McDonald's Corp. (MCD)

Total Debt Disclosure

McDonald's Corp., Statement of Financial Position, Debt

USD $ in thousands

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Current maturities of long-term debt	–	366,600	8,300	18,100	31,800
Long-term debt, excluding current maturities	13,632,500	12,133,800	11,497,000	10,560,300	10,186,000
Total debt	13,632,500	12,500,400	11,505,300	10,578,400	10,217,800

Source: Based on data from McDonald's Corp., Annual Reports

Item	Description	The company
Total debt	Sum of the carrying values as of the balance sheet date of all debt plus capital lease obligations.	McDonald's Corp.'s total debt increased from 2010 to 2011 and from 2011 to 2012.

McDonald's Corp.

USD $ in thousands

12 months ended	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Interest expense	516,600	492,800	450,900	473,200	522,600
Capitalized interest	15,900	14,000	12,000	11,700	12,300
Interest costs incurred	532,500	506,800	462,900	484,900	534,900

Source: Based on data from McDonald's Corp., Annual Reports

Item	Description	The company
Interest expense	Represents the portion of interest incurred in the period on debt arrangements that was charged against earnings.	McDonald's Corp.'s interest expense increased from 2010 to 2011 and from 2011 to 2012.
Capitalized interest	The amount of interest that was capitalized during the period.	McDonald's Corp.'s capitalized interest increased from 2010 to 2011 and from 2011 to 2012.
Interest costs incurred	Total interest costs incurred during the period and either capitalized or charged against earnings.	McDonald's Corp.'s interest costs incurred increased from 2010 to 2011 and from 2011 to 2012.

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data (USD $ in thousands)
Net income	5,464,800	5,503,100	4,946,300	4,551,000	4,313,200
Add: Interest expense, net of capitalized interest	516,600	492,800	450,900	473,200	522,600
Add: Income tax expense (benefit)	2,614,200	2,509,100	2,054,000	1,936,000	1,844,800
Earnings before interest and tax (EBIT)	8,595,600	8,505,000	7,451,200	6,960,200	6,680,600

Interest costs incurred	532,500	506,800	462,900	484,900	534,900
Ratio With and Without Capitalized Interest
Interest coverage ratio (excluding capitalized interest)¹	16.64	17.26	16.53	14.71	12.78
Adjusted interest coverage ratio (including capitalized interest)²	16.14	16.78	16.10	14.35	12.49

2012 Calculations

¹ Interest coverage ratio (excluding capitalized interest) = EBIT ÷ Interest expense, net of capitalized interest
= 8,595,600 ÷ 516,600 = 16.64

² Adjusted interest coverage ratio (including capitalized interest) = EBIT ÷ Interest costs incurred
= 8,595,600 ÷ 532,500 = 16.14

Ratio	Description	The company
Adjusted interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments (including capitalized interest).	McDonald's Corp.'s adjusted interest coverage ratio improved from 2010 to 2011 but then slightly deteriorated from 2011 to 2012 not reaching 2010 level.