EX-12 2 mcd-12312012xex12.htm COMPUTATION OF RATIOS MCD-12.31.2012-Ex 12


Exhibit 12. Computation of Ratios
 
Ratio of Earnings to Fixed Charges
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

 
2009

 
2008

Earnings available for fixed charges
 
 
 
 
 
 
 
 
 
 
 
Income from continuing operations before provision
for Income taxes and cumulative effect of
accounting changes
 
 
$
8,079.0

 
$
8,012.2

 
$
7,000.3

 
$
6,487.0

 
$
6,158.0

Noncontrolling interest expense in operating results
of majority-owned subsidiaries less equity in
undistributed operating results of less than
50%-owned affiliates
 
 
11.1

 
13.3

 
10.4

 
7.5

 
10.7

Income tax provision (benefit) of 50%-owned
affiliates included in income from continuing
operations before provision for income taxes
 
 
64.0

 
65.5

 
28.7

 
47.7

 
30.0

Portion of rent charges (after reduction for rental
income from subleased properties) considered
to be representative of interest factors*
 
 
358.1

 
339.4

 
315.4

 
302.8

 
321.3

Interest expense, amortization of debt discount and
issuance costs, and depreciation of capitalized
interest*
 
 
550.1

 
520.5

 
479.1

 
504.5

 
556.8

 
 
 
$
9,062.3

 
$
8,950.9

 
$
7,833.9

 
$
7,349.5

 
$
7,076.8

Fixed charges
 
 
 

 
 

 
 

 
 

 
 

Portion of rent charges (after reduction for rental
income from subleased properties) considered
to be representative of interest factors*
 
 
$
358.1

 
$
339.4

 
$
315.4

 
$
302.8

 
$
321.3

Interest expense, amortization of debt discount
and issuance costs*
 
 
532.8

 
503.0

 
461.5

 
486.9

 
539.7

Capitalized interest*
 
 
16.1

 
14.0

 
12.0

 
11.9

 
12.5

 
 
 
$
907.0

 
$
856.4

 
$
788.9

 
$
801.6

 
$
873.5

Ratio of earnings to fixed charges
 
 
9.99

 
10.45

 
9.93

 
9.17

 
8.10

*
Includes amounts of the Company 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.
Return on Average Assets
 
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Operating income
 
 
$
8,604.6

 
$
8,529.7

 
$
7,473.1

Average assets(1)
 
 
$
33,934.2

 
$
32,861.1

 
$
30,294.9

Return on average assets
 
 
25.4
%
 
26.0
%
 
24.7
%
(1)
Represents the average of the month-end balances of total assets for the past 13 months.
Return on Average Common Equity
 
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Net income
 
 
$
5,464.8

 
$
5,503.1

 
$
4,946.3

Average shareholders' equity(1)
 
 
$
14,562.8

 
$
14,585.4

 
$
14,021.9

Return on average common equity
 
 
37.5
%
 
37.7
%
 
35.3
%
(1)
Represents the average of the month-end balances of shareholders' equity for the past 13 months.
Fixed-rate Debt as a Percent of Total Debt
 
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Total debt obligations
 
 
$
13,632.5

 
$
12,500.4

 
$
11,505.3

Fair value adjustments(1)
 
 
42.3

 
55.9

 
77.4

Debt obligations before fair value adjustments
 
 
$
13,590.2

 
$
12,444.5

 
$
11,427.9

Fixed-rate debt(2)
 
 
$
10,102.6

 
$
8,562.3

 
$
7,546.5

Fixed-rate debt as a percent of total debt
 
 
74
%
 
69
%
 
66
%
(1)
Reflects adjustments to the carrying value of debt obligations related to fair value hedges. These adjustments are excluded as they do not affect the amount of obligations at maturity. See Debt financing note to the consolidated financial statements.
(2)
Includes the effect of interest rate swaps.






Foreign Currency-denominated Debt as a Percent of Total Debt
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Total debt obligations
 
 
$
13,632.5

 
$
12,500.4

 
$
11,505.3

Fair value adjustments(1)
 
 
42.3

 
55.9

 
77.4

Debt obligations before fair value adjustments
 
 
$
13,590.2

 
$
12,444.5

 
$
11,427.9

Foreign currency-denominated debt
 
 
$
4,864.5

 
$
5,005.3

 
$
4,719.9

Foreign currency-denominated debt as a percent of total debt
 
 
36
%
 
40
%
 
41
%
(1)
Reflects adjustments to the carrying value of debt obligations related to fair value hedges. These adjustments are excluded as they do not affect the amount of obligations at maturity. See Debt financing note to the consolidated financial statements.
Total Debt as a Percent of Total Capitalization
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Total debt obligations
 
 
$
13,632.5

 
$
12,500.4

 
$
11,505.3

Fair value adjustments(1)
 
 
42.3

 
55.9

 
77.4

Debt obligations before fair value adjustments
 
 
$
13,590.2

 
$
12,444.5

 
$
11,427.9

Total capitalization(2)
 
 
$
28,883.8

 
$
26,834.7

 
$
26,062.1

Total debt as a percent of total capitalization
 
 
47
%
 
46
%
 
44
%
(1)
Reflects adjustments to the carrying value of debt obligations related to fair value hedges. These adjustments are excluded as they do not affect the amount of obligations at maturity. See Debt financing note to the consolidated financial statements.
(2)
Total capitalization represents debt obligations before fair value adjustments and total shareholders' equity.
Cash Provided by Operations as a Percent of Total Debt
 
 
 
 
 
 
Dollars in millions
Years ended December 31, 2012
 
 
2011

 
2010

Total debt obligations
 
 
$
13,632.5

 
$
12,500.4

 
$
11,505.3

Fair value adjustments(1)
 
 
42.3

 
55.9

 
77.4

Debt obligations before fair value adjustments
 
 
$
13,590.2

 
$
12,444.5

 
$
11,427.9

Cash provided by operations
 
 
$
6,966.1

 
$
7,150.1

 
$
6,341.6

Cash provided by operations as a percent of total debt
 
 
51
%
 
57
%
 
55
%
(1)
Reflects adjustments to the carrying value of debt obligations related to fair value hedges. These adjustments are excluded as they do not affect the amount of obligations at maturity. See Debt financing note to the consolidated financial statements.
Return on Incremental Invested Capital
 
 
 
 
 
 
 
See Part II, Item 7, page 24 of this Form 10-K for the calculation.