McDonalds Corp. (MCD) Misses Q1 EPS by 3c; U.S. Comps Fell 1.7%

McDonalds Corp. (NYSE: MCD) reported Q1 EPS of $1.21, $0.03 worse than the analyst estimate of $1.24. Revenue for the quarter came in at $6.7 billion versus the consensus estimate of $6.73 billion.

First Quarter results included:

• Global comparable sales increase of 0.5% reflecting higher average check, as well as negative guest traffic in the U.S. and Asia/Pacific, Middle East and Africa (APMEA)
• Consolidated revenues increase of 1% (3% in constant currencies)
• Consolidated operating income decrease of 1% (1% increase in constant currencies)

In the U.S., comparable sales decreased 1.7% in the first quarter, and operating income declined 3%. Top-line results for the quarter reflected negative comparable guest traffic amid challenging industry dynamics and severe winter weather. Looking ahead, the U.S. remains focused on improving the restaurant experience through a continued commitment to operations and service excellence, customer engagement and menu choice to drive sales and profitability.

During the first quarter, Europe grew comparable sales 1.4%, and operating income by 6% (4% in constant currencies). Positive sales performance in the U.K., France and Russia was partially offset by ongoing weakness in Germany. Across Europe, a combination of unique limited-time food events, premium offerings and everyday affordable pricing contributed to positive performance.

APMEA's first quarter comparable sales increased 0.8% and operating income declined 10% (2% in constant currencies). Solid comparable sales performance in China and many other markets was somewhat offset by weakness in Japan, and to a lesser extent, Australia. Ongoing premium product innovation, convenience and affordability options were sales drivers for the quarter.

CEO Don Thompson commented, In today's dynamic global marketplace, our goal is to ensure that we are evolving to remain a relevant and trusted brand by serving great-tasting, high-quality, affordable food and creating memorable experiences with our brand. By leveraging a deeper understanding of what our customers want with the power of our business model, our investments in restaurant capabilities and modernization, and our hard-earned competitive advantages, we will grow McDonald's business and deliver enduring profitable growth over the long term. As we begin the second quarter, global comparable sales for the month of April are expected to be modestly positive.

For earnings history and earnings-related data on McDonalds Corp. (MCD) click here.

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