1:00PM New York - McDonald’s Corp fourth quarter revenue rise 6% on falling U.S sales.
McDonald’s Corp fourth quarter revenue rose 6% to $5.75 billion from $5.44 billion a year earlier amid weakening domestic demand.
The company said U.S. sales remained flat, on “severe weather” conditions and slowing consumer expenditure in a receding economy.
U.S comparable sales were at 3.3%. Global comparable sales gained 6.8% in the quarter.
McDonald’s said it achieved double-digit revenue growth in Europe while revenue from Africa, Asia-Pacific and the Middle East rose 11.4%, the highest in 15 years..
Sales from company operated restaurants to $4.1 billion from $4 billion a year ago and rose to $1.65 billion from $1.43 billion in franchised and affiliated restaurants.
For fiscal 2007, the company posted revenue increase of 9% to $22.78 billion compared with $20.89 billion in 2006.
In the quarter, McDonald’s said net income was fractionally up 3% to $1.27 billion from $1.24 billion posted same period in 2006.
Earnings gained 6% to $1.06 per share from $1 year earlier, including gains of $0.33 per share of income tax benefits.
Currency translation benefited earnings by $0.04 per share. Excluding income tax gains, McDonald’s earned 76 cents per share.
The earnings stood at the top end of market predictions. Analysts surveyed by Thomson Financial were looking for earnings of 71 cents per share on revenue of $5.61 billion.
In the year, net income fell 32% to $2.39 billion or $1.98 per share compared with $3.54 billion or $2.83 per share in 2006.
McDonald’s said U.S operating income rose 6% driven by some demand for breakfast and beverages.”
The company said sales were hurt by “softer consumer spending” but remained optimistic U.S sales will pick up despite current weaknesses in the economy.
Domestic sales have fallen to 38% of total revenues from 58% in 1991, company chief executive, Jim Kinner told a call conference Monday.
European sales with twin-digit figures, as China, Japan and Australia led higher sales growth in the Africa, Asia-Pacific and the Middle East. The company is planning to open 150 more outlets in China in 2009.
During the quarter, the company said it increased cash return to shareholders to between $15 billion to $17 billion in 2007 through to 2009 before declaring first dividend of $0.375 per share, which we now be paid on a quarterly basis.