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| McDonald's may accelerate Asia expansion |
| Bloomberg / Beijing Feb 13, 2009, 00:30 IST |
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McDonald’s Corp, the world’s largest restaurant company, will push through with expansion plans in Asia and may be able to boost growth as the region’s economic slump pushes prices down.
“It’s a time to gain market share,” said Tim Fenton, McDonald’s president for Asia, the Middle East and Africa. While the world is in recession and economic growth in China has slowed, “we will not cut back on anything, we will accelerate if anything,” he said in an interview in Hong Kong on Wednesday.
The costs of opening outlets have gone down in China, he said, making it easier for Oak Brook, Illinois-based McDonald’s to meet its goal of 175 new branches in the country this year, raising the total by 20 per cent. The chain’s global sales grew 7.1 per cent in January, beating analysts’ estimates, with revenue in Asia, the West Asia and Africa jumping 10 per cent.
“It’s prudent for McDonald’s, with its strong cash flow, to take advantage of local weakness to expand,” Peter Jankovskis, co-chief investment officer at Oakbrook Investments LLC, said by phone on Thursday.
“While initial growth will be slower, the reduction in costs will likely more than compensate for that.” Lisle, Illinois-based Oakbrook manages $1.1 billion, including McDonald’s shares.
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