Q1 2014 Earnings Call Transcript

Transcript Call Date 04/22/2014

Operator: Hello and welcome to the McDonald's April 22, 2014 Investor Conference Call. At the request of McDonald's Corporation, this conference is being recorded.

Following today's presentation, there will be a question-and-answer session for investors.

I would now like to turn the call over to Ms. Kathy Martin, Vice President of Investor Relations for McDonald's Corporation. Ms. Martin, you may begin.

Kathy Martin - IR: Good morning, everyone, and thank you for joining us. With me on the call are President and Chief Executive Officer, Don Thompson; and our Chief Financial Officer, Pete Bensen. Today's conference call is being webcast live and recorded for replay by phone, webcast and podcast.

Before I turn it over to Don, I want to remind everyone that the forward-looking statements in our earnings release and 8-K filing also applies to our comments. These documents are both available on our website at www.investor.mcdonalds.com, as are any reconciliations of any non-GAAP financial measures mentioned on today's call with our corresponding GAAP measures.

So now, I'd like to turn it over to Don.

Don Thompson - President and CEO: Thank you, Kathy, and good morning, everyone. We began 2014 with our strategies and our business model sound and intact. From a financial standpoint, our system's number goal remains enduring profitable growth, which starts with continuing to grow customer visits and comparable sales.

From our diversified geographic portfolio that leverages the entrepreneurial power of local ownership to the breadth of our menu across dayparts and meal occasions, our strategies, infrastructure and investments support this goal. And while we expect the market dynamics to remain similar to 2013, we do have experienced effectively competing and challenging operating environments and I remain confident in our ability to be successful at McDonald's.

Our global growth priorities are focused on ensuring that we remain relevant and appealing, so that more customers will visit us more often. We're focused on optimizing our menu so that we offer our customers food and drinks that have strong appeal, on modernizing the customer experience in our restaurant so that that experience for each customer is more memorable, and on broadening accessibility so that we deliver unparalleled convenience.

The key to our growth lies in our ability to place the customer at the center of everything that we do. Over the past few months, I had the opportunity to visit our priority markets, the U.S., Germany, Japan and Australia with Steve Easterbrook, Pete Bensen and Tim Fenton. We focused on more deeply understanding how each of those markets are adjusting their plans to address current challenges and adapt to the environment and to our customers' expectations.

There were four opportunities that were common to these markets and are being fortified in many other countries in which we operate. First, we're strengthening our planning process to more effectively bridge consumer insights into the right customer-centric plans and actions while striking the right balance against our internal financial objectives. Second, we're strengthening our marketing messaging to better resonate with customers and create stronger awareness. Third, we're enhancing our affordability platforms to ensure our value offers are consistent and clearly messaged. We want our customers to feel good about the value that they get when they visit us at McDonald's.

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