Company Quick10K Filing
Quick10K
McDonalds
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$220.54 764 $168,395
10-Q 2019-09-30 Quarter: 2019-09-30
10-Q 2019-06-30 Quarter: 2019-06-30
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
8-K 2019-11-04 Officers, Exhibits
8-K 2019-09-19 Regulation FD, Exhibits
8-K 2019-08-12 Other Events, Exhibits
8-K 2019-07-26 Earnings, Exhibits
8-K 2019-07-18 Regulation FD, Exhibits
8-K 2019-05-23 Amend Bylaw, Shareholder Vote, Regulation FD, Exhibits
8-K 2019-04-30 Earnings, Exhibits
8-K 2019-03-19 Officers
8-K 2019-02-25 Other Events, Exhibits
8-K 2019-02-24 Officers
8-K 2019-01-30 Earnings, Regulation FD, Exhibits
8-K 2019-01-14
8-K 2018-11-29
8-K 2018-10-23
8-K 2018-09-20 Regulation FD, Exhibits
8-K 2018-09-20
8-K 2018-08-15 Other Events, Exhibits
8-K 2018-07-26
8-K 2018-07-19
8-K 2018-05-24
8-K 2018-05-22
8-K 2018-04-30
8-K 2018-03-16
8-K 2018-01-30
YUMC Yum China Holdings 16,008
ARMK Aramark 10,153
TXRH Texas Roadhouse 3,654
WING Wingstop 3,036
CAKE Cheesecake Factory 1,717
DFRG Del Frisco's 266
LIVX Livexlive Media 122
PBPB Potbelly 113
LUB Lubys 44
IPIC iPic 4
MCD 2019-09-30
Part I - Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
EX-31.1 mcd-9302019xex31110xq.htm
EX-31.2 mcd-9302019xex31210xq.htm
EX-32.1 mcd-9302019xex32110xq.htm
EX-32.2 mcd-9302019xex32210xq.htm

McDonalds Earnings 2019-09-30

MCD 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

Document
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Table of Contents

 
 
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended
September 30, 2019
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from             to            
Commission File Number 1-5231
McDONALD’S CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware
 
36-2361282
(State or Other Jurisdiction of
Incorporation or Organization)
 
(I.R.S. Employer
Identification No.)
 
 
110 North Carpenter Street
Chicago, Illinois
 
60607
(Address of Principal Executive Offices)
 
(Zip Code)
(630) 623-3000
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value
MCD
New York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes    No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes    No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
 
Accelerated Filer
 
 
 
 
Non-accelerated Filer
 
Smaller Reporting Company
 
 
 
 
 
Emerging Growth Company
 
 
 
 
 
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes    No  
753,093,326
(Number of shares of common stock
outstanding as of 9/30/2019)
 
 
 
 
 


Table of Contents

McDONALD’S CORPORATION
___________________________
INDEX
_______
 
 
 
Page Reference
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 1A – Risk Factors
 
 
 
 
Item 6 – Exhibits
 
 
All trademarks used herein are the property of their respective owners and are used with permission.

2

Table of Contents

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
CONDENSED CONSOLIDATED BALANCE SHEET
 
 
 
 
 
 
 
 
(unaudited)
 
 
 
In millions, except per share data
 
September 30,
2019
 
 
December 31,
2018
Assets
 
 
 
 
 
Current assets
 
 
 
 
 
Cash and equivalents
 
$
1,177.3

 
 
$
866.0

Accounts and notes receivable
 
2,005.3

 
 
2,441.5

Inventories, at cost, not in excess of market
 
42.6

 
 
51.1

Prepaid expenses and other current assets
 
379.7

 
 
694.6

Total current assets
 
3,604.9

 
 
4,053.2

Other assets
 
 
 
 
 
Investments in and advances to affiliates
 
1,245.4

 
 
1,202.8

Goodwill
 
2,541.8

 
 
2,331.5

Miscellaneous
 
2,622.0

 
 
2,381.0

Total other assets
 
6,409.2

 
 
5,915.3

Lease right-of-use asset, net
 
12,465.6

 
 

Property and equipment
 
 
 
 
 
