(Reuters) ? McDonald's Corp (MCD.N) reported stronger-than-expected December sales, but its shares fell on investor concerns that quarterly profit may have beat expectations only because of income that was not related to its operations.
Chief Financial Officer Pete Bensen said investors remain cautious about consumer spending. He added that as a percentage of sales, margins declined 30 basis points to 18.7 percent during the fourth quarter as higher costs for food and other items offset sales strength.
He also said that ongoing austerity measures in Europe have not hurt sales there and that "we're really seeing no change in customer behavior."
Shares of the world's biggest hamburger chain were down 1.4 percent to $99.48 in morning trading on Tuesday.
McDonald's reported fourth-quarter profit of $1.38 billion, or $1.33 per share, up from $1.24 billion, or $1.16 a share, a year earlier. Analysts on average expected $1.30 a share, according to Thomson Reuters I/B/E/S.
Edward Jones analyst Jack Russo said results from the latest quarter were helped by 3 cents per share of non-operating income.
"So it really it appears they met consensus," he said.
Revenue rose 10 percent to $6.82 billion, edging above the average analyst estimate of $6.81 billion.
Sales at stores open at least a year rose 9.6 percent in December, with a 9.8 percent increase in the United States and a 10.8 percent rise in its top revenue market of Europe.
Analysts on average forecast a 5.9 percent increase overall, with the a 5.4 percent increase in the United States and a 6.4 percent increase in Europe, according to Thomson Reuters I/B/E/S.
The results, which were helped by new menu items, restaurant renovations and effective marketing, defied a global economic slowdown, said Rikky Shoker, co-manager of the Credo Best Ideas Portfolio at Credo Group Ltd in London.
"This shows that McDonald's is a truly unique business and able to grow sales regardless of economic conditions," Shoker said.
McDonald's and its franchisees have been pouring money into their restaurants at a time when smaller and financially strapped chains are slashing costs.
The company also has broadened its appeal beyond the young men who account for the biggest share of sales at most other fast-food chains by adding low-cost Dollar Menu items and introducing high-margin beverages such as coffee and fruit smoothies.
Menu standouts during the quarter included bagel sandwiches in France and Big Mac's and chicken products in the United States, the company said.
(Reporting by Brad Dorfman in Chicago, editing by Dave Zimmerman)
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