EXHIBIT 99
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Investor Release
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FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT:
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12/14/01 Investors: Xxxx Xxxxx, 000-000-0000
Media: Xxxx Xxxxxxxx, 000-000-0000
McDONALD'S FOURTH QUARTER 2001 UPDATE
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OAK BROOK, IL - McDonald's Corporation expects fourth quarter 2001 earnings per
share to be $.34, in line with previous guidance and excluding the following
unusual items:
. A previously announced pre-tax special charge of about $200
million related to change initiatives around the world. This
charge relates primarily to employee severance and outplacement,
consolidation of facilities and other related costs. As a result
of these initiatives, the Company expects ongoing annual savings
of about $100 million in selling, general and administrative
expenses, beginning in 2002.
. An additional pre-tax charge of $35 - $45 million related to the
disposition of Aroma Cafe in the U.K. and unrecoverable costs
incurred in connection with the Monopoly game fraud and the
related termination of a supplier.
Including these pre-tax charges of $235 - $245 million, fourth quarter earnings
per share are expected to be $.21 - $.22.
Xxxx Xxxxxxxxx, Chairman and Chief Executive Officer noted, "Our
European business is recovering nicely from the impact of consumer concerns
about the safety of the continent's beef supply, posting positive comparable
sales for the first two months of the fourth quarter. Europe's constant
currency* sales grew 8 percent for the first two months of the quarter and 4
percent for the first eleven months of 2001.
"In the U.S., sales grew 2 percent quarter-to-date and year-to-date
through November. We believe our restructuring, ongoing change initiatives and
renewed focus on quality, service, cleanliness and value will help drive
improved results going forward.
"Asia/Pacific's sales for both periods were negatively affected by weak
economies in several markets. In addition, concerns about the safety of the beef
supply in Japan are significantly reducing fourth quarter sales. To offset these
concerns, we are actively communicating our strong beef safety and quality
messages, underscoring the fact that XxXxxxxx'x Japan does not use Japanese
beef."
Asia/Pacific's constant currency sales declined 4 percent for the first
two months of the quarter and increased 4 percent for the first eleven months of
2001. In Latin America, which has also been affected by weak economies, constant
currency sales declined 3 percent quarter-to-date and increased 7 percent
year-to-date. Constant currency sales in the Other segment increased 6 percent
quarter-to-date and 18 percent year-to-date.
McDonald's Systemwide sales for the first eleven months of 2001 were
$37.1 billion, up 4 percent in constant currencies over the same period last
year. For the first two months of the fourth quarter, Systemwide sales were up 2
percent in constant currencies, compared with the same period last year.
McDonald's expects 2001 annual earnings per share to be $1.38,
excluding the $235 - $245 million in pre-tax charges described above, or $1.25 -
$1.26 including these charges. If average foreign currency exchange rates had
remained constant in 2001 versus 2000, expected 2001 earnings per share would be
4 - 5 cents higher.
Xxxxxxxxx also noted, "This year has been challenging for McDonald's.
But I am confident that our strategies are right and we will see significant
improvement in 2002, setting the stage for stronger growth in 2003 and beyond.
We expect 2002 earnings per share of $1.47 - $1.54, in constant currencies. This
reflects 5% to 10% projected growth over 2001's estimated $1.38 earnings per
share as described above, plus a 2 cent benefit related to the elimination of
goodwill amortization, in accordance with new accounting rules."
In conjunction with its fourth quarter 2001 update, XxXxxxxx'x
Corporation will broadcast its conference call with members of management live
over the Internet on Friday, December 14, 2001 at 11:00 a.m. Central Time.
Interested parties are invited to listen by logging on to xxxx://xxx.xxxxxxxxx.
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com/corporate/investor and clicking "Latest Investor Webcast", which appears
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below the stock quote.
McDonald's is the world's leading food service retailer with about
29,000 restaurants in 121 countries serving 45 million people each day.
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Certain forward-looking statements are included in this release. They
use such words as "may," "will," "expect," "believe," "plan" and other similar
terminology. These statements reflect management's current expectations
regarding future events and operating performance and speak only as of the date
of this release. These forward-looking statements involve a number of risks and
uncertainties. The following are some of the factors that could cause actual
results to differ materially from those expressed in or underlying our
forward-looking statements: the effectiveness of operating initiatives and
advertising and promotional efforts, the effects of the Euro conversion, as well
as changes in: global and local business and economic conditions; currency
exchange and interest rates; food, labor and other operating costs; political or
economic instability in local markets; competition; consumer preferences,
spending patterns and demographic trends; legislation and governmental
regulation; and accounting policies and practices. The foregoing list of
important factors is not exclusive.
The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
* Information in constant currencies excludes the effect of foreign currency
translation on reported results, except for hyperinflationary economies, such
as Russia, whose functional currency is the U.S. Dollar.
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