UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _________________ Commission file number 001-37762 Yum China Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 8 ...

Yum China Holdings, Inc. (NYSE:YUMC) Q1 2023 Earnings Conference Call May 2, 2023 8:00 PM ET Company Participants Michelle Shen - Director, IR Joey Wat - CEO & Executive Director Andy Yeung - CFO Conference Call Participants Michelle Cheng - Goldman Sachs Group Lillian Lou - Morgan Stanley Lina Yan - HSBC Chen Luo - Bank of America Merrill Lynch Anne Ling - Jefferies Yan Peng - UBS Operator Thank you for standing by, and welcome to the Yum China First Quarter 2023 Earnings Conference Call. [Operator Instru ...

Financial Performance - Yum China reported revenues of $9.6 billion in 2022, operating nearly 13,000 restaurants across over 1,800 cities in China[7]. - For the year ended December 31, 2022, the Company's China subsidiaries distributed approximately $453 million in dividends to the Company's Hong Kong-incorporated holding companies[56]. - Yum China paid cash dividends to stockholders totaling $202 million and repurchased $466 million of its common stock in 2022[57]. - Net cash provided by operating activities was $1,413 million in 2022, an increase from $1,131 million in 2021, primarily driven by VAT asset refunds[422]. - Net cash used in investing activities decreased to $522 million in 2022 from $855 million in 2021, mainly due to the prior year's acquisition impacts[422]. - Net cash used in financing activities increased to $844 million in 2022 from $313 million in 2021, attributed to resumed share repurchases and acquisition costs[422]. - The company generated $2.2 billion in net proceeds from its global offering in September 2020[423]. - The company anticipates that existing cash, net cash from operations, and credit facilities will be sufficient to fund operations for the next 12 months[425]. - The board of directors increased the share repurchase authorization by $1 billion to a total of $2.4 billion, with $466 million or 10.5 million shares repurchased in 2022[428]. - The company paid cash dividends of $0.12 per share for each quarter in 2021 and 2022, totaling $202 million in 2022 and $203 million in 2021[428]. Business Expansion and Strategy - The company aims to expand its restaurant network to 20,000 stores, currently tracking over 900 cities without a KFC or Pizza Hut[15]. - Yum China plans to open 1,000 Lavazza stores in the next few years, targeting the underserved coffee market in China[28]. - The company aims to expand the Taco Bell store network to at least 225 stores by the end of 2025, having satisfied the development milestones for the brand[85]. - The company expanded its restaurant count from 7,562 at the end of 2016 to 12,947 at the end of 2022, representing a compound annual growth rate (CAGR) of approximately 9%[33]. Digital Transformation - Digital orders exceeded $8 billion in 2022, accounting for approximately 89% of KFC and Pizza Hut Company sales[24]. - Digital orders accounted for approximately 89% of KFC and Pizza Hut Company sales in 2022, reflecting a strong shift towards digitalization[44]. - Digital payments accounted for 99% of Company sales in 2022, up from 33% in 2016, indicating a significant consumer preference for mobile payment options[45]. - Delivery services contributed approximately 39% of Company sales in 2022, highlighting significant growth potential in the delivery market[25]. - Delivery sales accounted for approximately 39% of total Company sales in 2022, up from 21% in 2019, driven by increased delivery orders during the COVID-19 pandemic[49]. Customer Engagement and Loyalty - The loyalty programs had over 380 million members as of December 31, 2022, enhancing guest loyalty and order frequency[24]. - As of December 31, 2022, KFC and Pizza Hut loyalty programs exceeded 410 million members combined, with member sales accounting for approximately 62% of system sales in 2022[47]. Innovation and Product Development - The company launched over 500 new and improved products across all restaurant brands in 2022, showcasing its commitment to menu innovation[42]. - Yum China is focused on food innovation and value propositions to enhance unit-level performance and drive sales growth[20]. - Approximately 73% of KFC restaurant units and 87% of Pizza Hut restaurant units were remodeled or built in the past five years, reflecting ongoing investment in restaurant format innovation[50]. Corporate Governance and Compliance - Yum China is classified as a Commission-Identified Issuer under the Holding Foreign Companies Accountable Act, requiring annual documentation to the SEC[81]. - The PCAOB's ability to inspect registered public accounting firms in mainland China and Hong Kong remains uncertain, impacting the potential delisting of Yum China's common stock from the New York Stock Exchange[83]. - The Company faces uncertainties regarding compliance with Chinese laws and regulations, which may adversely affect its business and financial condition[54]. - The ability to declare and pay dividends may be restricted by earnings available for distribution under applicable Chinese laws[60]. Environmental and Social Responsibility - The company has set a target to reduce absolute Scope 1 and 2 GHG emissions by 63% by 2035 from a 2020 base year[108]. - The company is committed to achieving a 10% reduction in food waste per restaurant by 2030 compared to a 2020 baseline[109]. - The company aims for 100% of customer-facing, plastic-based packaging to be recyclable and targets a 30% reduction in non-degradable plastic packaging weight by 2025 compared to a 2019 baseline[110]. - The company has opened 30 "Angel Restaurants" by the end of 2022, providing jobs for nearly 200 individuals with special needs[95]. - The company provided around 9 million total training hours in 2022 to enhance employee competencies[96]. Taxation and Financial Regulations - The Company is subject to a 10% withholding income tax on dividends paid by China subsidiaries, which can be reduced to 5% under certain conditions due to a tax arrangement with Hong Kong[56]. - The Company's China subsidiaries are regarded as China resident enterprises and are subject to a 25% enterprise income tax on their worldwide income[68]. - Gains from the sale of equity interests in a China resident enterprise are subject to a 10% withholding income tax, with a stamp duty of 0.05% on the transfer value[71]. - Indirect transfers of Chinese taxable assets may be treated as direct transfers, potentially subjecting gains to a 10% withholding income tax if deemed to lack reasonable commercial purpose[71]. - The estimated total temporary difference for which the company has not provided foreign withholding taxes is approximately $3 billion as of December 31, 2022[463]. Employee and Workforce Management - As of December 31, 2022, the company employed over 400,000 individuals, including approximately 145,000 full-time employees[90]. - By the end of 2022, female employees represented more than 50% of the total workforce, with women holding director and above positions making up 53% of senior management[95]. - The company has launched equity incentive schemes, granting RSUs valued at $3,000 to approximately 4,000 eligible RGMs starting in February 2021[101].

