,6147,224+5+5
Same-Store Sales Growth (%)+5+4NMNM+3+6NMNM
Franchise and Property Revenues ($MM)234218+7+7444419+6+6
Operating Profit ($MM)250228+10+10458432+6+6
Operating Margin (%)37.536.80.70.736.336.20.10.1


•Taco Bell Division opened 56 gross new restaurants across 11 countries.
•Taco Bell U.S. system sales grew 7% and Taco Bell International system sales excluding foreign currency grew 4%.
•Taco Bell U.S. same-store sales grew 5% and Taco Bell International same-store sales declined 1%.
•Company-owned restaurant margins were 25.6%, flat year-over-year.


PIZZA HUT DIVISION
Second-QuarterYear-to-Date
%/ppts Change%/ppts Change
20242023ReportedEx F/X20242023ReportedEx F/X
Restaurants19,86419,242+3N/A19,86419,242+3N/A
System Sales ($MM)3,1403,201(2)Even6,3076,537(4)(2)
Same-Store Sales Growth (%)(3)+4NMNM(5)+5NMNM
Franchise and Property Revenues ($MM)148149Even+1296304(3)(1)
Operating Profit ($MM)9491+4+6187195(4)(2)
Operating Margin (%)39.337.32.02.539.239.3(0.1)0.3

Second-Quarter (% Change)Year-to-Date (% Change)
InternationalU.S.InternationalU.S.
System Sales Growth Ex F/XEven(1)(1)(3)
Same-Store Sales Growth(4)(1)(6)(3)

•Pizza Hut Division opened 236 gross new restaurants across 30 countries.
•Foreign currency translation unfavorably impacted operating profit by $2 million.
3


Pizza Hut Markets1
Percent of Pizza Hut System Sales2
System Sales Growth Ex F/X
Second-Quarter
(% Change)		Year-to-Date
(% Change)
United States41%(1)(3)
China18%+10+4
Asia13%(5)(5)
Europe12%(6)(5)
Latin America6%+1+2
Middle East / Africa5%(6)(6)
Canada3%+7+5
India2%+4+1

1Refer to investors.yum.com/financial-information/financial-reports/ for a list of the countries within each of the markets.
2Reflects Full Year 2023.

HABIT BURGER GRILL DIVISION

•The Habit Burger Grill Division opened 4 gross new restaurants this quarter.
•The Habit Burger Grill Division system sales declined 1% with same-store sales declining 6%.

OTHER ITEMS
•See reconciliation of Non-GAAP Measurements to GAAP results within this release for further detail of Special Items by financial statement line item including the impact of Special Items on General and administrative expenses.
•In June 2024, the Company completed a strategic transaction to transfer certain rights related to trademarks of the Jeno’s and Telepizza brands in Colombia and Chile to restaurant operator Food Delivery Brands, S.A. As a result of the transaction, approximately 120 Jeno’s and Telepizza branded restaurant units were removed from Pizza Hut’s global unit count.
•Disclosures pertaining to outstanding debt in our Restricted Group capital structure will be provided at the time of the filing of the second-quarter Form 10-Q.
4

CONFERENCE CALL
Yum! Brands, Inc. will host a conference call to review the company's financial performance and strategies at 8:15 a.m. Eastern Time August 6, 2024. The number is 404/975-4839 for U.S. callers, 833/950-0062 for Canada callers, and 929/526-1599 for international callers, conference ID 125949.

The call will be available for playback beginning at 10:00 a.m. Eastern Time August 6, 2024 through August 15, 2024. To access the playback, dial 866/813-9403 in the U.S., 226/828-7578 in Canada, 0204/525-0658 for U.K. (local), and +44/204-525-0658 internationally, conference ID 908951.

