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Thu 22nd Oct 2015 - McDonald’s reports like-for-likes rose around the world in third quarter
McDonald’s reports like-for-likes rose around the world in third quarter: McDonald’s has reported a return to global like-for-like sales growth in its third quarter ended September 30, 2015. Overall like-for-likes were up 4% with like-for-likes up 0.9% in the US, the first rise in two years. Chief executive Steve Easterbrook said: “Consumers have more choices than ever about where to dine, and our operational growth-led turnaround is focused on appealing to customers in the areas that matter most to them – great-tasting, high-quality food, convenience and value. I am encouraged by our operating performance for the quarter, with positive comparable sales across all segments, including the US, as well as sales recovery in China following the prior year supplier issue. I am confident in the fundamental strength of the McDonald’s system and our ability to drive initiatives that are focused on delivering the greatest benefit for our customers.” The company returned $3.1bn to shareholders through share repurchases and dividends. This brings the year-to-date return to shareholders to $7.1bn against a targeted return of $8-9bn in 2015. In the US, third quarter like-for-like sales increased 0.9%, the segment’s first quarterly comparable sales increase in two years. The introduction of the new Premium Buttermilk Crispy Chicken Deluxe sandwich and breakfast, including a return to the classic recipe ingredients for McDonald’s iconic Egg McMuffin, contributed to the segment’s performance. US third quarter operating income declined 1% as a result of an incremental investment in wages and benefits for all eligible company-operated restaurant employees, which is designed to improve restaurant performance and enhance its “employer brand”. Moving forward, rebuilding customer traffic remains a top priority for the segment. Comparable sales for the “international lead markets” segment increased 4.6% for the third quarter led by strong performance in Australia, the UK and Canada and positive results in Germany. Third quarter operating income decreased 11% (increased 5% in constant currencies). Positive consumer response to multiple menu, service and value initiatives throughout most of the segment contributed to the segment’s performance. In the “high growth markets” segment, third quarter comparable sales increased 8.9%, reflecting very strong comparable sales performance in China and positive performance in most other markets. Operating income increased 39% (68% in constant currencies). Emphasis on value and breakfast during the quarter contributed to China’s sales recovery. Easterbrook added: “Third quarter marked an important step in the company’s global turnaround – the reorganisation of our business from a geographically focused structure to business segments that combine markets with similar characteristics and opportunities for growth. As we begin fourth quarter, comparable sales are expected to be positive in all segments. While still in the early stages, we believe our turnaround plan is starting to generate the change needed to reposition McDonald’s as a modern, progressive burger company.”


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