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    Yushen Wang's questions to Luckin Coffee Inc (LKNCY) leadership

    Yushen Wang's questions to Luckin Coffee Inc (LKNCY) leadership • Q4 2024

    Question

    Yushen Wang asked for a breakdown of the recent same-store sales growth improvement, specifically separating the impact of price versus volume, and inquired about management's outlook for this metric in 2025.

    Answer

    Jinyi Guo (executive) explained that the short-term volatility in same-store sales growth (SSSG) was an expected outcome of their strategic and rapid store expansion to gain market share. He expressed confidence in future SSSG enhancement, driven by their expanding network, product innovation, and the long-term trend of increasing coffee consumption frequency in China. CFO An Jing added that Q4 pricing remained stable year-over-year, with the SSSG improvement driven by a recovery in cup sales volume, which turned positive in December 2024. She anticipates stable pricing ahead, with growth coming from increased cup sales at maturing stores.

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    Yushen Wang's questions to Yum China Holdings Inc (YUMC) leadership

    Yushen Wang's questions to Yum China Holdings Inc (YUMC) leadership • Q4 2024

    Question

    Yushen Wang (Ethan Wang) from CLSA followed up on labor cost headwinds, asking why the efficiency gains that offset the rising delivery mix in 2024 might not do so again in 2025.

    Answer

    Acting CFO Adrian Ding explained that 2024 represents a tough comparison due to the significant one-time benefits from Project Fresh Eye. For 2025, he anticipates the non-rider portion of labor costs will be broadly stable as ongoing efficiencies offset wage inflation. However, for the delivery portion, he stated that while the cost-per-ticket will continue to decline, the growth in delivery's overall sales mix is expected to outpace these savings. This dynamic will likely cause the delivery-related labor cost as a percentage of sales to increase slightly, creating an overall headwind for the total Cost of Labor line.

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    Yushen Wang's questions to Yum China Holdings Inc (YUMC) leadership • Q3 2024

    Question

    Yushen Wang of CLSA questioned the significant increase in the target for franchisee-led new stores, particularly for KFC. He asked what prompted this change and whether it implies lower capital expenditures for the company going forward.

    Answer

    CFO Adrian Ding stated that the company is now 'ready' to accelerate franchising due to the development of lower-CapEx store models like 'KFC small town Mini,' improved franchisee quality, and enhanced digital and QA infrastructure. He confirmed the new targets (40-50% of new KFC stores) will lower CapEx and enhance ROIC over the long term, though the near-term impact will be gradual.

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