McDonald's beat expectations with a 2.6 per cent increase in January sales at established restaurants, as overseas results overcame a sluggish performance in the United States.
Sales at restaurants open at least 13 months fell 0.7 per cent in the United States, while those in Europe and in the Asia/Pacific, Middle East and Africa (APMEA) region both rose 4.3 per cent, McDonald's said today.
Analysts were expecting a 1.4 per cent overall rise in same-store sales for January. Europe and APMEA each topped Wall Street expectations, while the U.S. fell short of the flat January same-store sales result analysts expected, Bernstein Research analyst Sara Senatore said in a client note.
McDonald's claimed its US results outperformed those of its fast-food rivals.
In January, McDonald's US sales benefited from the national debuts of the breakfast Dollar Menu and the Mac Snack Wrap - a new spin on its popular Big Mac hamburger that sells for around $1.50 - as well as McCafe coffee drinks and the premium-priced Angus Burger.
The company reported a 0.1 per cent rise in US same-store sales for the recent fourth quarter.
That was better than the results from rival Burger King, which earlier this month said same-store sales for the United States and Canada fell 3.3 per cent during its quarter ended December 31st.
For the early part of the US recession, McDonald's and some other fast-food chains benefited when the global economic downturn sent customers to lower-priced fare.
But that so-called trade-down effect is no longer strong enough to offset weaker spending by young men and minority groups, who account for a large number of fast-food customers and have unemployment rates much higher than the overall US jobless rate of 9.7 per cent.
Just a few weeks ago, McDonald's surprised analysts by announcing a 1 per cent increase in December US same-store sales after two months of declines.
Despite the weather-affected January lull in US same-store sales, Skinner told Reuters earlier this month that the December increase in US same-store sales was a "sustainable result" in the longer term.
The company said on Tuesday that Europe's gain in January same-store sales was fueled by France, United Kingdom and other markets, offset partly by Germany.
The Asia/Pacific region was boosted by demand in Japan and Australia.
McDonald's Japan - which posted 10 per cent higher same-store sales for January fueled by its "Big American" hamburger promotion - said in a separate release that it planned to close about 430 units, mostly in traditional malls, store fronts and food courts, over the next 18 months in a bid to boost overall returns.
That operator, which now has 3,700 units, also plans to open 90 new restaurants and to renovate 250 others in the Japanese market this year. Those investments will mainly focus on free-standing units. McDonald's Corp plans to book related tax impairment charges of $40 million to $50 million, primarily in the first half of this year.
The move came just weeks after Wendy's/Arby's Group announced plans to shutter 70 Japanese restaurants and exit the country. Japan, which was still clawing back from its "lost decade" in the 1990s when the latest global financial crisis hit, has been a weak market for American hamburger chains.
China, seen as a key growth market for McDonald's, reported negative same-store sales for January, in part because the important Chinese New Year holiday falls in February this year, rather than in January as it did in 2009.
McDonald's shares were up 42 cents, or 0.7 per cent, to $63.34 in afternoon trade on the New York Stock Exchange.
Reuters