Services

New McDonald’s U.S. President Returning to His Roots

McDonalds Store
Source: McDonald's Corp.
McDonald’s Corp. (NYSE: MCD) announced on Friday that Mike Andres will replace retiring McDonald’s U.S. president Jeff Stratton who has spent 41 years under the Golden Arches. Andres has plenty of experience at McDonald’s having worked at the company for 30 years himself before accepting the Chairman/CEO/President position at privately held Logan’s Roadhouse Inc. in early 2013. The change is scheduled to occur on October 15th.

Stratton replaced Jan Fields as McDonald’s U.S. president in December 2012, shortly after current CEO Don Thompson took the reins the previous July. Stratton has been unable to turn around the company’s U.S. operations and same-store sales have been stalled or worse. July sales fell 3.2% year-over-year in the U.S. and were down 1.4% in the first quarter of this year and 1.5% in the second quarter.

Andres, who ran the company’s central U.S. division for 2 years before leaving for Logan’s Roadhouse, may have a relatively short time to come up with some good news — or it could be that Thompson is the one who will feel the most pressure. An analyst at Bernstein Research told Reuters, “It’s hard to argue that this type of turnover doesn’t put more scrutiny on a CEO. If results stay weak despite turnover in these executive roles, then ultimately it’s the responsibility of the CEO.”

Logan’s Roadhouse struggled both before and since Andres took over there, but he has cut the losses signifcantly. In 2013 the company posted a net loss of $108 million. In the first three quarters of its 2014 fiscal year the company’s net loss has dropped to about $22.8 million. The fourth quarter ended in July and if the 2014 quarter matches the 2013 fourth quarter for net sales, the net loss for the year will be on the order of $5 million for fiscal year 2014.

The change hasn’t had any big impact on McDonald’s shares, trading down about 0.1% in the mid-afternoon at $94.42 in a 52-week range of $92.22 to $103.78.