December 8, 2008 / 1:16 PM / in 9 years

UPDATE 2-McDonald's Nov sales up; strong dollar a concern

* November global same-store sales up 7.7 pct

* U.S. November same-store sales up 4.5 pct

* Extra weekend days help sales overseas

* Foreign currency hammers systemwide sales

* Stock down 0.3 pct after rising in early trade (Recasts, adds analyst comment. Changes dateline from NEW YORK)

CHICAGO, Dec 8 (Reuters) - McDonald’s Corp (MCD.N) posted higher November sales at restaurants open at least 13 months, helped by an extra weekend, while the strengthening dollar pressured international sales, especially in Europe.

McDonald’s and other fast-food restaurants have been boosted in recent months by cash-strapped consumers shifting down to their lower-priced fare during the recession.

The company has tried to keep a lid on costs and attracted customers with its popular Dollar Menu in the United States, while also introducing new items like premium coffee drinks and chicken biscuit breakfast sandwiches.

Same-store sales, a key gauge of retail health, were up 7.7 percent overall and rose 4.5 percent in the United States. Same-store sales rose 7.8 percent in Europe and increased 13.2 percent in the Asia/Pacific, Middle East and Africa division.

“The fact that they were able to deliver these types of results in these difficult times is a big positive for them,” Morningstar restaurant analyst John Owens said.

McDonald’s shares were down 6 cents to $62.66 after rising to $63.98 in New York Stock Exchange trade on Monday morning.

    November had an extra Saturday and Sunday this year compared with a year earlier, and one less Thursday and Friday. That extra weekend helped lift sales in some parts of the world, McDonald’s said.

    The company has also had to raise prices on some items, such as removing its popular double cheeseburger from the Dollar Menu and increasing its price to $1.19 on Dec. 1. But McDonald’s still has been seeing increased customer traffic, Owens said.

    One area of concern, though, could be the impact of the strengthening dollar on sales overseas.

    Total sales rose only 1.9 percent in November, but would have been up 9.6 percent without foreign exchange fluctuations, the company said. Europe was especially hard hit, with systemwide sales down 7.2 percent. Those sales would have been up 9.9 percent on a constant-currency basis.

    “Foreign currency is starting to be a drag on the company and that could continue for the next few quarters,” Owens said.

    McDonald‘s, which has more than 31,000 restaurants in more than 100 countries, has been outperforming rivals like Wendy‘s/Arby’s Group Inc WEN.N and CKE Restaurants’ CKR.N Carl’s Jr. chain by keeping a lid on costs and attracting customers with the Dollar Menu.

    Reporting by Brad Dorfman in Chicago, Aarthi Sivaraman in New York and Lisa Baertlein in Los Angeles, editing by Dave Zimmerman

    0 : 0
    • narrow-browser-and-phone
    • medium-browser-and-portrait-tablet
    • landscape-tablet
    • medium-wide-browser
    • wide-browser-and-larger
    • medium-browser-and-landscape-tablet
    • medium-wide-browser-and-larger
    • above-phone
    • portrait-tablet-and-above
    • above-portrait-tablet
    • landscape-tablet-and-above
    • landscape-tablet-and-medium-wide-browser
    • portrait-tablet-and-below
    • landscape-tablet-and-below