Pizza Hut 2005 Annual Report Download - page 77

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Selected฀Financial฀Data฀
YUM!฀Brands,฀Inc.฀and฀Subsidiaries
(in฀millions,฀except฀per฀share฀and฀unit฀amounts)฀ ฀ Fiscal฀Year
฀2005฀ 2004฀ 2003฀ 2002฀ 2001
Summary฀of฀Operations
Revenues
฀ Company฀sales฀ $฀ 8,225฀ $฀ 7,992฀ $฀ 7,441฀ $฀ 6,891฀ $฀ 6,138
฀ Franchise฀and฀license฀fees฀ ฀ 1,124฀ ฀ 1,019฀ ฀ 939฀ ฀ 866฀ ฀ 815
฀ Total฀ ฀ ฀ 9,349฀ ฀ 9,011฀ ฀ 8,380฀ ฀ 7,757฀ ฀ 6,953
Facility฀actions(a)฀฀ (19)฀ ฀ (26)฀ ฀ (36)฀ ฀ (32)฀ ฀ (1)
Wrench฀litigation฀income฀(expense)(b)฀฀ 2฀ ฀ 14฀ ฀ (42)฀ ฀ —฀ ฀ —
AmeriServe฀and฀other฀(charges)฀credits(c)฀฀ 2฀ ฀ 16฀ ฀ 26฀ ฀ 27฀ ฀ 3
Operating฀profit฀ ฀ 1,153฀ ฀ 1,155฀ ฀ 1,059฀ ฀ 1,030฀ ฀ 891
Interest฀expense,฀net฀ ฀ 127฀ ฀ 129฀ ฀ 173฀ ฀ 172฀ ฀ 158
Income฀before฀income฀taxes฀and฀cumulative฀฀
฀ effect฀of฀accounting฀change฀ ฀ 1,026฀ ฀ 1,026฀ ฀ 886฀ ฀ 858฀ ฀ 733
Income฀before฀cumulative฀effect฀of฀accounting฀change฀ ฀ 762฀ ฀ 740฀ ฀ 618฀ ฀ 583฀ ฀ 492
Cumulative฀effect฀of฀accounting฀change,฀net฀of฀tax(d)฀฀ —฀ ฀ —฀ ฀ (1)฀ ฀ —฀ ฀ —
Net฀income฀ ฀ 762฀ ฀ 740฀ ฀ 617฀ ฀ 583฀ ฀ 492
Basic฀earnings฀per฀common฀share(e)฀฀ 2.66฀ ฀ 2.54฀ ฀ 2.10฀ ฀ 1.97฀ ฀ 1.68
Diluted฀earnings฀per฀common฀share(e)฀฀ 2.55฀ ฀ 2.42฀ ฀ 2.02฀ ฀ 1.88฀ ฀ 1.62
Cash฀Flow฀Data฀ ฀ ฀ ฀
Provided฀by฀operating฀activities(f)฀$฀ 1,238฀ $฀ 1,186฀ $฀ 1,099฀ $฀ 1,112฀ $฀ 851
Capital฀spending,฀excluding฀acquisitions฀ ฀ 609฀ ฀ 645฀ ฀ 663฀ ฀ 760฀ ฀ 636
Proceeds฀from฀refranchising฀of฀restaurants฀ ฀ 145฀ ฀ 140฀ ฀ 92฀ ฀ 81฀ ฀ 111
Repurchase฀shares฀of฀common฀stock฀ ฀ 1,056฀ ฀ 569฀ ฀ 278฀ ฀ 228฀ ฀ 100
Dividends฀paid฀on฀common฀shares฀ ฀ 123฀ ฀ 58฀ ฀ —฀ ฀ —฀ ฀ —
Balance฀Sheet฀ ฀ ฀ ฀
Total฀assets฀ $฀ 5,698฀ $฀ 5,696฀ $฀ 5,620฀ $฀ 5,400฀ $฀ 4,425
Long-term฀debt฀ ฀ 1,649฀ ฀ 1,731฀ ฀ 2,056฀ ฀ 2,299฀ ฀ 1,552
Total฀debt฀฀ ฀ 1,860฀ ฀ 1,742฀ ฀ 2,066฀ ฀ 2,445฀ ฀ 2,248
Other฀Data
Number฀of฀stores฀at฀year฀end
฀ Company฀ ฀ 7,587฀ ฀ 7,743฀ ฀ 7,854฀ ฀ 7,526฀ ฀ 6,435
฀ Unconsolidated฀Affiliates฀ ฀ 1,648฀ ฀ 1,662฀ ฀ 1,512฀ ฀ 2,148฀ ฀ 2,000
฀ Franchisees฀฀ ฀22,666฀ ฀21,858฀ ฀21,471฀ ฀20,724฀ ฀19,263
฀ Licensees฀ ฀ 2,376฀ ฀ 2,345฀ ฀ 2,362฀ ฀ 2,526฀ ฀ 2,791
