McDonald's

McDonald's same-store sales up, but shares fall
Mon Jun 8, 2009 9:50am EDT


CHICAGO (Reuters) - McDonald's Corp (MCD.N) on Monday reported a 5.1 percent increase in May sales at restaurants open at least 13 months, with demand strong in Europe and Asia/Pacific.

However, the growth was down from April, when global same-store sales rose 6.9 percent. McDonald's shares fell 3.3 percent in early trading.

May same-restaurant sales were up 2.8 percent in the United States, helped by new coffee drinks and snacks. That was significantly slower than the 6.1 percent growth in April.

The world's largest hamburger chain is one of the restaurant industry's top performers largely because its Dollar Menu has been attracting diners amid a lengthy recession that has sent unemployment sharply higher.

The stronger U.S. dollar -- which lessens the dollar value of overseas sales -- led to an overall 0.4 percent decline at worldwide McDonald's restaurants, the company said. Sales rose 7 percent in constant currencies.

Fast-food restaurants generally have held up better in a tough economy than higher-priced sit-down restaurants.

McDonald's May same-store sales increased 7.6 percent in Europe, and 6.4 percent in the company's Asia/Pacific, Middle East and Africa segment. In April, same-store sales in the two regions were up 8.4 and 6.5 percent, respectively.

McDonald's said the hit by the foreign exchange rates, if they remain around current levels, is expected to be 8 cents to 9 cents a share in the second quarter and about 20 cents for the year.

The company also said second-quarter results, which it is scheduled to report on July 23, are expected to include 2 cents to 3 cents a share of income due to a license deal in Indonesia and the sale of Redbox Automated Retail.

Its shares fell $2.08, or 3.3 percent, to $57.80 in early trading on the New York Stock Exchange.

(Reporting by Ben Klayman and Lisa Baertlein in Los Angeles; Editing by Maureen Bavdek)