Yum Brands : May 3, 2017 – Yum! Brands Reports First-Quarter GAAP Operating Profit Growth of 39%; Delivers First-Quarter Core Operating Profit Growth of 9%; Maintains Full-Year Core Operating Profit Growth Guidance

NEWS ‌

Keith Siegner

Vice President, Investor Relations, Corporate Strategy and Treasurer

GREG CREED COMMENTS

Greg Creed, CEO, said "Our strategic transformation of Yum! Brands is already well underway, helping us deliver a solid start to 2017 with core operating profit growth of 9% in the first quarter. This growth was led by Taco Bell's impressive same-store sales growth of 8% and double-digit core operating profit growth at KFC, partially offset by weakness at Pizza Hut U.S. We remain confident that our multi-year strategy to be more focused, more franchised and more efficient will further strengthen our brands, accelerate growth, increase consistency in our results and increase capital returns."

FIRST-QUARTER HIGHLIGHTS

• Worldwide system sales grew 5% driven by 2% same-store sales growth and 3% net-unit growth.

• Taco Bell Division same-store sales grew 8% driven by industry-leading value and innovation; Core operating profit grew 19%.

• KFC Division delivered double-digit core operating profit growth of 13% driven by same-store sales growth, franchise net-unit development and decreased G&A.

• Foreign currency translation negatively impacted GAAP operating profit by $5 million.

SUMMARY FINANCIAL TABLE

1See Reconciliation of GAAP results to Non-GAAP measurements for further detail of Special Items.

System sales growth figures exclude foreign currency translation ("F/X") and core operating profit growth figures exclude F/X and Special Items. Special Items are not allocated to any segment and therefore only impact worldwide GAAP results. See reconciliation of GAAP results to non-GAAP measurements within this release for further details.

All comparisons are versus the same period a year ago. Effective January 2017, we removed the reporting lags from our international subsidiary fiscal calendars. To accommodate these changes, Yum! Brands now reports on a monthly calendar basis though certain subsidiaries, including our U.S. subsidiaries, continue to be included in our consolidated results on a periodic basis with 3, 3, 3 & 4 periods in each quarter, respectively. Prior year figures in this earnings release have been restated to present comparable results. An 8-K was filed on April 13, 2017 with restated quarterly 2016 results.

Yum! Brands, Inc. • 1900 Colonel Sanders Lane • Louisville, KY 40213 Tel 502 874-8300 • Website www.yum.com/investors

• KFC Division system sales increased 5%, excluding foreign currency translation.

  First Quarter (% Change)
  Int'l Emerging Markets Int'l Developed Markets U.S.
  System Sales Growth (Ex F/X) Same-Store Sales Growth	+6 +2	+4 +1	+2 +2

• KFC Division opened 176 new international restaurants in 36 countries, including 150 units in emerging markets.

• Operating margin increased 3.2 percentage points driven by same-store sales growth, refranchising, decreased G&A and franchise net-unit development, partially offset by commodity and labor inflation.

• Foreign currency translation negatively impacted GAAP operating profit by $3 million.

  KFC MARKETS1	Percent of KFC System Sales2	SYSTEM Sales Growth Ex F/X
  		First Quarter (%)
  Emerging Markets	26%	+3
  China3
  Asia (e.g. Malaysia, Indonesia, Philippines)	6%	+8
  Middle East / Turkey / North Africa	5%	(1)
  Latin America (e.g. Mexico, Peru)	4%	+11
  Africa	4%	+6
  Russia	3%	+27
  Thailand	2%	+6
  Continental Europe (e.g. Poland)	2%	+18
  India	1%	+2
  Developed Markets
  U.S.	19%	+2
  Asia (e.g. Japan, Korea, Taiwan)	7%	(3)
  Australia	7%	+8
  U.K.	6%	+5
  Continental Europe (e.g. France, Germany)	5%	+9
  Canada	2%	+4
  Latin America (e.g. Puerto Rico)	1%	+2

  1Refer to www.yum.com/investors for a list of the countries within each of the markets.

  2Reflects Full Year 2016.

  3Includes January, February and March; YUMC Q1 reported results include January and February.

  First Quarter
  2017 2016	%/ppts Change
  	Reported Ex F/X
  Restaurants	16,454 16,088 +2 N/A
  System Sales Growth	(2) Even
  Same-Store Sales Growth (%)	(3) (1) NM NM
  Franchise & License Fees ($MM)	144 146 (2) (1)
  Restaurant Margin (%)	6.3 10.0 (3.7) (3.6)
  Operating Profit ($MM)	83 91 (9) (7)
  Operating Margin (%)	35.6 32.4 3.2 3.6

• Pizza Hut Division system sales were even, excluding foreign currency translation.

