McDonald’s isn’t lovin’ it, and it’s going to do something about it. The world’s largest hamburger chain reported falling earnings and sales for its fourth quarter on Friday and says it is going to take action this year to save money and bring customers back. This includes slowing down new restaurant openings in some markets. The Oak Brook, Illinois, company’s stock rose slightly in morning trading because its earnings beat Wall Street expectations. An important sales measure fell in all of McDonald’s major markets because of economic uncertainty, a food-safety scandal in China and the changing tastes of diners.
Chief Financial Officer Peter Bensen said in a statement that McDonald’s has a 2015 capital expenditure plan of about $2 billion and is targeting fewer restaurant openings in its most challenged markets. “We believe this lower level of capital spending is prudent while we work to regain our business momentum and improve the sales and profitability at our more than 36,000 restaurants around the world,” he said. For the period ended Dec. 31, McDonald’s earned $1.1 billion, or $1.13 per share. That compares with $1.4 billion, or $1.40 per share, a year earlier. Excluding 9 cents per share for a supplier issue, earnings were $1.22 per share.
The results beat Wall Street expectations. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of $1.20 per share. Revenue fell to $6.57 billion from $7.09 billion. This fell short of the $6.73 billion that analysts polled by Zacks expected. Sales at locations open at least 13 months edged down 0.9 percent on weaker traffic. In the U.S., the metric declined 1.7 percent on fewer customer visits, tough competition and increased expenses. Since late 2012, McDonald’s has twice replaced the president of its flagship U.S. division while fighting to hold onto customers. The company is dealing with competition on a number of fronts, including convenience stores that are selling more food and smaller chains such as Chipotle that market themselves as being of higher quality. More