European growth helps McDonald's February results

OAK BROOK, Ill. (AP) -- McDonald's says higher global demand, especially in Europe, boosted sales in February.

Revenue at company-owned and franchised restaurants open at least 13 months grew 3.9 percent, more slowly than January's 5.3 percent. McDonald's Corp.'s stock fell 88 cents in midday trading to $75.41.

The monthly sales figure is a snapshot of the dollar value of food sales at all McDonald's restaurants. McDonald's corporate revenue, reported quarterly, includes only revenue at company-owned stores plus fees and rents paid by franchisees.

The sales metric is considered a key indicator of a restaurant chain's performance because it excludes the effects of locations that open or close during the year.

A campaign in France promoting premium beef and a U.K. sales push for the quarter-pound Big Tasty burger helped push the figure up 5.1 percent in Europe. Europe is McDonald's largest region, accounting for about 40 percent of its business.

In the U.S., growth at the burger chain was weaker, with the measurement rising 2.7 percent on demand for breakfast and McCafe drinks.

Sales in stores open at least 13 months rose 4 percent in Asia/Pacific, Middle East and Africa. Results in Japan and Australia were particularly strong.

Total sales for the month rose 8.1 percent. McDonald's doesn't release monthly dollar figures.

The results were "essentially in-line with our expectations," said Sterne Agee analyst Lynne Collier, with international results better than she expected but U.S. business slightly lower.

She added McDonald's is the best positioned fast-food chain to take more of the fast-food market because of its marketing strength, its perception of being low-priced, new menu items and newly renovated stores.

McDonald's, based in Oak Brook, Ill., has outperformed competitors for several years with an expanding menu, including its popular McCafe coffee selections, and an emphasis on low-priced items.

On Monday sandwich chain Subway said it now has more restaurants worldwide than McDonald's - 33,749 compared with McDonald's 32,737 - but McDonald's pulls in substantially higher revenue.

McDonald's, like many of its peers, is dealing with higher ingredient costs and expects to raise prices this year. The company already has raised prices in some parts of the world, which hasn't yet seemed to dampen demand.

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