McDonald's income rises 80% in '08

by Eric Schroeder
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OAK BROOK, ILL. — New product introductions coupled with a focus on food quality and value helped drive strong year-over-year earnings at McDonald’s Corp. in fiscal 2008. In the year ended Dec. 31, net income totaled $4,313.2 million, equal to $3.76 per share on the common stock, up 80% from $2,395.1 million, or $1.98 per share, in fiscal 2007.

Total revenue for the year was $23,522.4 million, up 3% from $22,786.6 million during fiscal 2007.

"Two-thousand-and-eight was a strong year for McDonald’s," said James Skinner, chief executive officer. "Through our strategic focus on menu choice, food quality and value, the average number of customers served per day increased to more than 58 million in 2008. Comparable sales and guest counts were positive across all segments for every quarter, and the company delivered double-digit growth in operating income for the fourth quarter and the year. These accomplishments validate the strength and resilience of McDonald’s ‘Plan to Win.’"

Within its U.S. operations, McDonald’s said it achieved "very strong results" by "seizing opportunities in the key growth areas of chicken, breakfast, beverages and convenience."

"Throughout 2008, the U.S. built brand loyalty by reinforcing the company’s dedication to value, convenience and menu variety with the addition of the Southern Style Chicken biscuit and sandwich, drive-thru enhancements to improve service and ongoing expansion of McCafe specialty coffees," the company said.

In the fourth quarter ended Dec. 31, McDonald’s posted net income of $985.3 million, or 87c per share, down 23% from $1,273.2 million, or $1.06 per share. Last year’s results included a tax benefit of 33c per share. Sales for the fourth quarter of fiscal 2008 totaled $5,565 million, down from $5,753.6 million.

Looking ahead to 2009, Mr. Skinner said the company plans to invest $2.1 billion of capital to open approximately 1,000 new McDonald’s restaurants and reinvest in existing locations.

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