Edgar Filing: YUM BRANDS INC

Form 8-K 03.2014

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)

March 28, 2014

Commission file number 1-13163

________________________

YUM! BRANDS, INC.

(Exact name of registrant as specified in its charter)



	North Carolina	13-3951308
	(State or other jurisdiction of	(I.R.S. Employer
	incorporation or organization)	Identification No.)

	1441 Gardiner Lane, Louisville, Kentucky	40213
	(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))



Section 2 - Financial Information

Item 2.02	Results of Operation and Financial Condition

Effective the beginning of fiscal year 2014, YUM! Brands, Inc. (“YUM”) combined its YUM Restaurants International and U.S. Divisions into three new global divisions: KFC Division, Pizza Hut Division and Taco Bell Division. These three divisions will each now constitute separate reportable segments. YUM’s China and India divisions will remain separate reportable segments due to their strategic importance and growth potential. The new structure is designed to drive greater global brand focus, enabling us to more effectively share know-how and accelerate growth.

This Form 8-K provides a summary of YUM’s 2013 quarterly and annual segment operating results as if they had been reported under this new reportable segment structure. Consolidated results remain unchanged. The information contained in this Form 8-K is being furnished pursuant to Item 2.02, Results of Operation and Financial Condition. Beginning with the quarter ended March 22, 2014, our financial statements will reflect the new reportable segment structure with prior periods adjusted accordingly.

YUM! Brands, Inc.

Recast Segment Operating Results

(amounts in millions)

(unaudited)



Quarter Ended 3/23/13	China			KFC		Pizza Hut			Taco Bell		India			Corporate and Unallocated			Consolidated
Company sales	$	1,133		$	458	$	138		$	353	$	17		—			$	2,099
Franchise and license fees and income	18			201		129			85		3			—			436
Total revenues	1,151			659		267			438		20			—			2,535

Company restaurant expenses
Food and paper	375			159		38			101		7			—			680
Payroll and employee benefits	231			110		41			105		3			—			490
Occupancy and other operating expenses	339			129		38			83		7			—			596
Company restaurant expenses	945			398		117			289		17			—			1,766

General and administrative expenses	55			81		42			45		4			46			273
Franchise and license expenses	2			15		9			4		—			—			30
Closures and impairment (income) expenses	2			—		1			—		1			—			4
Refranchising (gain) loss	—			—		—			—		—			(17		)	(17		)
Other (income) expense	(7		)	—		(1		)	—		—			—			(8		)
Total costs and expenses, net	997			494		168			338		22			29			2,048

Operating Profit (loss)	$	154		$	165	$	99		$	100	$	(2	)	$	(29	)	$	487



Quarter Ended 6/15/13	China		KFC		Pizza Hut			Taco Bell		India			Corporate and Unallocated			Consolidated
Company sales	$	1,429	$	514	$	144		$	358	$	29		—			$	2,474
Franchise and license fees and income	20		189		123			94		4			—			430
Total revenues	1,449		703		267			452		33			—			2,904

Company restaurant expenses
Food and paper	469		180		41			102		13			—			805
Payroll and employee benefits	319		123		44			100		4			—			590
Occupancy and other operating expenses	489		147		40			82		11			—			769
Company restaurant expenses	1,277		450		125			284		28			—			2,164

General and administrative expenses	90		92		54			48		8			41			333
Franchise and license expenses	3		16		9			5		1			—			34
Closures and impairment (income) expenses	6		—		(1		)	1		—			—			6
Refranchising (gain) loss	—		—		—			—		—			(32		)	(32		)
Other (income) expense	5		—		—			3		—			1			9
Total costs and expenses, net	1,381		558		187			341		37			10			2,514

Operating Profit (loss)	$	68	$	145	$	80		$	111	$	(4	)	$	(10	)	$	390



Quarter Ended 9/7/13	China			KFC		Pizza Hut			Taco Bell			India			Corporate and Unallocated			Consolidated
Company sales	$	2,001		$	514	$	140		$	340		$	26		—			$	3,021
Franchise and license fees and income	32			190		124			95			4			—			445
Total revenues	2,033			704		264			435			30			—			3,466

Company restaurant expenses
Food and paper	664			179		40			100			13			—			996
Payroll and employee benefits	357			123		42			96			3			—			621
Occupancy and other operating expenses	591			147		44			80			11			—			873
Company restaurant expenses	1,612			449		126			276			27			—			2,490

General and administrative expenses	88			88		54			45			6			46			327
Franchise and license expenses	3			20		14			6			1			—			44
Closures and impairment (income) expenses	6			—		(1		)	—			—			295			300
Refranchising (gain) loss	—			—		—			—			—			(38		)	(38		)
Other (income) expense	(11		)	—		—			(1		)	—			5			(7		)
Total costs and expenses, net	1,698			557		193			326			34			308			3,116

Operating Profit (loss)	$	335		$	147	$	71		$	109		$	(4	)	$	(308	)	$	350



Quarter Ended 12/28/13	China			KFC		Pizza Hut		Taco Bell			India			Corporate and Unallocated			Consolidated
Company sales	$	2,237		$	706	$	187	$	423		$	37		—			$	3,590
Franchise and license fees and income	35			264		162		121			7			—			589
Total revenues	2,272			970		349		544			44			—			4,179

Company restaurant expenses
Food and paper	750			248		54		121			15			—			1,188
Payroll and employee benefits	453			165		56		118			6			—			798
Occupancy and other operating expenses	713			205		60		99			18			—			1,095
Company restaurant expenses	1,916			618		170		338			39			—			3,081

General and administrative expenses	124			130		74		68			9			74			479
Franchise and license expenses	5			25		15		5			—			—			50
Closures and impairment (income) expenses	16			3		1		—			1			—			21
Refranchising (gain) loss	—			—		—		—			—			(13		)	(13		)
Other (income) expense	(9		)	2		—		(3		)	—			—			(10		)
Total costs and expenses, net	2,052			778		260		408			49			61			3,608

Operating Profit (loss)	$	220		$	192	$	89	$	136		$	(5	)	$	(61	)	$	571



Year Ended 12/28/13	China			KFC		Pizza Hut			Taco Bell			India			Corporate and Unallocated			Consolidated
Company sales	$	6,800		$	2,192	$	609		$	1,474		$	109		—			$	11,184
Franchise and license fees and income	105			844		538			395			18			—			1,900
Total revenues	6,905			3,036		1,147			1,869			127			—			13,084

Company restaurant expenses
Food and paper	2,258			766		173			424			48			—			3,669
Payroll and employee benefits	1,360			521		183			419			16			—			2,499
Occupancy and other operating expenses	2,132			628		182			344			47			—			3,333
Company restaurant expenses	5,750			1,915		538			1,187			111			—			9,501

General and administrative expenses	357			391		224			206			27			207			1,412
Franchise and license expenses	13			76		47			20			2			—			158
Closures and impairment (income) expenses	30			3		—			1			2			295			331
Refranchising (gain) loss	—			—		—			—			—			(100		)	(100		)
Other (income) expense	(22		)	2		(1		)	(1		)	—			6			(16		)
Total costs and expenses, net	6,128			2,387		808			1,413			142			408			11,286

Operating Profit (loss)	$	777		$	649	$	339		$	456		$	(15	)	$	(408	)	$	1,798

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:	March 28, 2014	/s/ David E. Russell
		Vice President, Finance and Corporate Controller