McDonald’s Confirms 10th Consecutive Earnings Meet/Beat!
Dow 30 Component McDonald’s (MCD) manages to confirm its 10th consecutive EPS meet/beat this week as they reported Q3 results and seem to be making gains against their stated “Velocity Growth Plan” while continuing to buy back shares and increase dividends.
McDonald’s President and Chief Executive Officer Steve Easterbrook stated, “We are serving more customers, more often by offering great tasting food at a good value with the quick service and friendly hospitality they expect from McDonald’s. Our positive comparable sales and guest counts across all of our operating segments during the third quarter demonstrate broad-based momentum throughout our business that builds upon our strong first half of 2017. Our Velocity Growth Plan is the right strategy for McDonald’s to achieve long-term, profitable growth and we are on track to succeed with our commitment and focus on execution. We’ve made progress in many areas of our business already, including optimizing our restaurant ownership mix and running better restaurants. At the same time, we also are making strides with initiatives such as delivery, mobile order and pay, as well as the Experience of the Future transformation of our restaurants that will make the experience more convenient, personalized and enjoyable for our customers.”
Third quarter highlights:
- Global comparable sales increased 6.0%, reflecting positive guest counts in all segments
Due to the impact of the Company’s strategic refranchising initiative, consolidated revenues decreased 10% (12% in constant currencies)
- Systemwide sales increased 7% in constant currencies, due to strong comparable sales performance and restaurant expansion
- Consolidated operating income increased 44% (42% in constant currencies), which benefited from a gain of approximately $850 million on the sale of the Company’s businesses in China and Hong Kong.
- Excluding the impact of the gain, as well as unrelated strategic charges, consisting of current quarter and prior year restructuring and non-cash impairment charges in connection with the Company’s global G&A and refranchising initiatives, consolidated operating income increased 5% (3% in constant currencies), primarily due to strong comparable sales performance across all segments
- Diluted earnings per share of $2.32 increased 55% (53% in constant currencies). Excluding the impact of the current year gain and these unrelated strategic charges, which total $0.56 per share, diluted earnings per share was $1.76. Excluding these 2017 items as well as the $0.12 per share of prior year strategic charges, the Company’s diluted earnings per share increased 9% (7% in constant currencies)
- Returned $2.9 billion to shareholders through share repurchases and dividends.
- In addition, the Company announced a 7% increase in its quarterly dividend to $1.01 beginning in the fourth quarter, demonstrating management’s continued confidence in the Company’s performance
Shares of MCD closed at $163.88 up .33% today.