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McDonald's boss apologizes to customers affected by E. coli in the United States linked to the brand's Quarter Pounders, a new setback for the brand which is struggling to cope with falling sales.
“We are sorry for what our customers have experienced,” said its general manager Chris Kempczinski. “We offer our sincere and deepest sympathies and are committed to remedying this situation.”
Executives told investors they believed public health fears were contained and did not believe they would have a significant impact on sales.
But they acknowledged it had added to the pressure the business was facing as budget-conscious customers ate out less.
“While we anticipate a challenging environment in 2024, our performance so far this year has not met expectations,” Kempczinski said in discussing the company's latest investor update.
In the three months to September, sales at stores open at least a year fell 1.5% compared to the same period last year, McDonald's said Tuesday.
Its international markets have been particularly affected, including the United Kingdom, France, China and the Middle East.
This is the second consecutive quarter of sales declines and the largest in four years, following a 1% decline in the previous three months.
Mr Kempczinski said the company was striving to offer “good value and affordability” as customers continue to “be careful with their spending”.
He added that McDonald's had, however, been pleased with signs of improvement in the US, where the company launched a $5 (£3.85) Happy Meals promotion over the summer and attracted customers with a new chicken sandwich.
During the quarter, this helped the company achieve a 0.3% increase in U.S. sales at stores open at least a year.
McDonald's is now hoping to replicate this success in other markets, such as the UK, where the chain has introduced deals such as a Three for £3 deal and a £2.75 breakfast bundle.
The debut of the popular “Grimace” shake in the United Kingdom has also sparked excitement, executives said.
“We are starting to see progress,” said Chief Financial Officer Ian Borden, while adding that the company expected its Middle East operations to continue to be affected by the conflict in the region.
Bosses told investors they did not expect a significant price increase until business was better, stressing they were still facing “a lot of resistance” from customers.
The impact of the E. coli in the United States, in which authorities have recorded at least 75 patients, was not reflected in results released Tuesday, which showed the company's overall quarterly revenue up 3% to more by $6.8 billion (£5.2 billion), compared to a year ago.
Profits fell 3% to $2.25 billion.
Mr. Borden said public health fears had reversed signs of improving U.S. sales and traffic, but said the company believed it would be able to restore customer confidence.
“The most significant events are behind us,” he said. “Getting our business back on this very strong momentum, we’re really confident in our ability to achieve that.”
McDonald's announced Monday that it was beginning to resume sales of Quarter Pounders, which were suspended last week at about a fifth of its U.S. restaurants.
She has indefinitely stopped working with Taylor Farms, which was her supplier of onions suspected of causing the contamination.
