McDonalds 2013 Annual Report Download - page 47

McDonald’s Corporation 2013 Annual Report | 39
Segment and Geographic Information
The Company operates in the global restaurant industry and
manages its business as distinct geographic segments. All
intercompany revenues and expenses are eliminated in computing
revenues and operating income. Corporate general and
administrative expenses are included in Other Countries &
Corporate and consist of home office support costs in areas such
as facilities, finance, human resources, information technology,
legal, marketing, restaurant operations, supply chain and training.
Corporate assets include corporate cash and equivalents, asset
portions of financial instruments and home office facilities.
In millions 2013 2012 2011
U.S. $ 8,851.3 $ 8,813.7 $ 8,528.2
Europe 11,299.8 10,827.4 10,886.4
APMEA 6,477.2 6,391.1 6,019.5
Other Countries &
Corporate 1,477.4 1,534.8 1,571.9
Total revenues $28,105.7 $27,567.0 $27,006.0
U.S. $ 3,779.3 $ 3,750.4 $ 3,666.2
Europe 3,370.6 3,195.8 3,226.7
APMEA 1,479.7 1,566.1 1,525.8
Other Countries &
Corporate 134.7 92.3 111.0
Total operating income $ 8,764.3 $ 8,604.6 $ 8,529.7
U.S. $11,711.8 $11,431.6 $ 10,865.5
Europe 15,096.3 14,223.3 12,015.1
APMEA 6,202.7 6,419.3 5,824.2
Other Countries &
Corporate 3,615.5 3,312.3 4,285.1
Total assets $36,626.3 $35,386.5 $ 32,989.9
U.S. $ 875.5 $ 1,065.0 $ 786.5
Europe 1,157.3 1,114.7 1,130.1
APMEA 654.6 716.6 614.1
Other Countries &
Corporate 137.3 152.9 199.1
Total capital
expenditures $ 2,824.7 $ 3,049.2 $ 2,729.8
U.S. $ 503.6 $ 477.1 $ 446.0
Europe 627.1 573.5 570.3
APMEA 319.2 296.2 267.5
Other Countries &
Corporate 135.2 141.7 131.2
Total depreciation and
amortization $ 1,585.1 $ 1,488.5 $ 1,415.0
Total long-lived assets, primarily property and equipment,
were (in millions)–Consolidated: 2013–$30,679.8; 2012–
$29,644.5; 2011–$27,587.6; U.S. based: 2013–$11,632.2; 2012–
$11,308.7; 2011–$10,724.9.
Debt Financing
LINE OF CREDIT AGREEMENTS
At December 31, 2013, the Company had a $1.5 billion line of
credit agreement expiring in November 2016 with fees of
0.065% per annum on the total commitment, which remained
unused. Fees and interest rates on this line are based on the
Company’s long-term credit rating assigned by Moody’s and
Standard & Poor’s. In addition, the Company's subsidiaries had
unused lines of credit that were primarily uncommitted, short-term
and denominated in various currencies at local market rates of
interest.
The weighted-average interest rate of short-term borrowings
was 5.1% at December 31, 2013 (based on $609.7 million of
foreign currency bank line borrowings) and 4.1% at December 31,
2012 (based on $581.3 million of foreign currency bank line
borrowings and $200.0 million of commercial paper).
DEBT OBLIGATIONS
The Company has incurred debt obligations principally through
public and private offerings and bank loans. There are no
provisions in the Company’s debt obligations that would accelerate
repayment of debt as a result of a change in credit ratings or a
material adverse change in the Company’s business. Certain of
the Company’s debt obligations contain cross-acceleration
provisions, and restrictions on Company and subsidiary
mortgages and the long-term debt of certain subsidiaries. Under
certain agreements, the Company has the option to retire debt
prior to maturity, either at par or at a premium over par. The
Company has no current plans to retire a significant amount of its
debt prior to maturity.
ESOP LOANS
Borrowings related to the leveraged Employee Stock Ownership
Plan ("ESOP") at December 31, 2013, which include $23.2 million
of loans from the Company to the ESOP, are reflected as debt with
a corresponding reduction of shareholders’ equity (additional paid-
in capital included a balance of $19.9 million and $27.2 million at
December 31, 2013 and 2012, respectively). The ESOP is
repaying the loans and interest through 2018 using Company
contributions and dividends from its McDonald’s common stock
holdings. As the principal amount of the borrowings is repaid, the
debt and the unearned ESOP compensation (additional paid-in
capital) are reduced.