| Reportable Operating Segments |
Reportable Operating Segments
We are principally engaged in developing, operating, franchising and licensing the worldwide KFC, Pizza Hut and Taco Bell concepts. KFC, Pizza Hut and Taco Bell operate in 120, 97, and 27 countries and territories, respectively. Our five largest international markets based on operating profit in 2012 are China, Asia Franchise, United Kingdom, Australia and Latin America Franchise.
We identify our operating segments based on management responsibility. The China Division includes mainland China and the India Division includes India, Bangladesh, Mauritius, Nepal and Sri Lanka. YRI includes the remainder of our international operations. We consider our KFC, Pizza Hut and Taco Bell operating segments in the U.S. to be similar and therefore have aggregated them into a single reportable operating segment. Our U.S. and YRI segment results also include the operating results of our LJS and A&W businesses prior to our disposal of those businesses in December 2011.
| | | | | | | | | | | | | | | | Revenues | | | 2012 | | 2011 | | 2010 | China | | $ | 6,898 |
| | $ | 5,566 |
| | $ | 4,135 |
| YRI | | 3,281 |
| | 3,192 |
| | 3,039 |
| U.S. | | 3,352 |
| | 3,786 |
| | 4,120 |
| India | | 102 |
| | 82 |
| | 49 |
| | | $ | 13,633 |
| | $ | 12,626 |
| | $ | 11,343 |
|
| | | | | | | | | | | | | | | | Operating Profit; Interest Expense, Net; and Income Before Income Taxes | | | 2012 | | 2011 | | 2010 | China (b) | | $ | 1,015 |
| | $ | 908 |
| | $ | 755 |
| YRI | | 715 |
| | 673 |
| | 592 |
| U.S. | | 666 |
| | 589 |
| | 668 |
| India | | (1 | ) | | — |
| | (3 | ) | Unallocated Occupancy and other(a)(c) | | 16 |
| | 14 |
| | 9 |
| Unallocated and corporate expenses(a)(d) | | (271 | ) | | (223 | ) | | (194 | ) | Unallocated Closures and impairment expense(a)(e) | | — |
| | (80 | ) | | — |
| Unallocated Other income (expense)(a)(f) | | 76 |
| | 6 |
| | 5 |
| Unallocated Refranchising gain (loss)(a)(g) | | 78 |
| | (72 | ) | | (63 | ) | Operating Profit | | 2,294 |
| | 1,815 |
| | 1,769 |
| Interest expense, net | | (149 | ) | | (156 | ) | | (175 | ) | Income Before Income Taxes | | $ | 2,145 |
| | $ | 1,659 |
| | $ | 1,594 |
|
| | | | | | | | | | | | | | | | Depreciation and Amortization | | | 2012 | | 2011 | | 2010 | China | | $ | 332 |
| | $ | 257 |
| | $ | 225 |
| YRI | | 162 |
| | 181 |
| | 156 |
| U.S. | | 141 |
| | 177 |
| | 201 |
| India | | 6 |
| | 5 |
| | 3 |
| Corporate(c) | | 4 |
| | 8 |
| | 4 |
| | | $ | 645 |
| | $ | 628 |
| | $ | 589 |
|
| | | | | | | | | | | | | | | | Capital Spending | | | 2012 | | 2011 | | 2010 | China | | $ | 655 |
| | $ | 405 |
| | $ | 272 |
| YRI | | 251 |
| | 240 |
| | 249 |
| U.S. | | 173 |
| | 256 |
| | 241 |
| India | | 18 |
| | 16 |
| | 10 |
| Corporate | | 2 |
| | 23 |
| | 24 |
| | | $ | 1,099 |
| | $ | 940 |
| | $ | 796 |
|
| | | | | | | | | | | | | | | | Identifiable Assets | | | 2012 | | 2011 | | 2010 | China (h) | | $ | 3,752 |
| | $ | 2,527 |
| | $ | 2,289 |
| YRI | | 2,663 |
| | 2,847 |
| | 2,606 |
| U.S. | | 1,844 |
| | 2,070 |
| | 2,398 |
| India | | 68 |
| | 52 |
| | 43 |
| Corporate(i) | | 684 |
| | 1,338 |
| | 980 |
| | | $ | 9,011 |
| | $ | 8,834 |
| | $ | 8,316 |
|
| | | | | | | | | | | | | | | | Long-Lived Assets(j) | | | 2012 | | 2011 | | 2010 | China | | $ | 2,779 |
| | $ | 1,546 |
| | $ | 1,269 |
| YRI | | 1,561 |
| | 1,600 |
| | 1,523 |
| U.S. | | 1,555 |
| | 1,805 |
| | 2,095 |
| India | | 47 |
| | 35 |
| | 25 |
| Corporate | | 32 |
| | 36 |
| | 52 |
| | | $ | 5,974 |
| | $ | 5,022 |
| | $ | 4,964 |
|
| | (a) | Amounts have not been allocated to the U.S., YRI or China Division segments for performance reporting purposes. |
| | (b) | Includes equity income from investments in unconsolidated affiliates of $47 million, $47 million and $42 million in 2012, 2011 and 2010, respectively, for China. |
| | (c) | 2012, 2011 and 2010 include depreciation reductions arising from the impairment of KFC restaurants we offered to sell of $3 million, $10 million and $9 million, respectively. 2012 and 2011 include depreciation reductions arising from the impairment of Pizza Hut UK restaurants we decided to sell in 2011 of $13 million and $3 million, respectively. See Note 4. |
| | (d) | 2012 includes the YUM Retirement Plan settlement charge of $84 million. 2012, 2011 and 2010 include approximately $5 million, $21 million and $9 million, respectively, of charges relating to U.S. general and administrative productivity initiatives and realignment of resources. See Note 4. |
| | (e) | 2011 represents net losses resulting from the LJS and A&W divestitures. See Note 4. |
| | (f) | 2012 includes gain upon acquisition of Little Sheep of $74 million. See Note 4. |
| | (g) | See Note 4 for further discussion of Refranchising gain (loss). |
| | (h) | China includes investments in 3 unconsolidated affiliates totaling $72 million for 2012 and 4 unconsolidated affiliates totaling $167 million and $154 million, for 2011 and 2010, respectively. |
| | (i) | Primarily includes cash, deferred tax assets and property, plant and equipment, net, related to our office facilities. 2011 includes $300 million of restricted cash related to the Little Sheep acquisition. |
| | (j) | Includes property, plant and equipment, net, goodwill, and intangible assets, net. |
See Note 4 for additional operating segment disclosures related to impairment and store closure (income) costs. |