published Tuesday, September 11th, 2012

McDonald's sales figure bounces back in August

CANDICE CHOI, AP Business Writer

MICHELLE CHAPMAN, AP Business Writer

NEW YORK — McDonald's said a key sales figure climbed 3.7 percent in August, as the fast-food chain emphasized the value of its menu offerings amid the challenging global economy.

The world's biggest hamburger chain's strongest performance came from the region encompassing Asia, the Middle East and Africa, with revenue at stores open at least 13 months up 5.7 percent.

The Oak Brook, Ill.-based company said Tuesday that strong results in Australia and China fueled the performance, along with a shift in the timing of Ramadan.

In the U.S., the company said its breakfast menu and value items pushed up sales by 3 percent. Last month, the figure had dipped 0.1 percent after the company said its promotions failed to drive growth.

In Europe, which is McDonald's biggest market and accounts for 40 percent of its business, the figure rose 3.1 percent on strength in the U.K., France and Russia. The company said its sponsorship of the London Olympics helped lift results. Another strong contributor was its Coke Glass promotion, in which customers got a free glass and wristband when they bought an extra value meal or premium salad.

The overall results for the month were offset by weakness in Japan, Germany and parts of southern Europe that have been hard hit by the economy.

Sales at all the company's restaurants rose 1.2 percent for the month. McDonald's, which has more than 33,500 locations around the world, is often seen as a bellwether for the industry.

The increase in August follows a disappointing showing in July, when the figure came in flat. That was the worst showing in more than nine years; the last time the figure dipped for McDonald's was in April 2003.

After years of outperforming its rivals, analysts say McDonald's could be heading into a period of slower growth. The company is also facing increasing competition, with Burger King Worldwide Inc. and The Wendy's Co. working to revive their brands.

Revenue in restaurants open at least 13 months is a key measure of a restaurant chain's performance because it strips out the impact of recently opened or closed stores. The figure is a snapshot of money spent on food at both company-owned and franchised restaurants. They do not reflect corporate revenue.

Shares of McDonald's Corp. rose 70 cents at $91.30 in premarket trading Tuesday.

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