EXHIBIT 99
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Investor Release
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FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT:
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07/24/01 Investors: ▇▇▇▇ ▇▇▇▇▇, ▇▇▇-▇▇▇-▇▇▇▇
Media: ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇-▇▇▇-▇▇▇▇
FOR ACCESS TO CONFERENCE CALL:
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When: 10:00 a.m. CT,
Tuesday, July 24, 2001
Where: ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇
McDONALD'S REPORTS GLOBAL RESULTS
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OAK BROOK, IL -- ▇▇▇▇▇▇▇▇'▇ Corporation today announced global results for the
six months and quarter ended June 30, 2001.
. Systemwide sales increased 5% for the six months and 4% for the quarter in
constant currencies.
. Sales increased in all segments for the six months: 2% in the U.S. and, in
constant currencies, 10% in Latin America, 6% in Asia/Pacific and 3% in
Europe.
. Revenues increased 9% for the six months and 8% for the quarter in constant
currencies.
. Diluted net income per common share was 34 cents for the quarter, 35 cents
in constant currencies.
. The Company repurchased $738 million of stock during the six months.
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Key highlights - Consolidated
Dollars in millions, except per common Percent
share data Increase/(Decrease)
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As Constant
Six months ended June 30 2001 2000 Reported Currency*
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Systemwide sales $19,888.5 $19,744.3 1 5
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Total revenues 7,219.2 6,904.4 5 9
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Operating income 1,467.7 1,644.9 (11) (7)
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Net income 819.2 976.8 (16) (12)
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Net income per common share - diluted .62 .71 (13) (8)
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Quarters ended June 30
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Systemwide sales $10,238.8 $10,237.6 - 4
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Total revenues 3,707.5 3,560.6 4 8
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Operating income 772.5 876.3 (12) (8)
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Net income 440.9 525.9 (16) (13)
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Net income per common share - diluted .34 .39 (13) (10)
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* 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.
SUMMARY COMMENTARY
Chairman and Chief Executive Officer ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ said, "McDonald's
reported earnings per share of 34 cents for the quarter, in line with guidance
issued last month. In constant currencies, earnings per share was 35 cents;
Systemwide sales increased 4%; and revenues increased 8%.
"While these results are below trendline, we are encouraged by improved
performance in Europe, where we saw sequential improvement in comparable sales
throughout the quarter. France led the segment with positive comparable sales
for each of the past four months. We've seen progress, but there are still
consumer concerns about the safety of the European beef supply in certain
markets. Therefore, we continue to proactively communicate our very high safety
and quality standards, as well as promote menu variety and value. We are
hopeful that the worst is behind us and Europe's results will continue to
improve.
"In the U.S., we faced tough comparisons with last year's Teenie Beanie
Babies promotion, which was the fourth most successful Happy Meal in our
history. Looking forward, we are excited about our New Tastes Menu and believe
our renewed emphasis on food taste, variety and improving operations will drive
customer visits and sales.
"Our Asia/Pacific segment delivered a 9% sales increase in constant
currencies for the quarter, primarily due to expansion. ▇▇▇▇▇▇▇▇'▇ Japan, our
largest market in this segment, will have an initial public offering (IPO) on
July 26. After the IPO, McDonald's will retain 50% ownership in ▇▇▇▇▇▇▇▇'▇
Japan. Our partner, ▇▇▇ ▇▇▇▇▇▇, and his family, will own approximately 26% and
he will continue to actively manage the business. As a result of this
transaction, McDonald's will record a gain of approximately $130 million in
third quarter 2001, to reflect an increase in the carrying value of our
investment, as a result of the cash proceeds from the IPO.
"While this has been a tough six months, we are intent upon improving the
business by building comparable sales around the world through improved
operations, effective marketing and menu development. And we continue to focus
on controlling costs to improve profitability. To that end, we are in the
process of reviewing approximately 250 underperforming restaurants for possible
closing. These restaurants are primarily located in certain emerging markets.
We expect this will result in charges to earnings in the second half of the
year.
