Asian Appetite for Burgers Boosts McDonald’s Sales

January 27, 2012

Asian Appetite

Asian Appetite for Burgers Boosts McDonald’s Sales


The world’s largest burger joint posted a better-than-expected bump in November sales, with China and Japan leading the way. Diversified menus helped McDonald’s (MCD) in the U.S. But sales also grew in the tough European market.

Sales climbed 7.4% globally at restaurants open at least a year, with analysts expecting 4.6%. The U.S. and Europe both reported 6.5% gains, with the Asia, Pacific, Middle East and Africa division posting 8.1% hike.

Shares gapped up on the news and traded around 97.60 early in the session.

“We’re listening to our customers and delivering what they expect from McDonald’s by optimizing our menu, modernizing the customer experience and broadening accessibility to our brand,” the chain’s CEO, Jim Skinner, said in a statement.

Fast-food chains, such as Burger King and Wendy’s (WEN), have seen growth muted by the “better burger” segment of the market, including shops such as Smashburger and Five Guys that offer a slightly more expensive, higher-quality burger, said Darren Tristano, executive vice president of restaurant consulting firm Technomic.

“But I think McDonald’s has done a great job of broadening their menu and diversifying away from the burger,” Tristano said.

The company has added chicken sandwiches, higher-margin smoothies and other items in recent years that help it compete outside of the burger category, against chains such as Dunkin’ Brands (DNKN) and Starbucks (SBUX).

McDonald’s in October posted a 14% hike in third-quarter sales, and a 12% rise in EPS. It plans to release fourth-quarter results on Jan. 24. Analysts now call for an 8% rise in revenue, and a 9% gain in earnings.

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