ITV news - McDonald's scales down
Mcnews | 09.11.2002 13:08
The worldwide job cuts, including approximately 250 in the United States, mark the company's third major round of layoffs in five years
McDonald's scales down
10.02AM GMT, 9 Nov 2002
Fast-food giant McDonald's has announced the closure of 175 restaurants worldwide and the loss of up to 600 jobs.
The worldwide job cuts, including approximately 250 in the United States, mark the company's third major round of layoffs in five years.
They are the latest attempt by McDonald's to take costs out of an operation that has struggled with lacklustre sales in the United States, weak economies in major markets such as Latin America, and the impact of mad cow disease outbreaks in Europe and Japan.
The corporation forecast a shortfall in 2002 earnings as it struggles to turn around its US performance and trim worldwide costs.
The Illinois-based company said the actions, which include restaurant closures in 10 countries, will reduce fourth-quarter earnings by $350 million to $425 million.
McDonald's shares fell by as much as 13 per cent on the New York Stock Exchange on Friday morning, and the news also pushed down the stock of some rivals.
In recent weeks, McDonald's has returned to price discounting in the United States, its largest market, sparking increased competition in the fast-food industry.
The effect of price cutting has been blamed for weakening the value of the sale of Burger King Corp. by its parent, British drink conglomerate Diageo.
McDonald's plans to close restaurants will result in the closure of business in three countries yet to be disclosed.
http://www.itv.com/news/Front969203.html
10.02AM GMT, 9 Nov 2002
Fast-food giant McDonald's has announced the closure of 175 restaurants worldwide and the loss of up to 600 jobs.
The worldwide job cuts, including approximately 250 in the United States, mark the company's third major round of layoffs in five years.
They are the latest attempt by McDonald's to take costs out of an operation that has struggled with lacklustre sales in the United States, weak economies in major markets such as Latin America, and the impact of mad cow disease outbreaks in Europe and Japan.
The corporation forecast a shortfall in 2002 earnings as it struggles to turn around its US performance and trim worldwide costs.
The Illinois-based company said the actions, which include restaurant closures in 10 countries, will reduce fourth-quarter earnings by $350 million to $425 million.
McDonald's shares fell by as much as 13 per cent on the New York Stock Exchange on Friday morning, and the news also pushed down the stock of some rivals.
In recent weeks, McDonald's has returned to price discounting in the United States, its largest market, sparking increased competition in the fast-food industry.
The effect of price cutting has been blamed for weakening the value of the sale of Burger King Corp. by its parent, British drink conglomerate Diageo.
McDonald's plans to close restaurants will result in the closure of business in three countries yet to be disclosed.
http://www.itv.com/news/Front969203.html
Mcnews
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