Property and equipment, at cost
 
37,748.0

 
 
37,193.6

Accumulated depreciation and amortization
 
(14,422.7
)
 
 
(14,350.9
)
Net property and equipment
 
23,325.3

 
 
22,842.7

Total assets
 
$
45,805.0

 
 
$
32,811.2

Liabilities and shareholders’ equity
 
 
 
 
 
Current liabilities
 
 
 
 
 
Accounts payable
 
$
849.5

 
 
$
1,207.9

Dividends payable
 
934.0

 
 

Lease liability
 
703.3

 
 

Income taxes
 
277.9

 
 
228.3

Other taxes
 
248.1

 
 
253.7

Accrued interest
 
314.0

 
 
297.0

Accrued payroll and other liabilities
 
948.8

 
 
986.6

Total current liabilities
 
4,275.6

 
 
2,973.5

Long-term debt
 
32,850.1

 
 
31,075.3

Long-term lease liability
 
11,881.8

 
 

Long-term income taxes
 
2,219.6

 
 
2,081.2

Deferred revenues - initial franchise fees
 
640.1

 
 
627.8

Other long-term liabilities
 
976.5

 
 
1,096.3

Deferred income taxes
 
1,560.5

 
 
1,215.5

Shareholders’ equity (deficit)
 
 
 
 
 
Preferred stock, no par value; authorized – 165.0 million shares; issued – none
 

 
 

Common stock, $.01 par value; authorized – 3.5 billion shares; issued – 1,660.6 million shares
 
16.6

 
 
16.6

Additional paid-in capital
 
7,619.7

 
 
7,376.0

Retained earnings
 
51,359.5

 
 
50,487.0

Accumulated other comprehensive income (loss)
 
(2,663.1
)
 
 
(2,609.5
)
Common stock in treasury, at cost; 907.5 and 893.5 million shares
 
(64,931.9
)
 
 
(61,528.5
)
Total shareholders’ equity (deficit)
 
(8,599.2
)
 
 
(6,258.4
)
Total liabilities and shareholders’ equity (deficit)
 
$
45,805.0

 
 
$
32,811.2

See Notes to condensed consolidated financial statements.

3

Table of Contents

CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarters Ended
 
 
Nine Months Ended
 
 
September 30,
 
 
September 30,
In millions, except per share data
 
2019
 
 
2018
 
 
2019
 
 
2018
Revenues
 
 
 
 
 
 
 
 
 
 
 
Sales by Company-operated restaurants
 
$
2,416.6

 
 
$
2,511.0

 
 
$
7,057.5

 
 
$
7,641.5

Revenues from franchised restaurants
 
3,014.0

 
 
2,858.4

 
 
8,670.0

 
 
8,220.7

Total revenues
 
5,430.6

 
 
5,369.4

 
 
15,727.5

 
 
15,862.2

Operating costs and expenses
 
 
 
 
 
 
 
 
 
 
 
Company-operated restaurant expenses
 
1,967.7

 
 
2,047.9

 
 
5,821.0

 
 
6,309.3

Franchised restaurants-occupancy expenses
 
559.5

 
 
499.4

 
 
1,637.3

 
 
1,463.6

Selling, general & administrative expenses
 
543.6

 
 
515.2

 
 
1,575.8

 
 
1,590.4

Other operating (income) expense, net
 
(49.5
)
 
 
(110.8
)
 
 
(83.8
)
 
 
(324.2
)
Total operating costs and expenses
 
3,021.3

 
 
2,951.7

 
 
8,950.3

 
 
9,039.1

Operating income
 
2,409.3

 
 
2,417.7

 
 
6,777.2

 
 
6,823.1

Interest expense
 
280.6

 
 
250.1

 
 
838.9

 
 
727.1

Nonoperating (income) expense, net
 
(23.5
)
 
 
8.9

 
 
(53.0
)
 
 
31.3

Income before provision for income taxes
 
2,152.2

 
 
2,158.7

 
 
5,991.3

 
 
6,064.7

Provision for income taxes
 
544.3

 
 
521.4

 
 
1,538.1

 
 
1,555.7

Net income
 
$
1,607.9

 
 
$
1,637.3

 
 
