McDonald's Corp. on Thursday reported slightly lower third-quarter earnings, its fourth consecutive quarterly decline, despite signs that European demand was recovering from the effects of mad cow disease. The world's biggest restaurant company said net income for the quarter was $545.5 million, or 42 cents a share, down 1 percent from $548.5 million, or 41 cents a share, a year earlier. Analysts polled by Thomson Financial/First Call were expecting an average of 39 cents.
"It does look like Europe is starting to come back," said Bear Stearns restaurant analyst Joe Buckley. "But they're kind of nudging down the fourth quarter, even with currency looking a little bit better. That's modestly disappointing."
McDonald's said it sees fourth-quarter earnings of 34 cents to 36 cents a share, excluding currency effects. Wall Street analysts were expecting an average 36 cents per share, including currency effects.
The company said that, if foreign exchange rates stay the same for the rest of the year, exchange effects would shave 4 to 5 cents a share off full-year results. It did not say how much of that was for the fourth quarter.


Systemwide sales, which include company-owned and franchised restaurants, rose 1 percent to $10.63 billion from $10.51 billion a year earlier, driven by new store openings. Operating income fell 18 percent to $746.6 million from $910.8 million.
Bureau Report