Fast food booms in China
Chinese consumers flock to KFC, Pizza Hut and other distinctly American restaurants.
And that's great news for Yum Brands (YUM), the company that owns KFC, Pizza Hut and Taco Bell. The U.S. economy may be in the doldrums, but in China, a new KFC opens almost every day, CNNMoney reports.
American fast food has gone global, and the welcome has been better than executives could have hoped for. Yum Brands has the ambitious goal of opening 20,000 fast-food restaurants in China, writes Ben Rooney.
In some ways, business in China is better for Yum than in the U.S. Same-store sales growth, which is an important measuring stick in the industry, grew 4% in China in the second quarter but was flat in the U.S., Rooney writes.
Second-quarter profit from Chinese operations grew by 33% from the year-ago period.
The fast-food industry as a whole will benefit from China's recent decision to allow its currency to appreciate against the dollar. When the companies convert their income from the yuan to the dollar, they should see better profits, The Associated Press writes.
Yum Brands, with about 10% of its 35,000 restaurants in China, will be the biggest beneficiary of the currency move. McDonald's (MCD) should also benefit, with about 3% of its locations in China's mainland.
In India, meanwhile, Yum expects its profit to hit $100 million by 2015, Reuters reports.
Shares of Yum have been on a tear recently, going from $33 in February to around $40 this week.
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