EXHIBIT 99
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Investor Release
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FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT:
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04/18/02 Investors: Xxxx Xxxxx, 000-000-0000
Media: Xxxx Xxxxxxxx, 000-000-0000
FOR ACCESS TO CONFERENCE CALL:
------------------------------
When: 11:00 a.m. CT,
Thursday, April 18, 2002
Where: xxxx://xxx.xxxxxxxxx.xxx
McDONALD'S REPORTS GLOBAL RESULTS
---------------------------------
OAK BROOK, IL -- McDonald's Corporation today announced global results for the
quarter ended March 31, 2002.
.. Diluted net income per common share was 31 cents, before the cumulative
effect of the goodwill accounting change and excluding $43 million of
non-cash asset impairment charges. Including the asset impairment charges,
diluted net income per common share was 27 cents, before the cumulative
effect of the accounting change.
.. Systemwide sales increased 3% for the quarter in constant currencies and
revenues increased 6% in constant currencies.
.. In Europe, Systemwide sales increased 10% and operating income increased
13% in constant currencies.
.. The Company repurchased $331 million of stock during the quarter.
======================================================================================================================
Key highlights - Consolidated
Percent
Dollars in millions, except per common share data Increase/(Decrease)
----------------------------------------------------------------------------------------------------------------------
As Constant
Quarters ended March 31 2002 2001 Reported Currency*
----------------------------------------------------------------------------------------------------------------------
Systemwide sales $9,698.5 $9,649.7 1 3
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Total revenues 3,597.4 3,511.7 2 6
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Operating income 641.3 695.2 (8) (6)
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Income before cumulative effect of accounting
change 351.7 378.3 (7) (6)
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Cumulative effect of accounting change, net of tax (98.6) - n/m n/m
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Net income 253.1 378.3 (33) (32)
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Per common share - diluted:
Income before cumulative effect of
accounting change 0.27 0.29 (7) (3)
Cumulative effect of accounting change (0.07) - n/m n/m
Net income 0.20 0.29 (31) (31)
======================================================================================================================
* 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. Constant
currency results are calculated by translating the current year results at
prior year monthly average exchange rates.
n/m Not meaningful
1
SUMMARY COMMENTARY
Xxxx X. Xxxxxxxxx, Chairman and Chief Executive Officer noted, "Earnings per
share for the first quarter 2002 were $.31, excluding the charges described
below, compared with $.29 for the same period last year. This performance was
better than anticipated, due primarily to strong sales in Europe during the last
two weeks in March and better than expected U.S. profitability."
As previously announced, the Company recorded a $43 million (pre and after
tax) non-cash charge in the first quarter, primarily related to asset impairment
in Latin America and restaurant closings in Turkey, as a result of economic
weakness. Including these charges, earnings per share were $.27 for the quarter
before the cumulative effect of adopting SFAS No. 142, "Goodwill and Other
Intangible Assets." To reflect the cumulative effect of this accounting change,
the Company recorded a non-cash charge of $99 million after tax ($.07 per share)
related to impaired goodwill in the first quarter. The impaired goodwill was
primarily in Latin America, where economies have weakened significantly over the
last several years.
Xxxxxxxxx also noted, "Europe's performance was strong. In constant
currencies, Europe's sales increased 10% and operating income increased 13% for
the quarter. Comparable sales increased in France, Germany and the U.K. We are
encouraged by these results and look forward to continued strong performance
throughout the year.
"In the U.S., sales increased 2% for the quarter. U.S. operating income
declined 2% for the quarter, due to payments to owner/operators to facilitate a
new front counter team service system. Excluding these payments, U.S. operating
income increased 4% for the first quarter reflecting higher combined operating
margin dollars and lower selling, general and administrative expenses. We expect
our restaurant operations improvement process, along with menu and value
initiatives, to boost top line sales and help us achieve improved results as the
year progresses.
"In our Asia/Pacific/Middle East/Africa segment, Australia posted strong
results, continuing the momentum begun last fall as a result of its New Tastes
Menu introduction. However, the segment continues to be hurt by weak economic
conditions and consumer concerns about food safety in Japan, our largest market
in the region. XxXxxxxx'x Japan continues to communicate our safety and quality
standards. Sales in this segment declined 2% in constant currencies for the
quarter.
