McDonald's Corp., the world's biggest restaurant company, on Tuesday posted a quarterly net loss after taking a big charge for the sale of its outlets in Latin America.
The company's second-quarter net loss was $711.7 million, or 60 cents per share, compared with a net profit of $834.1 million, or 67 cents, a year ago.
Excluding the Latin America charge, McDonald's earned 71 cents a share, in line with the better-than-expected forecast the fast-food chain gave last week.
In April, McDonald's said it would sell about 1,600 restaurants in Latin America and the Caribbean to a franchisee so it could focus resources on markets where it sees the biggest opportunities for growth, such as China.
Total revenue rose 12 percent to $6.01 billion. Analysts on average were expecting revenue of $5.90 billion, according to Reuters Estimates.
McDonald's last week said second-quarter sales at restaurants open at least 13 months rose 7.4 percent. Restaurants in Asia reported a 10.9 percent same-store sales increase, while European same-store sales rose 7.8 percent. In the United States, the company's biggest market, same-store sales rose 5 percent.
In recent months, performance in McDonald's flagship market has benefited from sales of a chicken wrap sandwich and breakfast items including a new, stronger coffee blend. In Asia, sales of western-style breakfast options have boosted results at McDonald's growing business in China.
Chief Executive Jim Skinner in an interview with Reuters last week said that four years into the company's aggressive turnaround there was still plenty of room for the company to boost its U.S. sales.
McDonald's has said it plans to pay out a combined total of $5.7 billion for dividends and share buybacks in 2007-2008.
McDonald's shares traded at $52.00 on Tuesday morning in electronic trading, compared with Monday's $52.50 close on the New York Stock Exchange. The stock trades at about 17.4 times analysts' average 2008 earnings estimate, compared with multiples of 25.8 and 18.7 for rivals Wendy's International Inc. and Yum Brands Inc., respectively.
(Additional reporting by Nichola Groom)