"We remain confident in our business fundamentals and expect to post
significantly stronger results in the second half. Accordingly, our previously
stated outlook, for relatively flat constant currency earnings per share for the
year, remains the same."
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: Aroma
Cafe, Boston Market, Chipotle Mexican Grill and Donatos Pizza. Collectively
these four businesses are referred to as "Partner Brands." In addition,
McDonald's has a minority ownership in Pret A Manger.
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.
Reported results for the six months and quarter were negatively affected by
foreign currency translation primarily due to the weaker Euro, British Pound,
Japanese Yen, Australian Dollar and the Brazilian Real.
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.
Systemwide sales
Percent
Dollars in millions Increase/(Decrease)
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As Constant
Six months ended June 30 2001 2000 Reported Currency*
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U.S. $ 9,865.1 $ 9,697.5 2 n/a
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Europe 4,449.4 4,632.5 (4) 3
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Asia/Pacific 3,322.7 3,481.9 (5) 6
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Latin America 887.0 863.6 3 10
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Other** 1,364.3 1,068.8 28 32
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Total Systemwide sales $19,888.5 $19,744.3 1 5
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Quarters ended June 30
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U.S. $ 5,188.6 $ 5,192.5 - n/a
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Europe 2,271.2 2,326.8 (2) 4
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Asia/Pacific 1,635.2 1,696.3 (4) 9
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Latin America 431.7 429.5 1 10
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Other** 712.1 592.5 20 24
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Total Systemwide sales $10,238.8 $10,237.6 - 4
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* Excluding the effect of foreign currency translation on reported results.
** Includes Systemwide sales for Partner Brands in 2001 of $467.7 million for
the six months and $242.1 million for the quarter. In 2000, Systemwide sales
for Partner Brands were $159.2 million for the six months and $111.8 million
for the quarter.
n/a Not applicable
On a global basis, the increases in sales and revenues for the six months
and quarter were primarily due to restaurant expansion and the acquisition of
Boston Market in the second quarter 2000, 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 six months and quarter. On a
constant currency basis, revenues increased at a higher rate than sales for both
periods primarily due to the acquisition of Boston Market restaurants, which are
all Company-operated, and an increase in the royalty percent received from our
Japanese affiliate, effective January 1, 2001.
U.S. sales increased 2% for the six months and were flat for the quarter.
The growth for the six months was due to expansion, partly offset by negative
comparable sales. Both periods were negatively impacted by the difficult
comparison with the successful June 2000 Teenie Beanie Babies promotion.
In Europe, Asia/Pacific and Latin America, constant currency sales
increased for the six months and quarter due to expansion, partly offset by
negative comparable sales.
In Europe, France and the U.K. were primary contributors to the sales
growth for the quarter and six months. Also, the Netherlands and Russia
delivered strong performances in both periods. Comparable sales continued to be
affected by consumer confidence issues regarding the European beef supply in
certain markets. Sales trends are improving in several markets, most notably
France, which had positive comparable sales in each month from March through
June. We expect the impact from the concerns regarding European beef will
continue to lessen as the year progresses.
In Asia/Pacific, the six months and quarter benefited from positive
comparable sales in China and strong results in several Southeast Asia markets.
Japan also contributed significantly to the increases for both periods. Weak
consumer spending in Australia, partly due to the goods and services tax
introduced in July 2000, continued to negatively impact sales growth. As we
pass the anniversary of the introduction of the tax, our comparisons become
easier; however, consumer spending remains weak in Australia.
In Latin America, expansion and positive comparable sales in Mexico for the
six months and quarter and in Brazil for the six months were the primary
contributors to the sales increases. Weak consumer spending continued to
negatively affect most markets in this segment.
In the Other segment, the increases for the six months and quarter were
primarily driven by Canada and the Partner Brands.
Combined Operating Margins
The following combined operating margin information represents margins for
McDonald's restaurant business only.