"We expect 2002 annual earnings per share to improve significantly over
2001 results. Consistent with our previous guidance, this equates to 2002
earnings per share of $1.47-$1.50, excluding the impact of foreign currency
translation and the $142 million of charges described above."
2
OPERATING RESULTS
The Company operates in the food service industry and primarily operates
quick-service restaurant businesses under the McDonald's brand. To capture
additional meal occasions, the Company also operates other restaurant concepts
under its Partner Brands: Boston Market, Chipotle and Donatos Pizzeria. In
addition, McDonald's has a minority ownership in Pret A Manger. In fourth
quarter 2001, the Company approved a plan to dispose of its Aroma Cafe business
in the U.K. and completed the sale in March 2002.
The segments presented in all tables and related discussion reflect the
Company's current management structure. Previously, McDonald's restaurant
operations in Canada, the Middle East and Africa, as well as the Partner Brands
were included in the Other segment. The newly created APMEA segment includes
results for McDonald's restaurant operations in Asia/Pacific, the Middle East
and Africa, while Canada and the Partner Brands are presented as individual
operating segments. In addition, U.S. and Corporate selling, general &
administrative expenses reflect a realignment of certain home office
departments' responsibilities for all periods presented.
Impact of Foreign Currencies on Reported Results
While changing foreign currencies affect reported results, McDonald's
lessens exposures, where practical, by financing in local currencies, hedging
certain foreign-denominated cash flows and by purchasing goods and services in
local currencies.
Foreign currency translation had a negative impact on reported results for
the quarter primarily due to the weaker Euro, Japanese Yen and Brazilian Real.
Cumulative Effect of Accounting Change and Asset Impairment Charges
Effective January 1, 2002, the Company adopted SFAS No. 142 "Goodwill and
Other Intangible Assets," which indicates that goodwill will no longer be
amortized but will be subject to annual impairment tests. As a result of the
first of required goodwill impairment tests, the Company recorded a non-cash
charge of $98.6 million after tax in the first quarter for the cumulative effect
of this accounting change. The impaired goodwill was primarily in Argentina,
Uruguay and other markets in Latin America and the Middle East, where economies
have weakened significantly over the last several years.
The Company also recorded $43.0 million of non-cash asset impairment
charges in the first quarter, primarily related to the impairment of assets in
existing restaurants in Chile and other Latin American markets and the closing
of 32 underperforming restaurants in Turkey, as a result of continued economic
weakness.
3
Net Income and Diluted Net Income Per Common Share
Income before the cumulative effect of the goodwill accounting change
declined 7%, while net income, which included the $98.6 million after-tax charge
for the cumulative effect of the goodwill accounting change, declined 33% for
the quarter. Diluted income per common share before the cumulative effect of the
accounting change declined 7% to 27 cents, while diluted net income per common
share declined 31% to 20 cents for the quarter.
Excluding the $43.0 million of asset impairment charges, income before the
cumulative effect of the accounting change increased 4% and diluted income per
common share before the cumulative effect of the accounting change increased 7%
to 31 cents.
Weighted average shares outstanding for the quarter were lower compared
with the prior year due to shares repurchased. In addition, outstanding stock
options had a less dilutive effect than in the prior year. The Company
repurchased 11.9 million shares of its common stock during the quarter for
approximately $331 million.
Systemwide Sales and Revenues
Systemwide sales represent sales by Company-operated, franchised and
affiliated restaurants. Total revenues include sales by Company-operated
restaurants and fees from restaurants operated by franchisees and affiliates.
These fees include rent, service fees and royalties that are based on a percent
of sales with specified minimum payments along with initial fees.
