McDonald’s Reports Weaker Sales

(Chicago Tribune/TNS) -

McDonald’s worldwide sales fell 2.2 percent in November, the company said Monday, as it warned that fourth-quarter profit is under pressure because of the sales slump.

McDonald’s comparable sales across all of its restaurants and at its long-standing locations have fallen 1.1 percent this year through the end of November.

Along with competition in its home market from competitors including Chick-fil-A and Chipotle Mexican Grill, McDonald’s has been dealing with the lingering effects of a supplier safety scandal in Asia and economic and political turmoil in Europe, particularly Russia. McDonald’s is trying to win back diners with such things as mobile ordering, updated marketing and localized menus.

Overall sales, which include sales at newer locations, fell 6 percent, but rose just slightly when stripping out currency fluctuations.

Oak Brook, Ill.-based McDonald’s said its poor sales should “significantly pressure” fourth-quarter margins at company-operated and franchised locations, the majority of McDonald’s restaurants.

Same-restaurant sales fell 4.6 percent in the United States. McDonald’s U.S. same-store sales have not increased since October 2013.

Same-restaurant sales in the Asia/Pacific, Middle East and Africa region fell 4 percent, slightly deeper than the 3.8 percent decline analysts had anticipated. McDonald’s said it continues to feel the impact of the supplier safety issue in Japan and China. The supplier issue is still expected to take a bite of 7 cents to 10 cents out of fourth-quarter profit.

Same-restaurant sales fell 2 percent in Europe. A good performance in the United Kingdom was not enough to overcome very weak results in Russia and declines in France and Germany, McDonald’s said.