By RTT News, March 11, 2013, 05:41:00 PM EDT
(RTTNews.com) - Shares of Yum! Brands Inc. ( YUM ) rose seven percent in after-hours trade Monday, after the restaurant chain said same-store sales for China division in February rose 2 percent, after sales had dropped significantly at its major market late last year due to a food safety scare.
Yum said first-quarter same-store sales declined an estimated 20 percent for the China division, including 24 percent decline at KFC and 2 percent at Pizza Hut Casual Dining.
February same-store sales growth was about 2 percent for China, including flat same-store sales at KFC and 13 percent growth at Pizza Hut Casual Dining.
The company said the Chinese New Year had a positive mid-teen impact on February same-store sales growth for both KFC and Pizza Hut.
On December 18, 2012, the Chinese state media reported excessive levels of antibiotics and hormones in chicken sold at KFC outlets. The reports prompted an investigation from the Shanghai FDA into poultry supply management at Yum China.
The Shanghai FDA concluded its probe on January 25 and provided "Supervisory Recommendations" to Yum China to strengthen its poultry supply chain practices. Although, Yum! China were not fined by the regulators, the negative reports had scared KFC China's customers as its same-store sales turned sharply negative.
While reporting its fourth quarter results, Yum had said it expects KFC China same-store sales to improve as the 2013 progresses and to be positive in the fourth quarter.
YUM closed Monday on the NYSE at $67.84, up $0.12 or 0.18%. In after hours, the stock gained $4.26 or 6.28%.
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