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