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NEW YORK (AP) -- Yum Brands Inc., which operates restaurant chains, reports earnings for the fiscal third quarter on Monday. The following is a summary of key developments and analyst opinion related to the period. OVERVIEW: Yum Brands, which operates the Taco Bell, KFC and Pizza Hut chains, has been focusing largely on its international business so far in 2007, particularly its China division which has enjoyed rapid growth and soaring profit and revenue. Yum has projected its operating profit in 2007 will grow 20 percent in China and at least 10 percent in its international division. Yum also plans to add about 1,200 restaurants this year in those two divisions. Domestically, the company has struggled to recover from two highly publicized incidents at Taco Bell, once the leader of Yum's U.S. business. An E. coli outbreak that sickened 70 people last year and a rat infestation in a New York City KFC/Taco Bell restaurant that was filmed by a TV news camera in February both hurt the chain's image. That, plus a slump in the casual dining sector, has led to declining sales and profit in the U.S. division. In a July conference call with investors, Yum Chairman and CEO David C. Novak said the recovery at Taco Bell was slower than he'd like, but noted it typically takes six to nine months for a restaurant company to recover from a food-safety issue. BY THE NUMBERS: Yum has not offered any guidance for the quarter ended in September. Analysts polled by Thomson Financial expect earnings per share of 45 cents on revenue of $2.44 billion. ANALYST TAKE: UBS analyst David Palmer said in a note to investors he expects "choppy profit growth" in Yum's third and fourth quarters. Palmer said higher energy, cheese and chicken costs as well as sluggish U.S. sales could hinder profit near-term. But, he added, the company should be able to post better profit in 2008 as commodity costs moderate, U.S. same-store sales rise and the company remodels its KFC U.S. restaurants. WHAT'S AHEAD: Yum Brands has said it expects full-year earnings per share to grow 12 percent. Longer term, Yum Brands expects earnings-per-share growth of at least 10 percent, with U.S. operating profit growth of 5 percent. Yum has also predicted U.S. same-store sales growth of 2 percent to 3 percent. STOCK PERFORMANCE: Shares fell about 5 percent in the quarter, but are up about 24 percent during the past 52 weeks.
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