Exhibit 12
McDONALD'S CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Dollars In Millions
Nine months
ended September 30, Years ended December 31,
2002 2001 2001 2000 1999 1998 1997
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Earnings available for fixed charges
- - Income before provision for income taxes and
cumulative effect of accounting change $ 1,983.7 $1,960.2 $2,329.7/(1)/ $2,882.3 $2,884.1 $2,307.4/(3)/ $2,407.3
- - Minority interest expense (income) in
operating results of majority-owned
subsidiaries, including fixed charges
related to redeemable preferred stock, less
equity in undistributed operating results of
less-than-50% owned affiliates 3.3 (3.6) (15.4) 16.2 21.9 23.7 28.3
- - Provision for income taxes of 50% owned
affiliates included in consolidated income
before provision for income taxes 6.1 38.7 51.0 93.7 72.8 99.9 69.0
- - Portion of rent charges (after reduction
for rental income from subleased
properties) considered to be representative
of interest factors* 195.5 188.4 252.5 207.0 178.5 161.3 145.9
- - Interest expense, amortization of debt
discount and issuance costs, and
depreciation of capitalized interest* 315.2 385.8 510.3 470.3 440.1 461.9 424.8
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$ 2,503.8 $2,569.5 $3,128.1 $3,669.5 $3,597.4 $3,054.2 $3,075.3
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Fixed charges
- - Portion of rent charges (after reduction for
rental income from subleased properties)
considered to be representative of interest
factors* $ 195.5 $ 188.4 $ 252.5 $ 207.0 $ 178.5 $ 161.3 $ 145.9
- - Interest expense, amortization of debt
discount and issuance costs, and fixed
charges related to redeemable preferred
stock* 301.8 372.8 492.9 457.9 431.3 453.4 426.1
- - Capitalized interest* 10.7 11.2 15.4 16.5 14.7 18.3 23.7
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$ 508.0 $ 572.4 $ 760.8 $ 681.4 $ 624.5 $ 633.0 $ 595.7
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Ratio of earnings to fixed charges 4.93 4.49 4.11/(2)/ 5.39 5.76 4.82/(4)/ 5.16
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* Includes amounts of the Registrant and its majority-owned subsidiaries, and
one-half of the amounts of 50%-owned affiliates.
(1) Includes special items primarily related to the U.S. business
reorganization and other global change initiatives, and the closing of 163
underperforming restaurants in international markets, partly offset by a
gain on the initial public offering of McDonald's Japan, for a net expense
of $252.9 million.
(2) Excluding the special items in (1) above, the ratio of earnings to fixed
charges for the year ended December 31, 2001 would have been 4.45.
(3) Includes $161.6 million of Made For You costs and the $160.0 million
special charge related to the home office productivity initiative for a
total of $321.6 million.
(4) Excluding Made For You costs and the special charge, the ratio of earnings
to fixed charges for the year ended December 31, 1998 would have been 5.33.