Louisville: Yum Brands Inc. said Monday that it expects that KFCs sales in China will suffer because of a recent government investigation of its poultry.
The company announced in late December that the Chinese government was conducting a review of two poultry suppliers who provided chicken with unapproved levels of antibiotics to KFC. The supplies represent a small percentage of the companys product, but the publicity slowed sales.
Yum Brands said Monday that because of the bad publicity associated with the review, it expects a key sales measure for KFC in China will come in lower than expected. It anticipates revenue from its stores in China open at least a year will be down 6 percent for the fourth quarter of its 2012 fiscal year, versus its prior forecast of a 4 percent decline.
Yum expects to earn $3.24 for the full fiscal year on an adjusted basis. Analysts polled by FactSet had forecast earnings of $3.26 per share, on average.
The company said it will not comment further until it releases its full quarterly results on Feb. 4.
Yum, based in Louisville, owns the KFC, Pizza Hut and Taco Bell chains. It is already the biggest Western fast-food chain in China