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14 | McDonald’s Corporation 2013 Annual Report
Consolidated Operating Results
Operating results
2013 2012 2011
Dollars and shares in millions, except per share data Amount
Increase/
(decrease) Amount
Increase/
(decrease) Amount
Revenues
Sales by Company-operated restaurants $18,875 1% $18,603 2% $18,293
Revenues from franchised restaurants 9,231 3 8,964 3 8,713
Total revenues 28,106 2 27,567 2 27,006
Operating costs and expenses
Company-operated restaurant expenses 15,579 2 15,224 3 14,838
Franchised restaurants-occupancy expenses 1,624 6 1,527 3 1,481
Selling, general & administrative expenses 2,386 (3) 2,455 3 2,394
Other operating (income) expense, net (247) (2) (244) (3) (237)
Total operating costs and expenses 19,342 2 18,962 3 18,476
Operating income 8,764 2 8,605 1 8,530
Interest expense 522 1 517 5 493
Nonoperating (income) expense, net 38 n/m 9 (64) 25
Income before provision for income taxes 8,204 2 8,079 1 8,012
Provision for income taxes 2,618 0 2,614 4 2,509
Net income $ 5,586 2% $ 5,465 (1%) $ 5,503
Earnings per common share—diluted $ 5.55 4% $ 5.36 2% $ 5.27
Weighted-average common shares outstanding—
diluted 1,006.0 (1%) 1,020.2 (2%) 1,044.9
n/m Not meaningful
IMPACT OF FOREIGN CURRENCY TRANSLATION ON REPORTED RESULTS
While changes in foreign currency exchange rates affect reported results, McDonald’s mitigates exposures, where practical, by purchasing
goods and services in local currencies, financing in local currencies and hedging certain foreign-denominated cash flows.
In 2013, foreign currency translation had a negative impact on consolidated operating results due to the weaker Australian Dollar,
Japanese Yen and many other foreign currencies, partly offset by the stronger Euro. In 2012, foreign currency translation had a negative
impact on consolidated operating results primarily due to the weaker Euro, along with most other currencies. In 2011, foreign currency
translation had a positive impact on consolidated operating results driven by the stronger Euro and Australian Dollar, as well as most other
currencies.
Impact of foreign currency translation on reported results
Reported amount Currency translation
benefit/(cost)
In millions, except per share data 2013 2012 2011 2013 2012 2011
Revenues $ 28,106 $ 27,567 $ 27,006 $ (29) $ (726) $ 944
Company-operated margins 3,296 3,379 3,455 (7) (97) 134
Franchised margins 7,607 7,437 7,232 (43) (204) 213
Selling, general & administrative expenses 2,386 2,455 2,394 (5) 40 (55)
Operating income 8,764 8,605 8,530 (66) (261) 301
Net income 5,586 5,465 5,503 (52) (178) 195
Earnings per common share—diluted 5.55 5.36 5.27 (0.05) (0.17) 0.19