In many ways, April was a tough month for McDonald's (NYSE: MCD), given the sudden death of CEO Jim Cantalupo. However, Jim lives on through his initiatives, which provided another healthy boost to the Golden Arches' same-store sales in April.
Overall, McDonald's same-store sales increased 10.5%, with a 13.5% hike here in the U.S. European sales in stores open for more than a year increased 5%. (In related news, cost cuts have helped McDonald's Japan segment rev up its profits, giving even more reason to be cheerful about earnings prospects.) Also, happy anniversary to the turnaround -- April marks the 12th consecutive month of positive same-store sales.
In addition to the healthy menu initiatives, which are on the brink of being rolled out in Europe, extended hours that attract people with the late-night munchies are cited as another reason for robust sales. (Some of us may have noticed that the late-night drive-through window concept has worked well for Wendy's (NYSE: WEN).)
Is May going to be a more difficult month for the company? After all, Super Size Me, a film we've probably all heard about by now (unless, some of us have been hiding under a super-sized rock), opened in theaters last week. Here at the Fool, we debunked the notion that the public will react negatively to this film -- yep, it's pretty common knowledge that a Big Mac and fries day in and day out aren't a healthy diet plan.
So far, McDonald's, Wendy's, and Yum! Brands (NYSE: YUM) have all had a strong year based on the continued emphasis on inexpensive, fast food, and, in many cases, menu changes, though, the latter company has its work cut out for it in terms of revitalizing its rather confused KFC brand.
It's been a good year for McDonald's, but even beyond May's prospects, things will get more and more interesting as 2004 progresses. Soon, last year's stunning successes will add up to a tough act to follow. However, McDonald's has been delivering more surprises than the old-fashioned kids' Happy Meals of yesterday, so it's not hard to imagine it has more surprises up its sleeve.
Can McDonald's keep on putting the gold into the Golden Arches? Talk to other Fools about the issues facing the fast-food giant on the McDonald's discussion board.
Alyce Lomax does not own shares of any of the companies mentioned. Though she's never been a McDonald's junkie, come to think of it, she's been in McDonald's more often in the last year than she has been in the last 10.
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