McDonald’s shareholders are lovin’ it: Nearly 5pc profit increase


The McDonald’s fast-food empire reported a “fat” 4.8% increase in profit in the first quarter of 2012. McDonald’s profit increased to $1.27 billion or $1.23/share. Last year at this time, the world’s largest restaurant chain reported profit at $1.21 billion and $1.15 share.
McDonald’s operates about 33,000 outlets around the world. Although franchises already seem to be everywhere, the chain plans to open 1,500 new stores this year and plans to remodel thousands more. This is “earnings season,” as corporations of all kinds release their quarterly financial statements. Why does McDonald’s continue to be successful in the crowded fast-food marketplace? According to the Wall Street Journal, McDonald’s ” has been able to boost guest traffic and sales faster than most of its competitors with its increasingly diverse menu…and its growing global operations. ” A Wall Street analyst cited by Bloomberg claims that “McDonald’s is taking market share just because their restaurants are more up-to-date, more modern and cleaner” than other burger chains. Chicken McBites and other new menu items are said to have contributed to the climbing profits. Changes in corporate leadership are coming too, with a new CEO and CFO taking over later this year. Current CEO Jim Skinner is retiring in July after 41 years with McDonald’s, and eight years at the top job.
The fact that you can’t turn on the TV or radio without encountering a McDonald’s commercial doesn’t hurt either, but does anyone find this advertising overkill annoying?
The company continues to push forward despite warnings about the obesity epidemic and while the U.S. economy is still weak. McDonald’s and other chains have tweaked their menus somewhat to apparently make the food more health friendly. McDonald’s serves 56 million customers each day and employs 1.6 million people around the world in corporate and restaurant positions.