  First Quarter (% Change)
  Int'l Emerging Markets Int'l Developed Markets U.S.
  System Sales Growth (Ex F/X) Same-Store Sales Growth	+7 +2	+4 +1	(6) (7)

• Pizza Hut Division opened 152 new international restaurants in 36 countries, including 83 units in emerging markets.

• Operating margin increased 3.2 percentage points driven by refranchising partially offset by a decrease in same- store sales.

• Foreign currency translation negatively impacted GAAP operating profit by $2 million.

  PIZZA HUT MARKETS1	Percent of Pizza Hut System Sales2	SYSTEM Sales Growth Ex F/X
  		First Quarter (%)
  Emerging Markets	17%	+9
  China3
  Latin America (e.g. Mexico, Peru)	5%	+4
  Middle East / Turkey / Africa	4%	+3
  Asia (e.g. Malaysia, Indonesia, Philippines)	4%	+8
  India	1%	+6
  Continental Europe (e.g. Poland)	1%	+8
  Developed Markets
  U.S.	48%	(6)
  Asia (e.g. Japan, Korea, Taiwan)	7%	+1
  U.K.	5%	+4
  Continental Europe (e.g. France, Germany)	4%	+2
  Canada	2%	+5
  Australia	1%	+21
  Latin America (e.g. Puerto Rico)	1%	+7

  1Refer to www.yum.com/investors for a list of the countries within each of the markets.

  2Reflects Full Year 2016.

  3YUM Q1 reported results are for January, February and March and include both Pizza Hut Casual Dining and Pizza Hut Home Service;

  YUMC Q1 reported results are for January and February. Pizza Hut Casual Dining and Pizza Hut Home Service are reported by YUMC within separate segments.

  First Quarter
  2017 2016	%/ppts Change
  	Reported Ex F/X
  Restaurants	6,648 6,436 +3 N/A
  System Sales Growth	+12 +12
  Same-Store Sales Growth (%)	+8 +1 NM NM
  Franchise & License Fees ($MM)	114 101 +13 +13
  Restaurant Margin (%)	21.8 21.0 0.8 0.8
  Operating Profit ($MM)	141 118 +19 +19
  Operating Margin (%)	31.2 27.8 3.4 3.4

• Taco Bell Division system sales increased 12%.

• Taco Bell Division opened 54 new restaurants.

• Restaurant margin was 21.8%, an increase of 0.8 percentage points, driven by same-store sales growth partially offset by increased cost of sales associated with value promotions and labor inflation.

• Operating margin increased 3.4 percentage points driven by same-store sales growth.

  OTHER ITEMS

• Transformation Agreement reached with Pizza Hut U.S. franchisees on May 1, 2017 that will improve brand marketing alignment, accelerate enhancements to operations and technology and include a permanent commitment to incremental advertising.

• We adopted Accounting Standards Update No. 2016-09, Compensation - Stock Compensation: Improvements to Employees Share-Based Payment Accounting during the quarter. This standard requires that excess tax benefits associated with share-based compensation, which we previously recognized within Common Stock, be reflected within our Income Tax Provision beginning in the first quarter. As a result of adopting this standard, our GAAP Effective Tax Rate was 19.4% and our Effective Tax Rate excluding Special Items was 12.5% during the first quarter. While the new standard will make it harder to predict our tax rate, on a full year basis, we expect our Effective Tax Rate excluding Special Items to be closer to our rate of recent years.

• During the quarter, we refranchised 121 restaurants, including 31 KFC, 36 Pizza Hut and 54 Taco Bell units, for proceeds of $185 million. We recorded refranchising gains of $111 million in Special Items. As of quarter end, our global franchise ownership mix was 94%.

• During the quarter, we repurchased 6.8 million shares totaling $442 million at an average price of $65. As of quarter end, there was approximately $1.5 billion remaining in share repurchase authorization through year end 2017.

• In the first quarter, we early adopted Accounting Standards Update No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which requires non-service related pension costs such as interest and loss amortization to be excluded from Operating Profit. As a result, $28 million of non- service related net pension costs were excluded from Operating Profit and recorded within Other Pension (income) expense for the quarter, $22 million of which was recorded as a Special Item. We were required to adopt this standard retrospectively, and as such $1 million of net pension benefits were excluded from Operating Profit and recorded within Other Pension (income) expense in Q1 2016.

• In March, certain subsidiaries that operate the company's KFC, Pizza Hut and Taco Bell businesses completed the repricing of the existing approximately $2 billion Term Loan B under the Senior Secured Credit Facility pursuant to an amendment to the Senior Secured Credit Agreement.

• Disclosures pertaining to outstanding debt in our Restricted Group capital structure will be filed simultaneously with the filing of the first quarter Form 10-Q.