Industry News | October 22, 2003

McDonald's Announces Positive Results

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McDonald's Corporation today announced positive results for the quarter and nine months ended September 30, 2003.

Chairman and Chief Executive Officer Jim Cantalupo said in a statement:

"Earnings per share increased 13 percent to a record high of 43 cents. This performance indicates that our revitalization plan is beginning to yield results. Our focused and disciplined approach is producing strong sales and profitability improvements in our U.S. business and improved trends in some international markets; still, there are many opportunities to improve our business as we move forward.

"In the U.S., our emphasis on improving the taste of our food, the introduction of Premium Salads and McGriddles, continued demand for the Dollar Menu's outstanding value, and other initiatives are generating almost one million new customer visits each day. While we are pleased with our customers' response to these innovations, our efforts remain aligned around delivering improved service and a superior overall restaurant experience.

"Europe delivered its highest quarterly sales increase this year. While we've had solid performance in many European markets, improving results in our largest markets is critical to achieving our long-term sales and profit targets. To strengthen the business in these markets, we are working to increase relevance and customer visit frequency by enhancing our value positioning and adding more menu choices. I am confident that our European customers will notice the changes and respond favorably.

"Around the world, we recently launched our first-ever global marketing initiative, 'i'm lovin' it.' This initiative is designed to reaffirm McDonald's marketing leadership and help keep McDonald's contemporary and relevant in the minds of our customers.

"Financially, we have put in place a more disciplined capital allocation approach intended to maximize returns over the long term. Our free cash flow - cash from operations less capital expenditures - is significant and growing. We are paying down debt, buying back stock and paying a significantly higher dividend. These actions are aligned with our commitment to return cash to shareholders without compromising our financial strength or flexibility.

"While we are encouraged by our current business momentum, we know that significant opportunities remain -- particularly in the area of service. Every day, we have nearly 47 million occasions to demonstrate operational excellence and satisfy our customers. Our revitalization plan is designed to build on our strengths, address our challenges and deliver consistent, positive results."