Stock Analysis on Net
Stock Analysis on Net

YUM! Brands Inc. (NYSE:YUM)

$22.49

This company has been moved to the archive! The financial data has not been updated since October 11, 2016.

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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YUM! Brands Inc., consolidated income statement

US$ in millions

Microsoft Excel
12 months ended: Dec 26, 2015 Dec 27, 2014 Dec 28, 2013 Dec 29, 2012 Dec 31, 2011
Company sales
Franchise and license fees and income
Revenues
Food and paper
Payroll and employee benefits
Occupancy and other operating expenses
Company restaurant expenses
General and administrative expenses
Franchise and license expenses
Closures and impairment expenses
Refranchising gain (loss)
Equity income from investments in unconsolidated affiliates
Gain upon acquisition of Little Sheep
China poultry supply insurance recovery
Loss associated with planned sale of aircraft
Foreign exchange net gain (loss) and other
Other income (expense)
Costs and expenses, net
Operating profit
Interest expense
Interest income
Interest expense, net
Income before income taxes
Income tax provision
Net income, including noncontrolling interests
Net (income) loss, noncontrolling interests
Net income, YUM! Brands, Inc.

Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).

Revenue Trends
Revenues increased from 12,626 million USD in 2011 to a peak of 13,633 million USD in 2012, followed by a decline to 13,105 million USD in 2015. Company sales showed an initial rise from 10,893 million USD in 2011 to 11,833 million USD in 2012, then a gradual decrease to 11,145 million USD by 2015. Meanwhile, franchise and license fees steadily grew from 1,733 million USD in 2011 to 1,960 million USD in 2015, indicating increased income from these sources.
Cost and Expense Patterns
Company restaurant expenses, representing direct operating costs, steadily increased from -9,140 million USD in 2011 to -9,852 million USD in 2012, then decreased overall to -9,359 million USD by 2015. Food and paper costs fluctuated but trended downwards from -3,633 million USD in 2011 to -3,507 million USD in 2015. Payroll and employee benefits rose in 2012 to -2,620 million USD, later returning to levels near 2011 by 2015. Occupancy and other operating expenses increased from -3,089 million USD in 2011 to a high of -3,425 million USD in 2014, then decreased slightly. General and administrative expenses showed minor fluctuations, overall rising from -1,372 million USD to -1,504 million USD at the end of the period. Franchise and license expenses increased notably in 2015 to -242 million USD. Closure and impairment expenses peaked sharply in 2014 at -535 million USD but reduced significantly by 2015.
Profitability Analysis
Operating profit rose from 1,815 million USD in 2011 to a peak of 2,294 million USD in 2012, followed by declines in 2013 and 2014, before recovering somewhat to 1,921 million USD in 2015. Income before taxes correspondingly increased sharply in 2012, then declined, with a rebound in 2015. Net income attributable to YUM! Brands exhibited a similar pattern, rising sharply in 2012, dropping in 2013 and 2014, then improving in 2015 to 1,293 million USD. The income tax provision increased substantially in 2012 and remained elevated thereafter, indicating higher taxable income or changes in tax rates.
Non-Operating Items and Other Income
Non-operating gains and losses, including refranchising gains, equity income, and other miscellaneous items showed variability with a refranchising gain notable in 2012 and 2013. The gain on acquisition of Little Sheep was recorded only in 2012, providing a one-time income boost. Foreign exchange losses increased over time, negatively impacting net results. Insurance recoveries and losses on sale of aircraft were minor and inconsistent. Overall, other income contributions fluctuated but were generally positive.
Interest Expense and Net Impact
Interest expense showed a decline in 2012 but increased in 2013 and then decreased again. Interest income remained relatively stable over the periods. Net interest expense mirrored the expense trend, with occasional declines. These fluctuations modestly influenced income before taxes but did not dominate earnings trends.
Summary
Overall, the financial data demonstrates a peak in revenue and profitability in 2012, followed by a period of lower results and modest recovery by 2015. Cost control efforts appear to be mixed, with some expense categories stabilizing or declining by the end of the period, while others increased, notably franchise and license expenses and general administrative costs. Operating efficiency faced challenges after 2012, with significant impairment and closure charges in 2013 and 2014. The company’s income benefited from certain one-time gains and refranchising activities, which diminished toward 2015. Exchange rate losses and tax expense remained consistent headwinds. The trends suggest a need for continued management focus on operational efficiency and cost management to sustain profitability amidst fluctuating sales.