Other Key Information
SELECTED FINANCIAL DATA
5-Year Summary
Years ended December 31,
2019
In millions, except per share and unit amounts
Consolidated Statement of Income Data
Revenues
Sales by Company-operated restaurants
Revenues from franchised restaurants
Total revenues
Operating income
Net income
Consolidated Statement of Cash Flows Data
Cash provided by operations
Cash used for (provided by) investing activities
Capital expenditures
Cash used for (provided by) financing activities
Treasury stock purchases(1)
Common stock dividends
Financial Position
Total assets(2)
Total debt
Total shareholders’ equity (deficit)
Shares outstanding
Per Common Share Data
Earnings-diluted
Dividends declared
Market price at year end
Restaurant Information and Other Data
Restaurants at year end
Company-operated restaurants
Franchised restaurants
Total Systemwide restaurants
Franchised sales(3)
2018
2017
$
9,421
11,656
21,077
9,070
6,025
$
10,013
11,012
21,025
8,823
5,924
$
$
8,122
3,071
2,394
4,995
4,980
3,582
$
6,967
2,455
2,742
5,950
5,247
3,256
12,719
10,101
22,820
9,553
5,192
2016
2015
$
15,295
9,327
24,622
7,745
4,687
$
$
5,551 $
(562)
1,854
5,311
4,651
3,089
6,060
982
1,821
11,262
11,142
3,058
$
16,488
8,925
25,413
7,146
4,529
6,539
1,420
1,814
(735)
6,182
3,230
$
47,511 $
34,177
(8,210)
746
32,811 $
31,075
(6,258)
767
33,804 $
29,536
(3,268)
794
31,024 $
25,956
(2,204)
819
37,939
24,122
7,088
907
$
7.88
4.73
197.61
7.54
4.19
177.57
6.37
3.83
172.12
5.44
3.61
121.72
4.80
3.44
118.44
$
2,636
36,059
38,695
90,757
$
$
2,770
35,085
37,855
86,134
$
$
3,133
34,108
37,241
78,191
$
$
5,669
31,230
36,899
69,707
$
$
6,444
30,081
36,525
66,226
(1)
Represents treasury stock purchases as reflected in Shareholders' equity.
(2)
Total assets increased from 2018 to 2019 primarily due to the Company's right-of-use asset recorded as a result of the adoption of ASC 842.
(3)
While franchised sales are not recorded as revenues by the Company, management believes they are important in understanding the Company's financial
performance because these sales are the basis on which the Company calculates and records franchised revenues and are indicative of the financial health of the
franchisee base. Franchised restaurants represent 93% of McDonald's restaurants worldwide at December 31, 2019.
McDonald's Corporation 2019 Annual Report 22
Consolidated Statement of Income
Years ended December 31, 2019
REVENUES
Sales by Company-operated restaurants
$ 9,420.8
Revenues from franchised restaurants
11,655.7
Total revenues
21,076.5
OPERATING COSTS AND EXPENSES
Company-operated restaurant expenses
Food & paper
2,980.3
Payroll & employee benefits
2,704.4
Occupancy & other operating expenses
2,075.9
Franchised restaurants-occupancy expenses
2,200.6
Selling, general & administrative expenses
2,229.4
Other operating (income) expense, net
(183.9)
Total operating costs and expenses
12,006.7
Operating income
9,069.8
Interest expense-net of capitalized interest of $7.4, $5.6 and $5.3
1,121.9
Nonoperating (income) expense, net
(70.2)
Income before provision for income taxes
8,018.1
Provision for income taxes
1,992.7
Net income
$ 6,025.4
Earnings per common share–basic
$
7.95
Earnings per common share–diluted
$
7.88
Dividends declared per common share
$
4.73
Weighted-average shares outstanding–basic
758.1
Weighted-average shares outstanding–diluted
764.9
2018
2017
$ 10,012.7
11,012.5
21,025.2
$ 12,718.9
10,101.5
22,820.4
In millions, except per share data
$
$
$
$
3,153.8
2,937.9
2,174.2
1,973.3
2,200.2
(236.8)
12,202.6
8,822.6
981.2
25.3
7,816.1
1,891.8
5,924.3
7.61
7.54
4.19
778.2
785.6
$
$
$
$
4,033.5
3,528.5
2,847.6
1,790.0
2,231.3
(1,163.2)
13,267.7
9,552.7
921.3
57.9
8,573.5
3,381.2
5,192.3
6.43
6.37
3.83
807.4
815.5
See Notes to consolidated financial statements.