฀ System฀ ฀34,277฀ ฀33,608฀ ฀33,199฀ ฀32,924฀ ฀30,489
U.S.฀Company฀blended฀same฀store฀sales฀growth(g)฀฀ 4%฀ ฀ 3%฀ ฀ —฀ ฀ 2%฀ ฀ 1%
International฀Division฀system฀sales฀growth(h)฀฀ ฀ ฀
฀ Reported฀ ฀ 9%฀ ฀ 14%฀ ฀ 13%฀ ฀ 6%฀ ฀ —
฀ Local฀currency(i)฀฀ 6%฀ ฀ 6%฀ ฀ 5%฀ ฀ 7%฀ ฀ 7%
China฀Division฀system฀sales฀growth(h)฀฀ ฀ ฀ ฀
฀ Reported฀ ฀ 13%฀ ฀ 23%฀ ฀ 23%฀ ฀ 25%฀ ฀ 14%฀
฀ Local฀currency(i)฀฀ 11%฀ ฀ 23%฀ ฀ 23%฀ ฀ 25%฀ ฀ 17%฀
Shares฀outstanding฀at฀year฀end(e)฀฀ 278฀ ฀ 290฀ ฀ 292฀ ฀ 294฀ ฀ 293฀
Cash฀dividends฀declared฀per฀common฀share฀ $฀ 0.445฀ $฀ 0.30฀ ฀ —฀ ฀ —฀ ฀ —฀
Market฀price฀per฀share฀at฀year฀end(e)฀$฀ 46.88฀ $฀ 46.27฀ $฀ 33.64฀ $฀ 24.12฀ $฀ 24.62฀
Fiscal฀year฀2005฀includes฀53฀weeks฀and฀fiscal฀years฀2004,฀2003,฀2002฀and฀2001฀include฀52฀weeks.
Fiscal฀year฀2005฀includes฀the฀impact฀of฀the฀adoption฀of฀Statement฀of฀Financial฀Accounting฀Standards฀(“SFAS”)฀No.฀123R฀(Revised฀2004),฀“Share฀Based฀Payment,”฀(“SFAS฀123R”).฀This฀resulted฀in฀a฀
$38฀million฀decrease฀in฀net฀income,฀or฀a฀decrease฀of฀$0.13฀to฀basic฀and฀diluted฀earnings฀per฀share฀for฀2005.฀If฀SFAS฀123R฀had฀been฀effective฀for฀prior฀years฀presented,฀reported฀basic฀and฀diluted฀
earnings฀per฀share฀would฀have฀decreased฀$0.12฀and฀$0.12,฀$0.12฀and฀$0.12,฀$0.14฀and฀$0.13,฀and฀$0.13฀and฀$0.13฀per฀share฀for฀2004,฀2003,฀2002,฀and฀2001,฀respectively,฀consistent฀with฀
previously฀disclosed฀pro-forma฀information.฀See฀Note฀2฀to฀the฀Consolidated฀Financial฀Statements.
From฀May฀7,฀2002,฀results฀include฀Long฀John฀Silver’s฀(“LJS”)฀and฀A&W฀All-American฀Food฀Restaurants฀(“A&W”),฀which฀were฀added฀when฀we฀acquired฀Yorkshire฀Global฀Restaurants,฀Inc.
Fiscal฀year฀2002฀includes฀the฀impact฀of฀the฀adoption฀of฀SFAS฀No.฀142,฀“Goodwill฀and฀Other฀Intangible฀Assets”฀(“SFAS฀142”).฀As฀a฀result฀we฀ceased฀amortization฀of฀goodwill฀and฀indefinite-lived฀
assets฀beginning฀December฀30,฀2001.฀If฀SFAS฀142฀had฀been฀effective฀for฀2001,฀reported฀net฀income฀would฀have฀increased฀$26฀million฀and฀both฀basic฀and฀diluted฀earnings฀per฀share฀would฀have฀
increased฀$0.09.
The฀selected฀financial฀data฀should฀be฀read฀in฀conjunction฀with฀the฀Consolidated฀Financial฀Statements฀and฀the฀Notes฀thereto.
