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Financial Case Study
Company Overview
McDonald Corporation specializes in the food service globally. The company started operation in 1940, and in 1967, the MacDonald registered its trademark. The primary product of McDonald includes chicken, hamburgers, soft drink, French fries, dessert and milkshakes. Over the years, the company has expanded its menu and included wraps, fish, salads fruits and smoothies. Presently, the company operates its business through either affiliate or franchise globally and the company realizes bulk of its revenues from the fees collected from franchise. Moreover, the company derives its revenues from the royalties and rents. Since MacDonald has started operations, the company has enjoyed rapid growth. At the end of the 2012 fiscal year, the company recorded the annual revenues of more than $25.7 billion with the net profits of $5.5 billion. The company also recorded the market capitalization of $94.5 billion. The company operates in 119 countries and presently, it serves approximately 69 million customers daily.
MacDonald has its headquarter in the United States, however, the company operates in all the continents such as North America, Europe, Latin America, Asia, Australia and Africa.In 2014, the company has opened its operations in Vietnam. (
Objective of this paper is to carry out financial analysis of the McDonald Corporation. The paper uses various financial tools to analyze the company financial performances. The paper uses 5-year financial records between 2008 and 2012 to carry out the company financial analysis
a. Sales Performances and Income Record
Table 1
TTM
2013
2012
2011
2010
2009
2008
Revenue USD Mil
28,106
28,106
27,567
27,006
24,075
22,745
23,522
Gross Margin %
38.8
38.8
39.2
39.6
40.0
38.7
36.7
Operating Income (USD Mil)
8,764
8,764
8,605
8,530
7,473
6,841
6,443
Operating Margin %
31.2
31.2
31.2
31.6
31.0
30.1
27.4
Net Income (USD Mil)
5,586
5,586
5,465
5,503
4,946
4,551
4,313
Earnings -Per -- Share ( USD)
5.55
5.55
5.36
5.27
4.58
4.11
3.76
Dividends USD
3.12
3.12
2.87
2.53
2.26
2.05
1.63
Payout Ratio %
56.2
56.2
53.6
48.0
49.4
49.9
43.2
Shares Mil
1,006
1,006
1,020
1,045
1,080
1,107
1,146
Book -- Value- Per (Share USD_
16.17
16.16.....