YUM - Thailand Speaks

Yum's China Division includes mainland China, Thailand and KFC Taiwan. Yum Restaurants International (Thailand) Co., Ltd., or Yum! Thailand, owns, manages, and awards franchise licenses to the KFC and Pizza Hut quick-service restaurant chains in Thailand. Currently, there are 306 KFC stores in 56 provinces and 75 Pizza Hut stores in Bangkok and major provincial cities throughout the country.

The Bangkok Post reported that Yum Thailand has not yet raised prices in response to rising petrol prices. Sran Smutkochorn, Managing Director of Yum Thailand, said ''Our costs are rising due mainly to runaway oil prices and [costs of] other ingredients. It does not matter if you are in the United States or Thailand operators need to be very careful about raising prices, as consumers are suffering from significantly higher costs of living. However, Mr. Sran said, the company would consider adjusting KFC prices if oil prices go up to 50-60 baht per litre in the next few months. - The price is now 41.09 baht per litre.

In contrast to KFC, Pizza Hut has raised its prices by 2-3% since March, according to the article. Despite the political uncertainties and sluggish economy, Mr. Sran is maintaining 2008 sales growth of 15-20% (1H sales grew 15%.) In 1H08 KFC sales grew 16%, including a 7% increase in same-store sales rise. The article stated that delivery represents 11% of KFC sales, up 27% YoY. Interestingly, the significant growth in delivery can partially be explained by higher petrol prices. Delivery also carries a higher average check.

Research Edge - In the current environment, a strong marketing calendar and cost reduction initiatives is the best way to protect margins.


7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more

Got Process? Zero Hedge Sells Fear, Not Truth

Fear sells. Always has. Look no further than Zero Hedge.

read more