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Combined operating margins
Six months ended Quarters ended
June 30 June 30
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2001 2000 2001 2000
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Dollars in millions
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Company-operated $ 745.3 $ 831.5 $ 386.0 $ 428.2
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Franchised 1,471.2 1,493.3 771.0 783.6
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Combined operating margins $2,216.5 $2,324.8 $1,157.0 $1,211.8
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Percent of sales/revenues
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Company-operated 15.2% 17.0% 15.4% 17.3%
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Franchised 78.8 79.4 79.6 80.1
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In constant currencies, combined operating margin dollars decreased by
$25.4 million for the six months and $12.4 million for the quarter; a 1% decline
for both periods. The U.S. and Europe segments accounted for over 80% of the
combined margin dollars in both periods.
As a percent of sales, consolidated Company-operated margins decreased for
the six months and quarter. Food & paper costs, payroll costs and occupancy &
other operating expenses all increased as a percent of sales for both periods.
In the U.S., Company-operated margins decreased as a percent of sales for
both periods. As a percent of sales, food & paper costs decreased while payroll
costs increased for both periods. Occupancy & other operating expenses were
flat for the six months and increased for the quarter.
In each of the remaining segments, Company-operated margins decreased as a
percent of sales for both periods. In Europe and Latin America, the decline was
primarily due to negative comparable sales and higher food costs. In addition,
Europe experienced higher labor costs. Asia/Pacific's Company-operated margin
percent decreased primarily due to negative comparable sales and higher labor
costs for the six months and higher food & paper costs and occupancy & other
operating expenses for the quarter.
Franchised margins as a percent of applicable revenues in the U.S., Europe
and Latin America decreased for the six months and quarter, partly due to
negative comparable sales for both periods. In addition, the decreases in
Europe for the six months and Latin America for both periods were partly due to
temporary rent assistance provided to franchisees in certain markets. The
franchised margin percent in Asia/Pacific increased for both periods primarily
due to an increase in the royalty percent received from our Japanese affiliate.
Franchised margins as a percent of revenues in all segments were also
negatively impacted by higher occupancy costs as a result of our strategy to
lease more sites. By leasing a higher proportion of new sites, we have reduced
initial capital requirements. However, as anticipated, this practice reduces
franchised margins because the financing costs implicit in the lease are
included in occupancy expense, whereas for owned sites, financing costs are
reflected in interest expense.
Selling, General & Administrative Expenses
Selling, general & administrative expenses increased 5% for the six months
and quarter. The increases were primarily due to the acquisition of Boston
Market and increased spending on future store technology improvements, partly
offset by weaker foreign currencies. Excluding Partner Brands, selling, general
& administrative expenses increased 2% for the six months and 3% for the
quarter.
Other Operating Income, net
Equity in earnings of unconsolidated affiliates decreased for both periods,
primarily due to the increase in Japan's royalty expense and a weaker Japanese
Yen and, for the six months, weaker results in Japan. Although the increase in
royalty expense reduced McDonald's equity in earnings for Japan, it was more
than offset by the royalty benefit McDonald's received in franchised revenues.
Other expense for the second quarter included a $24 million asset impairment
charge in Turkey due to our assessment of the ongoing impact of significant
currency devaluation on our business. For the six months, other expense also
included the write-off of certain technology costs and a gain on the sale of
real estate in Singapore.
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Other operating income, net
Six months ended Quarters ended
June 30 June 30
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Dollars in millions 2001 2000 2001 2000
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Gains on sales of restaurant businesses $ 46.3 $ 37.9 $ 31.0 $ 22.3
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Equity in earnings of unconsolidated
affiliates 37.1 59.9 25.2 33.5
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Other expense (42.7) (17.8) (37.1) (5.1)
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Total $ 40.7 $ 80.0 $ 19.1 $ 50.7
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Operating Income
Consolidated operating income decreased $113.3 million, or 7%, for the six
months and $70.2 million, or 8%, for the quarter, in constant currencies. The
decreases for both periods were due to lower combined operating margin dollars,
lower other operating income and higher selling, general & administrative
expenses, partly due to the acquisition of Boston Market.
