OAK BROOK, Ill., Nov. 10, 2014 /PRNewswire/ -- McDonald's
Corporation today announced that global comparable sales decreased
0.5% in October. Performance by segment was as follows:
- U.S. down 1.0%
- Europe down
0.7%
- Asia/Pacific, Middle East and Africa (APMEA) down 4.2%
"Today's consumers increasingly prefer customizable food
options, dining in a contemporary, inviting atmosphere and using
more convenient ways to order and pay for their meals," said
McDonald's President and Chief Executive Officer Don Thompson. "At McDonald's, we are
diligently working to bring these elements of the customer
experience to life through McDonald's Experience of the
Future. Although October results reflect our current business
challenges, we are moving with a sense of urgency to improve the
trajectory of our financial performance while taking the actions
necessary to pursue the Brand's long-term potential."
In October, U.S. comparable sales decreased 1.0% amid strong
competitive activity. To restore business momentum, the U.S.
is revamping its marketing approach, simplifying the menu and
creating a new organizational structure. These initiatives
are designed to better address consumer preferences and the
competitive dynamics of the local markets in which we compete by
bringing decision making closer to our customers.
Europe's comparable sales
decreased 0.7% in October as solid performance in the U.K. was more
than offset by very weak results in Russia due to factors related to the operating
environment, including temporary restaurant closures. These
factors, along with the significant weakening of the euro and
Russian ruble, negatively impacted the segment's reported
systemwide sales.
In October, APMEA's comparable sales decreased 4.2%, reflecting
the ongoing impact of the supplier issue on performance in
Japan and China, partly offset by strong performance in
Australia. The markets affected by the supplier issue are
actively executing multi-faceted initiatives to restore customer
trust in the McDonald's brand while the broader APMEA segment is
pursuing long-term opportunities to drive customer traffic and
loyalty with unique menu, affordability and convenience
options.
Strong comparable sales in McDonald's Other Countries &
Corporate segment, which includes Canada and Latin
America, contributed positively to the Company's global
comparable sales performance for the month.
Systemwide sales for the month decreased 3.4%, or increased 1.9%
in constant currencies.
Percent
Increase/(Decrease)
|
|
Comparable
Sales
|
Systemwide
Sales
|
|
|
|
As
|
Constant
|
Month ended October
31,
|
|
2014
|
|
2013
|
|
Reported
|
Currency
|
McDonald's
Corporation
|
|
(0.5)
|
|
0.5
|
|
(3.4)
|
|
1.9
|
Major
Segments:
|
|
|
|
|
|
|
|
|
U.S.
|
|
(1.0)
|
|
0.2
|
|
0.1
|
|
0.1
|
Europe
|
|
(0.7)
|
|
0.8
|
|
(5.7)
|
|
1.9
|
APMEA
|
|
(4.2)
|
|
(2.8)
|
|
(5.3)
|
|
0.0
|
|
|
|
|
|
|
|
|
|
Year-To-Date October
31,
|
|
|
|
|
|
|
|
|
McDonald's
Corporation
|
|
(1.0)
|
|
0.3
|
|
(0.7)
|
|
1.5
|
Major
Segments:
|
|
|
|
|
|
|
|
|
U.S.
|
|
(2.1)
|
|
0.2
|
|
(1.1)
|
|
(1.1)
|
Europe
|
|
(0.4)
|
|
(0.2)
|
|
3.4
|
|
2.3
|
APMEA
|
|
(2.9)
|
|
(1.8)
|
|
(2.5)
|
|
1.5
|
Definitions
- Comparable sales represent sales at all restaurants, whether
operated by the Company or by franchisees, in operation at least
thirteen months including those temporarily closed. Some of the
reasons restaurants may be temporarily closed include reimaging or
remodeling, rebuilding, road construction and natural disasters.
Comparable sales exclude the impact of currency translation.
Comparable sales are driven by changes in guest counts and average
check, which is affected by changes in pricing and product mix.
Typically, pricing has a greater impact on average check than
product mix. Management reviews the increase or decrease in
comparable sales compared with the same period in the prior year to
assess business trends.
- The number of weekdays and weekend days can impact our reported
comparable sales. In October
2014, this calendar shift/trading day adjustment consisted
of one less Tuesday and one more Friday compared with October 2013. The resulting adjustment varied by
area of the world, ranging from approximately 0.7% to 1.2%.
In addition, the timing of holidays can impact comparable
sales.
- Information in constant currency is calculated by translating
current year results at prior year average exchange rates.
Management reviews and analyzes business results excluding the
effect of foreign currency translation and bases incentive
compensation plans on these results because they believe this
better represents the Company's underlying business trends.
- Systemwide sales include sales at all restaurants, whether
operated by the Company or by franchisees. While franchised sales
are not recorded as revenues by the Company, management believes
the information is important in understanding the Company's
financial performance because these sales are the basis on which
the Company calculates and records franchised revenues and are
indicative of the financial health of the franchisee base.
Upcoming Communications
Pete Bensen, Chief Financial
Officer, and Steve Easterbrook,
Global Chief Brand Officer, will
participate in the Morgan Stanley Global Consumer & Retail
Conference at 8:00 a.m. (Eastern
Time) on November 19, 2014.
This presentation will be webcast live and available for replay for
a limited time thereafter at www.investor.mcdonalds.com.
The Company plans to release November
2014 sales on December 8,
2014.
About McDonald's
McDonald's is the world's leading global foodservice retailer
with over 35,000 locations serving approximately 70 million
customers in over 100 countries each day. More than 80% of
McDonald's restaurants worldwide are owned and operated by
independent local business men and women.
Forward-Looking Statements
This release contains certain forward-looking statements, which
reflect management's expectations regarding future events and
operating performance and speak only as of the date hereof. These
forward-looking statements involve a number of risks and
uncertainties. The factors that could cause actual results to
differ materially from our expectations are detailed in the
Company's filings with the Securities and Exchange Commission, such
as its annual and quarterly reports and current reports on Form
8-K.
SOURCE McDonald's Corporation