Yum China Holdings Inc., the franchise owner of KFC, Pizza Hut and Taco Bell in China, saw sales revenue at its stores decline following an increase in Covid-19 cases in the great wall country.
The increase in cases involving Covid-19 in China is once again haunting the country until the government has to announce travel restrictions (lockdown) throughout the region to curb its spread.
As a result, Yum Holdings had to bear the brunt of a 20% drop in sales revenue in the first 2 weeks of March, after it recorded a decline of almost 4% in January and February of the same year.
According to sources, Yum Holdings has temporarily closed all 1,100 of its stores and only offers takeaway services.
According to Joey Wat, chief executive of Yum Holdings, the spread of the Covid-19 outbreak in economically important provinces such as Guangdong, Shanghai, Shandong and Jilin affected his company's operations.
He added that only good supply chain management now supports the company from facing a worse situation.
Yun Holdings, which expects an operating profit of $ 165 million for the first quarter, is seen exceeding forecasts.
Meanwhile, carmakers Toyata and Volkswagen in Jilin province were also badly affected by the increased deployment of Covid-19 and lockdown.
The Chinese government has reported more symptomatic cases involving Covid-19 this year as the Omicron variant was found to be more contagious thus triggering the spread from Shanghai to Shenzhen.