Mr. Jerzyk: We were a spinoff of PepsiCo in the fourth quarter of 1997, thereby forming Tricon Global Restaurants. Each of our brands was an individual division of PepsiCo and individually managed. We were a very U.S.-centric company in 1997, with only 20% of our profits coming from outside the U.S. Our brands, KFC, Taco Bell and Pizza Hut, were principally driven by our U.S. business. As a result of the spinoff, we had acquired a really good base of operations from PepsiCo, as they had made some significant investments overseas, which we have aggressively expanded over the years. Today we are driven by our international business, with more than 60% of our profits coming from outside the U.S.
Since the spinoff, we changed the name of the company from Tricon Global Restaurants to Yum! Brands in 2002, after we acquired Long John Silver's and A&W All-American Food restaurants. We have been refranchising the U.S. business, which means selling company-owned restaurants to franchisees. We have also been focusing on our four key growth strategies, including building leading brands across China in every significant category, driving aggressive international expansion and building strong brands everywhere, dramatically improving U.S. brand positions, consistency and returns, and drive industry-leading long-term shareholder and franchisee value.
Today we are very much a global-driven company with a very significant business in China. We've been making investments in China over the long haul - we started there in the late 1980s. We were the first Western brand to open up in China, with a KFC in Tiananmen Square. At spinoff our China business was basically a break-even business, and today it's making over $600 million. Those would be the big changes: going from a U.S.-centric, U.S.-focused business with three brands to a truly global company of substantial scale and size. We are extremely proud of the fact that Yum! is one of only five companies in the world today to have two of the top global brands with KFC and Pizza Hut. We are also focused on developing Taco Bell into our third global brand.
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