Sales and margin worries for KFC China

|By:, SA News Editor

Yum Brands (YUM -0.1%) says KFC China knocked out a modest 1% gain in comparable store sales for November, but how the company got there might be an issue.

Though moving into positive growth after slips in September and October looks promising, KFC's comp sales growth after a promotion expired on November 10 was -8% Y/Y.

Early channel checks for December also indicate the chain may struggle to meet last year's pace of sales at comparable stores. While higher foods costs in China which could pressure margins if KFC stays promotional are also a concern.