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Record $300 Million Net Loss For McDonald's In Japan As Sales Drop

Hit by a string of scandals over food safety controls, McDonald's business in Japan has posted its worst annual results since going public 15 years ago. The company reported a net loss of 34.704 billion yen — around $303 million.

Last year, sales at McDonald's Japan stores were down around 15 percent from 2014, the company says. The Japanese unit has now reported a net loss for two years in a row, the result of a sequence of scandals.

Late in 2014, video footage emerged that seemed to show workers at a Chinese supplier of chicken nuggets mishandling and using out-of-date meat. The company switched to a Thai supplier — but in early 2015, foreign objects were reportedly found in nuggets, including what looked to be pieces of vinyl.

Hoping to regain its footing, McDonald's Japan closed more than 150 stores and opened only 16 new restaurants last year, according to its annual report. The company says it's also remodeling and updating many of its 2,956 stores.

From Japan Times:

"Sara Casanova, president of the company, said the burger chain started to regain momentum in the second half of last year, and that she is sure 2016 will be a good year for the company.

"She said it is premature to comment on a plan by U.S. chain McDonald's Corp. to sell its stake in the Japanese unit."

McDonald's Corp. currently owns roughly 50 percent of the Japanese business, which in 2015 it called its largest international affiliate.

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Bill Chappell is a writer and editor on the News Desk in the heart of NPR's newsroom in Washington, D.C.
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