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YUM! BRANDS, INC.-2012 Form10-K 62
Form 10-K
PART II
ITEM 8Financial Statements andSupplementaryData
Impact on Net Income
The components of share-based compensation expense and the related income tax benefi ts are shown in the following table:
2012 2011 2010
Options and SARs $ 42 $ 49 $ 40
Restricted Stock Units 5 5 5
Performance Share Units 3 5 2
TOTAL SHARE-BASED COMPENSATION EXPENSE $ 50 $ 59 $ 47
DEFERRED TAX BENEFIT RECOGNIZED $ 15 $ 18 $ 13
EID compensation expense not share-based $ 5 $ 2 $ 4
Cash received from stock option exercises for 2012, 2011 and 2010, was $62million, $59million and $102million, respectively.Tax benefi ts realized
on our tax returns from tax deductions associated with stock options and SARs exercised for 2012, 2011 and 2010 totaled $105million, $72million
and $82million, respectively.
NOTE16 Shareholders’ Equity
Under the authority of our Board of Directors, we repurchased shares of our Common Stock during 2012, 2011 and 2010.All amounts exclude
applicable transaction fees.
Authorization Date
Shares Repurchased (thousands) Dollar Value of Shares Repurchased
2012 2011 2010 2012 2011 2010
November2012 1,069 — — $ 47 $ — $ —
November2011 11,035 — — 750 — —
January2011 2,787 10,864 — 188 562 —
March2010 — 3,441 2,161 — 171 107
September2009 — — 7,598 — — 283
TOTAL 14,891(a) 14,305(b) 9,759(b) $ 985(a) $ 733(b) $ 390(b)
(a) 2012 amount includes the effect of $20 million in share repurchases (0.3 million shares) with trade dates prior to December 29, 2012 but with settlement dates subsequent to
December29, 2012.
(b) 2011 amount excludes and 2010 amount includes the effect of $19million in share repurchases (0.4million shares) with trade dates prior to the 2010 fiscal year end but cash settlement
dates subsequent to the 2010 fiscal year.
On November16, 2012, our Board of Directors authorized share repurchases
through May2014 of up to $1billion (excluding applicable transaction fees)
of our outstanding Common Stock. As of December29, 2012, we have
$953million available for future repurchases under our November2012
share repurchase authorization.
Accumulated Other Comprehensive Income (Loss) – Comprehensive
income is Net Income plus certain other items that are recorded directly to
Shareholders’ Equity.The following table gives further detail regarding the
composition of Accumulated other comprehensive loss at December29,
2012 and December31, 2011.Refer to Note14 for additional information
about our pension and post-retirement plan accounting and Note12 for
additional information about our derivative instruments.
2012 2011
Translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature,
net of tax $ 166 $ 140
Pension and post-retirement losses, net of tax (286) (375)
Net unrealized losses on derivative instruments, net of tax (12) (12)
TOTAL ACCUMULATED OTHER COMPREHENSIVE LOSS $ (132) $ (247)
Changes in translation adjustments and gains (losses) from intra-entity transactions of a long-term investment nature include current year additions of
$26million, net of tax effects of $3million, and reclassifi cations of currency translation adjustments of $3million.
NOTE17 Income Taxes
U.S. and foreign income before taxes are set forth below:
2012 2011 2010
U.S. $ 504 $ 266 $ 345
Foreign 1,641 1,393 1,249
$ 2,145 $ 1,659 $ 1,594