Yum China Holdings, Inc.

Good day and thank you for standing by. Welcome to Yum China Third Quarter 2026 Earnings Conference Call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. And I'd like to hand the conference over to your first speaker today, Ms. Florence Lip, Senior Director, Investor Relations of Yum China. Please go ahead, ma'am.

Thank you, operator. Hello, everyone, and welcome to Yum China's third quarter 2026 earnings conference call. With me on the call are our CEO, Ms. Joey Wat, and our CFO, Mr. Adrian Ding. Before we begin, please note that our remarks and investor materials contain forward-looking statements. These are subject to future events and uncertainties, and actual results may differ materially. Please refer to the cautionary statement in our earnings release and the risk factors in our SEC filing. We'll also discuss non-GAAP measures. and comparable gap measures and reconciliation are in our earnings release on ir.yamchina.com. You can also find the webcast replay and the presentation there. Please note that all year-over-year growth rates exclude the impact of foreign currency unless otherwise mentioned. With that, I'll turn the call over to Joey Wat, CEO of YamChina. Joey?

Hello, everyone, and thank you for joining us. In quarter three, we continued to grow sales and profit year over year. In reporting currency, revenue grew 8%, operating profit grew 13%, and diluted EPS grew 20%, partially supported by favorable foreign exchange impact. Excluding foreign exchange impact, System sales grew 3% year-over-year in Q3 and continued to outperform the catering industry. Core operating profit grew 6% year-over-year. We also achieved our 10th consecutive quarter of system sales, operating profit, and OP margin growth. Importantly, we have delivered double-digit dilute EPS growth year-to-date and in each of the past three years, excluding the Meituan investment. In quarter three, same-store sales reached 97% of the prior year's level, primarily reflecting tough lapping from last year's delivery platform subsidies and the impact of extreme weather this August. With our due focus on innovation and operational efficiency, restaurant and OP margins improved 50 and 40 bids year-over-year, respectively. This margin expansion demonstrates the resilience of our business and the disciplined execution of our teams in mitigating the sales deleveraging impact. It was also partially supported by license fee savings following the Pizza Hut brand acquisition in mainland China. We delivered our 15th consecutive quarter of positive same-store transaction growth, a key element of our growth strategy. Our breakthrough side-by-side modules are helping us capture new occasions and drive incremental sales and profits. We also continue to build our brand and attract more customers to our stores through compelling in-store offers and experience. as well as greater takeaway convenience. Dining and takeaway performance improved sequentially, bucking the previous trend. Active members grew 6% year-over-year to 278 million, and our goal is to engage them across even more occasions. We also continue to accelerate new store openings, adding close to 700 net new stores in quarter three A new quarterly record. Total store count was 19,989, keeping us on track to surpass 20,000 stores this year. Thanks to our team's strong execution and innovation, we delivered solid operational efficiency, which was particularly important this quarter. We proactively reviewed our store portfolio to reduce rent, and lowered delivery rider costs on a per-order basis. We also improved supply chain efficiency through manual innovation together with dynamic promotions. This allows us to offer great value for money to consumers. To ease the burden of our frontline teams, we have been automating and digitizing certain tasks and shifting some to our operations support center. By combining frontline operational experience with AI-enabled intelligence, the center supports inventory replenishment, staff scheduling, as well as recruiting, training, and online customer service for our restaurant teams. All of these efforts have contributed to our margin expansion and will continue to support our growth going forward. Our innovative side-by-side modules have become meaningful contributors to incremental sales and profits. Their store economics have also improved. K-Coffee Cafe exceeded 4,000 locations. The Apple Sparkling Americano sold more than 1 million cups per week during the peak summer season. Non-coffee drinks more than tripled year-over-year in Q3, with the addition of the popular Mango Pomelo Sago, Yang Zi Gan Lu, and Sparkling Tea. K-Pro surpassed 700 locations. We expanded the venue to broaden its appeal, developing sandwiches as another sales growth pillar alongside energy bowls. We also introduced high-protein smoothies, which have been particularly popular with certain consumer segments. and have generated strong repeat purchases. K-Pro is now in around 250 cities, demonstrating solid potential for further growth. Pizza Hut's burger bar reached more than 300 locations in 50 cities, contributing double-digit incremental sales and meaningful profits to parent stores. Overall, Pizza Hut's burger category captured new customers especially young people and solo diners, with sales growing in the high double-digit percentage year-over-year in Q3. As side-by-side modules help us capture new occasions, our hero products anchor our strong fundamentals, inspiring innovations to drive sales and social buzz. In August, KFC launched the intriguing Oreo Original Recipe Chicken Burger , a new twist on last year's Original Recipe Chicken Burger with cocoa bun and creamy Oreo blend sauce. Trust me, it does taste pretty good. On its first day, we sold more than 1.5 million burgers, roughly three times the launch day sales of the original recipe chicken burger last year. At Pizza Hut, pizza is our hero category, accounting for over 40% of sales. We sold 17% more pizza year over year in the first nine months. In August, we launched the exciting handheld pizza, Sour Pizza. Targeting solo diners and on-the-go occasions. Made with our latest low-sugar multigrain cuts and available with a variety of toppings, it offers a high-protein option under 500 calories. The handheld pizza draws strong repeat purchases and attracts younger customers, helping us tap into the emerging light meal market. Let me now turn the call over to Adrian. Adrian?