McDonald's Corp (MCD) announced its fourth quarter and full year 2016 results on January 23 2016. (See also: McD’s To Open More Restaurants in Russia)

For the fourth quarter, total revenue came in at $6.03 billion, a 5% decrease over the prior-year quarter, or 3% decrease assuming currency exchange rates were constant since the prior-year quarter.

Earnings for the quarter clocked in at $1.44 per share, a 10% increase compared to the prior-year quarter, or 12% increase if exchange rates were constant. Comparable store sales were up 2.7%, driven by positive comparable store sales in its various international markets.

Analysts expected comparable store sale increase of 1.4% to yield revenue of $5.99 billion and earnings of $1.41 for the fourth quarter.

For full year 2016, comparable store sales increased by 3.8%, with all of its segments posting positive figures. This is the best comparable store growth MCD has posted since 2011.

Total revenue for the year was $24.6 billion, a 3% decrease from 2015’s revenue, albeit, unchanged if exchange rates were constant. Earnings clocked in at $5.44 a share, 13% higher than 2015’s EPS. It’d have been a 16% increase if exchange rates were constant. The dollar has outperformed many of the major currency pairs — GBPUSD for example.

US Sales Growth Issues

The fast food chain said US comparable sales in the fourth quarter declined by 1.3%, with the company blaming it on comparison challenges that arose due to the launch of the All-Day Breakfast being “very successful” in Q4 2015.

The translation is that the All-Day Breakfast isn’t as huge a sales driver as it was a year ago. MCD confirms this impression by saying:

“As we begin the first quarter of 2017, we are mindful of the comparison we face against first quarter 2016 results, which benefited from leap year, favorable weather and continued momentum from All-Day Breakfast in the U.S."

This also signals that it’s likely that comparison store sales in the US won’t grow much, if at all, this quarter.

In a recent MCD article, I pointed out, using operating income per restaurant, how MCD’s US segment isn’t the most productive. The latest results, while positive overall, further entrenches the need to either become disruptive in the US or invest more in its international segments.

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