Yum Brands Earnings Report Shows Damage From Taco Bell Lawsuit

by admin on July 14, 2011

Fast-food restaurant operator Yum Brands Inc. says its U.S. business remains in the doldrums as its Taco Bell brand tries to recover from publicity surrounding a dropped lawsuit over the beef content of its taco filling.

Yum Chief Financial Officer Rick Carucci told industry analysts Thursday that the company is bracing for another double-digit drop in operating profit in its U.S. business in the third quarter.

In reporting second-quarter earnings Wednesday, the owner of the Pizza Hut, KFC and Taco Bell brands said its U.S. operating profit fell 28 percent.

The company expects its surging business in China and other foreign markets to more than offset the domestic declines.

Yum posted 10 percent growth in its second-quarter profit and raised its earnings forecast for the full year.

From the Associated Press

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