The webcast and the playback can be accessed by visiting Yum! Brands' website, investors.yum.com/events-and-presentations and selecting “Q2 2024 Yum! Brands, Inc. Earnings Call.”
ADDITIONAL INFORMATION ONLINE
Quarter-end dates for each division, restaurant count details, definitions of terms and Restricted Group financial information are available at investors.yum.com. Reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures are included in our Condensed Consolidated Summary of Results.
FORWARD-LOOKING STATEMENTS
This announcement may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend all forward-looking statements to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the fact that they do not relate strictly to historical or current facts and by the use of forward-looking words such as “expect,” “expectation,” “believe,” “anticipate,” “may,” “could,” “intend,” “belief,” “plan,” “estimate,” “target,” “predict,” “likely,” “seek,” “project,” “model,” “ongoing,” “will,” “should,” “forecast,” “outlook” or similar terminology. These statements are based on and reflect our current expectations, estimates, assumptions and/ or projections, our perception of historical trends and current conditions, as well as other factors that we believe are appropriate and reasonable under the circumstances. Forward-looking statements are neither predictions nor guarantees of future events, circumstances or performance and are inherently subject to known and unknown risks, uncertainties and assumptions that could cause our actual results to differ materially from those indicated by those statements. There can be no assurance that our expectations, estimates, assumptions and/or projections, including with respect to the future earnings and performance or capital structure of Yum! Brands, will prove to be correct or that any of our expectations, estimates or projections will be achieved.

Numerous factors could cause our actual results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation: food safety and food- or beverage-borne illness concerns; adverse impacts of health epidemics, deterioration in public health conditions or the occurrence of other catastrophic or unforeseen events; the success of our concepts’ franchisees; the success of our development strategy; anticipated benefits from past or potential future acquisitions, investments, other strategic transactions or initiatives, or our portfolio business model; our significant exposure to the Chinese market; our global operations and related exposure to geopolitical instability; foreign currency risks and foreign exchange controls; our ability to protect the integrity or availability of IT systems or the security of confidential information and other cybersecurity risks; compliance with data privacy and data protection legal requirements; our ability to successfully implement technology initiatives, including utilization of artificial intelligence; our increasing dependence on digital commerce platforms; the impact of social media; our ability to protect our trademarks or other intellectual property; shortages or interruptions in the availability and the delivery of food, equipment and other supplies; the loss of key personnel, labor shortages and increased labor costs, including as a result of state and local legislation related to wages and working conditions; changes in food prices and other operating costs; our corporate reputation, the value and perception of our brands and changes in consumer preferences and wellness trends; evolving expectations and requirements with respect to social and environmental sustainability matters; adverse effects of severe weather and climate change; pending or future litigation and legal claims or proceedings; changes in, or noncompliance with, legal requirements; tax matters, including changes in tax rates or laws, impositions of new taxes, tax implications of our restructurings, or disagreements with taxing authorities; changes in consumer discretionary spending and macroeconomic conditions, including inflationary pressures and elevated interest rates; competition within the retail food industry; risks relating to our level of indebtedness. In addition, other risks and uncertainties not presently known to us or that we currently believe to be immaterial could affect the accuracy of any such forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

The forward-looking statements included in this announcement are only made as of the date of this announcement and we disclaim any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances. You should consult our filings with the Securities and Exchange Commission (including the information set forth under the captions “Risk Factors” and “Forward-Looking Statements” in our most recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q) for additional detail about factors that could affect our financial and other results.

Yum! Brands, Inc., based in Louisville, Kentucky, and its subsidiaries franchise or operate a system of over 59,000 restaurants in more than 155 countries and territories under the company’s concepts – KFC, Taco Bell, Pizza Hut and the Habit Burger Grill. The Company's KFC, Taco Bell and Pizza Hut brands are global leaders of the chicken, Mexican-style food, and pizza categories, respectively. The Habit Burger Grill is a fast casual restaurant concept specializing in made-to-order chargrilled burgers, sandwiches and more. In 2024, Yum! was named to the Dow Jones Sustainability Index North America for the eighth consecutive year, and the company was recognized among TIME Magazine’s list of Best Companies for Future Leaders, Newsweek’s list of America’s Most Responsible Companies and USA Today’s America’s Climate Leaders. Yum! also received widespread recognition in 2023, including being listed on the Bloomberg Gender-Equality Index; and Forbes’ list of America’s Best Employers for Diversity. In addition, KFC, Taco Bell and Pizza Hut brands were ranked in the top five of Entrepreneur’s Top Global Franchises Ranking for 2023.