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Operating income**
Percent
Dollars in millions Increase/(Decrease)
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As Constant
Six months ended June 30 2001 2000 Reported Currency*
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U.S. $ 878.2 $ 870.6 1 n/a
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Europe 487.0 573.5 (15) (9)
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Asia/Pacific 214.4 227.6 (6) 5
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Latin America 36.5 56.1 (35) (32)
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Other*** 7.4 48.8 n/m n/m
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Corporate (155.8) (131.7) (18) n/a
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Total operating income $1,467.7 $1,644.9 (11) (7)
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Quarters ended June 30
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U.S. $ 475.5 $ 481.9 (1) n/a
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Europe 264.2 297.1 (11) (5)
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Asia/Pacific 98.9 109.4 (10) 2
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Latin America 14.2 24.4 (42) (37)
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Other*** (4.3) 28.0 n/m n/m
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Corporate (76.0) (64.5) (18) n/a
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Total operating income $ 772.5 $ 876.3 (12) (8)
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* Excluding the effect of foreign currency translation on reported results.
** Segment operating income has been restated for 2000 to break out corporate
expenses from the other operating segments.
*** Includes operating losses for Partner Brands in 2001 of $27.4 million for
the six months and $12.5 million for the quarter. In 2000, operating losses
for Partner Brands were $17.9 million for the six months and $8.8 million
for the quarter.
n/a Not applicable.
n/m Not meaningful.
U.S. operating income increased $7.6 million, or 1%, for the six months,
while decreasing $6.4 million, or 1%, for the quarter. The increase for the six
months was due to higher combined operating margin dollars and other operating
income, partly offset by higher selling, general & administrative expenses. The
decrease for the quarter was mainly due to lower combined operating margin
dollars and higher selling, general & administrative expenses, partly offset by
higher other operating income.
Europe's operating income decreased 9% for the six months and 5% for the
quarter in constant currencies. Driving this segment's improved performance
over the first quarter was significant improvement in France's results, as well
as strong results in the Netherlands and Russia. However, operating income
continued to be negatively affected by the decline in consumer confidence
regarding the safety of the European beef supply in certain markets.
Operating income in Asia/Pacific increased 5% for the six months and 2% for
the quarter in constant currencies. In both periods, this segment benefited
from a strong performance in China and an increase in the royalty percent
received from Japan. In addition, a gain on the sale of real estate in
Singapore contributed significantly to the increase for the six months.
Latin America's operating income decreased 32% for the six months and 37%
for the quarter in constant currencies. Both periods were negatively impacted by
the continuing difficult economic conditions experienced by most markets in the
region.
In the Other segment, the results for both periods were impacted by the
asset impairment charge in Turkey, driven by the recent currency devaluation.
INTEREST, NONOPERATING EXPENSE AND INCOME TAXES
For both periods, higher interest expense was primarily due to higher average
debt levels, partly offset by lower average interest rates and weaker foreign
currencies. The higher average debt levels were a result of the Company using
its available credit capacity to repurchase shares of its common stock.
Nonoperating (income) expense for the six months included lower foreign
currency translation losses, while the quarter included lower foreign currency
translation gains. In addition, nonoperating expense included the first quarter
write-off of a financing receivable from a Latin American supplier and minority
interest expense related to the sale of real estate in Singapore. Also, second
quarter 2000 included a gain related to the sale of a partial ownership interest
in a majority-owned subsidiary outside the U.S.
The effective income tax rate was 32.3% and 32.6% for the six months and
quarter 2001, respectively. The 2000 effective tax rate was 32.0% for both
periods. The increase in the income tax rate in 2001 was primarily the result
of the Turkey asset impairment charge, which could not be tax-effected for
financial reporting purposes.
WEIGHTED AVERAGE SHARES
Weighted average shares outstanding for the six months and 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.
During the first six months of 2001, the Company repurchased 24.4 million shares
of its common stock for approximately $738 million.
