Yum China Opens KFCs at Sinopec, CNPC Gas Stations
Under the new partnership with Sinopec and CNPC, Yum China plans to open more than 100 restaurants over the next three years.
Yum China Holdings, Inc. (NYSE: YUMC) announced the launch of two new KFC restaurants in the gas stations of China Petrochemical Corp. (Sinopec) and China National Petroleum Corp. (CNPC).
The Shanghai-based company, which also operates Taco Bell and Pizza Hut in China, said in a statement after markets closed on Wednesday that its KFC restaurant at the CNPC gas station in the Kunming, Yunnan Province, opened on Tuesday. Its restaurant at the Sinopec gas station in the Dalian, Liaoning Province, is set to open Dec. 23.
The news today follows a KFC pilot franchised restaurant opening at a CNPC gas station located in Tangshan, Hebei Province, in October 2018. Yum China said after a few months the restaurant "thrived," from the synergies the company and CNPC were able to achieve together. Earlier this year, Reuters reported that the company would further its partnership with the two Chinese gas stations.
"We are delighted that within a year, our collaborations with Sinopec and CNPC are already starting to bear fruit. The first franchised gas station restaurants represent an important milestone in our long-term strategic partnership with both companies," Joey Wat, the chief executive officer of Yum China, said in a statement today.
He added, "Together with Sinopec and CNPC, we are committed to building a successful business model and creating innovation-driven growth together."
Following the report, shares in Yum China were trading 38 cents higher to $47.90 apiece by midday on Thursday.
According to its third-quarter financial report, Yum China opened 174 new KFC brands during that period, bringing the total count to 6,324 restaurants.
Sinopec and CNPC operate more than 50,000 gas stations in China. Under the new partnership, Yum China said that it plans to open more than 100 stores in those gas station locations over the next three years.
In the three months through September, Yum China said its revenue reached $2.3 billion, up 5% from the same period last year. Net income rose 11% to $223 million, or 58 cents per American depositary share, compared with $203 million, or 51 cents per ADS, a year ago.
Yum China said it will report its fourth quarter results on Feb. 5 after markets close.