(a)฀ See฀Note฀4฀to฀the฀Consolidated฀Financial฀Statements฀for฀a฀description฀of฀Facility฀actions฀in฀2005,฀2004,฀and฀2003.
(b)฀ See฀Note฀4฀and฀Note฀21฀to฀the฀Consolidated฀Financial฀Statements฀for฀a฀description฀of฀Wrench฀litigation฀in฀2005,฀2004,฀and฀2003.
(c)฀ See฀Note฀4฀to฀the฀Consolidated฀Financial฀Statements฀for฀a฀description฀of฀AmeriServe฀and฀other฀charges฀(credits)฀in฀2005,฀2004,฀and฀2003.
(d)฀ Fiscal฀year฀2003฀includes฀the฀impact฀of฀the฀adoption฀of฀SFAS฀No.฀143,฀“Accounting฀for฀Asset฀Retirement฀Obligations.”฀See฀Note฀2฀to฀the฀Consolidated฀Financial฀Statements฀for฀further฀discussion.
(e)฀ Per฀share฀and฀share฀amounts฀have฀been฀adjusted฀to฀reflect฀the฀two-for-one฀stock฀split฀distributed฀on฀June฀17,฀2002.
(f)฀ All฀prior฀years฀presented฀have฀been฀adjusted฀for฀the฀reclassification฀of฀distributions฀from฀unconsolidated฀affiliates฀from฀investing฀activities฀to฀operating฀activities฀in฀accordance฀with฀
SFAS฀No.฀95,฀“Statement฀of฀Cash฀Flows.”฀These฀reclassifications฀increased฀net฀cash฀provided฀by฀operating฀activities฀by฀$55฀million,฀$46฀million,฀$24฀million฀and฀$19฀million฀for฀2004,฀2003,฀
2002,฀and฀2001,฀respectively.
(g)฀U.S.฀Company฀blended฀same-store฀sales฀growth฀includes฀the฀results฀of฀Company฀owned฀KFC,฀Pizza฀Hut฀and฀Taco฀Bell฀restaurants฀that฀have฀been฀open฀one฀year฀or฀more.฀LJS฀and฀A&W฀are฀
not฀included.
(h)฀ International฀Division฀and฀China฀Division฀system฀sales฀growth฀includes฀the฀results฀of฀all฀restaurants฀regardless฀of฀ownership,฀including฀Company฀owned,฀franchise,฀unconsolidated฀affiliate฀and฀license฀
restaurants.฀Sales฀of฀franchise,฀unconsolidated฀affiliate฀and฀license฀restaurants฀generate฀franchise฀and฀license฀fees฀for฀the฀Company฀(typically฀at฀a฀rate฀of฀4%฀to฀6%฀of฀sales).฀Franchise,฀unconsoli-
dated฀affiliate฀and฀license฀restaurant฀sales฀are฀not฀included฀in฀Company฀sales฀we฀present฀on฀the฀Consolidated฀Statements฀of฀Income;฀however,฀the฀fees฀are฀included฀in฀the฀Company’s฀revenues.฀
We฀believe฀system฀sales฀growth฀is฀useful฀to฀investors฀as฀a฀significant฀indicator฀of฀the฀overall฀strength฀of฀our฀business฀as฀it฀incorporates฀all฀our฀revenue฀drivers,฀Company฀and฀franchise฀same฀store฀
sales฀as฀well฀as฀net฀unit฀development.฀Additionally,฀as฀previously฀noted,฀we฀began฀reporting฀information฀for฀our฀international฀business฀in฀two฀separate฀operating฀segments฀(the฀International฀Division฀
and฀the฀China฀Division)฀in฀2005฀as฀a฀result฀of฀changes฀in฀our฀management฀structure.฀Segment฀information฀for฀periods฀prior฀to฀2005฀has฀been฀restated฀to฀reflect฀this฀reporting.
(i)฀ Local฀currency฀represents฀the฀percentage฀change฀excluding฀the฀impact฀of฀foreign฀currency฀translation.฀These฀amounts฀are฀derived฀by฀translating฀current฀year฀results฀at฀prior฀year฀average฀exchange฀
rates.฀We฀believe฀the฀elimination฀of฀the฀foreign฀currency฀translation฀impact฀provides฀better฀year-to-year฀comparability฀without฀the฀distortion฀of฀foreign฀currency฀fluctuations.
Yum!฀Brands,฀Inc.฀ ฀ ฀ |฀ ฀ ฀ 81.