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Systemwide sales
Percent
Dollars in millions Increase/(Decrease)
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Quarters ended March 31 2002 2001 As Constant
Reported Currency*
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U.S. $4,792.7 $4,676.5 2 n/a
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Europe 2,308.7 2,178.2 6 10
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APMEA 1,632.1 1,782.7 (8) (2)
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Latin America 390.2 455.3 (14) (1)
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Canada 320.1 331.4 (3) 1
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Partner Brands 254.7 225.6 13 13
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Total Systemwide sales $9,698.5 $9,649.7 1 3
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* Excluding the effect of foreign currency translation on reported results.
n/a Not applicable
4
On a global basis, the increases in sales and revenues for the quarter were
primarily due to restaurant expansion, partly offset by negative comparable
sales. Foreign currency translation had a negative effect on the growth rates
for both Systemwide sales and revenues for the quarter. On a constant currency
basis, revenues increased at a higher rate than sales primarily due to
significantly lower sales from our affiliate in Japan. Under our affiliate
structure, we record a royalty in revenues based on a percentage of Japan's
sales, whereas all of Japan's sales are included in Systemwide sales. For this
reason, Japan's sales decline had a larger negative impact on Systemwide sales
than revenues.
U.S. sales increased 2% for the quarter primarily due to expansion.
Comparable sales were relatively flat for the quarter.
In Europe, expansion and positive comparable sales drove the ten percent
constant currency sales increase for the quarter. Strong performances in France,
Germany and the U.K. were the primary contributors to the increase. In addition,
we are seeing significant improvements in the other markets that were previously
impacted by consumer concerns regarding the European beef supply.
Constant currency sales results in APMEA declined due to negative
comparable sales, partly offset by expansion. APMEA's sales were impacted by
negative comparable sales in Japan due to weak economic conditions and consumer
concerns regarding food safety, partly offset by expansion in China and strong
results in Australia. Although we are proactively communicating our strong
safety and quality messages, including the fact that XxXxxxxx'x Japan does not
use Japanese beef, we expect Japan's results in the near term to continue to be
negatively affected by these consumer concerns.
In Latin America, constant currency sales declined due to negative
comparable sales in Argentina and most other markets. We expect the weak
economic conditions in many Latin American markets to continue to impact our
business in the near term.
The sales increase in the Partner Brands was primarily due to strong
comparable sales at Chipotle and Boston Market.
Combined Operating Margins
The following combined operating margin information represents margins for
McDonald's restaurant business only and excludes Partner Brands.
5
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Combined operating margins Quarters ended
March 31
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2002 2001
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Dollars in millions
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Company-operated $ 350.3 $ 359.3
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Franchised 715.9 700.2
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Combined operating margins $1,066.2 $1,059.5
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Percent of sales/revenues
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Company-operated 14.4% 15.0%
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Franchised 78.0 78.1
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In constant currencies, combined operating margin dollars increased $30.9
million or 3% for the quarter. The U.S. and Europe segments accounted for about
80% of the combined margin dollars for the quarter in both years.
Consolidated food & paper costs and occupancy & other operating expenses
increased as a percent of sales for the quarter, while consolidated payroll
costs were flat as a percent of sales.
The U.S. Company-operated margin percent increased for the quarter,
primarily due to the elimination of goodwill amortization and a lower
contribution rate to the national co-op for advertising expenses. As a percent
of sales, food & paper costs decreased, payroll costs increased and occupancy &
other operating expenses decreased.
In Europe, Company-operated margins were flat for the quarter. France,
Germany and the U.K.'s margins increased for the quarter, however, this was
offset by higher food costs in certain other markets. Company-operated margins
in APMEA and Latin America decreased primarily due to negative comparable sales
and difficult economic conditions in many markets.
The decline in the consolidated franchised margin percent reflects higher
occupancy costs due to an increased number of leased sites. Our strategy of
leasing a higher proportion of new sites over the past few years has reduced
initial capital requirements and related interest expense. However, as
anticipated, franchised margins as a percent of applicable revenues have been
negatively impacted because financing costs implicit in the lease are included
in rent expense, which affects these margins. For owned sites, financing costs
are reflected in interest expense, which does not affect these margins.