Analysts are invited to contact:
Matt Morris, Head of Investor Relations at 888/298-6986
Members of the media are invited to contact:
Virginia Ferguson, Vice President, Public Relations, at 502/874-8200
5

YUM! Brands, Inc.
Condensed Consolidated Summary of Results
(amounts in millions, except per share amounts)
(unaudited)
 Quarter ended% ChangeYear to date% Change
 6/30/246/30/23B/(W)6/30/246/30/23B/(W)
Revenues
Company sales$572 $511 12$1,046 $985 6
Franchise and property revenues789 785 Even1,546 1,555 (1)
Franchise contributions for advertising and other services402 391 3769 792 (3)
Total revenues1,763 1,687 43,361 3,332 1
Costs and Expenses, Net
Company restaurant expenses470 415 (13)870 818 (6)
General and administrative expenses281 291 4567 573 1
Franchise and property expenses23 32 3154 68 22
Franchise advertising and other services expense401 388 (3)768 783 2
Refranchising (gain) loss(14)(17)NM(19)(21)NM
Other (income) expense(5)5 NM(6)15 NM
Total costs and expenses, net1,156 1,114 (4)2,234 2,236 Even
Operating Profit607 573 61,127 1,096 3
Investment (income) expense, net— (29)NM22 (5)NM
Other pension (income) expense(1)(1)NM(3)(3)NM
Interest expense, net121 125 4238 255 7
Income before income taxes487 478 2870 849 3
Income tax provision120 60 (101)189 131 (44)
Net Income$367 $418 (12)$681 $718 (5)
Basic EPS
EPS$1.30 $1.49 (13)$2.41 $2.55 (6)
Average shares outstanding282 281 (1)282 281 —
Diluted EPS
EPS$1.28 $1.46 (12)$2.38 $2.51 (5)
Average shares outstanding286 286 —286 286 —
Dividends declared per common share$0.67 $0.605 $1.34 $1.21 

See accompanying notes.
 Percentages may not recompute due to rounding.
6

YUM! Brands, Inc.
KFC DIVISION Operating Results
(amounts in millions)
(unaudited)

 Quarter ended% ChangeYear to date% Change
 6/30/246/30/23B/(W)6/30/246/30/23B/(W)
Company sales$163 $115 41$268 $225 19
Franchise and property revenues405 416 (3)802 828 (3)
Franchise contributions for advertising and other services149 151 (2)279 316 (12)
Total revenues717 682 51,349 1,369 (2)
Company restaurant expenses144 99 (45)236 195 (21)
General and administrative expenses84 90 6167 179 7
Franchise and property expenses9 16 4626 42 39
Franchise advertising and other services expense147 150 2276 314 12
Other (income) expense(1)1 NM(3)8 NM
Total costs and expenses, net383 356 (7)702 738 5
Operating Profit$334 $326 3$647 $631 3
Company restaurant margin %1
11.9 %14.3 %(2.4) ppts.12.0 %13.2 %(1.2) ppts.
Operating margin46.6 %47.7 %(1.1) ppts.48.0 %46.0 %2.0 ppts.
 
See accompanying notes.
Percentages may not recompute due to rounding.

1See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further detail of Company restaurant margin %.

7

YUM! Brands, Inc.
TACO BELL DIVISION Operating Results
(amounts in millions)
(unaudited)
 
 Quarter ended% ChangeYear to date% Change
 6/30/246/30/23B/(W)6/30/246/30/23B/(W)
Company sales$268 $253 6$508 $482 5
Franchise and property revenues234 218 7444 419 6
Franchise contributions for advertising and other services164 150 9312 292 7
Total revenues666 621 71,264 1,193 6
Company restaurant expenses199 187 (6)385 366 (5)
General and administrative expenses47 49 596 94 (1)
Franchise and property expenses8 9 116 14 (15)
Franchise advertising and other services expense163 148 (10)310 286 (9)
Other (income) expense(1)— NM(1)1 NM
Total costs and expenses, net416 393 (6)806 761 (6)
Operating Profit$250 $228 10$458 $432 6
Company restaurant margin %1
25.6 %25.6 %Even24.2 %24.0 %0.2 ppts.
Operating margin37.5 %36.8 %0.7 ppts.36.3 %36.2 %0.1 ppts.
 
