McDONALD’S REPORTS THIRD QUARTER 2023 RESULTS
PR Newswire
CHICAGO, Oct. 30, 2023
-- Global Systemwide sales* increased 11% for the quarter, with global comparable sales of nearly 9% and strong growth across each segment -- Digital Systemwide sales in our top six markets were nearly $9 billion for the quarter, representing over 40% of their Systemwide sales
CHICAGO, Oct. 30, 2023 /PRNewswire/ — McDonald’s Corporation today announced results for the third quarter ended September 30, 2023.
“With global Systemwide sales growth of 11%, our third quarter results reflect our position of strength as the industry leader,” said McDonald’s President and Chief Executive Officer, Chris Kempczinski. “The macroeconomic environment is unfolding in line with our expectations for the year, and we continued to deliver convenience and value for our customers. Thanks to the entire McDonald’s System’s outstanding execution of Accelerating the Arches, we remain confident in our future and the strategic direction of our business.”
Third quarter financial performance:
-- Global comparable sales increased 8.8%, reflecting strong comparable sales across all segments: -- U.S. increased 8.1% -- International Operated Markets segment increased 8.3% -- International Developmental Licensed Markets segment increased 10.5% -- Consolidated revenues increased 14% (11% in constant currencies). -- Systemwide sales increased 11% (10% in constant currencies). -- Consolidated operating income increased 16% (13% in constant currencies) and included $26 million of pre-tax charges, primarily related to restructuring costs associated with the Company's internal effort to modernize ways of working (Accelerating the Organization). -- Diluted earnings per share was $3.17, an increase of 18% (15% in constant currencies).** -- The Company declared a 10% increase in its quarterly cash dividend to $1.67 per share.
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*Refer to page 4 for a definition of Systemwide sales.
**Refer to the table on page 3 for additional details on diluted earnings per share.
COMPARABLE SALES Increase/(Decrease) ------------------------------ Quarters Ended September 30, 2023 2022 ----------------------------------------- -------------- -------------- U.S. 8.1 % 6.1 % International Operated Markets 8.3 8.5 International Developmental Licensed Markets & Corporate 10.5 16.7 Total 8.8 % 9.5 % ------------------------------------------ -------------- -------------- -- U.S.: Comparable sales results benefited from strong average check growth driven by strategic menu price increases. Successful restaurant level execution, effective 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. -- International Developmental Licensed Markets: The quarter reflected strong comparable sales in all geographic regions. KEY FINANCIAL METRICS - CONSOLIDATED Dollars in millions, except per share data Quarters Ended September 30, Nine Months Ended September 30, -------------- ---------------------------------------------------- ------------------------------------------------------ Inc/ (Dec) Inc/ (Dec) Excluding Excluding Inc/ Currency Inc/ Currency 2023 2022 (Dec) Translation 2023 2022 (Dec) Translation -------------- ----------- ----------- ----- ----------- ------------ ------------ ----- ----------- Revenues $ 6,692.2 $ 5,872.1 14% 11% $ 19,087.5 $ 17,256.1 11% 11% Operating income 3,208.3 2,763.9 16 13 8,844.8 6,788.3 30 31 Net income 2,317.1 1,981.6 17 14 6,429.8 4,274.0 50 51 Earnings per share-diluted $ 3.17 $ 2.68 18% 15% $ 8.76 $ 5.75 52% 53% -------------- ----------- ----------- ----- ----------- ------------ ------------ ----- -----------
Results for 2023 included the following:
-- Pre-tax charges of $26 million, or $0.02 per share, for the quarter and $224 million, or $0.23 per share, for the nine months, primarily related to restructuring costs associated with Accelerating the Organization
Results for 2022 included the following:
-- Pre-tax charges of $1,281 million, or $1.44 per share, for the nine months, related to the sale of the Company's business in Russia -- Pre-tax gain of $271 million, or $0.40 per share, for the nine months, related to the Company's sale of its Dynamic Yield business -- $537 million, or $0.72 per share, for the nine months, 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.
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NET INCOME AND EARNINGS PER SHARE-DILUTED RECONCILIATION Dollars in millions, except per share data Quarters Ended September 30, ------------------- ------------------------------------------------------------------------------------------------ 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 $ 2,317.1 $ 1,981.6 17% 14% $ 3.17 $ 2.68 18% 15% (Gains)/charges 20.0 -- 0.02 -- Tax Settlement -- -- -- -- Non-GAAP $ 2,337.1 $ 1,981.6 18% 15% $ 3.19 $ 2.68 19% 16% ------------------- --------- --------- ----- ----------- ---------- ---------- ----- ----------- Nine Months Ended September 30, ------------------- ---------------------------------------------------------------------------------------------------- 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 $ 6,429.8 $ 4,274.0 50% 51% $ 8.76 $ 5.75 52% 53% (Gains)/charges 168.1 770.7 0.23 1.04 Tax Settlement -- 537.2 -- 0.72 Non-GAAP $ 6,597.9 $ 5,581.9 18% 19% $ 8.99 $ 7.51 20% 20% ------------------- --------- --------- ----- ----------- ---------- ---------- ----- -----------
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THE FOLLOWING DEFINITIONS APPLY TO THESE TERMS AS USED THROUGHOUT THIS RELEASE
Constant currency results exclude the effects of foreign currency translation and are calculated by translating current year results at prior year average exchange rates. Management reviews and analyzes business results excluding the effect of foreign currency translation, impairment and other charges and gains, as well as material regulatory and other income tax impacts, and bases incentive compensation plans on these results because the Company believes this better represents underlying business trends.