ƒ Debt pay-down totaled more than $800 million.

Over the past two years, the

company has exercised increased financial discipline; by paying down debt,

reducing capital expenditures and selling, general & administrative expenses

as a percent of revenues. In addition, the company returned a significant

amount of excess cash to shareholders in the form of dividends and share

repurchases. The payment of $800 million of long-term debt is the primary

reason for the relatively low current ratio.

ƒ The annual dividend was increased 38%, to about $700 million. The Company

has paid dividends on its common stock for 29 consecutive years and has

increased the dividend amount every year. In 2004, the Company declared a

38% increase in the annual dividend to $0.55 per share or $695 million,

reflecting the Company’s confidence in the ongoing strength and reliability of

its cash flow and positive results from its revitalization efforts.

ƒ McDonald’s served an additional 1.6 million customers a day – compared with

2003. For each quarter of 2004, McDonald’s increased customer visits,

improved margins and delivered double-digit growth in operating income and

earnings per share. In addition, comparable sales were positive across all

geographic segments during each and every quarter.

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