CHICAGO – McDonald's Corp. (MCD) on Tuesday said sales at its namesake U.S. restaurants open at least 13 months rose a better-than-expected 4.6 percent in February, but weak results in Europe sent the company's shares down 3 percent.
Same-store sales, a key retail measure, rose 4.6 percent in the United States, McDonald's largest market, thanks in part to a promotion of the company's new Chicken Selects (search) fried chicken strips. Europe, the company's No. 2 market, reported a drop of 3.4 percent.
In recent months, McDonald's sales in Europe have been hard-hit by economic weakness in Germany that was aggravated by poor weather in February.
"We had an extraordinary weather event over the last eight or nine days of the month," McDonald's Chief Executive Jim Skinner said in an interview, referring to heavy snow in London, Paris and Germany.
Skinner added that the company was working on introducing new premium products in Germany to balance that business' equivalent of the Dollar Menu (search).
"We'll crack the code sooner or later," he said of McDonald's European unit, adding that McDonald's was "right about on track" with its expectations for the first quarter.
Several analysts had expected McDonald's to have difficulty posting an increase in U.S. same-store sales for February due to a tough comparison against last year, when same-store sales rose 20.1 percent. In Europe, however, some analysts had been expecting flat or positive results for the period.
Last year's period included an extra day because of Leap Year. Excluding that extra day, same-store sales would have been up 7.6 percent in the United States and up about 0.6 percent in Europe.
J.P. Morgan analyst John Ivankoe said in a note to clients that several analysts' estimates for Europe had likely not taken into account the calendar shift and a lack of discounting compared with the previous month.
Worldwide, same-store sales at McDonald's restaurants rose 1.6 percent.
Total systemwide sales rose 4.4 percent in February, but would have been up only 2.7 percent without the weaker dollar, which boosts the dollar value of sales overseas.
McDonald's shares were down $1.02, or 3 percent, at $33.19 on the New York Stock Exchange on Tuesday afternoon.