McDonald`s warns of big hit from China meat scandal

McDonald`s said that a recent scandal over expired meat from a Chinese food supplier has had a "significant negative impact" on sales in China, Japan and some other markets.

New York: McDonald`s said on Monday that a recent scandal over expired meat from a Chinese food supplier has had a "significant negative impact" on sales in China, Japan and some other markets.

The fast food giant also said it was working to regain customer confidence in a region that accounts for 10 per cent of its revenues.

On July 21, Shanghai officials shut the Shanghai Husi Food Co following a television report alleging the plant mixed out-of-date meat with fresh product. Chinese police later detained five Shanghai Husi officials.
As a consequence, "McDonald`s businesses in China, Japan and certain other markets are experiencing a significant negative impact to results," the company said in a quarterly securities filing.

"McDonald`s is undertaking recovery strategies to restore the trust and confidence of our customers," it added.

Last week, McDonald`s said it stopped using food from all Chinese plants owned by Shanghai Husi`s parent company, US-based OSI Group.

Japanese McDonald`s restaurants also halted the sale of products made with chicken from China.

Both McDonald`s and OSI have apologised for the safety problems and pledged action to ensure meat quality.
The McDonald`s warning follows a similar statement last week by Yum Brands, which said the scandal has had a "significant, negative impact" on sales at its Pizza Hut and KFC chains in China.

McDonald`s shares fell 0.7 per cent to USD 93.68 in midday trade.