MCD McDonalds Corp

By Heather Haddon and Allison Prang 

McDonald's Corp. said that dramatic changes in consumer behavior since the coronavirus pandemic hurt its profit and sales.

The burger giant said Thursday its earnings fell in the first quarter as the virus forced the chain to close restaurants across the globe, limit service and lose sales as consumers no longer ordered food habitually as they did prior.

"We continue to operate in a very challenging and unpredictable environment," CEO Chris Kempczinski said.

Shares fell 1.2% premarket.

Profit of $1.1 billion at the Chicago-based company dropped 17% from a year ago as sales fell to $4.7 billion, down 6% from the previous year's period ending March 31. Analysts' consensus for sales according to FactSet was $4.67 billion.

Earnings were $1.47 a share, which missed analysts' consensus.

The company reported its same-store sales for the quarter earlier this month and said they fell 3.4% overall. McDonald's said they rose in the first two months of the year, but tumbled 22% in March as stores closed in China and beyond. That was around when the Covid-19 pandemic spurred businesses to close and consumers to stay home and socially distance.

Nearly all restaurants in France, Italy, Spain and the U.K. are closed, while operations remain limited in Australia, Canada, Germany, Russia, Japan and Brazil, the company said. McDonald's has resumed service in 99% of its restaurants in China, though demand remains reduced.

Domestically, 99% of McDonald's locations are operating, the company said Thursday.

McDonald's earlier withdrew its guidance for this year and said it was cutting capital spending. The company's board also approved cutting executives' salaries. Mr. Kempczinski's base pay was cut in half.

(END) Dow Jones Newswires

April 30, 2020 08:20 ET (12:20 GMT)

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