Chicago / IL. (mdc) McDonald’s Corporation announced results for the first quarter ended March 31, 2019. «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,» said McDonald’s President and Chief Executive Officer Steve Easterbrook. «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 percent, reflecting strong comparable sales across all segments.
- Consolidated revenues decreased 4 percent (increased 2 percent in constant currencies), reflecting strong comparable sales, partly offset by the impact of the Company’s strategic refranchising initiative.
- Systemwide sales increased 6 percent in constant currencies.
- Consolidated operating income decreased 2 percent (increased 3 percent in constant currencies).
- Diluted earnings per share of USD 1.72 was flat with the prior year (increased 5 percent in constant currencies).
- The Company returned USD 1.9 billion to shareholders through share repurchases and dividends.
In the U.S., first quarter comparable sales increased 4.5 percent, reflecting successful promotions, including the Bacon Event, the 2 for USD 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 percent, 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 percent, reflecting positive results across all markets, primarily driven by the U.K. and France. The segment’s operating income was flat (increased 8 percent 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 percent, reflecting positive sales performance across all geographic regions.
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.»
Key Highlights – Consolidated
|USD in millions, except per share data||Q1/2019||Q1/2018||Change||Change Excluding
|Earnings per share-diluted||USD||1.72||USD||1.72||0%||5%|
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.
Results in 2019 included USD 47 million, or USD 0.06 per share, of additional income tax costs due to regulations issued in January 2019 related to the Tax Cuts and Jobs Act of 2017 (Tax Act). Results in 2018 included USD 52 million, or USD 0.07 per share, of additional income tax costs associated with adjustments to the provisional amounts recorded in December 2017 under the Tax Act.
Foreign currency translation had a negative impact of USD 0.09 on diluted earnings per share for the quarter.