Although McDonald’s went through a management transition after the sudden

death of its CEO, Jim Cantalupo, in April 2004, the company’s management team has

strong background and significant experience within the industry that can allow them to

set a corporate strategy that will result in the company’s growth and the investors

expectations.

VI. Operations Analysis

Geographic Areas of Operation

McDonald’s business is managed as distinct geographic segments: United States;

Europe; Asia/Pacific, Middle East and Africa (APMEA); Latin America and Canada. For

the fiscal year ended December 2005, the company generated revenues of $51.2 billion,

up 12% from $45.9 billion in 2003. Net Income for the year totaled $2.2 billion. The

proportional share of systemwide sales by geographic region in 2004 was: U.S. 48%

(same as 2003), Europe 28% (27% 2003), Asia/Pacific/ Middle East Africa 16% (16%

2003), Latin America 3% (3% 2003), Canada 4% (4% 2003) and Partner Brands 2%

(3%).

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