$
4,453.2

 
 
$
4,509.0

Earnings per common share-basic
 
$
2.13

 
 
$
2.12

 
 
$
5.85

 
 
$
5.77

Earnings per common share-diluted
 
$
2.11

 
 
$
2.10

 
 
$
5.80

 
 
$
5.72

Dividends declared per common share
 
$
2.41

 
 
$
2.17

 
 
$
4.73

 
 
$
4.19

Weighted-average shares outstanding-basic
 
756.6

 
 
772.8

 
 
761.1

 
 
781.2

Weighted-average shares outstanding-diluted
 
763.9

 
 
779.6

 
 
768.1

 
 
788.5

See Notes to condensed consolidated financial statements.

4

Table of Contents

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarters Ended
 
 
Nine Months Ended
 
 
September 30,
 
 
September 30,
In millions
 
2019
 
 
2018
 
 
2019
 
 
2018
Net income
 
$
1,607.9

 
 
$
1,637.3

 
 
$
4,453.2

 
 
$
4,509.0

Other comprehensive income (loss), net of tax
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments:
 
 
 
 
 
 
 
 
 
 
 
Gain (loss) recognized in accumulated other comprehensive
income ("AOCI"), including net investment hedges
(179.1
)
 
 
(78.8
)
 
 
(108.3
)
 
 
(379.5
)
Reclassification of (gain) loss to net income

 
 

 
 
46.8

 
 

Foreign currency translation adjustments-net of tax
benefit (expense) of $(145.5), $(19.0), $(177.6) and $(90.6)
(179.1
)
 
 
(78.8
)
 
 
(61.5
)
 
 
(379.5
)
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Gain (loss) recognized in AOCI
24.4

 
 
8.6

 
 
33.6

 
 
33.2

Reclassification of (gain) loss to net income
(13.4
)
 
 
(5.2
)
 
 
(30.4
)
 
 
10.4

Cash flow hedges-net of tax benefit (expense) of $(3.3), $(1.2), $(1.0) and $(13.0)
11.0

 
 
3.4

 
 
3.2

 
 
43.6

Defined benefit pension plans:
 
 
 
 
 
 
 
 
 
 
 
Gain (loss) recognized in AOCI
0.1

 
 

 
 
0.5

 
 
(1.1
)
Reclassification of (gain) loss to net income
1.5

 
 
2.1

 
 
4.2

 
 
7.1

Defined benefit pension plans-net of tax benefit (expense)
of $0.0, $0.0, $0.0 and $(0.8)
1.6

 
 
2.1

 
 
4.7

 
 
6.0

Total other comprehensive income (loss), net of tax
(166.5
)
 
 
(73.3
)
 
 
(53.6
)
 
 
(329.9
)
Comprehensive income (loss)
 
$
1,441.4

 
 
$
1,564.0

 
 
$
4,399.6

 
 
$
4,179.1

See Notes to condensed consolidated financial statements.

5

Table of Contents

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarters Ended
 
 
Nine Months Ended
 
 
September 30,
 
 
September 30,
In millions
 
2019
 
 
2018
 
 
2019
 
 
2018
Operating activities
 
 
 
 
 
 
 
 
 
 
 
Net income
 
$
1,607.9

 
 
$
1,637.3

 
 
$
4,453.2

 
 
$
4,509.0

Adjustments to reconcile to cash provided by operations
 
 
 
 
 
 
 
 
 
 
 
Charges and credits:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
 
413.4

 
 
375.1

 
 
1,204.3

 
 
1,103.0

Deferred income taxes
 
78.5

 
 
31.1

 
 
190.8

 
 
114.7

Share-based compensation
 
29.6

 
 
36.0

 
 
90.1

 
 
99.7

Other
 
(64.2
)
 
 
(52.7
)
 
 
2.2

 
 
(198.3
)
Changes in working capital items
 
221.5

 
 
444.3

 
 
292.2

 
 
(173.0
)
Cash provided by operations
 
2,286.7

 
 
2,471.1

 
 
6,232.8

 
 
5,455.1

Investing activities
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
 
(548.7
)
 
 
(703.8
)
 
