“The group’s turnover and results continued to be negatively impacted by the war in the Middle East,” the firm said in a statement.
“We do not foresee a significant improvement (…) until the war is over,” company executives said in an audio conference with analysts.
The fast food giant came under fire after its franchise in Israel decided to offer free food to the Israeli army in November.
McDonald’s announced on April 4 an agreement to buy the Alonyal group, owner of 225 franchised restaurants in Israel, which had managed them for more than 30 years.
The company indicated that the effect of the boycott is also felt in predominantly Muslim countries such as Malaysia and Indonesia, or with a significant Muslim population such as France.
Around 95% of the more than 42,000 restaurants located in 115 countries are franchises that pay royalties to the group after purchasing the brand license.
The group provided “insignificant” assistance in the form of reduced royalties or deferred payments to some franchises. This expense was more than offset by increased sales in Japan, Latin America and Europe.
The group’s turnover grew 5% in the first quarter to 6.17 billion dollars and its net profit increased 9% to 1.93 billion. Earnings per share were $2.70, 2% more than in the same period last year, in line with the $2.72 expected by analysts.
In 2024, the group will invest between $2.5 billion and $2.7 billion, half of it to open new restaurants, more than 2,100 locations in total, of which 1,600 outside the United States.
Source: With information from AFP.
