Financial Overview - Mcdonalds Case Study Essay

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Pages: 9

Financial Analysis of the McDonald’s Corporation

MCD, NYSE (New York Stock Exchange)
One McDonald's Plaza, Oak Brook, IL 60523 Map
+1-630-6233000 (Phone)
+1-630-6235700 (Fax)

McDonald’s is the most famous and well-known fast-food company in the world. This case study examines McDonald’s from a financial standpoint. This case study will be broken down in three parts. Discussed first will be a full description of McDonald’s corporation, including its background, followed by a financial overview with comments for each financial category reviewed, the a comparison of financial ratio’s between McDonald’s and it rival Burger King derived from their 2009 and 2009 annual reports. Finally a support will be provided based off
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McDonald’s hopes this campaign will silence critics who have vocally spoken out about how unhealthy the company’s Happy Meal are. This will be continuing part of McDonald’s overall ad campaign which was $963 million in measured media in 2011, up 8.6 percent from 2010 and will likely increase in 2012 (Morrison, 2012).
PART 2, FINANCIAL OVERVIEW: In Dollars in Millions

a. Sales and Income Record:

-------------------- Fiscal Years ---------------------- 2006 2007 2008 2009 2010

Sales 20,895 22,787 23,522 22,745 24,075

Percent change in sales each year 9% 3% -3% 6%

Net Income 3,544 2,395 4,313 4,551 4,946

Percent change in net income each year -32% 80% 6% 9%


COMMENTS: McDonald’s has continued a slight upward trend in net income for the past 5 years. Even though there was a 3 percent decline in sales during 2009, net income has continued to climb at a steady rate. Most noted is after a 32% drop in net income in 2007, McDonald’s came back strong in 2008 posting a 80% gain in net income.

b. Expense