Yum China to Dine on 8-Year Deal With Universal Park in Beijing
Shares in Yum China inched 6 cents higher on news of its partnership with Universal Beijing Resort.
Yum China (NYSE: YUMC) announced Tuesday that it has entered into a partnership with Universal Beijing Resort, the highly-anticipated theme park set to open in the spring of next year.
During the eight-year collaboration, the China restaurant behemoth will provide dining services to the theme park's customers. The massive operator of KFC, Pizza Hut and Taco Bell brands currently spans more than 8,000 stores in China and boasts a digital base of 230 million users.
The theme park is backed by local state-owned companies and Universal Parks & Resorts, a subsidiary of Philadelphia-based American telecommunication conglomerate Comcast (Nasdaq: CMCSA).
"We are excited about the potential of combining the power of our iconic brands, unrivalled food innovation capabilities and industry leading digital ecosystem with Universal's globally recognized entertainment expertise and assets to reshape the future of consumer experience," Joey Wat, the chief executive officer of Yum China Holdings Inc., said in a statement today.
As China's middle class continues to expand, the market for theme park-styled family entertainment in the country is expected to grow.
(Image: Yum China)
"This partnership is a perfect example of our shared goal to meet the changing needs of Chinese consumers and market commitment to bring joy to countless families in China," Page Thompson, the chief operating officer of International, Universal Parks & Resorts, said.
Yum China is also licensed to run a KFC restaurant at Universal CityWalk Beijing, a retail, dining and entertainment complex inside the Universal Beijing Resort. The company also expanded its KFC restaurants through a partnership with the gas stations of China Petroleum & Chemical Corp. (NYSE: SNP) and China National Petroleum Corp. (CNPC) in December.
The restaurant giant in China reported revenue in the third quarter of $2.3 billion, up 5% from a year ago but still worse than analysts expected. Net income, it reported, grew 11% to $223 million, or 58 cents per American depositary share, compared with $203 million, or 51 cents per ADS, in the same period of 2018.
Universal Beijing Resort in Beijing follows Shanghai Disneyland Park in Shanghai, which opened in the summer of 2016.
Shares in Yum China closed Tuesday at $47.93 per share, up 6 cents on the news.