McDonald’s aiming to halt the decline

Picture: Eugene Hoshiko
Picture: Eugene Hoshiko
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McDonald’s said it expects global comparable sales to rise in the current quarter, after four straight quarters of decline, as its new chief executive’s initiatives to boost sales start paying off along with a recovery in China.

McDonald’s shares rose 1.5 per cent in premarket trading after the company also reported better-than-expected sales and profit for the second quarter yesterday.

Global sales at McDonald’s restaurants open at least 13 months fell a steeper-than-expected 0.7 per cent in the quarter ended June 30, due to a drop in traffic in all major markets.

However, this was the slowest decline in four quarters for the world’s largest restaurant chain by sales.

Analysts on average expected same-restaurant sales to fall 0.4 per cent, according to research firm Consensus Metrix.

McDonald’s CEO Steve Easterbrook, appointed in March, has reorganised the business with the aim of bolstering sales by offering all-day breakfast, tweaking menus to reflect regional tastes and experimenting with custom hamburger toppings.

The company said it expects these initiatives to pay off in the third quarter.

McDonald’s has been struggling on myriad fronts – it is trying to recover from a food scare in China that battered Asian sales and is wrestling with economic weakness and political upheaval in Europe, its top revenue market.