Adjustments to Financial Statements: Removal of Goodwill
Adjusted Financial Ratios: Removal of Goodwill (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

McDonald’s Corp., adjustments to financial statements

US$ in thousands

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported)	56,146,800)	50,435,600)	53,854,300)	52,626,800)	47,510,800)
Less: Goodwill	3,040,400)	2,900,400)	2,782,500)	2,773,100)	2,677,400)
Total assets (adjusted)	53,106,400)	47,535,200)	51,071,800)	49,853,700)	44,833,400)
Adjustment to Shareholders’ Equity (deficit)
Shareholders’ equity (deficit) (as reported)	(4,706,700)	(6,003,400)	(4,601,000)	(7,824,900)	(8,210,300)
Less: Goodwill	3,040,400)	2,900,400)	2,782,500)	2,773,100)	2,677,400)
Shareholders’ equity (deficit) (adjusted)	(7,747,100)	(8,903,800)	(7,383,500)	(10,598,000)	(10,887,700)
Adjustment to Net Income
Net income (as reported)	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,025,400)
Add: Goodwill impairment losses	—)	—)	—)	—)	99,400)
Net income (adjusted)	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,124,800)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

McDonald’s Corp., Financial Data: Reported vs. Adjusted

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McDonald’s Corp., adjusted financial ratios

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net Profit Margin
Reported net profit margin	33.22%	26.65%	32.49%	24.63%	28.59%
Adjusted net profit margin	33.22%	26.65%	32.49%	24.63%	29.06%
Total Asset Turnover
Reported total asset turnover	0.45	0.46	0.43	0.36	0.44
Adjusted total asset turnover	0.48	0.49	0.45	0.39	0.47
Financial Leverage
Reported financial leverage	—	—	—	—	—
Adjusted financial leverage	—	—	—	—	—
Return on Equity (ROE)
Reported ROE	—	—	—	—	—
Adjusted ROE	—	—	—	—	—
Return on Assets (ROA)
Reported ROA	15.08%	12.25%	14.01%	8.99%	12.68%
Adjusted ROA	15.95%	13.00%	14.77%	9.49%	13.66%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	McDonald’s Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	McDonald’s Corp. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	McDonald’s Corp. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

McDonald’s Corp., Financial Ratios: Reported vs. Adjusted

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	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,025,400)
Revenues	25,493,700)	23,182,600)	23,222,900)	19,207,800)	21,076,500)
Profitability Ratio
Net profit margin¹	33.22%	26.65%	32.49%	24.63%	28.59%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,124,800)
Revenues	25,493,700)	23,182,600)	23,222,900)	19,207,800)	21,076,500)
Profitability Ratio
Adjusted net profit margin²	33.22%	26.65%	32.49%	24.63%	29.06%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

¹ Net profit margin = 100 × Net income ÷ Revenues
= 100 × 8,468,800 ÷ 25,493,700 = 33.22%

² Adjusted net profit margin = 100 × Adjusted net income ÷ Revenues
= 100 × 8,468,800 ÷ 25,493,700 = 33.22%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	McDonald’s Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Revenues	25,493,700)	23,182,600)	23,222,900)	19,207,800)	21,076,500)
Total assets	56,146,800)	50,435,600)	53,854,300)	52,626,800)	47,510,800)
Activity Ratio
Total asset turnover¹	0.45	0.46	0.43	0.36	0.44
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Revenues	25,493,700)	23,182,600)	23,222,900)	19,207,800)	21,076,500)
Adjusted total assets	53,106,400)	47,535,200)	51,071,800)	49,853,700)	44,833,400)
Activity Ratio
Adjusted total asset turnover²	0.48	0.49	0.45	0.39	0.47

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

¹ Total asset turnover = Revenues ÷ Total assets
= 25,493,700 ÷ 56,146,800 = 0.45

² Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 25,493,700 ÷ 53,106,400 = 0.48

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	McDonald’s Corp. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Total assets	56,146,800)	50,435,600)	53,854,300)	52,626,800)	47,510,800)
Shareholders’ equity (deficit)	(4,706,700)	(6,003,400)	(4,601,000)	(7,824,900)	(8,210,300)
Solvency Ratio
Financial leverage¹	—	—	—	—	—
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted total assets	53,106,400)	47,535,200)	51,071,800)	49,853,700)	44,833,400)
Adjusted shareholders’ equity (deficit)	(7,747,100)	(8,903,800)	(7,383,500)	(10,598,000)	(10,887,700)
Solvency Ratio
Adjusted financial leverage²	—	—	—	—	—

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

¹ Financial leverage = Total assets ÷ Shareholders’ equity (deficit)
= 56,146,800 ÷ -4,706,700 = —

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity (deficit)
= 53,106,400 ÷ -7,747,100 = —

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	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,025,400)
Shareholders’ equity (deficit)	(4,706,700)	(6,003,400)	(4,601,000)	(7,824,900)	(8,210,300)
Profitability Ratio
ROE¹	—	—	—	—	—
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,124,800)
Adjusted shareholders’ equity (deficit)	(7,747,100)	(8,903,800)	(7,383,500)	(10,598,000)	(10,887,700)
Profitability Ratio
Adjusted ROE²	—	—	—	—	—

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

¹ ROE = 100 × Net income ÷ Shareholders’ equity (deficit)
= 100 × 8,468,800 ÷ -4,706,700 = —

² Adjusted ROE = 100 × Adjusted net income ÷ Adjusted shareholders’ equity (deficit)
= 100 × 8,468,800 ÷ -7,747,100 = —

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	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,025,400)
Total assets	56,146,800)	50,435,600)	53,854,300)	52,626,800)	47,510,800)
Profitability Ratio
ROA¹	15.08%	12.25%	14.01%	8.99%	12.68%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income	8,468,800)	6,177,400)	7,545,200)	4,730,500)	6,124,800)
Adjusted total assets	53,106,400)	47,535,200)	51,071,800)	49,853,700)	44,833,400)
Profitability Ratio
Adjusted ROA²	15.95%	13.00%	14.77%	9.49%	13.66%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

¹ ROA = 100 × Net income ÷ Total assets
= 100 × 8,468,800 ÷ 56,146,800 = 15.08%

² Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 8,468,800 ÷ 53,106,400 = 15.95%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	McDonald’s Corp. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

McDonald’s Corp. (NYSE:MCD)

Analysis of Goodwill and Intangible Assets

Adjustments to Financial Statements: Removal of Goodwill

McDonald’s Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

McDonald’s Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)