Financial Data and Key Metrics - Total revenue declined 9% YoY in reported currency to $2.1 billion in Q4 2022, but grew 2% in constant currency [18] - System sales and same-store sales both declined 4% YoY in Q4 2022 [19] - Restaurant margin improved by 290 basis points YoY to 10.4% in Q4 2022, driven by labor productivity, operational efficiency, and temporary relief [19] - Free cash flow for 2022 was $734 million, with $668 million returned to shareholders through dividends and share repurchases [23] - Cash and short-term investments decreased to $3.2 billion from $4 billion in Q3 2022, mainly due to reclassification of $600 million to long-term deposits [23] Business Line Performance - KFC same-store sales were 97% of prior year levels in Q4 2022, with same-store traffic at 84% and ticket average up 16% due to higher delivery mix [19] - Pizza Hut same-store sales were 92% of prior year levels, with same-store traffic at 98% and ticket average at 95% [19] - Delivery sales mix doubled from 20% in 2019 to 39% in 2022, with off-premise sales reaching almost two-thirds of total sales in Q4 2022 [5] - Digital ordering increased from 55% of sales in 2019 to 89% in 2022, generating over $20 billion in digital sales over three years [6] - Packaged food sales grew 90% in 2022, reaching nearly CNY 900 million [14] Market Performance - KFC entered 200 new cities in 2022, focusing on white space in lower-tier cities and increasing density in higher-tier cities [37] - Pizza Hut opened a record 300+ stores in 2022, with a focus on satellite and smaller store formats [70][72] - Lavazza expanded to 85 stores by the end of Q4 2022, with loyalty members more than doubling to 1 million [15] - Taco Bell doubled its store count to 91 stores in 2022, with a focus on menu localization and improving unit economics [15] Strategy and Industry Competition - The company plans to open 1,100 to 1,300 new stores in 2023, with capital expenditure of $700 million to $900 million [26] - Focus on driving sales through product innovation, value promotions, and digital initiatives, while maintaining disciplined store expansion [52][53] - Continued investment in supply chain, digital, and automation to enhance operational efficiency and resilience [7][81] - The company remains committed to returning capital to shareholders, with a raised cash dividend from $0.12 to $0.13 per share [27] Management Commentary on Operating Environment and Future Outlook - The company faced significant challenges in Q4 2022 due to COVID-related labor shortages and temporary store closures, but managed to improve restaurant margins despite lower sales [17][19] - Management is cautiously optimistic about the recovery in 2023, but expects it to be gradual and uneven due to macroeconomic uncertainties and cautious consumer spending [25][45] - The company plans to focus on driving sales growth while maintaining operational efficiency and cost control [25][53] Other Important Information - The company hosted its 2023 Investor Day in Shanghai in September, with plans to share more details about the event [4] - The company has maintained profitability every quarter since the start of the pandemic in 2020, generating $1.9 billion in free cash flow and returning over $1 billion to shareholders [8] Q&A Session Summary Question: New store performance and margins post-COVID [30] - New stores opened during the pandemic have shown strong performance, with KFC stores breaking even within three months and Pizza Hut stores achieving a payback period of two to three years [31][32] - The company has focused on smaller store formats and flexible rent terms, reducing CapEx per store and improving unit economics [33][36] Question: Restaurant margin recovery potential in 2023 [41] - Management expects restaurant margins to improve with sales recovery, but cautions that inflationary pressures and the end of temporary relief measures could impact margins [43][44] - Cost of sales and labor are expected to remain stable, with a focus on reducing occupancy and other operating expenses [46][47] Question: Competitive landscape and promotion strategy [58] - The company has gained market share during the pandemic and plans to continue driving sales through effective promotions and product innovation [59][60] - Pricing strategy includes a mix of lower entry-point products and high-end offerings to cater to different customer segments [61] Question: Recovery pace for KFC and Pizza Hut [63] - KFC performed slightly better than Pizza Hut during the Chinese New Year period, with off-premise sales playing a key role in protecting margins [64][67] - Pizza Hut is focusing on increasing store count and improving resiliency through satellite and smaller store formats [70][72] Question: Regional recovery differences [74] - Recovery has been strong across regions, with lower-tier cities performing better during the Chinese New Year period [75] - Management remains cautious about post-holiday consumer spending and plans to focus on value promotions to drive traffic [76] Question: Supply chain and ESG initiatives [80] - The company plans to continue investing in supply chain infrastructure and automation, with a focus on reducing carbon footprint and working with suppliers to achieve net-zero emissions by 2050 [81][82] - Supply chain innovations, such as the use of rail and sea freight, have improved resilience during disruptions [86] Question: New store opening targets for 2023 [88] - The company plans to open 1,100 to 1,300 new stores in 2023, with a focus on quality of growth over quantity [89][90] - Store expansion will depend on market conditions and unit economics, with a disciplined approach to investment [91]

