Mcdonald's (MCD) announces third quarter 2020 comparable sales and dividend announcement
Category: Mcdonald's (MCD)
Date: 12 October 2020 Stock price of Mcdonalds (MCD): $224.83 We take a look at the third quarter 2020 comparable sales and dividend announcement from Mcdonald's (MCD), the world's largest burger franchise group. The group announced a $1.29 dividend for the quarter that will be paid on 15 December 2020
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Our third quarter performance demonstrates the underlying resilience of the McDonald's brand. Our unique strengths, including our unrivaled drive-thru presence around the world, advanced delivery and digital capabilities, and marketing scale have become even more important during the pandemic. - McDonald's President and Chief Executive Officer Chris Kempczinski"
More About Mcdonald's (MCD)
The McDonald Brothers
Dick and Mac McDonald moved to California to seek opportunities they felt unavailable in New England. Failing in the movie business, they subsequently proved successful in operating drive-in restaurants. In 1948 they took a risk by streamlining their operations and introducing their Speedee Service System featuring 15 cent hamburgers. The restaurant’s success led the brothers to begin franchising their concept—nine becoming operating restaurants.
Ray Kroc
A native Chicagoan, Ray Kroc left high school after his sophomore year to join the World War One Red Cross Ambulance Corps. The war ended before his unit was sent overseas with Ray returning home to earn a living as a musician and later selling paper cups. In 1939, he became the exclusive distributor of the Multimixer (a milkshake mixing machine). He visited the McDonald brothers in 1954 which led to him becoming their franchise agent. He opened up the first restaurant for McDonald’s System, Inc., a predecessor of McDonald’s Corp. in Des Plaines, Illinois in April, 1955. McDonald’s acquired the rights to the brother’s company in 1961 for $2.7 million.
Going Global
Ray Kroc’s vision was that there would be 1,000 McDonald’s restaurants solely in the United States. Yet, McDonald’s continued to grow and expand into international markets beginning in 1967 opening in Canada and Puerto Rico. Today, the company has over 36,000 restaurants in over 100 nations. The most recent opening in Kazakhstan in 2016.
Dick and Mac McDonald moved to California to seek opportunities they felt unavailable in New England. Failing in the movie business, they subsequently proved successful in operating drive-in restaurants. In 1948 they took a risk by streamlining their operations and introducing their Speedee Service System featuring 15 cent hamburgers. The restaurant’s success led the brothers to begin franchising their concept—nine becoming operating restaurants.
Ray Kroc
A native Chicagoan, Ray Kroc left high school after his sophomore year to join the World War One Red Cross Ambulance Corps. The war ended before his unit was sent overseas with Ray returning home to earn a living as a musician and later selling paper cups. In 1939, he became the exclusive distributor of the Multimixer (a milkshake mixing machine). He visited the McDonald brothers in 1954 which led to him becoming their franchise agent. He opened up the first restaurant for McDonald’s System, Inc., a predecessor of McDonald’s Corp. in Des Plaines, Illinois in April, 1955. McDonald’s acquired the rights to the brother’s company in 1961 for $2.7 million.
Going Global
Ray Kroc’s vision was that there would be 1,000 McDonald’s restaurants solely in the United States. Yet, McDonald’s continued to grow and expand into international markets beginning in 1967 opening in Canada and Puerto Rico. Today, the company has over 36,000 restaurants in over 100 nations. The most recent opening in Kazakhstan in 2016.
McDonald's press release announcing third quarter 2020 comparable sales
CHICAGO, Oct. 8, 2020 /PRNewswire/ -- "Our third quarter performance demonstrates the underlying resilience of the McDonald's brand. Our unique strengths, including our unrivaled drive-thru presence around the world, advanced delivery and digital capabilities, and marketing scale have become even more important during the pandemic. Our prior investments in these areas position us to further our competitive advantage and enable restaurant crew to continue to safely provide customers our great tasting food," said McDonald's President and Chief Executive Officer Chris Kempczinski. "Today's dividend increase reflects our strong financial position and represents continued confidence in our ability to drive profitable growth and long-term shareholder value while still investing in our people and the business."
Region 3Q 2020 3Q2019
On October 7, 2020, McDonald's Board of Directors declared a quarterly cash dividend of $1.29 per share of common stock payable on December 15, 2020 to shareholders of record at the close of business on December 1, 2020. This represents a 3% increase over the Company's previous quarterly dividend. While current year business results have been impacted by the COVID-19 pandemic, the pace of recovery paired with the Company's strong financial position support this increase to the dividend while still giving the Company the ability to invest in the business.
McDonald's has a strong history of returning capital to its shareholders and has raised its dividend for over 40 years consecutively since paying its first dividend in 1976. The new quarterly dividend of $1.29 per share is equivalent to $5.16 annually.
Region 3Q 2020 3Q2019
- U.S. 4.6% 4.8%
- International Operated Markets -4.4% 5.6%
- International Developmental Licensed Markets & Corporate -10.1% 8.1%
- Total -2.2% 5.9%
- Comparable Sales: Monthly comparable sales results improved sequentially for all segments throughout the third quarter of 2020.
- U.S.: Comparable sales were positive throughout the quarter, benefiting from strong average check growth from larger group orders as well as strong performance at the dinner daypart. The Company's strategic marketing investments and resulting promotional activity drove low double-digit comparable sales for the month of September, including positive comparable sales across all dayparts. Comparable guest counts remained negative for the quarter.
- International Operated Markets: Comparable sales results improved throughout the quarter, with consumer sentiment and government regulations impacting the pace of recovery from COVID-19. Limited operations also remained in place for some markets. Comparable sales varied across markets with negative comparable sales in France, Spain, Germany and the U.K., partly offset by positive comparable sales in Australia.
- International Developmental Licensed Markets: Comparable sales results were impacted by negative comparable sales in Latin America and China, partly offset by strong positive comparable sales in Japan.
On October 7, 2020, McDonald's Board of Directors declared a quarterly cash dividend of $1.29 per share of common stock payable on December 15, 2020 to shareholders of record at the close of business on December 1, 2020. This represents a 3% increase over the Company's previous quarterly dividend. While current year business results have been impacted by the COVID-19 pandemic, the pace of recovery paired with the Company's strong financial position support this increase to the dividend while still giving the Company the ability to invest in the business.
McDonald's has a strong history of returning capital to its shareholders and has raised its dividend for over 40 years consecutively since paying its first dividend in 1976. The new quarterly dividend of $1.29 per share is equivalent to $5.16 annually.
McDonald's (MCD) stock price history over the last 5 years
The image below shows the stock price history of Mcdonalds (MCD) over the last 5 years. And its been a pretty good time for Mcdonalds' stockholders as the stock of Mcdonald's increased by 98.4% over the last 5 years.