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, 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, except to the extent required by law.
RELATED COMMUNICATIONS
In conjunction with its second quarter earnings release, McDonald's Corporation
will broadcast its conference call with members of management live over the
Internet on Tuesday, July 24, 2001 at 10:00 a.m. Central Time. Interested
parties are invited to listen by logging on to
▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ and clicking "Latest Investor
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Webcasts".
▇▇▇▇▇▇▇▇'▇ Corporation will also make additional sales information available by
voicemail. Please call ▇▇▇-▇▇▇-▇▇▇▇ to obtain comparable sales information by
segment for the six months and quarter.
McDONALD'S CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
Dollars and shares in millions, except per common share data
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Inc/(Dec)
Six months ended June 30, 2001 2000 $ %
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SYSTEMWIDE SALES $19,888.5 $19,744.3 144.2 1
Revenues
Sales by Company-operated
restaurants 5,352.4 5,021.9 330.5 7
Revenues from franchised
and affiliated restaurants 1,866.8 1,882.5 (15.7) (1)
TOTAL REVENUES 7,219.2 6,904.4 314.8 5
Operating costs and expenses
Company-operated
restaurants 4,585.0 4,180.1 404.9 10
Franchised restaurants
--occupancy costs 394.8 388.4 6.4 2
Selling, general &
administrative expenses 812.4 771.0 41.4 5
Other operating
income, net (40.7) (80.0) 39.3 49
Total operating costs
and expenses 5,751.5 5,259.5 492.0 9
OPERATING INCOME 1,467.7 1,644.9 (177.2) (11)
Interest expense 238.0 206.6 31.4 15
Nonoperating (income)
expense, net 20.0 2.6 17.4 n/m
Income before provision
for income taxes 1,209.7 1,435.7 (226.0) (16)
Provision for
income taxes 390.5 458.9 (68.4) (15)
NET INCOME $ 819.2 $ 976.8 (157.6) (16)
NET INCOME PER
COMMON SHARE $ 0.63 $ 0.73 (0.10) (14)
NET INCOME PER
COMMON SHARE-DILUTED $ 0.62 $ 0.71 (0.09) (13)
Weighted average
common shares outstanding 1,295.2 1,335.3
Weighted average
common shares outstanding
-diluted 1,317.9 1,374.2
n/m Not meaningful
McDONALD'S CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
Dollars and shares in millions, except per common share data
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Inc/(Dec)
Quarters ended June 30, 2001 2000 $ %
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SYSTEMWIDE SALES $10,238.8 $10,237.6 1.2 -
Revenues
Sales by Company-operated
restaurants 2,738.2 2,582.0 156.2 6
Revenues from franchised
and affiliated restaurants 969.3 978.6 (9.3) (1)
TOTAL REVENUES 3,707.5 3,560.6 146.9 4
Operating costs and expenses
Company-operated
restaurants 2,341.6 2,147.0 194.6 9
Franchised restaurants
--occupancy costs 197.9 194.6 3.3 2
Selling, general &
administrative expenses 414.6 393.4 21.2 5
Other operating
income, net (19.1) (50.7) 31.6 n/m
Total operating costs
and expenses 2,935.0 2,684.3 250.7 9
OPERATING INCOME 772.5 876.3 (103.8) (12)
Interest expense 117.1 106.2 10.9 10
Nonoperating (income)
expense, net 1.7 (2.9) 4.6 n/m
Income before provision
for income taxes 653.7 773.0 (119.3) (15)
Provision for
income taxes 212.8 247.1 (34.3) (14)
NET INCOME $ 440.9 $ 525.9 (85.0) (16)
NET INCOME PER
COMMON SHARE $ 0.34 $ 0.40 (0.06) (15)
NET INCOME PER
COMMON SHARE-DILUTED $ 0.34 $ 0.39 (0.05) (13)
Weighted average
common shares outstanding 1,289.7 1,327.1
Weighted average
common shares outstanding
-diluted 1,311.1 1,365.5
n/m Not meaningful
McDONALD'S CORPORATION SYSTEMWIDE SALES