McDonald's Corporation 2019 Annual Report 34
Consolidated Balance Sheet
December 31, 2019
ASSETS
Current assets
Cash and equivalents
$
898.5
Accounts and notes receivable
2,224.2
Inventories, at cost, not in excess of market
50.2
Prepaid expenses and other current assets
385.0
Total current assets
3,557.9
Other assets
Investments in and advances to affiliates
1,270.3
Goodwill
2,677.4
Miscellaneous
2,584.0
Total other assets
6,531.7
Lease right-of-use asset, net
13,261.2
Property and equipment
Property and equipment, at cost
39,050.9
Accumulated depreciation and amortization
(14,890.9)
Net property and equipment
24,160.0
Total assets
$ 47,510.8
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable
$
988.2
Lease liability
621.0
Income taxes
331.7
Other taxes
247.5
Accrued interest
337.8
Accrued payroll and other liabilities
1,035.7
Current maturities of long-term debt
59.1
Total current liabilities
3,621.0
Long-term debt
34,118.1
Long-term lease liability
12,757.8
Long-term income taxes
2,265.9
Deferred revenues - initial franchise fees
660.6
Other long-term liabilities
979.6
Deferred income taxes
1,318.1
Shareholders’ equity (deficit)
Preferred stock, no par value; authorized – 165.0 million shares; issued – none
—
Common stock, $.01 par value; authorized – 3.5 billion shares; issued – 1,660.6 million shares
16.6
Additional paid-in capital
7,653.9
Retained earnings
52,930.5
Accumulated other comprehensive income (loss)
(2,482.7)
Common stock in treasury, at cost; 914.3 and 893.5 million shares
(66,328.6)
Total shareholders’ equity (deficit)
(8,210.3)
Total liabilities and shareholders’ equity (deficit)
$ 47,510.8
2018
In millions, except per share data
$
866.0
2,441.5
51.1
694.6
4,053.2
1,202.8
2,331.5
2,381.0
5,915.3
—
37,193.6
(14,350.9)
22,842.7
$ 32,811.2
$ 1,207.9
—
228.3
253.7
297.0
986.6
—
2,973.5
31,075.3
—
2,081.2
627.8
1,096.3
1,215.5
—
16.6
7,376.0
50,487.0
(2,609.5)
(61,528.5)
(6,258.4)
$ 32,811.2
See Notes to consolidated financial statements.
