Fast food giant Yum! Brands says sales in China are recovering more slowly than expected.
The US based company has had to cut its profit forecast for the year due to its China woes, which date back to a food safety scare relating to a former chicken supplier.
Yum!’s shares fell five per cent in trading on Wall St after the announcement.
Earlier this year, a Chinese TV network screened footage of a supplier mixing allegedly expired meat with fresh meat. The company, a subsidiary of OSI Group, was a minor supplier to Yum! and its contract was cancelled immediately. But the TV news footage was sufficient to spook Chinese customers, many of whom stopped eating at KFC China outlets.
Yum! had earlier this year projected earnings per share growth of about 20 per cent, but overnight it slashed this forecast back to a vague six to 10 per cent increase.
It is projecting at least 10 per cent growth in 2015.
Source insideretail.asia