• News
  • SAN DIEGO
  • Finance

McDonald's November sales figure rises

NEW YORK -- McDonald's Corp. said Monday that a key sales figure rebounded in November, as U.S. customers snapped up the world's biggest hamburger chain's breakfast offerings and limited-time Cheddar Bacon Onion sandwiches.

The increase follows a decline in October, the first drop in McDonald's (NYSE: MCD) key monthly sales gauge in nearly a decade.

The company, based in Oak Brook, Ill., said that its global sales at restaurants open at least 13 months rose 2.4 percent for the month ended Nov. 30. The figure is a key metric because it strips out the impact of newly opened and closed locations.

The figure rose 2.5 percent in the U.S., boosted by popularity of breakfast options, its value menu and limited-time Cheddar Bacon Onion sandwiches.

It rose 1.4 percent in Europe, where it gets 40 percent of its business, as strength in the U.K., Russia and other markets were offset by weakness in Germany.

In the region encompassing Asia, the Middle East and Africa, it edged up 0.6 percent, hurt by results in Japan.

Systemwide sales, which includes sales at all restaurants, rose 3.2 percent.

Results benefited from McDonald's increasing focus on its dollar menu, said Jefferies analyst Andy Barrish, as well as new products like its Cheddar Bacon Onion sandwiches and $4.99 20-piece Extra Value McNuggets.

But he said the increased price competition within the sector may pressure margins, since cheaper items are less profitable. He kept his “Hold” rating on the stock.

After years of outperforming its rivals, McDonald's has seen sales growth slow as the company faces intensifying competition and an uncertain global economy. Its global revenue at restaurants open at least 13 months fell 1.8 percent in October. The last time it had dropped was in March 2003.

McDonald's has responded by renovating some stores and expanding its value menu and adding other food items to its menu.

Its longtime rivals such as Burger King and Wendy's Co. are reviving their brands with improved menus and new TV ad campaigns. Taco Bell, owned by Yum Brands Inc., is also seeing improved growth sparked by new offerings such as it Doritos Locos Tacos and higher-end Cantina Bell bowls and burritos.

Meanwhile, people are increasingly flocking to restaurants such as Chipotle Mexican Grill Inc. and Panera Bread Co., which offer better-quality food for a little more money. The broader fast-food landscape has been undergoing changes over the past several years too, with the rise of chains such as Subway and Starbucks.

Shares rose 93 cents, or 1.1 percent, to close at $89.41 _ up 7 percent from their 52-week low of $83.31 in November. They traded as high as $102.22 in mid-January.

Leave Your Comment

Comments are moderated by SDDT, in accordance with the SDDT Comment Policy, and may not appear on this commentary until they have been reviewed and deemed appropriate for posting. Also, due to the volume of comments we receive, not all comments will be posted.

SDDT Comment Policy: SDDT encourages you to add a comment to this discussion. You may not post any unlawful, threatening, defamatory, obscene, pornographic or other material that would violate the law. All comments should be relevant to the topic and remain respectful of other authors and commenters. You are solely responsible for your own comments, the consequences of posting those comments, and the consequences of any reliance by you on the comments of others. By submitting your comment, you hereby give SDDT the right, but not the obligation, to post, air, edit, exhibit, telecast, cablecast, webcast, re-use, publish, reproduce, use, license, print, distribute or otherwise use your comment(s) and accompanying personal identifying and other information you provide via all forms of media now known or hereafter devised, worldwide, in perpetuity. SDDT Privacy Statement.

User Response
0 UserComments

Leave Your Comment

Comments are moderated by SDDT, in accordance with the SDDT Comment Policy, and may not appear on this commentary until they have been reviewed and deemed appropriate for posting. Also, due to the volume of comments we receive, not all comments will be posted.

SDDT Comment Policy: SDDT encourages you to add a comment to this discussion. You may not post any unlawful, threatening, defamatory, obscene, pornographic or other material that would violate the law. All comments should be relevant to the topic and remain respectful of other authors and commenters. You are solely responsible for your own comments, the consequences of posting those comments, and the consequences of any reliance by you on the comments of others. By submitting your comment, you hereby give SDDT the right, but not the obligation, to post, air, edit, exhibit, telecast, cablecast, webcast, re-use, publish, reproduce, use, license, print, distribute or otherwise use your comment(s) and accompanying personal identifying and other information you provide via all forms of media now known or hereafter devised, worldwide, in perpetuity. SDDT Privacy Statement.