McDonald’s Corporation (NYSE:MCD) shares jumped in pre-market trade on Monday after the fast-food giant posted better-than-expected first-quarter earnings.
The Illinois-based firm has been looking to drive traffic into its 37,000 stores around the world by extending its value offering – the $1 $2 $3 menu, for example – but said it was the higher-ticket items which fuelled higher check averages during the quarter.
Global same-store sales rose 5.5% in the opening three months of 2018, while the number of guests coming through its doors edged 0.8% higher.
Total revenue fell once again though to US$5.14bn from US$5.68bn in the year-ago period due to the burger-flipper’s “strategic refranchising initiative”, but that was still comfortably ahead of analyst forecasts of US$4.98bn.
Net income climbed to US$1.38bn, or US$1.72 a share, from US$1.21bn, or US$1.47 a share, in the year-ago period.
Excluding a small one-time tax cost McDonald’s reported adjusted earnings of US$1.79 per share – a 22% increase year-over-year and better than Wall Street forecasts of US$1.67.
“We continued to build upon the broad-based momentum of our business, marking 11 consecutive quarters of positive comparable sales and our fifth consecutive quarter of positive guest counts," said McDonald's President and Chief Executive Officer Steve Easterbrook.
“More customers are recognising that we are becoming a better McDonald's, appreciating our great tasting food, fast and friendly service and compelling value as we execute our Velocity Growth Plan.”
McDonald’s shares were up 4.4% to US$165.30 shortly before the opening bell in New York.