 
(1,661.8
)
 
 
(1,867.9
)
Purchases of restaurant and other businesses
 
(41.0
)
 
 
(40.2
)
 
 
(434.8
)
 
 
(75.5
)
Sales of restaurant businesses
 
49.4

 
 
109.5

 
 
249.9

 
 
439.4

Sales of property
 
21.1

 
 
11.3

 
 
112.3

 
 
135.8

Other
 
(73.6
)
 
 
(98.1
)
 
 
(529.7
)
 
 
(203.0
)
Cash (used for) investing activities
 
(592.8
)
 
 
(721.3
)
 
 
(2,264.1
)
 
 
(1,571.2
)
Financing activities
 
 
 
 
 
 
 
 
 
 
 
Net short-term borrowings
 
(600.7
)
 
 
(801.4
)
 
 
(105.6
)
 
 
(5.7
)
Long-term financing issuances
 
1,975.0

 
 
1,791.9

 
 
4,494.8

 
 
3,792.1

Long-term financing repayments
 
(667.9
)
 
 
(1.9
)
 
 
(2,064.1
)
 
 
(1,004.7
)
Treasury stock purchases
 
(1,467.8
)
 
 
(1,040.7
)
 
 
(3,531.3
)
 
 
(4,280.8
)
Common stock dividends
 
(876.9
)
 
 
(779.8
)
 
 
(2,646.7
)
 
 
(2,363.4
)
Proceeds from stock option exercises
 
73.4

 
 
69.2

 
 
323.4

 
 
236.2

Other
 
(12.7
)
 
 
(5.3
)
 
 
(23.5
)
 
 
(12.1
)
Cash (used for) financing activities
 
(1,577.6
)
 
 
(768.0
)
 
 
(3,553.0
)
 
 
(3,638.4
)
Effect of exchange rates on cash and cash equivalents
 
(73.5
)
 
 
(30.8
)
 
 
(104.4
)
 
 
(134.8
)
Cash and equivalents increase
 
42.8

 
 
951.0

 
 
311.3

 
 
110.7

Cash and equivalents at beginning of period
 
1,134.5

 
 
1,623.5

 
 
866.0

 
 
2,463.8

Cash and equivalents at end of period
 
$
1,177.3

 
 
$
2,574.5

 
 
$
1,177.3

 
 
$
2,574.5

See Notes to condensed consolidated financial statements.

6

Table of Contents

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
For the nine months ended September 30, 2018
 
Common stock
issued
 
 
 
 
 
 
Accumulated other
comprehensive income (loss)
 
 
Common stock in
treasury
 
Total
shareholders’
equity
 
Additional
paid-in
capital
 
 
Retained
earnings

Pensions
 
Cash flow
hedges
 
Foreign
currency
translation
 
 
In millions, except per share data
Shares

Amount
 
Shares

 
Amount

Balance at December 31, 2017
1,660.6

 
$
16.6

 
$
7,072.4

 
$
48,325.8

 
$
(190.2
)
 
$
(16.5
)
 
$
(1,971.7
)
 
(866.5
)
 
$
(56,504.4
)
 
$
(3,268.0
)
Net income
 
 
 
 
 
 
4,509.0

 
 
 
 
 
 
 
 
 
 
 
4,509.0

Other comprehensive income (loss),
net of tax
 
 
 
 
 
 
 
 
6.0

 
43.6

 
(379.5
)
 
 
 
 
 
(329.9
)
Comprehensive income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,179.1

Adoption of ASC 606 (1)
 
 
 
 
 
 
(450.2
)
 
 
 
 
 
 
 
 
 
 
 
(450.2
)
Adoption of ASU 2016-16 (2)
 
 
 
 
 
 
(57.0
)
 
 
 
 
 
 
 
 
 
 
 
(57.0
)
Common stock cash dividends
($4.19 per share)
 
 
 
 
 
 
(3,251.4
)
 
 
 
 
 
 
 
 
 
 
 
(3,251.4
)
Treasury stock purchases
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(26.7
)
 
(4,280.8
)
 
(4,280.8
)
Share-based compensation
 
 
 
 
99.7

 
 
 
 
 
 
 
 
