Exhibit 12
McDONALD’S CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Dollars in Millions
| Six Months Ended June 30, | Years Ended December 31, | |||||||||||||||||||||||||||||
| 2007 | 2006 | 2006 | 2005 | 2004 | 2003 | 2002 | ||||||||||||||||||||||||
Earnings available for fixed charges | ||||||||||||||||||||||||||||||
- Income from continuing operations before provision for income taxes and cumulative effect of accounting changes | $ | 821.8 | (1) | $ | 1,895.3 | $ | 4,166.4 | (2) | $ | 3,674.4 | $ | 3,200.7 | (3) | $ | 2,351.4 | (4) | $ | 1,675.7 | (5) | |||||||||||
- Minority interest expense in operating results of majority-owned subsidiaries, including fixed charges related to redeemable preferred stock, less equity in undistributed operating results of less than 50%-owned affiliates | 3.3 | 1.8 | 5.5 | 1.2 | 4.4 | 18.6 | 8.2 | |||||||||||||||||||||||
- Income tax provision (benefit) of 50% owned affiliates included in income from continuing operations before provision for income taxes | 10.1 | (0.9 | ) | 5.9 | (3.5 | ) | 13.1 | (28.6 | ) | (9.5 | ) | |||||||||||||||||||
- Portion of rent charges (after reduction for rental income from subleased properties) considered to be representative of interest factors* | 167.3 | 161.4 | 327.9 | 317.6 | 295.6 | 279.4 | 257.9 | |||||||||||||||||||||||
- Interest expense, amortization of debt discount and issuance costs, and depreciation of capitalized interest* | 216.7 | 216.1 | 437.5 | 392.2 | 394.2 | 427.3 | 419.7 | |||||||||||||||||||||||
| $ | 1,219.2 | $ | 2,273.7 | $ | 4,943.2 | $ | 4,381.9 | $ | 3,908.0 | $ | 3,048.1 | $ | 2,352.0 | |||||||||||||||||
Fixed charges | ||||||||||||||||||||||||||||||
- Portion of rent charges (after reduction for rental income from subleased properties) considered to be representative of interest factors* | $ | 167.3 | $ | 161.4 | $ | 327.9 | $ | 317.6 | $ | 295.6 | $ | 279.4 | $ | 257.9 | ||||||||||||||||
-Interest expense, amortization of debt discount and issuance costs, and fixed charges related to redeemable preferred stock* | 207.1 | 206.6 | 418.5 | 373.4 | 375.6 | 408.9 | 401.7 | |||||||||||||||||||||||
-Capitalized interest* | 2.2 | 2.3 | 5.5 | 5.0 | 4.1 | 7.9 | 14.4 | |||||||||||||||||||||||
| $ | 376.6 | $ | 370.3 | $ | 751.9 | $ | 696.0 | $ | 675.3 | $ | 696.2 | $ | 674.0 | |||||||||||||||||
Ratio of earnings to fixed charges | 3.24 | 6.14 | 6.57 | 6.30 | 5.79 | 4.38 | 3.49 | |||||||||||||||||||||||
| * | Includes amounts of the Registrant and its majority-owned subsidiaries, and one-half of the amounts of 50%-owned affiliates. |
| (1) | Includes pretax charges of $1.6 billion primarily related to impairment in connection with the Company’s sale of Latam to a developmental licensee. |
| (2) | Includes pretax charges of $134.2 million primarily related to impairment. |
| (3) | Includes pretax charges of $232.1 million consisting of $130.5 million related to impairment and $150.9 million related to the correction in the Company’s lease accounting practices and policies as well as a $49.3 million gain relating to the sale of the Company’s interest in a U.S. real estate partnership. |
| (4) | Includes pretax charges of $407.6 million primarily related to the disposition of certain non-McDonald’s brands and impairment. |
| (5) | Includes pretax charges of $853.2 million primarily related to restructuring markets and eliminating positions, restaurant closings/asset impairment and the write-off of technology costs. |