McDonald's Corporation

Hello and welcome to McDonald's first quarter 2019 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. At that time, investors only may ask a question by pressing star 1 on their touchtone phone. I would now like to turn the conference over to Mr. Mike Ciplek, Investor Relations Officer for McDonald's Corporation. Mr. Ciplek, you may begin.

Good morning, everyone, and thank you for joining us. With me on the call this morning are President and Chief Executive Officer Steve Easterbrook and Chief Financial Officer Kevin Ozan. Today's conference call is being webcast live and is also being recorded for replay on our website. Before I turn it over to Steve, I want to remind everyone that the forward-looking statements in our earnings release and 8 filing also apply to our comments. Both documents are available on www.investor.mcdonalds.com as are reconciliations of any non-GAAP financial measures mentioned on today's call with their corresponding GAAP measures. And now, I'll turn it over to Steve.

We're off to a strong start for 2019. Our broad-based momentum around the world continues as we further execute on our velocity growth plan. Global comparable sales increased 5.4%. That's over $1 billion of growth across the system for the quarter. This marks our 15th consecutive quarter of positive global comp sales, despite some of the continuing macroeconomic uncertainties around the world. We also grew global guest counts for the quarter. In the U.S., we're pleased with our performance to start the year. The market continues to execute against the most ambitious plan in our history. And whilst we recognize we have a lot of hard work ahead of us, we are encouraged with our progress and improved franchisee cash flow to start the year. Our customer satisfaction scores are improving as more guests are able to enjoy McDonald's in our modernized, experience-of-the-future restaurants. For the first time since we've begun our EOTF rollout, we are seeing a benefit to our overall US sales comp. Where 2018 focused on considerable transformation and building a foundation for growth, our 2019 focus is on operation execution in our restaurants and optimizing the experience for our customers. Additionally, our international operated segment continues to show strong performance. Every market in the segment grew comparable sales for the quarter. Their continued success is built on plans that have proven to be effective in delivering sustained growth by offering customers their favourite core menu food, drinks, compelling value offerings, a continued emphasis on running great restaurants and strong franchisee alignment. For example, the UK has now achieved a remarkable 13 consecutive years of comparable sales growth. The market's focus on value, menu innovation and book delivery is resulting in balanced growth in both average check and guest counts, including record high guest counts for the month of March. We're also seeing strong performance in Australia. I visited Sydney and Melbourne last month and continue to be impressed with how the team is successfully driving growth across all day paths. The market has now grown comparable sales for the past 20 consecutive quarters. With strong leadership and franchisee alignment, the market is excelling at the fundamentals of running great restaurants, growing their delivery business, and leveraging the investments we've made in digital. Our customers in Australia are also taking notice of the effort we're putting in to delivering delicious, feel-good moments. Today, more customers are using our global mobile app and McDelivery to order delicious McDonald's food on their terms. And an increasing number of customers are choosing to use our self-order kiosks to place their orders. The Australia team has more than doubled McDelivery awareness through our strong partnership with Uber Eats. And with our barista-trained crew executing at a high level both in restaurant and in the drive-thru, coffee has become the most frequently ordered item on our McDonald's app. Progress we're seeing in the U.S., UK and Australia demonstrates how our velocity growth plan is working and enabling us to deliver broad-based growth across our segments. With that, I'll turn it over to Kevin to share more about our top-line performance.