Same-store sales rose 5.4 percent at McDonald’s Corp. in the U.S. in the first quarter ended March 31, the company said Friday, as all-day breakfast and value deals brought more customers in the door.
The same-store sales growth also helped profits increase by 26 percent on an adjusted basis at the Oak Brook, Ill.-based quick-service chain.
Same-store sales rose 6.2 percent globally, the company said, and McDonald’s reported strong momentum in every market — benefiting from its efforts as well as an extra day in February.
“I’m pleased to report that our turnaround is taking hold,” CEO Steve Easterbrook said in a statement. “The ongoing investments we’re making in running great restaurants and delivering what matters most to our customers are beginning to yield positive results.”
The higher same-store sales in the U.S. continue the chain’s positive momentum, started late last year, following three years of same-store sales declines. McDonald’s stock rose more than 2 percent in premarket trading Friday.
The company started selling various breakfast items past 10:30 am and in the first quarter introduced variations of a “McPick” value offer, including two items for $2 in January and then two premium items for $5 in March.
Revenues at the burger chain declined by 1 percent to $5.9 billion, from $5.96 billion, but were up 3 percent excluding the impact of the strong dollar.
Net income rose 35 percent to $1.1 billion, or $1.23 per share, up from $811.5 million or 84 cents.
But much of that also due to strategic charges of $195 million in the first quarter a year ago as the company overhauled its management to turn around its business. Adjusted for the charge, and for currency translation, earnings per share rose 26 percent, the company said.
Same-store sales rose 5.2 percent in the company’s International Lead segment, which includes established markets in Europe and Australia. The U.K., Australia and Canada reported strong performance, offsetting “ongoing economic and competitive headwinds” in France and Germany.
In the High Growth segment, strong performance in China and positive performance in Russia led to same-store sales growth of 3.6 percent. Foundational Markets same-store sales rose 11 percent, thanks largely to a strong same-store sales in Japan as McDonald’s as that market recovers from a brutal sales decline following a food-safety scare in 2014.
Contact Jonathan Maze at [email protected]
Follow him on Twitter at @jonathanmaze