McDonald's Sales Dropped in March as Coronavirus Spread
April 08 2020 - 11:07AM
Dow Jones News
By Micah Maidenberg
McDonald's Corp. said sales among its existing base of
restaurants in the U.S. were hit hard in March as the coronavirus
spread and the economy shut down.
The hamburger chain on Wednesday said same-store sales, or those
from restaurants open at least 13 months, increased in January and
February in the domestic market, but then fell 13.4% in March as
elected officials issued guidelines requiring dining rooms to close
and consumers stayed home.
Overall, comparable sales gained 0.1% in the U.S. for the first
quarter, but dropped 3.4% globally.
As of today, 99% of its restaurants in the U.S. are offering at
least some service, such as delivery, carry out or meals via
drive-through windows, the Chicago-based company said.
But locations overseas have been forced to close, including in
France and Italy. In Brazil, 60% of restaurants are operating.
Globally, 75% of stores have at least limited service, according to
the chain.
"There will be more challenges and difficult business decisions
to be made," McDonald's Chief Executive Chris Kempczinski said.
So far, the company's supply chain for food, packaging and other
items hasn't seen disruptions, Mr. Kempczinski said.
McDonald's withdrew its financial forecast for 2020 on
Wednesday, citing uncertainty caused by the coronavirus. It also
said it expects to reduce capital spending by about $1 billion for
the year in part because the company won't open as many new
restaurants in most markets.
The company said it has deferred cash collection of certain
franchisee rent payments and royalties in almost all of the places
where it operates.
Mr. Kempczinski, who became CEO of McDonald's last year, offered
to reduce his base salary by 50%, while other top executives
offered 25% reductions, for the period running from April 15 to
Sept. 30, the company said. The board approved those cuts.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
April 08, 2020 10:52 ET (14:52 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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