McDonald’s Corp., balance sheet: debt

US$ in thousands

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Short-term borrowings and current maturities of long-term debt	2,192,400)	—)	—)	2,243,600)	59,100)
Current finance lease liability	45,500)	21,500)	—)	—)	—)
Long-term debt, excluding current maturities	37,152,900)	35,903,500)	35,622,700)	35,196,800)	34,118,100)
Long-term finance lease liability	1,530,000)	1,300,200)	—)	—)	—)
Total debt obligations and finance lease liability (carrying amount)	40,920,800)	37,225,200)	35,622,700)	37,440,400)	34,177,200)

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Debt item	Description	The company
Total debt obligations and finance lease liability (carrying amount)	Sum of the carrying values as of the balance sheet date of all debt plus capital lease obligations.	McDonald’s Corp. total debt increased from 2021 to 2022 and from 2022 to 2023.

	Dec 31, 2023
Selected Financial Data (US$ in thousands)
Debt obligations	38,400,000)
Finance lease liability	1,575,500)
Total debt obligations and finance lease liability (fair value)	39,975,500)
Financial Ratio
Debt, fair value to carrying amount ratio	0.98

Weighted-average effective interest rate on debt obligations and finance lease liability: 3.72%

Interest rate	Debt amount¹	Interest rate × Debt amount
4.20%	23,382,600)	982,069)
6.90%	1,097,500)	75,728)
2.40%	10,780,600)	258,734)
6.60%	331,200)	21,859)
3.40%	748,800)	25,459)
5.50%	204,400)	11,242)
4.10%	1,585,100)	64,989)
3.10%	754,900)	23,402)
2.90%	88,600)	2,569)
0.20%	475,400)	951)
4.90%	118,000)	5,782)
3.60%	45,500)	1,638)
3.60%	1,530,000)	55,080)
Total	41,142,600)	1,529,503)
3.72%

¹ US$ in thousands

² Weighted-average interest rate = 100 × 1,529,503 ÷ 41,142,600 = 3.72%

McDonald’s Corp., interest costs incurred

US$ in thousands

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Interest expense	1,360,800)	1,207,000)	1,185,800)	1,218,100)	1,121,900)
Capitalized interest	14,500)	9,500)	6,800)	6,000)	7,400)
Interest costs incurred	1,375,300)	1,216,500)	1,192,600)	1,224,100)	1,129,300)

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Debt item	Description	The company
Interest expense	Amount of the cost of borrowed funds accounted for as interest expense for debt.	McDonald’s Corp. interest expense increased from 2021 to 2022 and from 2022 to 2023.
Capitalized interest	Amount of interest costs capitalized disclosed as an adjusting item to interest costs incurred.	McDonald’s Corp. capitalized interest increased from 2021 to 2022 and from 2022 to 2023.
Interest costs incurred	Total interest costs incurred during the period and either capitalized or charged against earnings.	McDonald’s Corp. interest costs incurred increased from 2021 to 2022 and from 2022 to 2023.

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in thousands)
Net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,025,400)
Add: Income tax expense	2,053,400)	1,648,000)	1,582,700)	1,410,200)	1,992,700)
Add: Interest expense, net of capitalized interest	1,360,800)	1,207,000)	1,185,800)	1,218,100)	1,121,900)
Earnings before interest and tax (EBIT)	11,883,000)	9,032,400)	10,313,700)	7,358,800)	9,140,000)

Interest costs incurred	1,375,300)	1,216,500)	1,192,600)	1,224,100)	1,129,300)
Financial Ratio With and Without Capitalized Interest
Interest coverage ratio (without capitalized interest)¹	8.73	7.48	8.70	6.04	8.15
Adjusted interest coverage ratio (with capitalized interest)²	8.64	7.42	8.65	6.01	8.09

2023 Calculations

¹ Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense, net of capitalized interest
= 11,883,000 ÷ 1,360,800 = 8.73

² Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest costs incurred
= 11,883,000 ÷ 1,375,300 = 8.64

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Solvency ratio	Description	The company
Adjusted interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments (including capitalized interest).	McDonald’s Corp. adjusted interest coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 not reaching 2021 level.

McDonald’s Corp. (NYSE:MCD)

Analysis of Debt