McDonald’s (MCD) Beats by a Penny

McDonald’s Corporation (MCD) posted second-quarter 2010 earnings of $1.13 per share ,beating the Zacks Consensus Estimate by a penny. The second quarter earnings surged 15% from 98 cents reported in the prior-year quarter.

The better-than-expected results were driven by value offerings and premium products, and a rise in comparable-store sales across all regions.

McDonald’s, the world’s largest hamburger chain, said that revenue for the quarter climbed 5% to $6.0 billion, outperforming the Zacks Consensus Estimate of $5.9 billion.

Revenues from company-operated restaurants rose 4% to $4.0 billion, while revenues from franchise-operated restaurants jumped 8% to $1.9 billion. Total operating income soared 10% to $1.8 billion.

McDonald’s global comparable-store sales continue to grow, while maintaining healthy margins on an expanding market share. Global comparable-store sales rose 4.8% during the quarter with the U.S. sales up 3.7%, Europe up 5.2% and Asia/Pacific, Middle East and Africa (APMEA) up 4.6%.

The new menu offerings — including value-based drinks, frappes and McCafe premium coffee line-up, along with the breakfast dollar menu — have perked up U.S. comps and operating income (up 7%).

In Europe, the U.K., France and Russia led the operating income growth of 9%. The premium product innovation, marketing promotion and restaurant re-imaging program continued to drive market share gains. In APMEA, operating income jumped 19% led by Australia and China.

During the quarter, MCDonald’s returned shareholders $1.6 billion through share repurchases and dividend.

One of McDonald’s primary competitors, Yum! Brands, Inc. (YUM) reported its second quarter 2010 earnings of 58 cents per share on July 13, which surpassed the Zacks Consensus Estimate of 54 cents. The earnings increased 17% year over year, mainly on the back of strong performances in its China division.

MCDONALDS CORP (MCD): Free Stock Analysis Report
YUM! BRANDS INC (YUM): Free Stock Analysis Report
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