See accompanying notes.
Percentages may not recompute due to rounding.

1See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further detail of Company restaurant margin %.



8

YUM! Brands, Inc.
PIZZA HUT DIVISION Operating Results
(amounts in millions)
(unaudited)

 
 Quarter ended% ChangeYear to date% Change
 6/30/246/30/23B/(W)6/30/246/30/23B/(W)
Company sales$2 $4 (62)$4 $9 (63)
Franchise and property revenues148 149 Even296 304 (3)
Franchise contributions for advertising and other services89 89 (1)177 183 (3)
Total revenues239 242 (2)477 496 (4)
Company restaurant expenses2 4 604 9 62
General and administrative expenses50 53 4102 104 1
Franchise and property expenses5 6 2610 9 (11)
Franchise advertising and other services expense91 89 (2)181 182 1
Other (income) expense(3)(1)NM(7)(3)NM
Total costs and expenses, net145 151 5290 301 4
Operating Profit$94 $91 4$187 $195 (4)
Company restaurant margin %1
(2.2)%3.2 %(5.4) ppts.(0.1)%3.6 %(3.7) ppts.
Operating margin39.3 %37.3 %2.0 ppts.39.2 %39.3 %(0.1) ppts.
 
See accompanying notes.
Percentages may not recompute due to rounding.

1See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further detail of Company restaurant margin %.


9

YUM! Brands, Inc.
Condensed Consolidated Balance Sheets
(amounts in millions)
(unaudited)

 

6/30/24
12/31/23
ASSETS  
Current Assets 
Cash and cash equivalents$404 $512 
Accounts and notes receivable, less allowance: $49 in 2024 and $39 in 2023713 737 
Prepaid expenses and other current assets518 360 
Total Current Assets1,635 1,609 
Property, plant and equipment, net of accumulated depreciation of $1,361 in 2024
and $1,332 in 20231,272 1,197 
Goodwill718 642 
Intangible assets, net417 377 
Other assets1,335 1,361 
Deferred income taxes1,018 1,045 
Total Assets$6,395 $6,231 
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities
Accounts payable and other current liabilities$1,098 $1,169 
Income taxes payable14 55 
Short-term borrowings24 53 
Total Current Liabilities1,136 1,277 
Long-term debt11,140 11,142 
Other liabilities and deferred credits1,749 1,670 
Total Liabilities14,025 14,089 
Shareholders' Deficit
Common Stock, no par value, 750 shares authorized; 281 shares issued in 2024 and 2023
— 60 
Accumulated deficit(7,321)(7,616)
Accumulated other comprehensive loss(309)(302)
Total Shareholders' Deficit(7,630)(7,858)
Total Liabilities and Shareholders' Deficit$6,395 $6,231 
 See accompanying notes.


10

YUM! Brands, Inc.
Condensed Consolidated Statements of Cash Flows
(amounts in millions)
(unaudited)
 
Year to date
 6/30/246/30/23
Cash Flows - Operating Activities 
Net Income$681 $718 
Depreciation and amortization76 67 
Refranchising (gain) loss(19)(21)
Investment (income) expense, net22 (5)
Deferred income taxes12 (73)
Share-based compensation expense38 47 
Changes in accounts and notes receivable15 (21)
Changes in prepaid expenses and other current assets(36)(19)
Changes in accounts payable and other current liabilities(78)(107)
Changes in income taxes payable(46)19 
Other, net40 73 
Net Cash Provided by Operating Activities 705 678 
Cash Flows - Investing Activities
Capital spending(99)(122)
Proceeds from sale of Devyani Investment104 — 
Proceeds from sale of KFC Russia— 121 
Acquisition of KFC U.K. and Ireland restaurants(174)— 
Proceeds from refranchising of restaurants30 31 
Maturities (purchases) of Short term investments, net(116)1 
Other, net2 (5)
Net Cash Provided by (Used in) Investing Activities(253)26 
Cash Flows - Financing Activities
Proceeds from long-term debt237 — 
Repayments of long-term debt(463)(40)
Revolving credit facilities, three months or less, net175 (249)
Repurchase shares of Common Stock(50)(50)
Dividends paid on Common Stock(377)(339)
Other, net(69)(20)
Net Cash Used in Financing Activities (547)(698)
Effect of Exchange Rate on Cash and Cash Equivalents(6)6 
Net Increase (Decrease) in Cash, Cash Equivalents, Restricted Cash and Restricted Cash
Equivalents		(101)12 
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents - Beginning of Period724 647 
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents - End of Period$623 $659 
See accompanying notes.

