McDonald Quarterly Sales Improve, Shares UpDaniel McCarthy (Author) Published Date : Oct 26, 2015 16:12 ET
McDonald s must be pretty happy today after announcing a healthy rise in its global sales as well as profits. It has also now overtaken the sales record in the US for the past two years. Investors obviously gave thumps up to the new helping the stock ride to its lifetime high at about $111 per share.
To address a slump in sales, Easterbrook was handed over the reins of the company as CEO. The latest quarterly results do not account for the all-day breakfast offered by the fast-food giant since the roll-out happened more towards the beginning of Q4. The company also witnessed a 4% rise in its same-store sales across the globe beating 1.9% expected by the street. The CEO added that sustained growth was essential for a turnaround.
McDonalds s serves twin versions of the Monster energy drinks with high caffeine content in some 2o locations including the well known Rock N Roll in Chicago. What was important however was that Ronald McDonald must be a happy man now.
Speaking on the performance of the company, Easterbrook stated that finally, the turnaround strategy has worked and that the turnaround was operationally led. Toasting the buns longer and searing the burgers making them juicier were some of the tweaks in food preparation. Restaurants were also gaining a few seconds off the standard service time at the drive throughs. This has been largely due to simpler menu boards.
During the last summer, McDonald s had offered small fries with a Cheeseburger for as little as $2.50 and that deal performed above expectations as the season advanced. The CEO added that simplification was the goal of the company.
To fight the slump, McDonald s has been relentlessly working on several changes.
According to Easterbrook, long-term plans for McDonald s include investment to enhance the experience in restaurants, motivate workers at the restaurants, and reduce turnover, which should encourage customers to come back as competing chains such as Chick-fil and Chipotle expanded.
Robust performance was also seen from the segment that includes China. In the past year, McDonald s was plagued with provider problems in China and with that problem now behind, sales have been restored.
Currency headwinds, however, remain a concern for McDonald s sustained growth in the global arena.
As for the All Day Breakfast, no specific data was available from its early days. However, Mr. Easterbrook said, it was doing pretty well and has garnered a good following among college going students.
The press release outlining the details of the menu shift can be read here.
McDonald Quarterly Sales Improve, Shares Up