McDonald’s reported a smaller-than-expected fall in US and global same-restaurant sales and announced its lowest capital spending budget in more than five years, saying it expected to open fewer restaurants in its troubled markets.

Sales at US restaurants open at least 13 months fell 1.7 per cent in the fourth quarter. Analysts on average had expected a fall of 2.1 per cent, according to research firm Consensus Metrix.

Global same-restaurant sales fell 0.9 per cent compared with average analyst estimate of a 1.5 per cent fall.

The world’s biggest restaurant chain set a capital spending target of about $2 billion for this year as it looks to recover from a food scandal in China and fend off intense competition in the United States.

McDonald’s international sales plunged after the food scare, a shortage of potatoes for its french fries in Venezuela and temporary shutdown of some of its outlets in Russia due to geopolitical tension.

In the United States, the company has been losing customers to fast-casual chains such as Chipotle Mexican Grill and Shake Shack.

McDonald’s net income fell to $1.1 billion, or $1.13 per share, in the quarter ended December 31st from $1.40 billion, or $1.40 per share, a year earlier.

Revenue fell 7.3 per cent to $6.57 billion.

Analysts on average had expected a profit of $1.22 per share and revenue of $6.68 billion.

Reuters