McDonald’s November Sales Gain 2.4% as U.S. Business Improves

Dec. 10 (Bloomberg) -- McDonald’s Corp., the world’s largest restaurant chain, said sales at stores open at least 13 months rose 2.4 percent globally last month as its U.S. business picked up. Julie Hyman reports on Bloomberg Television's "In The Loop." (Source: Bloomberg)

McDonald’s Corp. (MCD) posted a surprise gain in U.S. same-store sales last month after a decline in October as the world’s largest restaurant chain increased advertising for less expensive items.

Sales in the U.S. increased 2.5 percent in November, the Oak Brook, Illinois-based company said today in a statement. Analysts projected a drop of 0.6 percent, the average of 14 estimates compiled by Consensus Metrix. Global sales rose 2.4 percent while analysts anticipated a gain of 0.2 percent.

McDonald’s, which has about 14,100 U.S. stores, has been pushing its Dollar Menu to attract budget-minded Americans. The Big Mac seller, which named Don Thompson chief executive officer in July, is trying to keep pace with Burger King Worldwide Inc. (BKW) and Yum! Brands Inc. (YUM)’s Taco Bell, which have been promoting new food and value items this year.

“You saw McDonald’s going on TV and pushing a lot more value” in the U.S. last month, Peter Saleh, a New York-based analyst at Telsey Advisory Group, said in an interview. “The numbers in the U.S. were particularly strong.”

McDonald’s rose 1.1 percent to $89.41 at the close in New York. The shares have fallen 11 percent this year.

Value Items

In November, U.S. sales were fueled by breakfast and value items, as well as the chain’s new Chedder Bacon Onion sandwiches, McDonald’s said in the statement. Thompson has said the company will have a stronger new menu presence next year compared with 2012.

Sales increased 1.4 percent in Europe and rose 0.6 percent in Asia, Africa and the Middle East. Analysts projected a gain of 0.1 percent and a drop of 0.9 percent, respectively, according to a survey by Consensus Metrix, a researcher owned by Wayne, New Jersey-based Kaul Advisory Group.

McDonald’s October comparable-store sales fell 1.8 percent globally, the first monthly decline in nine years. Sales at U.S. locations slid 2.2 percent that month.

Saleh said the company’s focus on its Dollar Menu is “not good news for margin.”

McDonald’s U.S. company-owned restaurant margin narrowed to 19.8 percent in the three months ended Sept. 30 from 21.1 percent a year earlier, according to company filings.

Same-store sales fell 3.1 percent in Japan last month. Comparable, or same-store, sales are considered an indicator of a company’s growth because they include only older restaurants.

There are more than 34,000 McDonald’s restaurants worldwide, about 80 percent of which are franchised.

To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net

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