6
Europe's franchised margin percent increased slightly for the quarter
primarily due to positive comparable sales and a decrease in the amount of rent
relief granted to franchisees compared with the prior year. The franchised
margin percent in APMEA increased for the quarter primarily due to a
restructuring of our ownership in the Philippines in July 2001. The
restructuring resulted in the reclassification of our restaurants and related
margins, that were lower than the average for the segment, from franchised to
Company-operated.
Selling, General & Administrative Expenses
Selling, general & administrative expenses decreased 3% for the quarter or
1% in constant currencies. As a result of the global change initiatives
introduced in late 2001, the Company expects ongoing annual selling, general &
administrative savings of about $100 million beginning in 2002, compared with
what otherwise would have been spent.
Other Operating Income (Expense), net
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Other operating income (expense), net Quarters ended
Dollars in millions March 31
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2002 2001
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Gains on sales of restaurant businesses $ 10.1 $15.3
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Equity in earnings of unconsolidated affiliates 8.3 11.9
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Asset impairment - Latin America and Turkey (43.0) -
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Team service system payments - U.S. (21.6) -
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Other income (expense) (12.7) (5.6)
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Total $(58.9) $21.6
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Equity in earnings of unconsolidated affiliates decreased for the quarter,
primarily due to lower earnings from our Japanese affiliate and a weaker
Japanese Yen. The team service system payments represent $21.6 million of
payments to U.S. owner/operators to facilitate the introduction of a new front
counter system. In 2001, other income (expense) included a gain on the sale of
real estate in Singapore, partly offset by the write-off of certain technology
costs.
Operating Income
Consolidated operating income for the quarter decreased 8% (6% in constant
currencies). Excluding the $43.0 million of asset impairment charges,
consolidated operating income was relatively flat in constant currencies due to
higher combined operating margin dollars and lower selling, general &
administrative expenses, offset by lower other operating income.
7
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Operating income Percent
Dollars in millions Increase/(Decrease)
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As Constant
Quarters ended March 31 2002 2001 Reported Currency(1)
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U.S. $402.1(2) $408.9 (2) n/a
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Europe 242.9 222.8 9 13
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APMEA 71.2(3) 113.7 (37) (34)
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Latin America (13.2)(4) 22.3 n/m n/m
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Canada 27.6 28.4 (3) 1
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Partner Brands (11.6) (14.9) 22 21
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Corporate (77.7) (86.0) 10 n/a
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Total operating income $641.3 $695.2 (8) (6)
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(1) Excluding the effect of foreign currency translation on reported results.
(2) Includes $21.6 million of front counter team service system payments.
(3) Includes $15.9 million of asset impairment charges in Turkey.
(4) Includes $27.1 million of asset impairment charges.
n/a Not applicable
n/m Not meaningful
U.S. operating income decreased 2% primarily due to the $21.6 million of
payments made to U.S. owner/operators, partly offset by higher combined
operating margin dollars and lower selling, general & administrative expenses.
Europe's operating income increased 13% in constant currencies. Strong
results in France, Germany, and the U.K. drove this segment's performance.
APMEA's operating income decreased 34% for the quarter in constant
currencies due to weak results in Japan, the $15.9 million of asset impairment
charges in Turkey and a gain on the sale of real estate in Singapore in the
prior year. Australia and China delivered significant growth in operating income
for the quarter.
Latin America's operating results declined significantly as Argentina and
most other markets continued to experience difficult economic conditions. In
addition, the segment's reported operating income included $27.1 million of
asset impairment charges.
The increase in operating income for the Partner Brands was primarily
driven by improved results for Chipotle and Boston Market and the elimination of
goodwill amortization, partly offset by higher losses for Aroma.
8
INTEREST, NONOPERATING EXPENSE AND INCOME TAXES
Interest expense decreased for the quarter primarily due to lower average
interest rates, partly offset by higher average debt levels. We expect the
percentage decrease in interest expense to moderate throughout the year.
Nonoperating expense decreased for the quarter primarily due to higher
minority interest expense in 2001 related to the gain on the sale of real estate
in Singapore and foreign currency translation gains in 2002 compared with
foreign currency translation losses in 2001.
