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Yum! Restaurants International: 2012 Sales Growth Stronger than Unit Growth in Europe

Yum! Restaurants International continued to expand in Europe last year. The number of outlets rose by 2.25% to 3,185. In 33 European national markets, the three Yum! brands - KFC, Pizza Hut and Taco Bell - generated revenues of US-$4,421 m, representing growth in constant-currency terms of 6% compared to 2011. www.yum.com 

The highest rate of outlet growth was achieved by KFC. With 5.6% more outlets in Europe, the rate of increase in the number of restaurants was slightly down on the year before (+6.9%). Pizza Hut did better than expected and recorded an upturn of 2.2%, a significant improvement on 2011 (-0.6%).
Mainly to be found at AAFES military bases, Taco Bell also expanded with two new openings in Spain. This represents growth of 6.9% (2011: +20.8%). The unchallenged leader of the ranking of Europe's top markets is Great Britain, with many more KFC and Pizza Hut outlets than any other country. Among the other top 10 countries, Russia and Germany stood out with doubledigit rates of growth.
In both cases, the KFC brand was the driving force of expansion. The top 3 European countries in terms of turnover are the UK, France and Russia. Six new KFC and four more Pizza Hut restaurants also meant strong store growth for Romania in 11th place. In contrast, the number of outlets in Greece fell by almost 40% in 2012. Worldwide, Yum! operates 39,014 restaurants (+5.1%) and generated system sales of US-$43,144 m (+4%) in 2012.
Thus, Europe accounts for 8.2% of the company's global business in terms of restaurants. When it comes to sales, the figure is 10.2%. Compared to world foodservice leader McDonald's, Yum! is not particularly well represented in Europe. Other US brands, such as Burger King and Subway, have much denser European networks.
One of the main reasons for this is the emphasis on expansion in China plus the fact that Taco Bell is little more than a national US brand (with the exception of AAFES bases). In global terms, the multi-brand com pany runs almost 20% of outlets itself while a good 80% are operated under licenses of various kinds, especially franchise agreements.


| 26 November 2013 |
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