Fourth Quarter and Fiscal Year 2022 Results 8 February 2023 NYSE: YUMC and HKEX: 9987 Cautionary Statement on Forward-Looking Statements & Non-GAAP Measures Thispresentation contains“forward-lookingstatements” withinthemeaningof Section 27Aof the SecuritiesAct of 1933and Section 21E ofthe SecuritiesExchangeActof1934.Weintendallforward-lookingstatementstobecovered bythesafe harbor provisionsofthePrivateSecurities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the fac ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _________________ Commission file number 001-37762 Yum China Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) Delawa ...

Yum China Holdings, Inc. (NYSE:YUMC) Q3 2022 Earnings Conference Call November 1, 2022 8:00 PM ET Company Participants Michelle Shen - Director, Investor Relations Joey Wat - CEO & Director Andy Yeung - CFO Conference Call Participants Chen Luo - Bank of America Merrill Lynch Lillian Lou - Morgan Stanley Xiaopo Wei - Citigroup Michelle Cheng - Goldman Sachs Anne Ling - Jefferies LLC, Research Division Veronica Song - Crédit Suisse Christine Peng - UBS Operator Thank you for standing by, and welcome to the Y ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _________________ Commission file number 001-37762 Yum China Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 81 ...

Yum China Holdings, Inc. (NYSE:YUMC) Q2 2022 Earnings Conference Call July 28, 2022 8:00 PM ET Corporate Participants Michelle Shen - Director, Finance Joey Wat - Chief Executive Officer Andy Yeung - Chief Financial Officer Conference Call Participants Lillian Lou - Morgan Stanley Michelle Cheng - Goldman Sachs Brian Wong - CMS Xiaopo Wei - Citi CJ Lin - CICC Anne Ling - Jefferies Christine Peng - UBS Lucy Yu - Bank of America Walter Woo - CMB International Operator Thank you all for standing by, and welcom ...