Stock Analysis on Net

McDonald’s Corp. (NYSE:MCD)

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Analysis of Debt

Microsoft Excel

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Total Debt (Carrying Amount)

McDonald’s Corp., balance sheet: debt

US$ in thousands

Microsoft Excel
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
Current finance lease liability
Long-term debt, excluding current maturities
Long-term finance lease liability
Total debt obligations and finance lease liability (carrying amount)

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).

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.

Total Debt (Fair Value)

Microsoft Excel
Dec 31, 2023
Selected Financial Data (US$ in thousands)
Debt obligations
Finance lease liability
Total debt obligations and finance lease liability (fair value)
Financial Ratio
Debt, fair value to carrying amount ratio

Based on: 10-K (reporting date: 2023-12-31).


Weighted-average Interest Rate on Debt

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

Interest rate Debt amount1 Interest rate × Debt amount Weighted-average interest rate2
Total

Based on: 10-K (reporting date: 2023-12-31).

1 US$ in thousands

2 Weighted-average interest rate = 100 × ÷ =


Interest Costs Incurred

McDonald’s Corp., interest costs incurred

US$ in thousands

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Interest expense
Capitalized interest
Interest costs incurred

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).

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.

Adjusted Interest Coverage Ratio

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in thousands)
Net income
Add: Income tax expense
Add: Interest expense, net of capitalized interest
Earnings before interest and tax (EBIT)
 
Interest costs incurred
Financial Ratio With and Without Capitalized Interest
Interest coverage ratio (without capitalized interest)1
Adjusted interest coverage ratio (with capitalized interest)2

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 Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense, net of capitalized interest
= ÷ =

2 Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest costs incurred
= ÷ =


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.