McDonald's August Comps Fall 3.7%, Plagued by China Supplier Issue

McDonald's announced global comparable sales that fell 3.7% in August. The biggest decline was in the Asia/Pacific, Middle East and Africa region, where comp sales dropped 14.5%, largely due to the recent supplier issue in China. The U.S. declined 2.8%, while Europe slipped 0.7%. The company said soft top-line results are expected to pressure U.S. margin performance in third quarter. It estimates that the supplier issue in China will negatively impact third quarter results by about $0.15 to $0.20 a share compared to a year ago. Sterne Agee analyst Lynne Collier said, "We believe the remainder of fiscal year 2014 will continue to be a difficult period given a lack of identifiable catalysts."

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