McDonald's Corporation 2019 Annual Report 36
Consolidated Statement of Cash Flows
In millions
Operating activities
Net income
Adjustments to reconcile to cash provided by operations
Charges and credits:
Depreciation and amortization
Deferred income taxes
Share-based compensation
Net gain on sale of restaurant businesses
Other
Changes in working capital items:
Accounts receivable
Inventories, prepaid expenses and other current assets
Accounts payable
Income taxes
Other accrued liabilities
Cash provided by operations
Investing activities
Capital expenditures
Purchases of restaurant and other businesses
Sales of restaurant businesses
Proceeds from sale of businesses in China and Hong Kong
Sales of property
Other
Cash provided by (used for) investing activities
Financing activities
Net short-term borrowings
Long-term financing issuances
Long-term financing repayments
Treasury stock purchases
Common stock dividends
Proceeds from stock option exercises
Other
Cash (used for) financing activities
Effect of exchange rates on cash and equivalents
Cash and equivalents increase (decrease)
Change in cash balances of businesses held for sale
Cash and equivalents at beginning of year
Cash and equivalents at end of year
Supplemental cash flow disclosures
Interest paid
Income taxes paid
Years ended December 31, 2019
2018
2017
$ 6,025.4
$ 5,924.3
$ 5,192.3
1,617.9
149.7
109.6
(128.2)
49.2
1,482.0
102.6
125.1
(308.8)
114.2
1,363.4
(36.4)
117.5
(1,155.8)
1,050.7
27.0
128.8
(26.8)
173.4
(3.9)
8,122.1
(479.4)
(1.9)
129.4
(33.4)
(87.4)
6,966.7
(340.7)
(37.3)
(59.7)
(396.4)
(146.4)
5,551.2
(2,393.7)
(540.9)
340.8
—
151.2
(628.5)
(3,071.1)
(2,741.7)
(101.7)
530.8
—
160.4
(302.9)
(2,455.1)
(1,853.7)
(77.0)
974.8
1,597.0
166.8
(245.9)
562.0
95.9
3,794.5
(1,759.6)
(5,207.7)
(3,255.9)
403.2
(20.0)
(5,949.6)
(159.8)
(1,597.8)
—
2,463.8
866.0 $
(1,050.3)
4,727.5
(1,649.4)
(4,685.7)
(3,089.2)
456.8
(20.5)
(5,310.8)
264.0
1,066.4
174.0
1,223.4
2,463.8
799.2
4,499.0
(2,061.9)
(4,976.2)
(3,581.9)
350.5
(23.5)
(4,994.8)
(23.7)
32.5
—
866.0
$ 898.5 $
$ 1,066.5
1,589.7
$
959.6
1,734.4
$
885.2
2,786.3
See Notes to consolidated financial statements.
McDonald's Corporation 2019 Annual Report 37
Debt Financing
LINE OF CREDIT AGREEMENTS
At December 31, 2019, the Company had a line of credit agreement, of which $3.5 billion expires in December 2023. The Company incurs
fees of 0.080% per annum on the total commitment, which remained unused. Fees and interest rates on this line are primarily based on the
Company’s long-term credit rating assigned by Moody’s and Standard & Poor’s. In addition, the Company's subsidiaries had unused lines of
credit that were primarily uncommitted, short-term and denominated in various currencies at local market rates of interest.
The weighted-average interest rate of short-term borrowings was 1.9% at December 31, 2019 (based on $242.4 million of foreign
currency bank line borrowings and $899.3 million of commercial paper outstanding) and 2.6% at December 31, 2018 (based on $253.5
million of foreign currency bank line borrowings and $99.9 million of commercial paper outstanding).
DEBT OBLIGATIONS
The Company has incurred debt obligations principally through public and private offerings and bank loans. There are no provisions in the
Company’s debt obligations that would accelerate repayment of debt as a result of a change in credit ratings or a material adverse change
in the Company’s business. Certain of the Company’s debt obligations contain cross-acceleration provisions, and restrictions on Company
and subsidiary mortgages and the long-term debt of certain subsidiaries. Under certain agreements, the Company has the option to retire
debt prior to maturity, either at par or at a premium over par. The Company has no current plans to retire a significant amount of its debt
prior to maturity.
The following table summarizes the Company’s debt obligations (interest rates and debt amounts reflected in the table include the
effects of interest rate swaps used to hedge debt).
