McDonald's Turnaround Marches On

The turnaround plan of Jim Cantalupo lives on at McDonald's ( MCD).

In its second quarterly results since the sudden death of its CEO three months ago, the fast-food giant preannounced sharply higher second-quarter earnings and reported another month of strong same-store sales in June.

The Oak Brook, Ill.-based company said it expects to earn 47 cents a share in the quarter, 27% higher than the year-ago period and 3 cents better than the consensus estimate, according to Thomson First Call.

Overall sales rose increased 8.4% for the month and 11.6% for the quarter. Same-store sales rose 7.8% -- the highest second-quarter increase since 1987. Same-store sales in the U.S. increased 6.6% in June and 9.2% in the quarter. Sales in Europe and other overseas markets were also strong, as the company introduced new menu items.

"This steady business momentum is what we planned to achieve when we launched our revitalization initiatives in early 2003," said CEO Charlie Bell, who replaced Cantalupo after he died of a heart attack April 19. "We will remain intensely focused on further building brand relevance with our customers around the world through operational excellence and leadership marketing."

In the first quarter, McDonald's earned $511.5 million, or 40 cents a share, compared with earnings of $327.4 million, or 26 cents a share, last year. Revenue jumped 16% to $4.40 billion from $3.80 billion.

The company reports complete second-quarter earnings July 22.

Shares rose 14 cents to $26.82 in premarket trading.

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