{"id":4458,"date":"2015-01-23T19:26:49","date_gmt":"2015-01-24T01:26:49","guid":{"rendered":"http:\/\/news.medill.northwestern.edu\/chicago\/?p=4458"},"modified":"2015-01-23T19:26:49","modified_gmt":"2015-01-24T01:26:49","slug":"mcdonalds-corp-earnings-fall","status":"publish","type":"post","link":"https:\/\/news.medill.northwestern.edu\/chicago\/mcdonalds-corp-earnings-fall\/","title":{"rendered":"McDonald’s Corp. earnings fall"},"content":{"rendered":"

By Alysha Khan<\/p>\n

Global fast food giant McDonald\u2019s Corp. ended a year of struggling sales with a 21 percent drop in fourth quarter earnings, missing Wall Street\u2019s expectations, and warned that it may take several months for its new strategies to translate to higher profits. The stock drooped.<\/p>\n

\u201c2014 was a difficult year during which performance fell short of our expectations,\u201d said president and CEO Don Thompson in a conference call with analysts.<\/p>\n

The Oak Brook-based company earned $1.1 billion<\/a>, or $1.13 per diluted share, in the fourth quarter ended December 31, compared with $1.4 billion, or $1.40 per diluted share in the year-earlier quarter.<\/p>\n

\"Summary<\/a>
Summary of McDonald’s Corp. fourth quarter earnings report (Alysha Khan\/Medill)<\/figcaption><\/figure>\n

 <\/p>\n

Analysts surveyed by Bloomberg expected $1.22 per diluted share.<\/p>\n

Revenues fell 7 percent to $6.6 billion from $7.1 billion in the year-earlier quarter. Sales at locations open at least 13 months fell 1.7 percent in the U.S. and 0.9 percent globally, slightly better than what analysts expected.<\/p>\n

Sara H. Senatore, senior analyst at asset management firm AB Bernstein, wrote in a research note that the earnings report was not as bad as investors feared. However, she cautioned that investors may still have \u201cmixed feelings\u201d about the stock, especially since there isn\u2019t a clear driving force that could revitalize U.S. store sales.<\/p>\n

The stock<\/a> fell $1.33, or 1.5 percent, to $89.56, in Friday trading on the New York Stock Exchange.<\/p>\n

On the conference call<\/a>, Chief Financial Officer Peter Bensen said sales were negatively impacted by sluggish U.S. sales, supplier issues in the Asia-Pacific region and political instability in Russia and Ukraine.<\/p>\n

In July, McDonald\u2019s cut ties with its Chinese poultry supplier<\/a> after allegations that the supplier mixed fresh and expired meat. Earlier this month, the fast food chain apologized after Japanese diners discovered objects<\/a> in their food, including plastic and a tooth.<\/p>\n

The Russian government also briefly shut down more than 200 stores<\/a>, about half of the locations McDonald\u2019s has in the country.<\/p>\n

\u201cWhile we expect to move beyond some of these unique events of last year, certain challenges remain,\u201d Bensen said.<\/p>\n

For the coming fiscal year, McDonald\u2019s plans to cut its capital expenditure budget by nearly $1 billion to approximately $2 billion by decreasing the number of new stores opening in China, Russia, Germany and the U.S.<\/p>\n

Company officials said the chain will also be emphasizing greater burger customization and experimenting with self-order kiosks, table service, and mobile ordering to improve sales at U.S. locations.<\/p>\n

\u201cIt has the potential to lift sales of core classics by bringing more customers into our restaurants,\u201d Thompson said.<\/p>\n

For the full year 2014, McDonald\u2019s reported earnings of $4.75 billion, or $4.82 per diluted share, down 15 percent from the year-prior $5.6 billion, or $5.55 per share. Revenue declined to $27.4 billion from $28.8 billion.<\/p>\n

Photo at top: A McDonald’s location\u00a0in Evanston, Illinois. (Alysha Khan\/Medill)<\/div>\n","protected":false},"excerpt":{"rendered":"

By Alysha Khan Global fast food giant McDonald\u2019s Corp. ended a year of struggling sales with a 21 percent drop in fourth quarter earnings, missing Wall Street\u2019s expectations, and warned that it may take several months for its new strategies to translate to higher profits. The stock drooped.<\/p>\n","protected":false},"author":28,"featured_media":4459,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[],"class_list":["post-4458","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"yoast_head":"\nMcDonald's Corp. earnings fall - Medill Reports Chicago<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/news.medill.northwestern.edu\/chicago\/mcdonalds-corp-earnings-fall\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"McDonald's Corp. earnings fall - Medill Reports Chicago\" \/>\n<meta property=\"og:description\" content=\"By Alysha Khan Global fast food giant McDonald\u2019s Corp. ended a year of struggling sales with a 21 percent drop in fourth quarter earnings, missing Wall Street\u2019s expectations, and warned that it may take several months for its new strategies to translate to higher profits. 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