McDONALD’S REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS
PR Newswire
CHICAGO, Feb. 5, 2024
-- Global comparable sales have grown 9% for the year and over 30% since
2019
-- Systemwide sales* to loyalty members were over $20 billion for the full
year and over $6 billion for the quarter across 50 loyalty markets, with
full year growth of more than 45% over prior year
CHICAGO, Feb. 5, 2024 /PRNewswire/ — McDonald’s Corporation today announced results for the fourth quarter and year ended December 31, 2023.
“Our global comparable sales growth of 9% for the year is a testament to the tremendous dedication of the entire McDonald’s System,” said McDonald’s President and CEO Chris Kempczinski. “Strong execution of our Accelerating the Arches strategy has driven over 30% comparable sales growth since 2019 as our talented crew members, and the industry’s best franchisees and suppliers have demonstrated proven agility with a relentless focus on the customer. By evolving the way we work across the System, we remain confident in the resilience of our business amid macro challenges that will persist in 2024.”
Fourth quarter financial performance:
-- Global comparable sales increased 3.4%, reflecting positive comparable
sales across all segments:
--
-- U.S. increased 4.3%
--
-- International Operated Markets segment increased 4.4%
--
-- International Developmental Licensed Markets segment increased
0.7%, reflecting the impact of the war in the Middle East
-- Consolidated revenues increased 8% (6% in constant currencies).
-- Systemwide sales increased 6% (5% in constant currencies).
-- Consolidated operating income increased 8% (6% in constant currencies).
Results included $72 million of pre-tax charges related to the write-off
of impaired software no longer in use and $66 million of pre-tax charges
related to the Company's Accelerating the Arches growth strategy,
including restructuring costs associated with Accelerating the
Organization. Excluding these charges, consolidated operating income
increased 14% (11% in constant currencies).**
-- Diluted earnings per share was $2.80, an increase of 8% (5% in constant
currencies). Excluding the charges described above of $0.15 per share,
diluted earnings per share was $2.95, an increase of 14% (11% in constant
currencies).**
Full year financial performance:
-- Global comparable sales increased 9.0%, reflecting strong comparable
sales across all segments:
--
-- U.S. increased 8.7%
--
-- International Operated Markets segment increased 9.2%
--
-- International Developmental Licensed Markets segment increased
9.4%
-- Consolidated revenues increased 10% (10% in constant currencies).
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-- Systemwide sales increased 10% (10% in constant currencies).
-- Consolidated operating income increased 24% (24% in constant currencies).
Results included $290 million of pre-tax charges related to the Company's
Accelerating the Arches growth strategy, including restructuring costs
associated with Accelerating the Organization and $72 million of pre-tax
charges related to the write-off of impaired software no longer in use.
Excluding these current year charges, as well as prior year pre-tax
charges and gains of $1.3 billion and $271 million, respectively,
consolidated operating income increased 16% (16% in constant
currencies).**
-- Diluted earnings per share was $11.56, an increase of 39% (38% in
constant currencies). Excluding the current year charges described above
of $0.38 per share, diluted earnings per share was $11.94, an increase of
18% (18% in constant currencies) when also excluding prior year charges
and gains and a tax settlement.**
*Refer to page 5 for a definition of Systemwide sales.
**Refer to pages 3 and 4 for additional details on our results for the fourth quarter and full year 2023 and 2022.
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COMPARABLE SALES
Increase/(Decrease)
-----------------------------
Quarters Ended December 31,
2023 2022
------------------------------------------ ------------- --------------
U.S. 4.3 % 10.3 %
International Operated Markets 4.4 12.6
International Developmental Licensed
Markets & Corporate 0.7 16.5
Total 3.4 % 12.6 %
------------------------------------------- ------------- --------------
-- U.S.: Comparable sales results benefited from strong average check growth
driven by strategic menu price increases. Successful restaurant level
execution, effective menu and marketing campaigns and continued digital
and delivery growth contributed to strong comparable sales results.
-- International Operated Markets: Segment performance was driven by strong
comparable sales in most markets, led by the U.K., Germany and Canada,
partly offset by negative comparable sales in France.
-- International Developmental Licensed Markets: Segment performance
reflected positive comparable sales in all geographic regions, with the
exception of the Middle East, which was impacted by the war in the
region.
KEY FINANCIAL METRICS - CONSOLIDATED
Dollars in millions, except per share data
Quarters Ended December 31, Years Ended December 31,
-------------- ---------------------------------------------------- -----------------------------------------------------
Inc/ (Dec) Inc/ (Dec)
Excluding Excluding
Inc/ Currency Inc/ Currency
2023 2022 (Dec) Translation 2023 2022 (Dec) Translation
-------------- ----------- ----------- ----- ----------- ----------- ------------ ----- -----------
Revenues $ 6,406.2 $ 5,926.5 8% 6% $ 25,493.7 $ 23,182.6 10% 10%
Operating
income 2,801.9 2,582.7 8 6 11,646.7 9,371.0 24 24
Net income 2,039.0 1,903.4 7 5 8,468.8 6,177.4 37 37
Earnings per
share-diluted $ 2.80 $ 2.59 8% 5% $ 11.56 $ 8.33 39% 38%
--------------- ----------- ----------- ----- ----------- ----------- ------------ ----- -----------
Results for 2023 included the following:
-- Pre-tax charges of $72 million, or $0.08 per share, for the quarter and
the year, related to the write-off of impaired software no longer in use
-- Pre-tax charges of $66 million, or $0.07 per share, for the quarter and
$290 million, or $0.30 per share, for the year, related to the Company's
Accelerating the Arches growth strategy, including restructuring costs
associated with its internal effort to modernize ways of working
(Accelerating the Organization)
Results for 2022 included the following:
-- Pre-tax charges of $1,281 million, or $1.44 per share, for the year,
related to the sale of the Company's business in Russia
-- Pre-tax gain of $271 million, or $0.40 per share, for the year, related
to the Company's sale of its Dynamic Yield business
-- $537 million, or $0.73 per share, for the year, of nonoperating expense
related to the settlement of a tax audit in France
Excluding the above items, results for both periods reflected strong operating performance driven primarily by higher sales-driven Franchised margins.
3
NET INCOME AND EARNINGS PER SHARE-DILUTED RECONCILIATION
Dollars in millions, except per share data
Quarters Ended December 31,
------------------- ----------------------------------------------------------------------------------------------
Net Income Earnings per share - diluted
Inc/ (Dec) Inc/ (Dec)
Excluding Excluding
Inc/ Currency Inc/ Currency
2023 2022 (Dec) Translation 2023 2022 (Dec) Translation
------------------- --------- --------- ----- ----------- --------- --------- ----- -----------
GAAP $ 2,039.0 $ 1,903.4 7% 5% $ 2.80 $ 2.59 8% 5%
(Gains)/charges 105.6 -- 0.15 --
Tax Settlement -- -- -- --
Non-GAAP $ 2,144.6 $ 1,903.4 13% 10% $ 2.95 $ 2.59 14% 11%
------------------- --------- --------- ----- ----------- --------- --------- ----- -----------
Years Ended December 31,