11

Reconciliation of Non-GAAP Measurements to GAAP Results
(amounts in millions, except per share amounts)
(unaudited)
 
In addition to the results provided in accordance with Generally Accepted Accounting Principles in the United States of America ("GAAP"), the Company provides the following non-GAAP measurements.

•Diluted Earnings Per Share ("EPS") excluding Special Items (as defined below);
•Effective Tax Rate excluding Special Items;
•Core Operating Profit. Core Operating Profit excludes Special Items and foreign currency translation (“F/X”) and we use Core Operating Profit for the purposes of evaluating performance internally;
•Company restaurant profit and Company restaurant margin as a percentage of sales (as defined below).

These non-GAAP measurements are not intended to replace the presentation of our financial results in accordance with GAAP. Rather, the Company believes that the presentation of these non-GAAP measurements provide additional information to investors to facilitate the comparison of past and present operations.

Special Items are not included in any of our Division segment results as the Company does not believe they are indicative of our ongoing operations due to their size and/or nature. Our chief operating decision maker does not consider the impact of Special Items when assessing segment performance. The Special Items are described in (a) - (d) in the accompanying notes.

Company restaurant profit is defined as Company sales less Company restaurant expenses, both of which appear on the face of our Condensed Consolidated Statements of Income. Company restaurant expenses include those expenses incurred directly by our Company-owned restaurants in generating Company sales, including cost of food and paper, cost of restaurant-level labor, rent, depreciation and amortization of restaurant-level assets and advertising expenses incurred by and on behalf of that Company restaurant. Company restaurant margin as a percentage of sales ("Company restaurant margin %") is defined as Company restaurant profit divided by Company sales. We use Company restaurant profit for the purposes of internally evaluating the performance of our Company-owned restaurants and we believe Company restaurant profit provides useful information to investors as to the profitability of our Company-owned restaurants. In calculating Company restaurant profit, the Company excludes revenues and expenses directly associated with our franchise operations as well as non-restaurant-level costs included in General and administrative expenses, some of which may support Company-owned restaurant operations. The Company also excludes restaurant-level asset impairment and closures expenses, which have historically not been significant, from the determination of Company restaurant profit as such expenses are not believed to be indicative of ongoing operations. Company restaurant profit and Company restaurant margin % as presented may not be comparable to other similarly titled measures of other companies in the industry.

Certain non-GAAP measurements are presented excluding the impact of F/X. These amounts are derived by translating current year results at prior year average exchange rates. We believe the elimination of the F/X impact provides better year-to-year comparability without the distortion of foreign currency fluctuations.

 Quarter endedYear to date
 6/30/246/30/236/30/246/30/23
Reconciliation of GAAP Operating Profit to Core Operating Profit
Consolidated
GAAP Operating Profit$607 $573 $1,127 $1,096 
Detail of Special Items:
(Gain) loss associated with market-wide refranchisings(a)
1 (2)4 (5)
Operating (profit) loss impact from decision to exit Russia(b)
— 9 — 12 
Charges associated with Resource Optimization(c)
25 8 46 10 
Other Special Items Expense— — — 1 
Special Items Expense - Operating Profit26 15 50 18 
Negative Foreign Currency Impact on Divisional Operating Profit12 N/A23 N/A
Core Operating Profit$645 $588 $1,200 $1,114 
Special Items as shown above were recorded to the financial statement line items identified below.
Condensed Consolidated Summary of Results Line Item
General and administrative expenses$25 $11 $46 $15 
Franchise and property expenses— 1 — 2 
Refranchising (gain) loss1 (2)4 (5)
Other (income) expense— 5 — 6 
Special Items Expense - Operating Profit$26 $15 $50 $18 
12

