McDonald’s posts surprise sales gain

CHICAGO — McDonald’s Corp. posted a surprise gain in U.S. same-store sales last month after a decline in October as the world’s largest restaurant chain increased advertising for less expensive items.

Sales in the United States increased 2.5 percent in November, the Oak Brook, Ill.-based company said Monday in a statement. Analysts projected a drop of 0.6 percent, the average of 14 estimates compiled by Consensus Metrix. Global sales rose 2.4 percent while analysts anticipated a gain of 0.2 percent.

McDonald’s, which has about 14,100 U.S. stores, has been pushing its Dollar Menu to attract budget-minded Americans. The Big Mac seller, which named Don Thompson chief executive officer in July, is trying to keep pace with Burger King Worldwide Inc. and Yum Brands Inc.’s Taco Bell, which have been promoting new food and value items this year.

“You saw McDonald’s going on TV and pushing a lot more value” in the U.S. last month, Peter Saleh, a New York-based analyst at Telsey Advisory Group, said in an interview. “The numbers in the U.S. were particularly strong.”

McDonald’s rose 1.1 percent to $89.41 at the close in New York. The shares have fallen 11 percent this year.

In November, U.S. sales were fueled by breakfast and value items, as well as the chain’s new Chedder Bacon Onion sandwiches, McDonald’s said in the statement. Thompson has said the company will have a stronger new menu presence next year compared with 2012.

Sales increased 1.4 percent in Europe and rose 0.6 percent in Asia, Africa and the Middle East. Analysts projected a gain of 0.1 percent and a drop of 0.9 percent, respectively, according to a survey by Consensus Metrix, a researcher owned by Wayne, New Jersey-based Kaul Advisory Group.

McDonald’s October comparable-store sales fell 1.8 percent globally, the first monthly decline in nine years. Sales at U.S. locations slid 2.2 percent that month.

Saleh said the company’s focus on its Dollar Menu is “not good news for margin.”

McDonald’s U.S. company-owned restaurant margin narrowed to 19.8 percent in the three months ended Sept. 30 from 21.1 percent a year earlier, according to company filings.

Same-store sales fell 3.1 percent in Japan last month. Comparable, or same-store, sales are considered an indicator of a company’s growth because they include only older restaurants.

There are more than 34,000 McDonald’s restaurants worldwide, about 80 percent of which are franchised.

More in Herald Business Journal

Snohomish County’s campaign to land the 797 takes off

Executive Dave Somers announced the formation of a task force to urge Boeing to build the plane here.

For modern women, 98-year-old rejection letters still sting

In a stark new video, female Boeing engineers break the silence about past inopportunity.

‘Not surprising’: FCC repeals net neutrality rules

Internet service providers will be free to slow down competing services and sell faster speeds.

Disney buying large part of 21st Century Fox in $52.4B deal

Before the buyout, 21st Century Fox will spin off the Fox network, stations and cable channels.

Commentary: GM, Boeing fight a war of words over Mars

Boeing is strongly signaling how crucial deep-space exploration is to its future.

Angel of the Winds pays $3.4M for Everett arena naming rights

The casino replaces Xfinity as the lead sponsor for the publicly owned downtown Everett events center.

Delta orders 100 Airbus A321neo jets valued at $12.7 billion

Boeing had hoped to land the deal, offering comparable 737s.

Rubio to vote against tax bill if child credit isn’t expanded

Sen. Bob Corker announced that he would vote against it due to concerns on the federal deficit.

Tulalips break ground on new Quil Ceda Creek Casino Hotel

A 150-room hotel was added to what is now a $140 million complex expected to open in spring 2019.

Most Read