Tainted chicken scare hits Yum China sales (2)

Ma added that annual sales growth across the catering sector was more than 10 percent, but that in the past eight months that rate dropped to 2.5 percent, the slowest rise since the 2003 SARS outbreak.

"The negative impact was worse than expected. As Yum's most important global market, the company will feel the effect of sluggish sales revenue in China for a while," said Ma.

Last month, McDonald's Corp, Yum's largest rival in China, said the chicken scare had also taken a small bite out of its business.

The scare "minimally impacted" McDonald's sales in China during the fourth quarter and continues to hurt business this year, said chief executive Don Thompson in a conference call with analysts.

McDonald's sales for China at established restaurants fell 0.9 percent during the fourth quarter.