 Quarter endedYear to date
 6/30/246/30/236/30/246/30/23
KFC Division
GAAP Operating Profit$334 $326 $647 $631 
Negative (Positive) Foreign Currency Impact 10 N/A20 N/A
Core Operating Profit$344 $326 $667 $631 
Taco Bell Division
GAAP Operating Profit$250 $228 $458 $432 
Negative (Positive) Foreign Currency Impact— N/A— N/A
Core Operating Profit$250 $228 $458 $432 
Pizza Hut Division
GAAP Operating Profit$94 $91 $187 $195 
Negative (Positive) Foreign Currency Impact2 N/A3 N/A
Core Operating Profit$96 $91 $190 $195 
Habit Burger Grill Division
GAAP Operating Loss$2 $3 $(3)$(2)
Negative (Positive) Foreign Currency Impact— N/A— N/A
Core Operating Profit (Loss)$2 $3 $(3)$(2)
Reconciliation of GAAP Net Income to Net Income excluding Special Items
GAAP Net Income$367 $418 $681 $718 
Special Items Expense - Operating Profit26 15 50 18 
Special Items Tax Benefit(d)
(7)(30)(17)(32)
Net Income excluding Special Items$386 $403 $714 $704 
Reconciliation of Diluted EPS to Diluted EPS excluding Special Items
Diluted EPS $1.28 $1.46 $2.38 $2.51 
Less Special Items Diluted EPS(0.07)0.05 (0.12)0.05 
Diluted EPS excluding Special Items$1.35 $1.41 $2.50 $2.46 
Reconciliation of GAAP Effective Tax Rate to Effective Tax Rate excluding Special Items
GAAP Effective Tax Rate24.7 %12.6 %21.8 %15.4 %
Impact on Tax Rate as a result of Special Items— %(5.6)%(0.6)%(3.3)%
Effective Tax Rate excluding Special Items24.7 %18.2 %22.4 %18.7 %
13



Reconciliation of GAAP Operating Profit to Company Restaurant Profit
Quarter ended 6/30/2024
KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
GAAP Operating Profit (Loss)$334 $250 $94 $2 $(73)$607 
Less:
Franchise and property revenues405 234 148 2 — 789 
Franchise contributions for advertising and other services149 164 89 — — 402 
Add:
General and administrative expenses84 47 50 14 86 281 
Franchise and property expenses9 8 5 1 — 23 
Franchise advertising and other services expense147 163 91 — — 401 
Refranchising (gain) loss— — — — (14)(14)
Other (income) expense(1)(1)(3)— — (5)
Company restaurant profit$19 $69 $— $15 $(1)$102 
Company sales$163 $268 $2 $139 $— $572 
Company restaurant margin %11.9 %25.6 %(2.2)%10.7 %N/A17.8 %

Quarter ended 6/30/2023
KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
GAAP Operating Profit (Loss) $326 $228 $91 $3 $(75)$573 
Less:
Franchise and property revenues416 218 149 2 — 785 
Franchise contributions for advertising and other services151 150 89 1 — 391 
Add:
General and administrative expenses90 49 53 13 86 291 
Franchise and property expenses16 9 6 — 1 32 
Franchise advertising and other services expense150 148 89 1 — 388 
Refranchising (gain) loss— — — — (17)(17)
Other (income) expense1 — (1)— 5 5 
Company restaurant profit$16 $66 $— $14 $— $96 
Company sales$115 $253 $4 $139 $— $511 
Company restaurant margin % 14.3 %25.6 %3.2 %11.1 %N/A18.9 %

14

Year to Date 6/30/2024
KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
GAAP Operating Profit (Loss)$647 $458 $187 $(3)$(162)$1,127 
Less:
Franchise and property revenues802 444 296 4 — 1,546 
Franchise contributions for advertising and other services279 312 177 1 — 769 
Add:
General and administrative expenses167 96 102 27 175 567 
Franchise and property expenses26 16 10 2 — 54 
Franchise advertising and other services expense276 310 181 1 — 768 
Refranchising (gain) loss— — — — (19)(19)
Other (income) expense(3)(1)(7)— 5 (6)
Company restaurant profit$32 $123 $— $22 $(1)$176 
Company sales$268 $508 $4 $266 $— $1,046 
Company restaurant margin % 12.0 %24.2 %(0.1)%8.2 %N/A16.8 %

