Other American companies followed McDonald’s exampleincluding Starbucks, Yum Brands, and Papa John’s, as well as carbonated beverage supplier Coca-Cola. As most restaurants in Russia (around 850 locations) and Ukraine (108 locations) are company-owned, McDonald’s is more exposed to risk than most other US fast food chainsthat have their premises in these markets, writes the CNBC website.
McDonald’s chief financial officer Kevin Ozan said Wednesday the company was still calculating the impact of the closure on its business. However, McDonald’s currently estimates that it will cost about $ 50 million. per month, or about 5 to 6 cents per share. By comparison, McDonald’s posted net income of $ 1.64 billion in the fourth quarter.
The company undertook that during a break in the restaurant’s operations, it will pay all its customers about PLN 62 thousand. Russian workers. Ozan said McDonald’s will also pay rent for its premises as well as supply chain costs and other expenses.
“We expect it to be a temporary hiatus and we certainly are not taking this decision lightly, but for us, it’s about doing what we think is right, both for the global business and for our employees on the ground,” he said.
McDonald’s has long played a symbolic role in Russia. The network opened its first facility in the Soviet Union 32 years ago in Moscow, a few months before the collapse of the USSR.
In addition to the temporary closure of its Russian outlets, McDonald’s also closed 108 restaurants in Ukraine. Russia and Ukraine are responsible for approx. 2 percent. sales throughout the McDonald’s system, 9 percent. revenues and 3 percent. operating income – reports CNBC.
You can follow live coverage of the situation in Ukraine here.
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