The first quarter effective income tax rate was 34.5% compared with 32.0%
in 2001. The increase in the effective income tax rate was due to the asset
impairment charges that were not tax-affected for financial reporting purposes.
We expect the annual 2002 effective tax rate to be approximately 32.5% to 33.0%.
FORWARD-LOOKING STATEMENTS
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, 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.
RELATED COMMUNICATIONS
In conjunction with its first quarter earnings release, McDonald's Corporation
will broadcast its conference call with members of management live over the
Internet on Thursday, April 18, 2002 at 11:00 a.m. Central Time. Interested
parties are invited to listen by logging on to
xxxx://xxx.xxxxxxxxx.xxx/xxxxxxxxx/xxxxxxxx and clicking "Latest Investor
Webcasts".
McDonald's Corporation will also make additional sales information
available by voicemail at 000-000-0000.
9
McDONALD'S CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
Dollars and shares in millions, except per common share data
--------------------------------------------------------------------
Inc/(Dec)
Quarters ended March 31, 2002 2001 $ %
--------------------------------------------------------------------
SYSTEMWIDE SALES $9,698.5 $9,649.7 48.8 1
Revenues
Sales by Company-operated
restaurants 2,678.5 2,614.2 64.3 2
Revenues from franchised
and affiliated restaurants 918.9 897.5 21.4 2
TOTAL REVENUES 3,597.4 3,511.7 85.7 2
Operating costs and expenses
Company-operated restaurants 2,309.6 2,243.4 66.2 3
Franchised restaurants
--occupancy costs 202.7 196.9 5.8 3
Selling, general &
administrative expenses 384.9 397.8 (12.9) (3)
Other operating (income)
expense, net 58.9 (21.6) 80.5 n/m
Total operating costs
and expenses 2,956.1 2,816.5 139.6 5
OPERATING INCOME 641.3 695.2 (53.9) (8)
Interest expense 92.3 120.9 (28.6) (24)
Nonoperating expense, net 11.8 18.3 (6.5) n/m
Income before provision
for income taxes 537.2 556.0 (18.8) (3)
Provision for income taxes 185.5 177.7 7.8 4
Income before cumulative
effect of accounting change 351.7 378.3 (26.6) (7)
Cumulative effect of
accounting change, net
of tax (98.6) - (98.6) n/m
NET INCOME $ 253.1 $ 378.3 (125.2) (33)
PER COMMON SHARE-DILUTED:
Income before cumulative
effect of accounting change $ 0.27 $ 0.29* (0.02) (7)
Cumulative effect of
accounting change $ (0.07) $ - (0.07) n/m
Net income $ 0.20 $ 0.29 (0.09) (31)
Weighted average common
shares outstanding-diluted 1,292.7 1,325.3
n/m Not meaningful
* Diluted earnings per share would have remained at $0.29 had SFAS 142
been adopted in 2001.
10
XxXXXXXX'X CORPORATION SYSTEMWIDE SALES
Dollars in millions
------------------------------------------------------------------------
% Inc/(Dec)
As Constant
Quarters ended March 31, 2002 2001 Reported Currency*
------------------------------------------------------------------------
U.S.
Operated by franchisees $3,811.4 $3,666.4 4
Operated by the Company 725.3 745.8 (3)
Operated by affiliates 256.0 264.3 (3)
4,792.7 4,676.5 2 n/a
Europe
Operated by franchisees 1,302.7 1,211.3 8
Operated by the Company 892.9 860.5 4
Operated by affiliates 113.1 106.4 6
2,308.7 2,178.2 6 10
APMEA
Operated by franchisees 477.2 488.5 (2)
Operated by the Company 522.1 465.5 12
Operated by affiliates 632.8 828.7 (24)
1,632.1 1,782.7 (8) (2)
Latin America
Operated by franchisees 198.8 232.2 (14)
Operated by the Company 183.0 214.9 (15)
Operated by affiliates 8.4 8.2 2
390.2 455.3 (14) (1)
Canada
Operated by franchisees 197.7 216.5 (9)
Operated by the Company 110.3 111.8 (1)
Operated by affiliates 12.1 3.1 n/m
320.1 331.4 (3) 1
Partner Brands
Operated by franchisees 9.8 9.9 (1)
Operated by the Company 244.9 215.7 14
254.7 225.6 13 13
Systemwide
Operated by franchisees 5,997.6 5,824.8 3
Operated by the Company 2,678.5 2,614.2 2
Operated by affiliates 1,022.4 1,210.7 (16)
$9,698.5 $9,649.7 1 3
* Excluding the effect of foreign currency translation on reported results.
