Yum! Brands Inc., owner of the KFC and Pizza Hut dining chains, posted first-quarter profit that topped analysts’ estimates as new menu items helped Taco Bell’s domestic sales.
Net income fell 26 percent to $337 million, or 72 cents a share, from $458 million, or 96 cents, a year earlier, the Louisville, Kentucky-based company said Tuesday in a statement. Excluding certain items, profit was 70 cents a share. Analysts estimated 60 cents, the average of 25 projections compiled by Bloomberg.
Chief Executive Officer David Novak is trying to lure U.S. consumers with new food at Taco Bell as the company’s China business struggles to recover from concerns about chicken quality. Sales at U.S. stores open at least 12 months rose 2 percent in the quarter. Analysts projected a 1.9 percent gain, the average of 22 estimates from Consensus Metrix. U.S. comparable-store sales for Taco Bell climbed 6 percent.
Yum shares rose 5.7 percent to $67.80 at 4:49 p.m. in New York. The shares fell 3.4 percent this year through the close of regular trading, while the Standard & Poor’s 500 Restaurants Index rose 10 percent.
Yum will hold a conference call Wednesday at 9:15 a.m. New York time.
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