McDonald’s Swings to Profit in 4th Quarter

McDonald’s Corp. capped a turnaround year with a modest $125.7-million profit in the fourth quarter, posting strong sales and operating results as it continued a resurgence under Chief Executive Jim Cantalupo.

Net income amounted to 10 cents a share, contrasted with a loss of $343.8 million, or 27 cents a share, in the fourth quarter of 2002. Except for the unprecedented loss a year earlier, the latest quarter was the company’s least profitable in more than a decade.

The results reported Monday included a $323-million charge for McDonald’s decision last month to shed part of its portfolio of non-hamburger-brand restaurants. Excluding the restructuring charge, earnings were 35 cents a share. That met the consensus estimate of analysts surveyed by Thomson First Call.

Revenue jumped 17% to $4.56 billion, showing no ill effects from a U.S. mad cow scare.

McDonald’s recent sales gains are attributed in part to the success of its new entree-sized salads, McGriddle breakfast sandwiches and white-meat chicken nuggets along with its global marketing campaign, with the tag line “I’m lovin’ it.”

For the full year, net income was $1.47 million, or $1.15 a share, up from $893.5 million, or 70 cents, a year earlier. Revenue increased 11% to $17.1 billion.

Separately, McDonald’s announced the retirement of Fred Turner, who had left the posts of chairman and CEO in 1990 but remained on the board.

Shares of Oak Brook, Ill.-based McDonald’s rose 3 cents to $25.28 on the New York Stock Exchange before the earnings report was released. They gained 20 cents in after-hours trading.