McDonald's sales soar as diners trade down

The global recession shows no sign of dulling people's appetite for a burger after fast food operator McDonald's said same-store sales had risen 6.9pc in 2008

 

In a welcome boost to the global leisure industry McDonald's said it would open 1,000 new restaurants this year at a cost of $2.1bn (£1.5bn).

Fourth quarter pre-tax profits rose 9pc to $1.4bn as the company benefited from consumers trading down in the face of the economic crisis.

However, quarterly revenues fell 3pc to $5.6bn as the fast food chain was hit by the strength of the dollar.

Growth accelerated in the fourth quarter, with same-store sales 7.2pc ahead, fuelled by strong growth in Asia, the Middle East and Africa where revenues were 10pc ahead year-on-year. In Europe same-store sales grew 7.6pc, while the US saw a 5pc increase.

Full year revenues rose 3pc to $23.5bn while pre-tax profits were up 72pc at $6.2bn.

McDonald's, which has a market value of $66bn, said it had returned $5.8bn to shareholders in 2008 via dividends and share buybacks. The company increased its fourth quarter dividend by 33pc to 50 cents a share.

The company has returned $11.5bn to shareholders since the beginning of 2007, in line to meet its target of a $15bn to $17bn return by the end of 2009.

Chief executive Jim Skinner welcomed the strong results. "McDonald's begins 2009 with six years of momentum, a business model that has delivered even in challenging economic conditions and January sales that remain strong," he said.

McDonald's shares fell 1.37pc to $56.65 in early trading.

Tx:telegraph