Saturday, April 18th3.0°C
25889
24644

McDonald's profit edges up despite slowdown in customer traffic

NEW YORK, N.Y. - McDonald's reported disappointing quarterly sales Thursday as fewer customers visited the world's biggest hamburger chain.

The Oak Brook, Ill.-based company says global sales slipped 0.1 per cent at established locations for the last three months of the year. In the U.S., where it recently revamped its Dollar Menu to include items that cost a little more, the figure fell 1.4 per cent.

After outperforming its rivals for years, McDonald's Corp. is facing a mix of challenges, including a shift in eating habits toward foods people feel are fresher or healthier. CEO Don Thompson has been working to better reflect those tastes by adding options such as chicken wraps and egg whites for its breakfast sandwiches.

But the efforts have yet to take hold. In a regulatory filing with the Securities and Exchange Commission, the company said it has seen a "muted response" to its various promotions.

For 2013, guest counts fell 1.9 per cent globally at established locations and 1.6 per cent in the U.S., according to the filing.

McDonald's is also facing heightened competition from old rivals such as Burger King and Wendy's, and all three chains have been aggressively promoting their value menus to fight for customers.

To address concerns that the focus on value could eat into profit margins, McDonald's in early November updated its decade-old Dollar Menu. The "Dollar Menu & More" now includes items that cost around $2 and $5.

During the quarter, McDonald's said customers on average spent more per visit. But global comparable sales were dragged down by the decline in guest counts.

In Europe, sales at locations open at least a year rose 1 per cent. It fell 2.4 per cent for the unit encompassing Asia, the Middle East and Africa.

The figure is a key metric because it strips out the volatility of newly opened and closed locations.

For January, McDonald's expects the figure to be flat and says the challenges it's facing will persist in the year ahead.

For the quarter, McDonald's Corp. earned $1.4 billion, or $1.40 per share, which is a penny more than Wall Street expected. A year ago, it earned $1.39 billion, or $1.38 per share.

The opening of new locations helped lift revenue to $7.09 billion. But it was still shy of the $7.1 billion analysts expected.

The company plans to open between 1,500 and 1,600 new restaurants in 2014, adding to its more than 34,000 locations worldwide.

Shares of McDonald's edged up 36 cents to $95.24.

___

Follow Candice Choi at www.twitter.com/candicechoi

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX15360.55-26.22
S&P CDNX702.85-2.74
DJIA17826.30-279.47
Nasdaq4931.81-75.98
S&P 5002081.18-23.81
CDN Dollar0.8169-0.0001
Gold1204.10+6.10
Oil56.14-0.57
Lumber245.50-9.80
Natural Gas2.641-0.043

 
Okanagan Companies
Pacific Safety0.12+0.00
Knighthawk0.010.00
QHR Technologies Inc1.40-0.01
Cantex0.035+0.005
Anavex Life Sciences0.33+0.02
Metalex Ventures0.075+0.030
Russel Metals27.48-0.23
Copper Mountain Mining1.13+0.01
Colorado Resources0.10-0.00
ReliaBrand Inc0.005+0.001
Sunrise Resources Ltd0.04-0.01
Mission Ready Services0.175-0.010
Decisive Dividend Corporation1.80+0.15

 



24442

FEATURED Property
21933892211 Campbell Raod
10093088 bedrooms
$8,900,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


Calling on your help!

Has the internet flattened prices as predicted? Has the internet created opportunities for your business to find higher priced markets further afield? Is posting prices on your website a good thing o...


Living with Plan B

“It does not do to leave a live dragon out of your calculations, if you live near him.”― J.R.R. Tolkien, The Hobbit Photo: Thinkstock.comHuman beings are optimists by nature. Whether...


Reverse mortgage solution

With the housing and financial markets on solid footing, some retired Canadians may consider cashing in their growing assets to enjoy vacations and major home renovations. Others, on the other hand, a...

_



25922

25922


Member of BC Press Council


25541