 
 
 
 
 
99.7

Stock option exercises and other
 
 
 
 
85.1

 
 
 
 
 
 
 
 
 
3.5

 
150.9

 
236.0

Balance at September 30, 2018
1,660.6

 
$
16.6

 
$
7,257.2

 
$
49,076.2

 
$
(184.2
)
 
$
27.1

 
$
(2,351.2
)
 
(889.7
)
 
$
(60,634.3
)
 
$
(6,792.6
)
(1) Accounting Standards Codification ("ASC") 606, "Revenue Recognition - Revenue from Contracts with Customers."
(2) Accounting Standards Update ("ASU") 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory."
For the nine months ended September 30, 2019
 
Common stock
issued
 
 
 
 
 
 
Accumulated other
comprehensive income (loss)
 
 
Common stock in
treasury
 
Total
shareholders’
equity
 
Additional
paid-in
capital
 
 
Retained
earnings

Pensions
 
Cash flow
hedges
 
Foreign
currency
translation
 
 
In millions, except per share data
Shares

Amount
 
Shares

 
Amount

Balance at December 31, 2018
1,660.6

 
$
16.6

 
$
7,376.0

 
$
50,487.0

 
$
(216.6
)
 
$
32.4

 
$
(2,425.3
)
 
(893.5
)
 
$
(61,528.5
)
 
$
(6,258.4
)
Net income
 
 
 
 
 
 
4,453.2

 
 
 
 
 
 
 
 
 
 
 
4,453.2

Other comprehensive income (loss),
net of tax
 
 
 
 
 
 
 

 
4.7

 
3.2

 
(61.5
)
 
 
 
 
 
(53.6
)
Comprehensive income
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
4,399.6

Common stock cash dividends
($4.73 per share)
 
 
 
 
 
 
(3,580.7
)
 
 
 
 
 
 
 
 
 
 
 
(3,580.7
)
Treasury stock purchases
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(17.9
)
 
(3,571.4
)
 
(3,571.4
)
Share-based compensation
 
 
 
 
90.1

 
 
 
 
 
 
 
 
 
 
 
 
 
90.1

Stock option exercises and other
 
 
 
 
153.6

 
 
 
 
 
 
 
 
 
3.9

 
168.0

 
321.6

Balance at September 30, 2019
1,660.6

 
$
16.6

 
$
7,619.7

 
$
51,359.5

 
$
(211.9
)
 
$
35.6

 
$
(2,486.8
)
 
(907.5
)
 
$
(64,931.9
)
 
$
(8,599.2
)

See Notes to condensed consolidated financial statements.


7

Table of Contents

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
For the quarter ended September 30, 2018
 
Common stock
issued
 
 
 
 
 
 
Accumulated other
comprehensive income (loss)
 
 
Common stock in
treasury
 
Total
shareholders’
equity
 
Additional
paid-in
capital
 
 
Retained
earnings

Pensions
 
Cash flow
hedges
 
Foreign
currency
translation
 
 
In millions, except per share data
Shares

Amount
 
Shares

 
Amount

Balance at June 30, 2018
1,660.6

 
$
16.6

 
$
7,195.2

 
$
49,106.7

 
$
(186.4
)
 
$
23.8

 
$
(2,272.4
)
 
(884.8
)
 
$
(59,734.5
)
 
$
(5,851.0
)
Net income
 
 
 
 
 
 
1,637.3

 
 
 
 
 
 
 
 
 
 
 
1,637.3

Other comprehensive income (loss),
net of tax
 
 
 
 
 
 
 
 
2.2

 
3.3

 
(78.8
)
 
 
 
 
 
(73.3
)
Comprehensive income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,564.0

Adoption of ASC 606 (1)
 
 
 
 
 
 


 
 
 
 
 
 
 
 
 
 
 
0.0

Adoption of ASU 2016-16 (2)
 
 
 
 
 
 


 
 
 
 
 
 
 
 
 
 
 
0.0

Common stock cash dividends
($2.17 per share)
 
 
 
 
 
 
(1,667.8
)
 
 
 
 
 
 
 
 
 
 
 
(1,667.8
)
Treasury stock purchases
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(5.9
)
 
