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McDonald's Q1 income up 8pc, tops $1.2bn

WASHINGTON, April 26, 2017

McDonald's, a global foodservice retailer with over 36,000 locations in over 100 countries, posted a net income of $1.21 billion for the first quarter (Q1) of the year, marking an increase of 8 per cent over Q1 2016.

However, revenue during the period fell 3.9 per cent to $5.68 billion, while earnings per share was up 18 per cent to $1.47.

"Our efforts to build a better McDonald's are yielding meaningful results with continued positive momentum and a strong start to 2017 that includes positive comparable sales across all segments, higher global guest counts and enhanced profitability," said McDonald's president and chief executive officer Steve Easterbrook.

"There's a sense of urgency across the business as we take actions to retain existing customers, regain lapsed customers and convert casual customers to committed customers. We're continuing to build a more personalized and enjoyable visit, which delights customers with the taste and quality of our food and offers the highest level of convenience, in order to gain traffic in an increasingly competitive industry and deliver profitable growth for our System and shareholders."

Comparable sales for the International Lead segment increased 2.8 per cent for the quarter, primarily driven by continued momentum in the UK and Canada's successful launch of All Day Breakfast. The segment's operating income increased 2 per cent (6 per cent in constant currencies), fuelled by sales-driven improvements in franchised margin dollars across most markets.

In the High Growth segment, first quarter comparable sales increased 3.8 per cent, led by strong performance in China and positive results across the entire segment. The segment's operating income rose 36 per cent (38 per cent in constant currencies), with about half of the increase resulting from lower depreciation expense due to the accounting treatment of the pending sale of the China and Hong Kong businesses. Results also benefited from prior year VAT reform in China.

In the Foundational Markets & Corporate segment, first quarter comparable sales rose 10.7 per cent and operating income increased significantly, led by very strong performance in Japan as well as strong results across the segment's other geographic regions.

Steve Easterbrook concluded:"Today, we're harnessing the strong execution of our fundamental business drivers, a sharp focus on our customers, the benefits of right-sizing our organization and the contributions of the talented franchisees, suppliers and employees to seize the opportunities before us.

“We're challenging ourselves to identify and pursue initiatives that can bring the biggest benefit to the most customers in the shortest possible time. I'm confident that we're on the right path and well-positioned to unlock incremental growth and deliver against our Velocity Growth Plan for 2017 and beyond." – TradeArabia News Service

Tags: McDonald’s | breakfast |

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