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McDonald's warns of continuing sales drop in April

Candice Choi, AP Food Industry Writer

NEW YORK (AP) -- McDonald's said Friday that a global sales figure declined in the first quarter and warned that it was expected to dip in April as well.

The last time the quarterly sales figure declined was a decade ago, in early 2003, according to the company. A monthly sales figure also fell for the first time in nearly a decade late last year.

McDonald's Corp., based in Oak Brook, Ill., has been struggling to boost sales amid intensifying competition, changing eating habits and challenging economic conditions around the world.

The company has responded by renewing its focus on value and rolling out new menu items, such as chicken wraps, that are more in line with the fresher, healthier food people are increasingly searching for.

For the quarter, McDonald's said global sales at restaurants open at least 13 months fell 1 percent. That included a 1.2 percent drop in the U.S. where it has been trying to boost sales by touting its Dollar Menu, a strategy that analysts warn could eat away at profit margins. Despite the drop, McDonald's said it increased its market share.

The sales figure fell 1.1 percent in Europe, the company's biggest region by sales. It fell 3.3 percent in the region encompassing Asia, the Middle East and Africa, reflecting weakness in Japan and negative results in China.

For the quarter, McDonald's Corp. earned $1.27 billion, or $1.26 per share. That compares with $1.266 billion, or $1.23 per share, a year ago.

Revenue edged up 1 percent to $6.6 billion.

Analysts expected a profit of $1.26 per share on revenue of $6.59 billion, according to FactSet.