McDonald’s sees profits rise but misses December targets

 
Elizabeth Fournier
McDONALD’S has reported a nine per cent rise in global profits for 2010 with net profits of $4.95bn (£3.1bn) across its business, despite a slowdown in both fourth-quarter profits and sales. The fast-food retailer also said it expected to raise its prices this year, to offset a hike in its ingredients used to make its products.

Despite like-for-like restaurant sales for December gaining 2.6 per cent in the US, the rise fell below analyst predictions of 3.9 per cent growth.

Figures were further dented by a 0.5 per cent drop in European same-restaurant sales – well below analyst forecasts of a 3.4 per cent rise.

According to a McDonald’s spokesperson, the biggest contributors to European sales were the traditionally strong markets of France and Russia, with its other key markets of Germany and the UK showing a comparative increase in sales and footfall despite the impact of severe weather.

Net income in the fourth quarter rose to $1.24bn compared with $1.22bn in the year-earlier quarter.

Continuing the trend it set with price hikes in China over 2010, McDonald’s finance chief Pete Bensen said that the group would “raise prices where it makes sense” across the rest of the world, though no specifics were given on timing or how the changes would be rolled out.