McDonald's

Corporation
Shahryar Naeem
 Introduction
• McDonald's Corporation is an American fast food company, founded in
1940 as a restaurant operated by Richard and Maurice McDonald, in San
Bernardino, California, United States.
• Later turned the company into a franchise, with the Golden Arches logo.
• It is the world's largest restaurant chain by revenue, serving over 69
million customers daily in over 100 countries across 37,855 outlets as of
2018. 
 Introduction
• Vision: “to move with velocity to drive profitable growth and become an
even better McDonald’s serving more customers delicious food each day
around the world.”
• Mission: is “to be our customers’ favorite place and way to eat and
drink.” 
 Equity
• The number of shareholders of record and beneficial owners of the
Company’s common stock as of January 31, 2019 was estimated to be
2,150,000
• The Company has paid dividends on common stock for 43 consecutive
years through 2018 and has increased the dividend amount at least once
every year.
• In 2018, the Company returned approximately $8.5 billion to shareholders
through a combination of shares repurchased and dividends paid
Equity
 Revenues
• The Company’s revenues consist of sales by Company-operated restaurants
and fees from franchised restaurants operated by conventional franchisees,
developmental licensees and foreign affiliates.
• Revenues from conventional franchised restaurants include rent and royalties
based on a percent of sales with minimum rent payments, and initial fees.
• Revenues are to be recognized when control of promised goods or services is
transferred to a customer in an amount that reflects the consideration
expected to be received for those goods or services.
 Revenues
• The cumulative adjustment consisted of deferred revenue of
approximately $600 million within long-term liabilities and approximately
$150 million of associated adjustments to the deferred tax balances which
are recorded in Deferred income taxes and Miscellaneous other assets on
the Balance Sheet.
Revenues
 Leases
• At December 31, 2018, the Company was the lessee at 12,334 restaurant
locations through ground leases and through improved leases.
• In addition, the Company is the lessee under non-restaurant related leases
such as office buildings, vehicles and office equipment.
• The Company has long-term contractual obligations primarily in the form
of lease obligations (related to both Company-operated and franchised
restaurants) and debt obligations.
Leases
 Income Taxes
• In 2018 the reported effective income tax rate was 24.2%.
• The effective income tax rate for 2018 reflected approximately $75
million of net tax cost associated with the 2018 adjustments.
• The Company operates within multiple taxing jurisdictions and is subject
to audit in these jurisdictions
Income Taxes
 Earnings Per Share
• In 2018, net income increased 14% to $5.9 billion and diluted earnings per
common share increased 18% to $7.54 million
• Basic earnings per common share were 7.61 million in 2018.
Thank You.