McDonald’s Corporation (NYSE:MCD) reported strong first-quarter financial results, driven by its all-day breakfast and new meal deals that contributed to a 46% growth in earnings.
The shares of McDonald’s were trading around $126.14 per share, up by 0.35% around 1:04 in the afternoon in New York. The stock traded as much as $128.40 earlier today.
The world’s largest fast-food chain operator gained more than 28% in stock value over the past year since its CEO Steve Easterbrook implemented turnaround strategies.
McDonald’s financial results
McDonald’s generated earnings of $1.23 per diluted share, up from $0.84 per diluted share in the same period a year earlier. Wall Street analysts expected the company to report $1.16 per share. Its operating income rose 28%.
The company’s revenues were $5.96 billion, higher than the $5.8 billion estimated by analysts.
McDonald’s said its global comparable sales increased 6.2% while its comparable sales in the United States grew 5.4% due to the growing popularity of its all-day breakfast and the introduction of McPick 2.
Its comparable sales for the International Lead segment increased 5.2% due to the strong performance of its restaurants in Australia, Canada, and the United Kingdom.
The company’s High Growth segment’s comparable sales rose 3.6% driven by the strong sales performance in China and positive results in other markets including Russia. Its comparable sales in Foundational markets grew 11% primarily due to its sales recovery in Japan.
In a statement, Easterbrook said, “The turnaround plan we announced last year is grounded in enhancing these critical customer-driven elements, and I’m pleased to report that our turnaround is taking hold.”
“The ongoing investments we’re making in running great restaurants and delivering what matters most to our customers are beginning to yield sustained positive results. For the quarter, we generated higher sales, revenues and operating income in constant currencies across all business segments,” he added.
During the company’s conference call with analysts and investors, Easterbrook said, “Customers in the U.S. are noticing a difference.” According to him, McDonald’s will continues its current turnaround plan over the next two quarters before moving to a longer-term strategy.
McDonald’s is expected to refranchise 4,000 stores by 2018 and plans to become 95% franchised over the long-term.