China not so yummy?

Yum Brands, which as you know from Operations Insight 14.2 (page 374) operates the KFC, Pizza Hut and Taco Bell restaurant chains, reported its second-quarter profits yesterday.  They rose by 5% to $331m (£211m), compared with $316m in the same period last year.  But this rise was not as high as had been forecast.  The company explained that its earnings from China, where it now has 4,600 outlets, were squeezed by higher wage and food costs.  Analysts added that this rapid expansion into China, and the costs associated with this, also suppressed their profit performance.

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