(944.5
)
 
(944.5
)
Share-based compensation
 
 
 
 
36.0

 
 
 
 
 
 
 
 
 
 
 
 
 
36.0

Stock option exercises and other
 
 
 
 
26.0

 
 
 
 
 
 
 
 
 
1.0

 
44.7

 
70.7

Balance at September 30, 2018
1,660.6

 
$
16.6

 
$
7,257.2

 
$
49,076.2

 
$
(184.2
)
 
$
27.1

 
$
(2,351.2
)
 
(889.7
)
 
$
(60,634.3
)
 
$
(6,792.6
)
(1) ASC 606, "Revenue Recognition - Revenue from Contracts with Customers." There was no impact from this guidance in the third quarter 2019.
(2) ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory." There was no impact from this guidance in the third quarter 2019.
For the quarter ended September 30, 2019
 
Common stock
issued
 
 
 
 
 
 
Accumulated other
comprehensive income (loss)
 
 
Common stock in
treasury
 
Total
shareholders’
equity
 
Additional
paid-in
capital
 
 
Retained
earnings

Pensions
 
Cash flow
hedges
 
Foreign
currency
translation
 
 
In millions, except per share data
Shares

Amount
 
Shares

 
Amount

Balance at June 30, 2019
1,660.6

 
$
16.6

 
$
7,549.5

 
$
51,562.5

 
$
(213.5
)
 
$
24.6

 
$
(2,307.7
)
 
(901.2
)
 
$
(63,440.8
)
 
$
(6,808.8
)
Net income
 
 
 
 
 
 
1,607.9

 
 
 
 
 
 
 
 
 
 
 
1,607.9

Other comprehensive income (loss),
net of tax
 
 
 
 
 
 
 
 
1.6

 
11.0

 
(179.1
)
 
 
 
 
 
(166.5
)
Comprehensive income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,441.4

Common stock cash dividends
($2.41 per share)
 
 
 
 
 
 
(1,810.9
)
 
 
 
 
 
 
 
 
 
 
 
(1,810.9
)
Treasury stock purchases
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(7.1
)
 
(1,524.1
)
 
(1,524.1
)
Share-based compensation
 
 
 
 
29.6

 
 
 
 
 
 
 
 
 
 
 
 
 
29.6

Stock option exercises and other
 
 
 
 
40.6

 
 
 
 
 
 
 
 
 
0.8

 
33.0

 
73.6

Balance at September 30, 2019
1,660.6

 
$
16.6

 
$
7,619.7

 
$
51,359.5

 
$
(211.9
)
 
$
35.6

 
$
(2,486.8
)
 
(907.5
)
 
$
(64,931.9
)
 
$
(8,599.2
)

See Notes to condensed consolidated financial statements.





8

Table of Contents

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
McDonald’s Corporation, the registrant, together with its subsidiaries, is referred to herein as the "Company." The Company, its franchisees and suppliers, are referred to herein as the "System."
Basis of Presentation
The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements contained in the Company’s December 31, 2018 Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation have been included. The results for the quarter and nine months ended September 30, 2019, do not necessarily indicate the results that may be expected for the full year.

Restaurant Information
The following table presents restaurant information by ownership type:
Restaurants at September 30,
2019
 
2018
Conventional franchised
21,758

 
21,586

Developmental licensed
7,473

 
7,103

Foreign affiliated
6,432

 
6,056

Total Franchised
35,663

 
34,745

Company-operated
2,635

 
2,812

Total Systemwide restaurants
38,298

 
37,557


The results of operations of restaurant businesses purchased and sold in transactions with franchisees were not material either individually or in the aggregate to the Condensed Consolidated Financial Statements for the periods prior to purchase and sale.

Per Common Share Information
Diluted earnings per common share is calculated using net income divided by diluted weighted-average shares. Diluted weighted-average shares include weighted-average shares outstanding plus the dilutive effect of share-based compensation, calculated using the treasury stock method, of 7.3 million shares and 6.8 million shares for the quarters 2019 and 2018, respectively, and 7.0 million shares and 7.3 million shares for the nine months 2019 and 2018, respectively. Share-based co