Currency exchange effects cost McDonald’s 2% in revenues and 3% in operating income.
Globally, same-store sales in the second quarter rose 1% and consolidated net income rose 2%. U.S. same-store sales rose 1%, and were down 0.1% in Europe and 0.3% in Asia. Results in China were “negative” for the second consecutive quarter.
Oddly, perhaps, European operating income saved the quarter. U.S. operating income was flat, and operating income in McDonald’s Asia/Middle East/Africa region fell 0.3%. European operating income rose 5% even while “top-line results continue to be impacted by the challenging consumer environment.”
The company’s CEO said:
While our consolidated results this quarter were positive, global comparable sales for July are expected to be relatively flat. Based on recent sales trends, our results for the remainder of the year are expected to remain challenged.
McDonald’s did not offer guidance in its earnings press release. The company cut its capex spending by $100 million, to $3.1 billion, and reduced the number of new stores it plans to open to a range of 1,500 to 1,550, down 50 at the top end.
The consensus forecast for the second quarter calls for EPS of $1.55 on revenues of $7.47 billion. The current full-year forecast calls for EPS of $5.69 on revenues of $28.46 billion.
McDonald’s shares are down 2.3% in premarket trading this morning, at $97.95 in a 52-week range of $83.31 to $103.70. Thomson Reuters had a consensus analyst price target of around $106.60 before today’s report.