Earnings roundup: McDonald's profit slips as U.S. sales drop

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Posted: Wednesday, April 23, 2014 12:00 am

NEW YORK — McDonald's is fighting to hold onto customers in the U.S.

The world's biggest hamburger chain said sales at established U.S. locations fell 1.7 percent in the first three months of the year as guest counts declined. After a decade of consistent growth, sales also declined last year as McDonald's struggled to roll out an array of new menu items and fend off competitors.

CEO Don Thompson said in a call with analysts and investors Tuesday that the company is working to improve its operations and marketing in key regions, including the U.S.

Thompson said the decline in U.S. guest counts in the latest quarter was largely the result of severe weather. Last week, however, Chipotle said its sales rose 13.4 percent on stronger customer traffic.

The disappointing performance in the U.S. reflects the struggles McDonald's is facing as people flock to chains that position themselves as higher-quality alternatives.

For the quarter ended March 31, sales rose 1.4 percent at established locations in Europe and 0.8 percent in the unit encompassing Asia, the Middle East and Africa, offsetting the decline in the U.S. Overall, global sales edged up 0.5 percent.

Profit fell to $1.2 billion, or $1.21 per share. Analysts expected $1.24 per share, according to FactSet. Revenue edged up to $6.7 billion, but was shy of the $6.71 billion Wall Street expected. — AP

Lockheed Martin

Lockheed Martin Corp., the U.S. government's top contractor, said its first-quarter profit jumped 23 percent, topping analysts' estimates even as federal budget cuts sapped sales.

Net income from continuing operations rose to $933 million, or $2.87 a share, from $761 million, or $2.33 a share, a year earlier, the company said. That was higher than the $2.53-a-share estimate of 21 analysts surveyed by Bloomberg.

The maker of the F-35 jet, the Pentagon's most expensive weapons program, also boosted its full-year profit outlook. It now anticipates a profit from continuing operations of $10.50 to $10.80 a share, compared with $10.25 to $10.55 forecast in January. The contractor affirmed its earlier estimate of $44 billion to $45.5 billion in sales for 2014. — Bloomberg News

Comcast

Comcast Corp. is having no problem getting bigger. The largest U.S. cable company added video customers for a second straight quarter, bucking the industry trend of losing TV subscribers.

Video subscriber growth and the Winter Olympics helped first-quarter profit of 68 cents a share, excluding some items, beat the 64 cents analysts estimated on average.

Philadelphia-based Comcast also reported in Tuesday's statement that revenue rose to $17.4 billion. Analysts had predicted $17 billion.

Comcast is about to get even larger once its proposed $45 billion purchase of Time Warner Cable Inc. is approved by regulators. — Bloomberg News

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