McDonald's reports July sales were worst in 9 years

By Lisa Baertlein, Reuters

McDonald's Corp reported flat sales in July at established restaurants around the world, its worst performance in more than nine years and a sign that a weakening global economy was hitting discretionary spending on the lower end.

Analysts polled by Consensus Metrix expected a gain of 2.3 percent at restaurants open at least 13 months.

Shares of the world's largest hamburger chain fell 3.2 percent in premarket trading on Wednesday.

The results marked the first time since April, 2003, that same-restaurant sales did not rise.

"We've grown used to seeing McDonald's weather bad economies, so this is a bit of a surprise," RBC Capital analyst Larry Miller said.

Just two weeks ago, McDonald's said it had expected July same-restaurant sales to rise, but not as much as the 3.7 percent gain reported in the second quarter.

The company, a major sponsor of this year's summer Olympics in London, has increased advertising for its value-priced meals to draw more diners to its restaurants.

July sales in the United States and Europe were down 0.1 percent and down 0.6 percent, respectively.

Analysts, on average, expected a 2.2 percent gain in the U.S. and a rise of 2.4 percent in Europe.

Same-restaurant sales from the Asia/Pacific, Middle East and Africa region were down 1.5 percent, while analysts expected a 1.4 percent gain.

Below, Rachael Rothman, a Susquehanna Financial Group analyst, breaks down the McDonald's numbers for CNBC.?

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Source: http://marketday.nbcnews.com/_news/2012/08/08/13182678-mcdonalds-reports-july-sales-were-worst-in-9-years?lite

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