Running Head: A FINANCIAL ANALYSIS OF MCDONALD
A Financial Analysis McDonald's Corp.
McDonald’s Corporation is a global company that conducts business in 117 countries.
McDonald’s operates 32,737 restaurants and 26,338 franchises in the highly competitive fast
food industry. Since 1940, McDonald’s has built a loyal customer base by continuing dedicating
to customer service and providing high quality fast food for customers. Presently, McDonald’s
could boast of over 60 million customers and the company serves average of 64 million
customers daily. In the United States, and other countries where McDonald’s is operating, fast
food business is very competitive. Despite the competition that McDonald’s is facing, the
company has been able to record revenues of more than $16 billion in restaurants and revenues
of more than $7 billion in franchise restaurants business. McDonald’s operates in six
geographical locations. The company business operations are in the U.S, Europe, Middle East,
Asia-Pacific, Latin America and Africa. In the U.S, McDonald’s total revenues account for 34%.
In Europe, the company total revenues account for 40% while in Asia/Pacific, Middle East and
Africa (APMEA) segment, McDonald’s total revenues account for 21%. The company records a
remarkable success in the U.S with more than 3.8% growth in eight consecutive years. In
addition, McDonald’s has gained competitive market advantages in its international business
operations. The U.S and Canada are the McDonald’s major markets. In France, the UK, and
Germany, the company market performances accounts for 5% of the total revenues in Europe.
Similarly, the company market performances in Australia, Japan and China account for 50% of
McDonald’s continues to focus on customer experience, and achieve global success by providing
branded affordability. In all countries that McDonald’s operates, the company has been able to
achieve global comparable sales of increased of 5.0% and 4.9% in guest counts. Since 2007,
McDonald’s financial performance rise steadily. The company recorded $2.4 billion in the net
income in 2007. In 2008, McDonald’s net income increased to $4.3 billion, and the net income
was $4.5 in 2009. McDonald’s recorded high success in 2010; the company recorded $4.9
billion in the net income and the comparable sale growth of 5.0% with earning per share rises by
11%. Typically, McDonald’s recorded “92 Consecutive months of global comparable sales
increases through December 2010” (McDonald’s Corporation Annual Report 2010, P 2).
The objective of the paper is to provide the financial analysis of McDonald’s.