McDonald’s Corporation (MCD)

Fixed asset turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Revenue (ttm)	US$ in thousands	25,920,000	25,938,200	25,757,200	25,765,200	25,494,200	25,014,500	24,194,600	23,415,000	23,182,600	23,265,200	23,594,400	23,763,900	23,222,900	22,527,600	21,744,400	19,618,000	19,207,800	19,243,000	19,327,200	20,975,500
Property, plant and equipment	US$ in thousands	25,295,000	25,775,000	24,811,000	24,682,000	24,908,000	23,924,100	24,101,500	23,858,500	23,773,600	22,698,300	23,334,500	24,434,700	24,720,600	24,428,700	24,620,200	24,549,800	24,958,200	24,218,300	23,830,000	23,595,900
Fixed asset turnover		1.02	1.01	1.04	1.04	1.02	1.05	1.00	0.98	0.98	1.02	1.01	0.97	0.94	0.92	0.88	0.80	0.77	0.79	0.81	0.89

December 31, 2024 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $25,920,000K ÷ $25,295,000K
= 1.02

McDonald’s Corporation's fixed asset turnover ratio has exhibited fluctuations over the past few years. The ratio has shown a general increasing trend from March 31, 2022, to March 31, 2024, indicating that the company is generating more revenue per dollar of fixed assets invested. This signifies improved efficiency in the utilization of fixed assets, which is a positive indicator of operational performance.

Although the ratio experienced some minor fluctuations in the interim periods, overall, the trend is favorable. The ratio peaked at 1.05 on September 30, 2023, suggesting that the company efficiently utilized its fixed assets to generate sales during that period. The subsequent slight decline in the ratio to 1.02 by December 31, 2024, indicates a slight decrease in efficiency.

It is important for McDonald’s to continue monitoring and optimizing its fixed asset turnover to ensure that its assets are effectively utilized to generate revenue efficiently. Overall, the trend of the fixed asset turnover ratio indicates that the company has been successful in managing its fixed assets to support its revenue generation activities.