LOUISVILLE, KY, May 03, 2006 – Yum! Brands, Inc., (NYSE:YUM), the world’s largest restaurant company in terms of units, and parent of KFC, Taco Bell, Pizza Hut, Long John Silver’s and A&W Restaurants, announced today that it will debut its first advertising ever on network television as part of the first-ever sponsorship of the 132nd Kentucky Derby.
Five new 30-second television commercials will air on Saturday, May 6 on NBC, ESPN and ESPN2. The ads will run in six different time slots before, during and after the race, including an ad immediately prior to the historic Kentucky Derby race. Also as part of the sponsorship agreement, the Company has logo placement around the track and on television billboards before and throughout the broadcast.
Yum! Brands became the first presenting sponsor of the Kentucky Derby because it is a premier sporting event watched by millions of people around the globe. Traditional Derby television viewers match the profile of individual investors who may be interested in purchasing shares of YUM Brands.
“Individual investors tend to buy shares of companies whose products they loyally consume. Yet while we have over 90% awareness of the KFC, Pizza Hut and Taco Bell restaurant brands, many investors do not know Yum! Brands, the company that owns them,” said David C. Novak, Chairman and CEO, Yum! Brands, Inc. “We are using a focused marketing approach to create maximum awareness of YUM Brands among millions of potential individual investors in a fun and unique way. When people tune in to the Derby, they’ll begin to associate Yum! with our global restaurant portfolio,” added Novak.
Yum! Brands has 272 million shares outstanding, traded on the New York Stock Exchange. The company’s stock has increased 24% on a 5-year compounded annual growth rate. However, the company’s individual investor base is only about 20%, the balance held by institutional investors. The company’s goal is to increase that individual investor number to as much as 30% over time, as individual investors tend to hold onto the stock longer and are loyal consumers of the companies they invest in.
In the company’s first quarter earnings release, Yum! raised its full-year EPS outlook for 2006 to at least $2.81, 11% growth prior to special items, based on a very strong first quarter in the U.S. business. The company also said it expects solid full-year operating-profit growth from each of its three segments: China, YRI and the U.S. The company’s prior forecast for 2006 EPS was at least $2.79. This would make the fifth straight year that Yum! Brands delivers against its annual target of at least 10% EPS growth.
The five new commercials let viewers know that Yum! Brands is the world’s largest restaurant company (larger than McDonald’s, Starbucks or Wendy’s in terms of restaurant units), with a global portfolio and tremendous growth potential. The campaign showcases the company’s category-leading dominance in the chicken, pizza, and Mexican-inspired restaurant categories by focusing on KFC, Pizza Hut and Taco Bell, respectively, including a special focus on China, the company’s largest international growth market.
The ads are whimsical in nature and avoid the stereotypical corporate advertising approach. The campaign’s tagline is “The World Says Yum!” Yum’s signature red bubble logo is used as a word balloon throughout the ads and at the end of each spot. All ads carry the company’s website and ticker symbol on the New York Stock Exchange.
The new advertising was created by Foote, Cone & Belding Chicago and highlights that:
- Yum! is the world’s largest restaurant company, based on stores, with more than 34,000 restaurants in over 100 countries.
- Through KFC, Yum! offers the most popular chicken in China.
- Through Pizza Hut, Yum! has one of the most diverse menu options in the world.
- Through Taco Bell, Yum! serves two billion customers in the U.S. alone each year.
- Yum!, brings America’s favorite brands to millions around the globe everyday and is proud to welcome the world to the Kentucky Derby.
Four of the ads each will air once and one ad will run two times during the 90 minute Derby telecast. One spot, which airs just before the Kentucky Derby, prepares viewers for the historic race and encourages them to grab a seat with a slice of pizza, piece of chicken, or a taco. In addition, KFC is airing a separate commercial, created by Creative Alliance in Louisville, about the brand’s rich heritage and Kentucky roots.
On Derby Day, Yum! Brands, KFC, Taco Bell, Pizza Hut, Long John Silver’s and A&W Restaurants logos will appear across the entire third-floor railing of Churchill Down’s third floor Clubhouse. Additionally, the YUM Brands logo will appear on the starting gate; finish line; main tote boards; Paddock tote boards and on the jackets of the pony riders who escort the Derby horses and jockeys during the post parade. David Novak will be invited into the Winners Circle with Kentucky Governor Ernie Fletcher and Churchill CEO Tom Meeker, to present the trophy to the owner of the Kentucky Derby winning horse.
The presenting sponsorship for the Kentucky Derby will not impact the purse of the race, which was doubled last year to $2 million guaranteed. But owners and trainers who race their horses at Churchill Downs during the track’s Spring and Fall racing meets will benefit as a portion of the sponsorship’s revenues will go to race purses through a formula negotiated in the most recent agreement between the track and its horsemen.
The Kentucky Derby, which holds the distinction of being America’s oldest continuously held sporting event, has been run without interruption at Churchill Downs since the track’s first race meet in 1875. The race for 3-year-old Thoroughbreds offers a $2 million-guaranteed purse.
Yum! Brands Inc., based in Louisville, Kentucky, is the world’s largest restaurant company in terms of system restaurants with over 34,000 restaurants in more than 100 countries and territories. Four of the company’s restaurant brands — KFC, Pizza Hut, Taco Bell and Long John Silver’s — are the global leaders of the chicken, pizza, Mexican-style food and quick-service seafood categories respectively. Yum! Brands is the worldwide leader in multibranding, which offers consumers more choice and convenience at one restaurant location from a combination of KFC, Taco Bell, Pizza Hut, A&W or Long John Silver’s brands. The company and its franchisees today operate over 3,200 multibrand restaurants. Outside the United States in 2005, the Yum! Brands’ system opened about three new restaurants each day of the year, making it one of the fastest growing retailers in the world. For the past three years, the company has been recognized as one of FORTUNE magazine’s “Top 50 Employers for Minorities.” It also has been recognized as one of the “Top 50 Employers for Women” by FORTUNE, one of the “Top 30 Best Companies for Diversity” by BLACK ENTERPRISE Magazine, one of the “Corporate 100 Companies Providing Opportunities for Hispanics” by Hispanic Magazine, one of the “Top 50 Corporations for Supplier Diversity” by HISPANIC Trends Magazine and by BusinessWeek as one of the “Top 15 Companies for In-Kind Corporate Philanthropy.”
Churchill Downs, the world’s most legendary racetrack, has conducted Thoroughbred racing and presented America’s greatest race, the Kentucky Derby, continuously since 1875. Located in Louisville, the flagship racetrack of Churchill Downs Incorporated (NASDAQ:CHDN) also operates Trackside at Churchill Downs, which offers year-round simulcast wagering at the historic track. Churchill Downs will conduct the 132nd running of the Kentucky Derby on May 6, 2006. The track’s 2006 Spring Meet is scheduled for April 29-July 16. Churchill Downs has served as host to the Breeders’ Cup World Thoroughbred Championships a record five times and will host the event again in 2006. Information about Churchill Downs can be found on the Internet at www.churchilldowns.com.
Video b-roll is available at the following times and coordinates:
Wednesday, May 3rd, 2006
7:00 – 7:15 PM (ET)
C-Band IA 6, Trans 11
Thursday, May 4th , 2006
2:00 -2:15PM (ET)
C-Band IA 6, Trans 11
Friday, May 5th, 2006
04:30-04:45 AM (ET)
1:30-1:45 PM (ET)
C-Band IA 5, Trans 13
DL 3960 V
Saturday, May 6th, 2006
C-Band IA 5, Trans 13
DL 3960 V