Interest rates(1)
December 31
In millions of U.S. Dollars
Maturity dates
Fixed
Floating
Total U.S. Dollar
Fixed
Floating
Total Euro
2018
4.0%
3.4
1.5
2.3
1.6
—
3.4
2.0
—
—
4.6
3.1
2.9
0.2
2.2
5.3
3.1
2.9
0.3
2.6
2020-2049
2020-2031
Fixed
Floating
Total Australian Dollar
Total British Pounds Sterling - Fixed
Total Canadian Dollar - Fixed
Total Japanese Yen - Fixed
Fixed
Floating
Total other currencies(2)
Debt obligations before fair value adjustments and deferred
debt costs(3)
Fair value adjustments
2019
4.0%
2.2
(4)
Deferred debt costs
Total debt obligations
2024-2029
2020-2054
2021-2025
2030
2020-2024
Amounts outstanding
December 31
2019
$19,340.2
2,049.3
21,389.5
8,671.8
337.0
2018
$18,075.8
1,349.9
19,425.7
8,069.1
1,264.1
9,008.8
771.0
210.6
981.6
1,386.3
768.6
115.1
413.8
241.8
9,333.2
—
—
—
952.3
732.0
114.0
414.9
244.2
655.6
659.1
34,305.5
31,216.3
12.1
(140.4)
$34,177.2
(12.0)
(129.0)
$31,075.3
(1)
Weighted-average effective rate, computed on a semi-annual basis.
(2)
Consists of Swiss Francs and Korean Won.
(3)
Aggregate maturities for 2019 debt balances, before fair value adjustments and deferred debt costs, are as follows (in millions): 2020–$59.1; 2021–$2,132.2;
2022–$2,250.1; 2023–$6,007.0; 2024–$2,819.0; Thereafter–$21,038.1. These amounts include a reclassification of short-term obligations totaling $3.5 billion to
long-term obligations as they are supported by a long-term line of credit agreement expiring in December 2023.
(4)
The carrying value of underlying items in fair value hedges, in this case debt obligations, are adjusted for fair value changes to the extent they are attributable to
the risk designated as being hedged. The related hedging instruments are also recorded at fair value on the Consolidated Balance Sheet.
McDonald's Corporation 2019 Annual Report 52
Quarterly Results (Unaudited)
Quarters ended
December 31
Weighted-average
common shares—basic
Weighted-average
common shares—diluted
Quarters ended
June 30
Quarters ended
March 31
2019
2018
2019
2018
2019
2018
2019
2018
$ 2,363.3
$2,371.2
$ 2,416.6
$ 2,511.0
$2,400.4
$2,594.9
$ 2,240.5
$2,535.6
2,985.7
5,349.0
423.7
2,422.4
2,292.6
$ 1,572.2
2,791.8
5,163.0
414.6
2,282.1
1,999.5
$1,415.3
3,014.0
5,430.6
448.9
2,454.5
2,409.3
$ 1,607.9
2,858.4
5,369.4
463.1
2,359.0
2,417.7
$ 1,637.3
2,940.9
5,341.3
433.3
2,396.2
2,273.9
$1,516.9
2,759.0
5,353.9
464.4
2,275.1
2,262.3
$1,496.3
2,715.1
4,955.6
354.3
2,182.0
2,094.0
$ 1,328.4
2,603.3
5,138.9
404.7
2,123.0
2,143.1
$1,375.4
$
2.10
$
1.84
$
2.13
$
2.12
$
1.99
$
1.92
$
1.74
$
1.74
$
2.08
$
1.82
$
2.11
$
2.10
$
1.97
$
1.90
$
1.72
$
1.72
$
—
$
—
$
2.41
$
2.17
$
1.16
$
1.01
$
1.16
$
1.01
In millions, except per share data
Revenues
Sales by Company-operated
restaurants
Revenues from franchised
restaurants
Total revenues
Company-operated margin
Franchised margin
Operating income
Net income
Earnings per common
share—basic
Earnings per common
share—diluted
Dividends declared per
common share
Quarters ended
September 30
(1)
(1)
749.2
769.5
756.6
772.8
761.8
780.0
764.9
790.9
755.6
776.6
763.9
779.6
768.7
787.1
771.6
798.7
(1) Includes a $1.16 and $1.01 per share dividend declared and paid in third quarter of 2019 and 2018, respectively, and a $1.25 and $1.16 per share dividend declared
in the third quarter and paid in fourth quarter of 2019 and 2018, respectively.
McDonald's Corporation 2019 Annual Report 54