BUSINESS McDonald's reports 68% drop in 2Q profits on coronavirus hit

BUSINESS

McDonald's reports 68% drop in 2Q profits on coronavirus hit

AFP

20:12, July 28, 2020

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File photo: Agencies

McDonald's reported a steep drop in second-quarter profits Tuesday on much lower sales due to coronavirus closures that affected most of the chain's worldwide network.

The fast-food company suffered a 68 percent drop in profits to $483.8 million, following a 30 percent decline in revenues to $3.8 billion.

Comparable sales tumbled throughout major markets for the food giant, but the US outperformed other regions because of drive-through and takeaway service that continued even where in restaurant dining service was stopped.

Sales improved throughout the quarter in the US and in some international markets as governments lifted lockdown restrictions and more activity resumed.

"Our strong drive-thru presence and the investments we've made in delivery and digital over the past few years have served us well through these uncertain times," said Chief Executive Chris Kempczinksi. "We saw continued improvement in our results throughout the second quarter as markets reopened around the world."

McDonald's last week announced it would begin requiring customers to wear face masks in US restaurants on August 1 because of coronavirus and would pause its plan to reopen more US dining rooms while the country battles the outbreak.

McDonald's said about 2,000 US restaurant dining rooms have reopened with reduced seating capacity, almost 15 percent of its total number of restaurants in the company's home market.

Shares fell 2.4 percent to $196.51 in pre-market trading.

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