Pizza Hut 2010 Annual Report Download - page 164

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Notes to Consolidated Financial Statements
(Tabular amounts in millions, except share data)
Note 1 – Description of Business
YUM! Brands, Inc. and Subsidiaries (collectively referred to as “YUM” or the “Company”) comprises the worldwide
operations of KFC, Pizza Hut, Taco Bell, Long John Silver’s (“LJS”) and A&W All-American Food Restaurants
(“A&W”) (collectively the “Concepts”). YUM is the world’s largest quick service restaurant company based on the
number of system units, with more than 37,000 units of which approximately 48% are located outside the U.S. in more
than 110 countries and territories. YUM was created as an independent, publicly-owned company on October 6, 1997
(the “Spin-off Date”) via a tax-free distribution by our former parent, PepsiCo, Inc., of our Common Stock to its
shareholders. References to YUM throughout these Consolidated Financial Statements are made using the first person
notations of “we,” “us” or “our.”
Through our widely-recognized Concepts, we develop, operate, franchise and license a system of both traditional and non-
traditional quick service restaurants. Each Concept has proprietary menu items and emphasizes the preparation of food
with high quality ingredients as well as unique recipes and special seasonings to provide appealing, tasty and attractive
food at competitive prices. Our traditional restaurants feature dine-in, carryout and, in some instances, drive-thru or
delivery service. Non-traditional units, which are principally licensed outlets, include express units and kiosks which
have a more limited menu and operate in non-traditional locations like malls, airports, gasoline service stations,
convenience stores, stadiums, amusement parks and colleges, where a full-scale traditional outlet would not be practical or
efficient. We also operate multibrand units, where two or more of our Concepts are operated in a single unit. In addition,
we continue to pursue the combination of Pizza Hut and WingStreet, a flavored chicken wings concept we have
developed.
YUM consists of six operating segments: KFC-U.S., Pizza Hut-U.S., Taco Bell-U.S., LJS/A&W-U.S., YUM Restaurants
International (“YRI” or “International Division”) and YUM Restaurants China (“China Division”). For financial
reporting purposes, management considers the four U.S. operating segments to be similar and, therefore, has aggregated
them into a single reportable operating segment (“U.S.”). The China Division includes mainland China (“China”), and the
International Division includes the remainder of our international operations.
At the beginning of 2010 we began reporting information for our Thailand and KFC Taiwan businesses within our
International Division as a result of changes to our management reporting structure. These businesses now report to the
President of YRI, whereas previously they reported to the President of the China Division. While this reporting change
did not impact our consolidated results, segment information for previous periods has been restated to be consistent with
the current period presentation throughout the Financial Statements and Notes thereto. For the years ended December 26,
2009 and December 27, 2008 this restatement resulted in decreases in Company sales of $270 million and $282 million,
respectively, and decreases in Operating profit of $6 million and $9 million, respectively, for the China Division. Any
impact of the restatement on the China Division reported figures was offset by the impact to the International Division
reported figures.
Form 10-K