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Taco Bell hurt by drop in breakfast and late-night traffic during the pandemic, parent company Yum Brands said in an intra-quarter financial report.

Role reversal at Yum Brands: Taco Bell hurting, Pizza Hut seeing record off-premise sales

Pizza Hut’s carryout and delivery business recorded record sales in early May, while breakfast and late-night segments are dragging down Taco Bell.

COVID-19 has triggered a role reversal for two chains under the Yum Brands portfolio: Taco Bell and Pizza Hut.

Pizza Hut’s U.S segment, which has struggled to find its footing the last few years, recorded in early May its highest delivery and carry-out average sales week in the past eight years, Yum Brands reported in a mid-quarter update released Wednesday.

"In our delivery and carry-out only focused restaurants, quarter-to-date same-store sales growth was approximately 15%, reflecting strength in our off-premise business," the Louisville, Ky.-based company said.

Taco Bell has done well at dinner, but continues to experience “significant traffic declines during the breakfast and late-night occasions,” Yum Brands reported.

In late March, some Taco Bell restaurants temporarily stopped serving breakfast. In addition, the late-night segment has been hit hard as fewer people are out in the eveneing due to the temporary closures of bars and entertainment events.

Global same-store sales at Yum Brands declined 19% for all of April and May. The figure does not include Habit Burger Grill, which became part of the Yum Brands portfolio in mid-March. Yum said the vast majority of the decline was driven by temporary restaurant closures. 

Temporary closures across the globe, primarily tied to the company’s Pizza Hut and KFC brands, reached about 11,000 locations during the peak period of the pandemic. 

For the same period, KFC global same-store sales declined 26%. Pizza Hut global same-store sales fell 10%. Taco Bell global same-store sales dropped 11%. 

“Trends have improved meaningfully in recent weeks, however, the COVID-19 pandemic continues to impact sales in numerous markets across the world, particularly in markets where we continue to experience significant temporary restaurant closures,” the company said.

In the U.S, Pizza Hut and KFC restaurants are bouncing back in recent weeks due to each brand’s strength in the dinner daypart, Yum said.

During this intra-quarter period, KFC U.S. is experiencing same-store sales growth in the mid-teens; Pizza Hut U.S. is seeing same-store sales growth in the low-teens; Taco Bell is experiencing “slightly positive” same-store sales growth. 

As of June 9, the company had 1,000 net reopens. About 5,000 locations, or 10% of the company’s global system, remained temporarily closed. 

For our most up-to-date coverage, visit the coronavirus homepage.

Contact Nancy Luna at [email protected] 

Follow her on Twitter: @fastfoodmaven

TAGS: Coronavirus
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