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, | ||||||||||||||||||||||||||||
| 2008 | 2007 | 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||||||
Earnings available for fixed charges | |||||||||||||||||||||||||||||
- Income from continuing operations before provision for income taxes and cumulative effect of accounting changes | $ | 3,062.0 | $ | 834.2 | (1) | $ | 3,572.1 | (1) | $ | 4,154.4 | (2) | $ | 3,660.2 | $ | 3,217.0 | (3) | $ | 2,349.4 | (4) | ||||||||||
- 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 | 4.3 | 3.3 | 7.2 | 5.5 | 1.2 | 4.4 | 18.6 | ||||||||||||||||||||||
- Income tax provision (benefit) of 50% owned affiliates included in income from continuing operations before provision for income taxes | 15.0 | 10.1 | 22.4 | 5.9 | (3.5 | ) | 13.1 | (28.6 | ) | ||||||||||||||||||||
- Portion of rent charges (after reduction for rental income from subleased properties) considered to be representative of interest factors* | 160.7 | 155.4 | 312.8 | 304.0 | 292.8 | 272.2 | 257.6 | ||||||||||||||||||||||
- Interest expense, amortization of debt discount and issuance costs, and depreciation of capitalized interest* | 292.1 | 216.7 | 442.7 | 437.4 | 392.2 | 394.2 | 427.2 | ||||||||||||||||||||||
| $ | 3,534.1 | $ | 1,219.7 | $ | 4,357.2 | $ | 4,907.2 | $ | 4,342.9 | $ | 3,900.9 | $ | 3,024.2 | ||||||||||||||||
Fixed charges | |||||||||||||||||||||||||||||
- Portion of rent charges (after reduction for rental income from subleased properties) considered to be representative of interest factors* | $ | 160.7 | $ | 155.4 | $ | 312.8 | $ | 304.0 | $ | 292.8 | $ | 272.2 | $ | 257.6 | |||||||||||||||
- Interest expense, amortization of debt discount and issuance costs, and fixed charges related to redeemable preferred stock* | 283.5 | 207.1 | 425.9 | 418.4 | 373.4 | 375.6 | 408.7 | ||||||||||||||||||||||
- Capitalized interest* | 3.8 | 2.2 | 7.0 | 5.5 | 5.0 | 4.1 | 7.9 | ||||||||||||||||||||||
| $ | 448.0 | $ | 364.7 | $ | 745.7 | $ | 727.9 | $ | 671.2 | $ | 651.9 | $ | 674.2 | ||||||||||||||||
Ratio of earnings to fixed charges | 7.89 | 3.34 | 5.84 | 6.74 | 6.47 | 5.98 | 4.49 | ||||||||||||||||||||||
| * | Includes amounts of the Registrant and its majority-owned subsidiaries, and one-half of the amounts of 50%-owned affiliates. The Company records interest expense on unrecognized tax benefits in the provision for income taxes. This interest is not included in the computation of fixed charges. |
| (1) | Includes pretax charges of $1.6 billion for the six months and $1.7 billion for the year, 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. |