n/a Not applicable
n/m Not meaningful
11
COMPARABLE SALES - McDONALD'S RESTAURANT BUSINESS*
-------------------------------------------------------------------------
Percent
Increase/(Decrease)
Quarters ended March 31, 2002 2001
-------------------------------------------------------------------------
U.S. (0.1) 1.5
Europe 5.0 (5.2)
APMEA (8.0) (5.1)
Latin America (5.5) (1.6)
Canada (3.3) 4.1
Brand McDonald's (0.8) (1.5)
* Comparable sales represent the percent change in constant currency sales from
the same period in the prior year for restaurants in operation at least
thirteen months.
McDONALD'S CORPORATION TOTAL REVENUES
Dollars in millions
----------------------------------------------------------------------
% Inc/(Dec)
As Constant
Quarters ended March 31, 2002 2001 Reported Currency*
----------------------------------------------------------------------
U.S. $1,266.3 $1,270.4 - n/a
Europe 1,146.3 1,094.9 5 8
APMEA 584.0 534.8 9 13
Latin America 217.2 254.6 (15) 1
Canada 138.2 140.9 (2) 2
Partner Brands 245.4 216.1 14 14
Total $3,597.4 $3,511.7 2 6
* Excluding the effect of foreign currency translation on reported results.
n/a Not applicable
12 -
McDONALD'S CORPORATION OPERATING MARGINS
OPERATING MARGINS - McDONALD'S RESTAURANT BUSINESS**
------------------------------------------------------------------------
% Inc/(Dec)
Quarters ended Percent Amount As Constant
March 31, 2002 2001 2002 2001 Reported Currency*
------------------------------------------------------------------------
Company-operated
U.S. 16.8 16.3 $ 121.5 $ 121.8 - n/a
Europe 14.7 14.7 131.2 126.7 4 7
APMEA 12.4 14.3 65.0 66.5 (2) -
Latin America 10.1 12.7 18.4 27.3 (33) (25)
Canada 12.9 15.2 14.2 17.0 (16) (13)
Total 14.4 15.0 $ 350.3 $ 359.3 (3) -
Franchised
U.S. 78.6 79.0 $ 425.1 $ 414.6 3 n/a
Europe 75.9 75.4 192.4 176.8 9 14
APMEA 86.4 84.8 53.5 58.8 (9) (3)
Latin America 67.8 68.5 23.2 27.2 (15) (6)
Canada 77.8 78.4 21.7 22.8 (5) (1)
Total 78.0 78.1 $ 715.9 $ 700.2 2 4
* Excluding the effect of foreign currency translation on reported results.
** Operating margin information relates to McDonald's restaurant business and
excludes Partner Brands.
n/a Not applicable
COMPANY-OPERATED MARGINS AS A PERCENT OF SALES -
McDONALD'S RESTAURANT BUSINESS*
-------------------------------------------------------------------------
Quarters ended March 31, 2002 2001
-------------------------------------------------------------------------
Food & paper 34.8 34.3
Payroll & employee
benefits 26.1 26.1
Occupancy & other
operating expenses 24.7 24.6
Total expenses 85.6 85.0
Company-operated margins 14.4 15.0
* Operating margin information relates to McDonald's restaurant business and
excludes Partner Brands.
