EXHIBIT 99
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Investor Release
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FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT:
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10/29/01 Investors: Xxxx Xxxxx, 000-000-0000
Media: Xxxx Xxxxxxxx, 000-000-0000
McDONALD'S DISCUSSES OUTLOOK AND
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ANNOUNCES $5 BILLION SHARE REPURCHASE PROGRAM
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. 2002 earnings per share expected to increase by 5% to 10%, excluding
foreign currency translation and the fourth quarter 2001 special charge.
. In connection with change initiatives, the Company expects to take a
special charge of $175 to $200 million in the fourth quarter of 2001 and
realize ongoing annual savings of about $100 million beginning in 2002.
. New $5 billion share repurchase program and increase in the annual cash
dividend announced.
OAK BROOK, IL -Today, McDonald's Chairman and Chief Executive Officer Xxxx X.
Xxxxxxxxx noted, "More than ever before, we must adapt and seize opportunities.
Our goal is to improve results in 2002 and put ourselves in position to return
to double-digit earnings growth."
The Company's goal is to increase sales and improve profitability and
returns. It expects 2002 earnings per share to increase by 5 percent to 10
percent, excluding the effect of foreign currency translation and the fourth
quarter 2001 special charge. This would represent a significant improvement over
2001 and set the stage for stronger growth in 2003 and beyond.
To prepare the Company for future growth, McDonald's is implementing a
number of change initiatives around the world. In connection with these changes,
McDonald's expects to take a special charge of $175 million to $200 million in
the fourth quarter of 2001, primarily for employee severance and outplacement,
consolidation of facilities and related costs. After redeploying more than $50
million, the Company expects ongoing annual S,G&A savings of about $100 million
beginning in 2002, compared with what otherwise would be spent.
Given the weak global economic environment, the Company expects to open
approximately 200 fewer McDonald's restaurants in 2002 than this year. Net of
restaurant closings, this reflects plans to add 1,300 to 1,400 XxXxxxxx'x
restaurants in 2002, a number similar to this year. In addition, the Company
expects to add 100 to 150 restaurants under its Partner Brands in 2002.
The Company announced that it will embark on a newly authorized $5
billion share repurchase program in the near future. To date, it has repurchased
$4.2 billion of McDonald's stock under its current program.
Xxxxxxx X. Xxxxx, Executive Vice President and Chief Financial Officer,
said, "We believe share repurchase is the best use of our excess cash flow after
investing in McDonald's and our Partner Brands. We are pleased that our strong
financial position allows us to do both and believe it will continue to provide
us with a strong credit rating and ample financial flexibility."
Also, McDonald's Board of Directors approved a 4.7 percent increase in
the annual dividend to 22.5 cents per share, payable on December 3, 2001 to
shareholders of record at the close of business on November 15, 2001.
McDonald's is the world's leading food service retailer with more than
29,000 restaurants in 121 countries, serving 45 million customers each day.
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.
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