Dollars in millions
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% Inc/(Dec)
As Constant
Six months ended June 30, 2001 2000 Reported Currency*
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US
Operated by franchisees $ 7,740.7 $ 7,597.0 2
Operated by the Company 1,562.7 1,500.2 4
Operated by affiliates 561.7 600.3 (6)
9,865.1 9,697.5 2 n/a
Europe
Operated by franchisees 2,467.1 2,547.4 (3)
Operated by the Company 1,768.7 1,850.4 (4)
Operated by affiliates 213.6 234.7 (9)
4,449.4 4,632.5 (4) 3
Asia/Pacific
Operated by franchisees 828.0 907.3 (9)
Operated by the Company 884.2 895.6 (1)
Operated by affiliates 1,610.5 1,679.0 (4)
3,322.7 3,481.9 (5) 6
Latin America
Operated by franchisees 456.8 449.1 2
Operated by the Company 420.3 358.5 17
Operated by affiliates 9.9 56.0 n/m
887.0 863.6 3 10
Other**
Operated by franchisees 628.2 629.1 -
Operated by the Company 716.5 417.2 n/m
Operated by affiliates 19.6 22.5 (13)
1,364.3 1,068.8 28 32
Systemwide
Operated by franchisees 12,120.8 12,129.9 -
Operated by the Company 5,352.4 5,021.9 7
Operated by affiliates 2,415.3 2,592.5 (7)
$19,888.5 $19,744.3 1 5
* Excluding the effect of foreign currency translation on reported results.
** The Other segment includes $467.7 million of sales in 2001 and $159.2
million in 2000 related to Partner Brands.
n/a Not applicable
n/m Not meaningful
▇▇▇▇▇▇▇▇'▇ CORPORATION SYSTEMWIDE SALES
Dollars in millions
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% Inc/(Dec)
As Constant
Quarters ended June 30, 2001 2000 Reported Currency*
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US
Operated by franchisees $ 4,074.3 $ 4,071.0 -
Operated by the Company 816.9 798.3 2
Operated by affiliates 297.4 323.2 (8)
5,188.6 5,192.5 - n/a
Europe
Operated by franchisees 1,255.8 1,278.1 (2)
Operated by the Company 908.2 932.9 (3)
Operated by affiliates 107.2 115.8 (7)
2,271.2 2,326.8 (2) 4
Asia/Pacific
Operated by franchisees 410.6 442.0 (7)
Operated by the Company 436.4 424.4 3
Operated by affiliates 788.2 829.9 (5)
1,635.2 1,696.3 (4) 9
Latin America
Operated by franchisees 224.6 224.5 -
Operated by the Company 205.4 179.7 14
Operated by affiliates 1.7 25.3 n/m
431.7 429.5 1 10
Other**
Operated by franchisees 330.7 335.6 (1)
Operated by the Company 371.3 246.7 n/m
Operated by affiliates 10.1 10.2 (1)
712.1 592.5 20 24
Systemwide
Operated by franchisees 6,296.0 6,351.2 (1)
Operated by the Company 2,738.2 2,582.0 6
Operated by affiliates 1,204.6 1,304.4 (8)
$10,238.8 $10,237.6 - 4
* Excluding the effect of foreign currency translation on reported results.
** The Other segment includes $242.1 million of sales in 2001 and $111.8
million in 2000 related to Partner Brands.
n/a Not applicable
n/m Not meaningful
▇▇▇▇▇▇▇▇'▇ CORPORATION TOTAL REVENUES
Dollars in millions
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% Inc/(Dec)
As Constant
Six months ended June 30, 2001 2000 Reported Currency*
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U.S. $2,670.0 $2,589.6 3 n/a
Europe 2,250.6 2,361.0 (5) 2
Asia/Pacific 1,007.4 1,003.1 - 9
Latin America 497.8 454.7 9 18
Other** 793.4 496.0 n/m n/m
$7,219.2 $6,904.4 5 9
----------------------------------------------------------------------
% Inc/(Dec)
As Constant
Quarters ended June 30, 2001 2000 Reported Currency*
----------------------------------------------------------------------
U.S. $1,399.6 $1,380.0 1 n/a
Europe 1,155.7 1,190.0 (3) 4
Asia/Pacific 497.2 476.5 4 14
Latin America 243.2 225.8 8 18
Other** 411.8 288.3 43 46
$3,707.5 $3,560.6 4 8
* Excluding the effect of foreign currency translation on reported results.
