McDonald’s CorporationMcDonald’s Corporation

Presented By: Presented By: Ardis Shannon Ardis Shannon Adam Krupa Adam Krupa Jigar Patel Jigar Patel David Seid David Seid

Samuel GeorgeSamuel George

McDonald’s MissionMcDonald’s Mission

Be the best quick service restaurant experience. By providing quality, service, cleanliness and value that make every customer in every restaurant smile.

3 World wide strategies3 World wide strategies

Best employer Operational Excellence Continue to grow and be profitable

HistoryHistory 1940 First McDonald’s 1952 Attempts at

franchising 1954 Milk Shake

Machine 1955 prototype opens

in Des Plaines, IL 1956 14 McDonald’s 1961 McDonald

brothers sell rights

• 1965 McDonald’s go public

• 1968 Introduction of Big Mac and shift to Network Television

• 1970 1600 restaurants

• 1980 6000 McDonald’s Restaurants

• 1990 record sales

History ContinuedHistory Continued

1994 Kuwait City, Kuwait 2002 Forty seven years after

– 30,000 locations– 2000 new restaurants – World Wide Web– McDonald’s a recognized Brand

Name

RecentRecentAcquisitions/DivestituresAcquisitions/Divestitures

Boston MarketChipolte Mexican GrillDonato’s Pizza chainMcCafe’

TrainingTraining

Surpasses even the U.S. ArmyProvides career opportunitiesService Enhancement ProcessConsistent through CD-ROMs

ReHIREmentReHIREment

Program established for mature workersEase of transition of older workers returning

to the workforce.Flexible scheduling so as not to jeopardize

their Social Security benefits.More than 40,000 older workers serve

McDonald’s customers on any given day

McJobsMcJobs

Assistance to employees with mental and physical disabilities.

More than 9,000 workers went through the program.

Given formal graduation ceremony

Management Management Development ProgramsDevelopment Programs

Crew DevelopmentRestaurant ManagementMid-ManagementExecutive Development

Hamburger UniversityHamburger University

Management Training Center

Worldwide Education Program

Technology 200 per class 65,000 managers

graduated to date

Women and MinoritiesWomen and Minorities

Soars above stereotype of average fast-food joint

Compose more than 50 percent of McDonald’s current workforce

Featured as the “The Best Companies for Minorities”

Product LinesProduct Lines

HamburgersChicken SandwichesFrench FriesBeveragesBreakfast ItemsDesserts

TechnologyTechnology

McDonald’s in Sweden– World’s First Snowmobile Drive-Thru

McDonald’s & ExxonMobil???– Speedpass invades McDonald’s

Industry TrendsIndustry Trends

What is happening with fast food?– People are more educated

McDonald’s Responds– America’s First McCafe

In Downtown Chicago

Financial AgendaFinancial Agenda

• System Wide Sales

• McDonald’s Corporation Revenues

• Cash Flow

• Financial Ratios

• Stock Performance

System Wide Sales System Wide Sales In The Year 2000In The Year 2000

$40.181 Billion$40.181 BillionCompany operated

Resturants26%

Franchised61%

Affiliated13%

McDonald’s CorporationMcDonald’s Corporation Sales By Segment Sales By Segment

U.S.37%

Europe33%

Asia/Pacific14%

Latin America7%

Other9%

IncomeIncome(in millions)(in millions)

NetRevenues

NetIncome

Earnings / Share

$12,421

$14,243

$13,259

'98 '99 '00

$1,550

$1,947 $1,977

'98 '99 '00

$1.14

$1.44 $1.49

'98 '99 '00

Cash Flow StatementCash Flow StatementIn (millions)In (millions)

2000 1999

Net Income

Net Cash Provided By Operating Activities

Net Cash Provided By Investing Activities

Net Cash Provided By Financing Activities

$1,977.3

$2,751.5

(2,212.6)

(536.7)

$1,947.9

3,008.9

(2,261.8)

(626.8)

Cash and equivalents increase(decrease)

Cash and equivalents at beginning of year

Cash and Equivalents at end of year

$2.2

$419.5

$421.7

$120.3

$299.2

$419.5

Financial RatiosFinancial RatiosAnalysis McDonald Industry

P/E Ratio 21.42 25.49

Price to Sales 2.36 1.97

Price to Book 3.52 3.95

Quick Ratio 0.76 0.63

Inventory Turnover 109.28 32.44

Total Debt to Equity 0.89 0.64

Net Profit Margin 11.01 7.62

Return on Assets 7.54 8.67

Return on Investment 8.30 10.54

Return on Equity 17.62 17.65

Revenue/Employee 40,852 77,289

Stock PerformanceStock Performance Mkt Cap 52-wk Range Last Trade 35.877B 24.75 - 31.00 Mar. 8 27.91

                                                                            

Making A DifferenceMaking A Difference

We have an obligation to We have an obligation to give back to the give back to the communities that give us so communities that give us so much." much." - Founder Ray Kroc, 1955- Founder Ray Kroc, 1955

Social CommitmentsSocial Commitments

“9-11” Relief EffortEnvironmental ConcernsEducational InvolvementQuality & Safety ProceduresRonald McDonald House

Charities (RHMC)

Stay Tuned ………… Stay Tuned …………

Terence HaynesTerence Haynes Senior Vice President, Senior Vice President, U.S. Controller U.S. Controller

Native of South AfricaNative of South Africa

Education: Bachelor of CommerceEducation: Bachelor of Commerce University of Witwatersand in Johannesburg University of Witwatersand in Johannesburg

Prior Position: Chief Financial Officer in the U.K.Prior Position: Chief Financial Officer in the U.K.