13
XxXXXXXX'X CORPORATION RESTAURANT INFORMATION
SYSTEMWIDE RESTAURANTS
-----------------------------------------------------------------------
At March 31, 2002 2001 Inc/(Dec)
-----------------------------------------------------------------------
U.S.* 13,148 12,811 337
Europe
United Kingdom 1,191 1,134 57
Germany 1,154 1,093 61
France 917 861 56
Italy 323 299 24
Spain 313 280 33
Sweden 241 228 13
Netherlands 211 206 5
Poland 189 183 6
Austria 155 148 7
Other 1,131 1,078 53
Total Europe 5,825 5,510 315
APMEA
Japan* 3,836 3,619 217
Australia 716 704 12
China 458 341 117
Taiwan 354 339 15
South Korea 333 255 78
Philippines 234 236 (2)
Hong Kong 199 180 19
Other 1,231 1,166 65
Total APMEA 7,361 6,840 521
Latin America
Brazil 573 554 19
Mexico 236 207 29
Argentina 211 214 (3)
Other 571 573 (2)
Total Latin America 1,591 1,548 43
Canada* 1,238 1,162 76
Partner Brands** 1,029 1,034 (5)
Systemwide restaurants 30,192 28,905 1,287
Countries 121 120 1
* Includes satellites at March 31, 2002: U.S. 1,018; Japan 1,836;
Canada 312. At March 31, 2001: U.S. 978; Japan 1,672;
Canada 285.
** Restaurants at March 31, 2002: Boston Market 653; Chipotle 184;
Donatos Pizzeria 192. At March 31, 2001: Aroma Cafe 42; Boston Market
702; Chipotle 124; Donatos Pizzeria 166.
14
XxXXXXXX'X CORPORATION RESTAURANT INFORMATION
RESTAURANT ADDITIONS
-----------------------------------------------------------------------
Quarters ended March 31, 2002 2001
-----------------------------------------------------------------------
U.S. 49 7
Europe 31 50
APMEA 40 69
Latin America 10 38
Canada 15 8
Partner Brands* (46) 26
Systemwide additions 99 198
* Decrease in 2002 was primarily due to sale of Aroma U.K. in March,
2002.
SYSTEMWIDE RESTAURANTS
-----------------------------------------------------------------------
At March 31, 2002 2001 Inc/(Dec)
-----------------------------------------------------------------------
U.S.
Operated by franchisees 10,504 10,148 356
Operated by the Company 1,907 1,897 10
Operated by affiliates 737 766 (29)
13,148 12,811 337
Europe
Operated by franchisees 3,346 3,116 230
Operated by the Company 2,228 2,162 66
Operated by affiliates 251 232 19
5,825 5,510 315
APMEA
Operated by franchisees 2,010 2,000 10
Operated by the Company 2,094 1,649 445
Operated by affiliates 3,257 3,191 66
7,361 6,840 521
Latin America
Operated by franchisees 729 738 (9)
Operated by the Company 791 778 13
Operated by affiliates 71 32 39
1,591 1,548 43
Canada
Operated by franchisees 782 745 37
Operated by the Company 406 350 56
Operated by affiliates 50 67 (17)
1,238 1,162 76
Partner Brands
Operated by franchisees 51 56 (5)
Operated by the Company 978 978 -
1,029 1,034 (5)
Systemwide
Operated by franchisees 17,422 16,803 619
Operated by the Company 8,404 7,814 590
Operated by affiliates 4,366 4,288 78
30,192 28,905 1,287
# # #
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FREQUENTLY ASKED QUESTIONS
.. Can you clarify earnings per share for the first quarter with and without
the unusual items?
As Constant
Quarter ended March 31, 2002 Reported Currency*
Diluted EPS - excluding $43 million
of asset impairment charges and before the
$99 million cumulative effect of the goodwill
accounting change. $.31 $.31
Diluted EPS - including $43 million of asset
impairment charges and before the $99 million
cumulative effect of the goodwill
accounting change. $.27 $.28
Diluted EPS - including $43 million of asset
impairment charges and after the $99 million
cumulative effect of the goodwill
accounting change. $.20 $.20
* Excluding the effect of foreign currency translation on reported results.
.. What is your earnings per share guidance for 2002?
Consistent with our previous guidance, we expect earnings per share to be
$1.47-$1.50, excluding the impact of foreign currency translation and the $142
million of charges related to asset impairment and the cumulative effect of the
goodwill accounting change.
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