April 20 - McDonald's announced higher first-quarter profits as global customers eat up the fast food giant's low cost menu and new regional cuisines. Jill Bennett reports.
PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL McDonald's serves up hamburgers, Parisian style, in a McBaguette at restaurants in France - as it adds regional cuisine to its core menu. It's a strategy that seems to be paying off, particularly in hard-hit Europe, its top revenue market. R.J. Hottovy, Director of Research for Morningstar. SOUNDBITE: R.J. HOTTOVY, DIRECTOR OF RESEARCH, MORNINGSTAR (ENGLISH) SAYING: "You are seeing some macroeconomic measures and austerity measures impact results in Europe and other markets as well, but at the same time I think McDonald's, given that they have so many structural advantages between lowest cost from suppliers a wide advertising budget, I think the resiliency in the numbers here is really the story here and I would expect that to continue. I think McDonald's is positioned to thrive in just about any macroeconomic environment." McDonald's, the world's biggest hamburger chain, reported higher quarterly profit, thanks to the growing popularity of its low-priced value menu around the world, restaurant makeovers, and expanded hours at established restaurants in the U.S. and Europe, where it continued to outpace rivals Burger King and Wendy's. SOUNDBITE: R.J. HOTTOVY, DIRECTOR OF RESEARCH, MORNINGSTAR (ENGLISH) SAYING: "The company is firing on all cylinders at this point the only criticism would probably be that they have been a little bit slow to address the China market where they are a clear number two competitor to YUM brands but I think we are starting to see a solid game plan." This summer marks a significant change for the company when CEO Jim Skinner retires. He'll be replaced by COO Don Thompson, considered the mastermind behind recent product successes and this summer's new offerings. SOUNDBITE: R.J. HOTTOVY, DIRECTOR OF RESEARCH, MORNINGSTAR (ENGLISH) SAYING: "They've got a couple of premium products on the menu too that will do very well on the slate later for this summer you know English pub burgers being one of the them, couple other beverage extensions." McDonald's forecasts a 4 percent rise in global established restaurant sales in April. Just a taste of what many analysts expect to see under the new CEO's leadership. Jill Bennett, Reuters