** The Other segment for the six months includes $448.5 million of revenue in
2001 and $138.5 million in 2000 related to Partner Brands. For the quarter,
the Other segment includes $232.4 million of revenue in 2001 and $101.2
million in 2000 related to Partner Brands.
n/a Not applicable
n/m Not meaningful
McDONALD'S CORPORATION OPERATING MARGINS
OPERATING MARGINS - McDONALD'S RESTAURANT BUSINESS**
------------------------------------------------------------------------
% Inc/(Dec)
Six months ended Percent Amount As Constant
June 30, 2001 2000 2001 2000 Reported Currency*
------------------------------------------------------------------------
Company-operated
U.S. 16.4 17.1 $ 256.5 $ 257.1 - n/a
Europe 15.6 18.1 276.8 335.0 (17) (12)
Asia/Pacific 14.4 17.1 127.0 153.4 (17) (10)
Latin America 11.6 12.7 48.8 45.6 7 13
Other 13.5 14.5 36.2 40.4 (10) (6)
Total 15.2 17.0 $ 745.3 $ 831.5 (10) (6)
Franchised
U.S. 79.9 80.3 $ 884.2 $ 875.1 1 n/a
Europe 76.4 77.8 368.0 397.1 (7) (1)
Asia/Pacific 85.9 82.4 105.8 88.6 19 36
Latin America 68.6 74.5 53.2 71.7 (26) (21)
Other 78.8 78.0 60.0 60.8 (1) 3
Total 78.8 79.4 $1,471.2 $1,493.3 (1) 2
------------------------------------------------------------------------
% Inc/(Dec)
Quarters ended Percent Amount As Constant
June 30, 2001 2000 2001 2000 Reported Currency*
------------------------------------------------------------------------
Company-operated
U.S. 16.5 17.5 $ 134.7 $ 139.5 (3) n/a
Europe 16.5 18.6 150.1 173.9 (14) (8)
Asia/Pacific 13.8 16.3 60.3 69.2 (13) (5)
Latin America 10.5 12.9 21.5 23.1 (7) -
Other 13.9 15.4 19.4 22.5 (14) (10)
Total 15.4 17.3 $ 386.0 $ 428.2 (10) (6)
Franchised
U.S. 80.6 81.4 $ 469.6 $ 473.4 (1) n/a
Europe 77.3 78.2 191.2 201.1 (5) 2
Asia/Pacific 85.5 82.1 52.0 42.8 21 39
Latin America 68.8 73.3 26.0 33.8 (23) (17)
Other 80.3 78.9 32.2 32.5 (1) 3
Total 79.6 80.1 $ 771.0 $ 783.6 (2) 2
* 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
McDONALD'S CORPORATION FINANCIAL INFORMATION
COMPANY-OPERATED MARGINS AS A PERCENT OF SALES -
McDONALD'S RESTAURANT BUSINESS*
-------------------------------------------------------------------------
Six months ended Quarters ended
June 30 June 30
2001 2000 2001 2000
-------------------------------------------------------------------------
Food & paper 34.2 34.0 34.2 33.8
Payroll & employee
benefits 26.2 25.4 26.2 25.4
Occupancy & other
operating expenses 24.4 23.6 24.2 23.5
Total expenses 84.8 83.0 84.6 82.7
Company-operated margins 15.2 17.0 15.4 17.3
* Operating margin information relates to McDonald's restaurant business and
excludes Partner Brands.
