US food chain’s profitup 8.6%

MCDONALD’S Corp, the world’s biggest restaurant chain, said third-quarter profit gained 8.6% as lower-priced items boosted US store sales.

Net income climbed to $1.51 billion (€1.1bn), or $1.45 a share, from $1.39bn, or $1.29, a year earlier, the Illinois-based company stated yesterday.

Analysts had expected $1.43 a share, the average of 24 estimates compiled by Bloomberg.

McDonald’s chief executive, Jim Skinner, has sought to draw American diners with low-priced menu items, such as the $1 McDouble burger, as the nation’s 9.1% unemployment rate saps consumer confidence.

Sales in the US were driven by fruit smoothies, Chicken McNuggets and breakfast foods, the company said.

“They continue to gain market share,” Brian Bittner, an analyst at Oppenheimer & Co in New York, said in an interview.

“Consumers are searching for value more than they ever really have.”

Mr Bittner rates the shares as outperforming.

McDonald’s rose 3.3% in early trading in New York. The shares had earlier climbed to $92.09, their highest level since at least 1980.

Global sales at stores which have been open more than 13 months climbed 5% during the quarter.

Analysts had expected a gain of 4%, on average.

Those sales rose 4.4% in the US, 4.9% in Europe, and increased 3.4% in Asia, the Middle East and Africa.

September same-store sales climbed 6.6% globally, McDonald’s said in a filing.

That topped analysts’ 3.9% average estimate. Same-store sales may rise as much as 5% in October, Skinner said.

Comparable, or same-store sales, are an indicator of growth because the numbers only include older restaurants.

Second-quarter same-store sales increased 5.6% worldwide.

Revenue climbed 14% to $7.17bn in the quarter. Analysts had estimated $7.04bn.

McDonald’s had about 14,000 stores in the US and more than 18,500 overseas at the end of 2010.