Year to Date 6/30/2023
KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
GAAP Operating Profit (Loss)$631 $432 $195 $(2)$(160)$1,096 
Less:
Franchise and property revenues828 419 304 4 — 1,555 
Franchise contributions for advertising and other services316 292 183 1 — 792 
Add:
General and administrative expenses179 94 104 26 170 573 
Franchise and property expenses42 14 9 1 2 68 
Franchise advertising and other services expense314 286 182 1 — 783 
Refranchising (gain) loss— — — — (21)(21)
Other (income) expense8 1 (3)— 9 15 
Company restaurant profit$30 $116 $— $21 $— $167 
Company sales$225 $482 $9 $269 $— $985 
Company restaurant margin % 13.2 %24.0 %3.6 %8.2 %N/A17.0 %
15

YUM! Brands, Inc.
Segment Results
(amounts in millions)
(unaudited)

    
Quarter ended 6/30/2024KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
Total revenues$717 $666 $239 $141 $— $1,763 
Company restaurant expenses144 199 2 124 1 470 
General and administrative expenses84 47 50 14 86 281 
Franchise and property expenses9 8 5 1 — 23 
Franchise advertising and other services expense147 163 91 — — 401 
Refranchising (gain) loss— — — — (14)(14)
Other (income) expense(1)(1)(3)— — (5)
Total costs and expenses, net383 416 145 139 73 1,156 
Operating Profit (Loss)$334 $250 $94 $2 $(73)$607 

Quarter ended 6/30/2023KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
Total revenues$682 $621 $242 $142 $— $1,687 
Company restaurant expenses99 187 4 125 — 415 
General and administrative expenses90 49 53 13 86 291 
Franchise and property expenses16 9 6 — 1 32 
Franchise advertising and other services expense150 148 89 1 — 388 
Refranchising (gain) loss— — — — (17)(17)
Other (income) expense1 — (1)— 5 5 
Total costs and expenses, net356 393 151 139 75 1,114 
Operating Profit (Loss)$326 $228 $91 $3 $(75)$573 


The above tables reconcile segment information, which is based on management responsibility, with our Condensed Consolidated Summary of Results.  Corporate and unallocated expenses comprise items that are not allocated to segments for performance reporting purposes.

The Corporate and Unallocated column in the above tables includes, among other amounts, all amounts that we have deemed Special Items. See Reconciliation of Non-GAAP Measurements to GAAP Results.


16

YUM! Brands, Inc.
Segment Results
(amounts in millions)
(unaudited)
Year to Date 6/30/2024KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
Total revenues$1,349 $1,264 $477 $271 $— $3,361 
Company restaurant expenses236 385 4 244 1 870 
General and administrative expenses167 96 102 27 175 567 
Franchise and property expenses26 16 10 2 — 54 
Franchise advertising and other services expense276 310 181 1 — 768 
Refranchising (gain) loss— — — — (19)(19)
Other (income) expense(3)(1)(7)— 5 (6)
Total costs and expenses, net702 806 290 274 162 2,234 
Operating Profit (Loss)$647 $458 $187 $(3)$(162)$1,127 

Year to Date 6/30/2023KFC DivisionTaco Bell DivisionPizza Hut DivisionHabit Burger Grill DivisionCorporate and UnallocatedConsolidated
Total revenues$1,369 $1,193 $496 $274 $— $3,332 
Company restaurant expenses195 366 9 248 — 818 
General and administrative expenses179 94 104 26 170 573 
Franchise and property expenses42 14 9 1 2 68 
Franchise advertising and other services expense314 286 182 1 — 783 
Refranchising (gain) loss— — — — (21)(21)
Other (income) expense8 1 (3)— 9 15 
Total costs and expenses, net738 761 301 276 160 2,236 
Operating Profit (Loss)$631 $432 $195 $(2)$(160)$1,096 


The above tables reconcile segment information, which is based on management responsibility, with our Condensed Consolidated Summary of Results.  Corporate and unallocated expenses comprise items that are not allocated to segments for performance reporting purposes.

