May solid but Mcdonald’s sees clouds

NEW YORK — McDonald’s Corp. said strength in the U.S. and Europe drove up a key revenue figure in May but warned that economic volatility around the world and rising expenses are pressuring its second-quarter results.

The fast-food chain, based in Oak Brook, Ill., also said that foreign currency translations are now expected to hurt second-quarter earnings by 7 cents to 9 cents per share. Shares of McDonald’s fell 63 cents to close at $87.75. For May, the company said global sales at stores open at least 13 months rose 3.3 percent. That is a key metric because it excludes the volatility from newly opened or closed stores.

The figure was dragged down by results in the region encompassing Asia Pacific, the Middle East and Africa, where McDonald’s said sales fell 1.7 percent from a year ago.

The negative performance in China was likely the result of new “value dinner” promotions that drove down average sales per visit, R.W. Baird analyst David Tarantino said in a note to investors. He also noted that McDonald’s is facing increasing competition in the region, where many other fast-food companies are looking to expand as well.

In Europe, the sales figure rose 2.9 percent driven by gains in the United Kingdom, Russia and France, with the company’s ongoing restaurant renovations helping improve sales. A mix of premium and value options also helped boost results in the region, the company said.

With more than 33,000 stores in 119 countries, McDonald’s is the world’s biggest hamburger chain and is often seen as a bellwether for the industry.