Coalition of Franchisee Associations

March 20, 2019

McDonald's Presents at JPMorgan Conference

On Friday McDonald's.CFO spent 45 minutes with an analyst from J.P. Morgan.

I'll never understand why they send out a bean counter to discuss operations and 
marketing, but the analysts share the same type of education so they take him/her 

About half-way through the discussion the CFO talks about Operator cash flow and 
for the first time McDonald's has admitted that the Operator cash flow numbers they 
give Wall Street are "pre-debt".   

Here's the Seeking Alpha Transcript


Anonymous said...

Wonder if they mentioned that 40% of operators currently are ineligible for expansion or rewrite because of crushing BBV2020 requirements.


Anonymous said...

Pre-debt cash flow indicates how much cash is available to pay down debt. Post debt cash flow is what the operators must contend with. Giving analysts only pre-debt cash flow is deceiving because MCD has forced so much debt on the operators for reinvestment. Pre-debt cash flow is a useless number because it is the debt that is creating many problems.