UPDATE 4-Yum profit beats street, shares down on outlook
(Adds company comment, range of 2008 estimates )
By Lisa Baertlein
LOS ANGELES Feb 4 (Reuters) - Yum Brands Inc (YUM.N: Cotización), operator of the KFC, Taco Bell and Pizza Hut chains, beat Wall Street's quarterly profit target on Monday, but forecast 2008 earnings below analysts' expectations and shares fell 2.3 percent.
An economic downturn in the United States has prompted people to spend less at restaurants and investors are jittery about the growth potential of budget-oriented, fast-food purveyors, who are seeing food and labor costs rise.
Sales at established U.S. stores rose only 1 percent in the quarter, compared with 17 percent in mainland China and 5 percent internationally.
Yum said in a statement it was raising its full- year forecast for 2008 earnings to $1.85 per share from $1.82 per share, principally due to growth in China. The company said its forecast excludes one-time items that would increase per-share earnings by 6 cents to $1.91.
Fourteen analysts polled by Reuters Estimates had 2008 targets for earnings excluding items that ranged from $1.82 to $1.91 per share. The resulting average was for full-year earnings of $1.86 per share, excluding items.
A Yum spokeswoman said she believed that some analysts' models included the one-time items excluded from the company's forecast.
RBC Capital Markets analyst Larry Miller said a lower tax rate boosted Yum's net income by 5 cents during recent fourth quarter. Continuación...