McDONALD'S CORPORATION RESTAURANT INFORMATION
SYSTEMWIDE RESTAURANTS
-----------------------------------------------------------------------
At June 30, 2001 2000** Inc/(Dec)
-----------------------------------------------------------------------
U.S.* 12,879 12,658 221
Europe
Germany 1,103 1,044 59
England 976 901 75
France 872 812 60
Italy 308 257 51
Spain 289 238 51
Sweden 233 213 20
Netherlands 207 204 3
Poland 185 168 17
Other 1,422 1,295 127
Total Europe 5,595 5,132 463
Asia/Pacific
Japan* 3,680 3,347 333
Australia 704 684 20
China 368 272 96
Taiwan 341 327 14
South Korea 273 200 73
Philippines 243 228 15
Hong Kong 182 169 13
Other 669 603 66
Total Asia/Pacific 6,460 5,830 630
Latin America
Brazil 566 495 71
Argentina 216 198 18
Mexico 213 183 30
Other 579 510 69
Total Latin America 1,574 1,386 188
Other
Canada* 1,168 1,126 42
Other McDonald's 527 460 67
Partner Brands*** 1,047 910 137
Total Other 2,742 2,496 246
Systemwide restaurants 29,250 27,502 1,748
Countries 120 119 1
* Includes satellites at June 30, 2001: U.S. 983; Japan 1,705;
Canada 283. At June 30, 2000: U.S. 1,017; Japan 1,386;
Canada 268.
** Adjusted to exclude 544 (503 in Brazil) dessert-only kiosks from the June
30, 2000 restaurant counts.
*** Restaurants at June 30, 2001: Aroma Cafe 42; Boston Market 691; Chipotle
Mexican Grill 137; Donatos Pizza 177. At June 30, 2000: Aroma Cafe 38;
Boston Market 653; Chipotle Mexican Grill 71; Donatos Pizza 148.
▇▇▇▇▇▇▇▇'▇ CORPORATION RESTAURANT INFORMATION
RESTAURANT ADDITIONS
-----------------------------------------------------------------------
Six months ended Quarters ended
June 30 June 30
2001 2000* 2001 2000**
-----------------------------------------------------------------------
U.S. 75 29 68 34
Europe 135 189 85 121
Asia/Pacific 200 176 136 126
Latin America 64 87 26 63
Other McDonald's 30 18 17 23
Partner Brands 39 694*** 13 673***
Systemwide additions 543 1,193 345 1,040
* Adjusted by 47 in 2000 to exclude dessert-only kiosks.
** Adjusted by 10 in 2000 to exclude dessert-only kiosks.
*** Primarily relates to the acquisition of Boston Market in second quarter
2000.
SYSTEMWIDE RESTAURANTS
-----------------------------------------------------------------------
At June 30, 2001 2000* Inc/(Dec)
-----------------------------------------------------------------------
US
Operated by franchisees 10,261 10,028 233
Operated by the Company 1,872 1,813 59
Operated by affiliates 746 817 (71)
12,879 12,658 221
Europe
Operated by franchisees 3,173 2,871 302
Operated by the Company 2,196 2,040 156
Operated by affiliates 226 221 5
5,595 5,132 463
Asia/Pacific
Operated by franchisees 1,741 1,563 178
Operated by the Company 1,574 1,343 231
Operated by affiliates 3,145 2,924 221
6,460 5,830 630
Latin America
Operated by franchisees 732 703 29
Operated by the Company 800 581 219
Operated by affiliates 42 102 (60)
1,574 1,386 188
Other
Operated by franchisees 1,143 1,117 26
Operated by the Company 1,481 1,293 188
Operated by affiliates 118 86 32
2,742 2,496 246
Systemwide
Operated by franchisees 17,050 16,282 768
Operated by the Company 7,923 7,070 853
Operated by affiliates 4,277 4,150 127
29,250 27,502 1,748
* Adjusted by 544 in 2000 to exclude dessert-only kiosks.
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Doc. #140491