The Corporate and Unallocated column in the above tables includes, among other amounts, all amounts that we have deemed Special Items. See Reconciliation of Non-GAAP Measurements to GAAP Results.
17

Notes to the Condensed Consolidated Summary of Results, Condensed Consolidated Balance Sheets
and Condensed Consolidated Statements of Cash Flows
(amounts in millions)
(unaudited)

Amounts presented as of and for the quarters and years to date ended June 30, 2024 and 2023 are preliminary.

(a)Due to their size and volatility, we have reflected as Special Items those refranchising gains and losses that were recorded in connection with market-wide refranchisings.

(b)In April 2023, we completed our exit from the Russia market by selling the KFC business in Russia to Smart Service Ltd. Our GAAP operating results presented herein for the quarter and year to date ended June 30, 2023, respectively, reflect revenues from and expenses to support the Russian operations for KFC prior to the date of sale, within their historical financial statement line items and operating segments. However, given our decision to exit Russia and our pledge to direct any future net profits attributable to Russia subsequent to the date of invasion of Ukraine to humanitarian efforts, we reclassed such net operating profits or losses from the KFC Division segment results to Unallocated Other income (expense). Additionally, we incurred certain expenses related to the disposition of the business and other one-time costs related to our exit from Russia which we recorded within Corporate and unallocated G&A and Unallocated Franchise and property expenses. The resulting net Operating Loss of $9 million and $12 million for the quarter and year to date ended June 30, 2023, respectively, has been reflected as a Special Item.

(c)We recorded charges of $25 million and $46 million during the quarter and year to date ended June 30, 2024, respectively, and $8 million and $10 million during the quarter and year to date ended June 30, 2023, respectively, to General and administrative expenses related to a resource optimization program. This program has allowed us to reallocate significant resources to accelerate our digital, technology and innovation capabilities to deliver a modern, world-class team member and customer experience and improve unit economics. We recently expanded the program to identify further opportunities to optimize the Company’s spending and identify additional, critical areas in which to potentially reallocate resources, both with a goal to enable the acceleration of the Company’s growth rate. Costs incurred to date related to the program include severance associated with positions that have been eliminated or relocated and consultant fees. Due to their scope and size, these charges have been reflected as Special Items.

(d)The below table includes the detail of Special Items Tax Benefit:

Quarter endedYear to date
6/30/246/30/236/30/246/30/23
Tax Benefit on Special Items Operating Profit$(7)$(2)$(13)$(2)
Tax Benefit - Income tax impacts from decision to exit Russia— (6)— (8)
Tax Benefit - Other Income tax impacts recorded as Special— (22)(4)(22)
Special Items Tax Benefit$(7)$(30)$(17)$(32)

Tax Benefit on Special Items Operating Profit was determined by assessing the tax impact of each individual component within Special Items based upon the nature of the item and jurisdictional tax law.

Other Income Tax impacts recorded as Special in the year to date ended June 30, 2024, and the quarter and year to date ended June 30, 2023 include benefits related to the reversal of reserves due to the favorable resolutions of tax audits in foreign jurisdictions. Such reserves were established in prior years related to income tax liabilities and deferred tax assets originally recorded as Special Items as part of intercompany restructurings of intellectual property. Other Income Tax impacts recorded as Special in the quarter and year to date ended June 30, 2023 also include the release of valuation allowances associated with a jurisdiction in which a market-wide refranchising event occurred.
18
v3.24.2.u1
Cover page Document
Aug. 06, 2024
Cover [Abstract]  
Entity Central Index Key 0001041061
Title of 12(b) Security Common Stock, no par value
Entity Incorporation, State or Country Code NC
Entity Registrant Name YUM! BRANDS, INC.
Entity File Number 1-13163
Entity Tax Identification Number 13-3951308
Entity Address, Address Line One 1441 Gardiner Lane,
Entity Address, City or Town Louisville,
Entity Address, State or Province KY
Entity Address, Postal Zip Code 40213
City Area Code (502)
Local Phone Number 874-8300
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Trading Symbol YUM
Security Exchange Name NYSE
Entity Emerging Growth Company false
Amendment Flag false
Document Type 8-K
Document Period End Date Aug. 06, 2024
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