Fast-food giant McDonald's today reported a 16 per cent drop in first-quarter earnings, meeting lowered estimates.
Sales of hamburgers in Europe continued to flag after outbreaks of animal diseases. The profit decline was the second consecutive quarterly drop for McDonald's.
It had net income of $378.3 million, or 29 cents a share, compared to $450.9 million, or 33 cents, a year ago.Analysts polled by Thomson Financial/First Call had expected McDonald's to post profits of 29 to 30 cents, based on the lowered guidance the company provided in March.
McDonald's has struggled with waning European sales since late last year when BSE was found in herds in several countries.The company reported a rare profit decline in its fourth quarter and has since faced outbreaks of foot-and-mouth disease in parts of Europe, where farmers have been forced to destroy beef herds.The two diseases have prompted some European consumers to avoid beef.
Sales in Europe, which account for about one-fourth of McDonald's total, fell 6 per cent to $2.18 billion from $2.31 billion.Sales in the competitive US market rose 4 per cent to $4.68 billion from $4.51 billion in the same period in 2000.