McDonald’s reports First Quarter 2019 Results

In the International Operated segment, first quarter comparable sales increased 6.0%, reflecting positive results across all markets, primarily driven by the U.K. and France

McDonald’s Corporation has announced results for the first quarter ended March 31, 2019.

In the U.S., first quarter comparable sales increased 4.5%, reflecting successful promotions, including the Bacon Event, the 2 for $5 Mix and Match deal, and Donut Sticks, as well as a net positive impact from our Experience of the Future deployment. Operating income for the quarter decreased 5%, reflecting lower gains on sales of restaurant businesses and lower Company-operated margin dollars, partly offset by higher franchised margin dollars and lower G&A costs.

In the International Operated segment, first quarter comparable sales increased 6.0%, reflecting positive results across all markets, primarily driven by the U.K. and France. The segment’s operating income was flat (increased 8% in constant currencies). The constant currency increase was primarily due to sales-driven improvements in franchised margin dollars.

In the International Developmental Licensed segment, first quarter comparable sales increased 6.0%, reflecting positive sales performance across all geographic regions.

Steve Easterbrook, McDonald’s President and Chief Executive Officer said, “We started the year strong with our 15th consecutive quarter of positive global comparable sales, reflecting continued broad-based momentum across each of our global segments. We remain focused on running better restaurants and elevating the experience for our customers by providing convenience on their terms through delivery, Experience of the Future, and our evolving digital channels.”

First quarter highlights:

• Global comparable sales increased 5.4%, reflecting strong comparable sales across all segments.
• Consolidated revenues decreased 4% (increased 2% in constant currencies), reflecting strong comparable sales, partly offset by the impact of the Company’s strategic refranchising initiative.
• Systemwide sales increased 6% in constant currencies.
• Consolidated operating income decreased 2% (increased 3% in constant currencies).
• Diluted earnings per share of $1.72 was flat with the prior year (increased 5% in constant currencies).
• The Company returned $1.9 billion to shareholders through share repurchases and dividends.

Steve Easterbrook concluded, “Two years into the Velocity Growth Plan, our sustained performance gives us confidence that our strategy is working, as more customers are experiencing a better McDonald’s every day. We remain focused on optimizing execution of the Plan, and our recent acquisition of Dynamic Yield further demonstrates our relentless determination to seize opportunities to unlock greater potential and position McDonald’s for long-term sustainable growth.”

Results for the quarter in constant currencies primarily reflected stronger operating performance due to an increase in sales-driven franchised margin dollars, partly offset by lower gains on sales of restaurant businesses, mostly in the U.S.