Pershing Square Activist Presentation Deck
C. McOpCo Financial Analysis
Set forth herein are
the assumptions for
the McOpCo business.
McOpCo: Model Key Drivers
Net Unit Growth
■ 90 net new owned restaurants in 2005
Net unit growth thereafter only in the franchised system. Assumes 200 new gross units and 200 closed units
annually.
Revenue drivers:
Average same-store sales growthof 2.5% -2.7% annually on a total company basis
Average unit sales of $1.6mm on a global basis in FY 2005
Cost drivers:
Food and paper costs held constant at 34.1% of sales, based on historicals
Payroll and employee costs of 26.1% in 2005, stepping down to 25.5% percent by 2011
Occupancy and other costs (excluding D&A) held constant at 20.5% of sales
D&A calculated as 110% of capex in 2006 trailing to approximately 107% of CapEx by 2015
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CapEx drivers:
4.0% of sales paid to Pro Forma McDonald's as a franchise fee
25% of consolidated SG&A allocated to McOpCo
Average maintenance CapEx per unit of approximately $50k in 2005 and 2006, growing at an inflationary
rate of 2.0% thereafter
■ Allocation of 25% of consolidated McDonald's corporate CapEx
■ Consolidated corporate CapEx held constant at 0.7% of sales
Other
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No dividends
Total Debt of $1.5 billion allocated (Net Debt of $1.35bn)
Free cash used to pay down debt and then buy back shares
$150 mm minimum cash balance
Tax rate of 32%
Minimal working capital requirements
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