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McDonald's sales surge in December

January 18, 2007|From the Associated Press

CHICAGO — McDonald's Corp. ended one of its strongest years with a sales acceleration, saying Wednesday that better-than-expected December results from its resurgent European restaurants and elsewhere would push fourth-quarter profit above Wall Street's estimates.

Its stock price rose to the latest in a series of seven-year highs, climbing 29 cents to $44.86.

Boosted in the U.S. by robust demand for breakfast items and the chicken snack wrap, the world's largest fast-food chain said global comparable sales rose 7.2% in December, 6.3% for the quarter and 5.7% for 2006 compared with a year earlier. That made it four years of continuing sales gains from restaurants open more than a year, since a rare slump ended.

Wachovia analyst Jeff Omohundro said the company's 2006 results were impressive because they handily beat difficult comparisons to the previous year.

The Oak Brook, Ill.-based chain said it now expected to post fourth-quarter earnings of $1 a share, or 61 cents a share excluding a 39-cent gain related to the spinoff of Mexican-style chain Chipotle last year. That result from continuing operations would be 3 cents a share better than the 58-cent consensus estimate of analysts polled by Thomson Financial.

McDonald's said its European operation had its best year in nearly 15 years with a 5.8% comparable sales increase in 2006.

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