McDonald’s, the world's largest restaurant chain, announced better-than-expected profits for the second quarter, thanks to the economic downturn and the growing appetite of Europeans.

The company has benefitted from the economic downturn as customers shun more expensive restaurants in favour of cheaper meals while overseas sales surpassed American consumption.

McDonald's reported that it has turned around a $711.7 million loss in the second quarter of last year to a $1.19 billion profit while revenue rose by 4 per cent to $6.08 billion.

Sales at European outlets rose by 7.4 per cent while US revenues increased by 3.4 per cent.

McDonald’s results were hurt last year by the sale of 13 of its Latin American and Caribbean businesses, which prompted the group to take a $1.6 billion impairment charge.

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts