News

McDonald's global comp sales down 1% for 2014

Troubles continue for the fast food giant, with global comp sales down 1 percent for the year and falling guest traffic.

January 23, 2015

McDonald's Corporation today announced results for the fourth quarter and 2014.

Full year results included:

• Global comparable sales decrease of 1.0 percent, reflecting negative guest traffic in all major segments
• Consolidated revenues decrease of 2 percent (flat in constant currencies)
• Consolidated operating income decrease of 9 percent (8 percent in constant currencies), primarily due to the impact of the previously-disclosed supplier issue in APMEA (Asia/Pacific, Middle East and Africa) and weak operating performance in the U.S.

Fourth quarter results included:

• Global comparable sales decrease of 0.9 percent, reflecting negative guest traffic in all major segments
• Consolidated revenues decrease of 7 percent (1 percent in constant currencies)
• Consolidated operating income decrease of 20 percent (15 percent in constant currencies), primarily due to weak operating performance in the U.S. and the impact of the supplier issue in APMEA

In the U.S., fourth quarter comparable sales decreased 1.7 percent and operating income declined 15 percent, reflecting negative guest traffic amid ongoing broad-based challenges, including sustained competitive activity. In addition, results were impacted by higher selling, general and administrative and other expenses associated with positioning the business for the future. McDonald's U.S. business begins 2015 evolving to a more nimble, customer-led organization with a strategic roadmap focused on menu simplification and local customer tastes and preferences.

Europe's fourth quarter comparable sales declined 1.1 percent and operating income decreased 14 percent (down 6 percent in constant currencies). While consumer confidence issues, particularly in Russia and Ukraine, and weakness in France and Germany negatively impacted the segment's quarterly results, the U.K. delivered positive comparable sales and operating income results.

APMEA's fourth quarter comparable sales decreased 4.8 percent and operating income declined 44 percent (down 40 percent in constant currencies) primarily due to the lingering impact of the supplier issue on sales and profitability in China, Japan and certain other markets. Sales and operating income benefited from solid performance in Australia.

"Our business continues to face meaningful headwinds. As the world's leading food service organization, we will continue to evolve, focusing on the customer as our first priority," said McDonald's President and Chief Executive Officer Don Thompson in a company press release. "Over the next 12 months, our charge is to ensure that we are adapting to the changing marketplace and maximizing the potential of our global growth priorities to serve our customers' favorite food and drink, create memorable experiences, offer unparalleled convenience and become an even more trusted brand."

Comp sales are expected to be negative in January.