Yum China Holdings, the company that owns the KFC and Pizza Hut chains in mainland China, remains committed to its goal of opening up to 1,300 stores in 2023. Despite the slowdown in the economy, CEO Joey Wat stated that they still see ample growth opportunities.

Following a 25% increase in second-quarter revenue, Yum plans to continue opening new outlets at a pace of 1,100 to 1,300 this year, with overall capital spending estimated between $700 million to $900 million. Wat highlighted that the Chinese market, even with slower GDP growth compared to some developed markets, is still considerably faster and offers significant potential due to its size.

In recent months, China’s post-COVID recovery has shown signs of deceleration as demand weakened both domestically and internationally, resulting in sluggish economic growth in the second quarter. However, catering and tourism have been among the few sectors experiencing growth as Chinese consumers seek new experiences and leisure activities.

Wat acknowledged that people are still adjusting to the easing of COVID restrictions, and small waves of infections have impacted consumption. Nevertheless, there has been a return in foot traffic, though per-person spending has decreased as consumers have become more cautious in their expenditures.

During the summer trading period, Yum has observed increasing foot traffic in tier 2 cities as people embark on trips. Wat expressed that recovery may take a bit more time, especially after facing three challenging years. However, she remains optimistic and believes that people need time to recover fully from the pandemic’s impact.

Yum’s shares traded on the Hong Kong stock exchange rose 1% during Tuesday morning trading.