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McDonald's Japan Heading to 270% Profit Increase

McDonald's Japan is making a nice recovery from its 2014 China supplier scandal, which in fiscal 2015 caused the company to post its biggest loss since going public. In fact, a settlement from that supplier has contributed to the company's rosy picture this year. The introduction of a larger burger designed specifically for the Japanese market and limited-time desserts have proven popular and contributed as well to profit growth.

McDonald's Japan upgraded its full-year net-profit forecast by 5.5 billion yen to 20 billion yen, up 270% on the year and the highest ever since the company went public. This marks a second upgrade for this year. Full-year sales are now seen rising 10%.

…The projected net profit for the year would set a record, but that is partly thanks to such non-operating factors as a reduction in reserve funds to cover for any loan defaults by franchise operators. Profit from core operations is projected at 11 billion yen -- short of the net profit target of 20 billion yen. — Nikkei Asian Review

Sarah Casanova, McDonald's Japan president, told reporters on Wednesday (Tuesday in the U.S.) that the company is now in a stronger position to further increase investments and better enhance the customer experience. Cashless payments are in the works and more than 80 percent of locations will have been renovated by the end of the current year.

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