McDonald's sees strong January sales

Coffee, oatmeal and European business drive the chain's results higher than expected.

By Kim Peterson Feb 8, 2011 11:05AM
Credit: (© Darren McCollester/Newsmakers/Getty Images)
Caption: McDonald's signOatmeal is treating McDonald's (MCD) well.

The burger chain reported a 5.3% increase in same-store sales in January from a year ago, more than the 4.5% analysts were expecting. Europe was the star of the month, with sales up 7% and contributing 40% of revenue.

In the U.S., sales of coffee and the new oatmeal menu item helped sales grow 3.1% -- not bad considering the horrendous weather in January that kept people from visiting stores. And the whole picture was decidedly brighter than a year ago, when McDonald's said its same-store sales rose only 2.6%, and that U.S. sales were down 0.7%.

January also saw sales rise 5.2% in Asia, Africa and the Middle East.


Post continues after video:

McDonald's shares jumped more than 2% on the news Tuesday to $75.05 in morning trading. Even so, the stock is down 2% since the start of the year.

The bump in sales is good news for McDonald's, which said it will raise prices this year to keep up with increased costs for raw materials. Analysts expect that the prices McDonald's pays for chicken, wheat and cheese will rise 2% to 2.5% this year, The Los Angeles Times reported.

McDonald's has said its price increases will not be across the board, however.



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