McDonald's to leave Russia market

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McDonald's to leave Russia market

McDonald's Corp. MCD has decided to leave the Russia market following Russia's unprovoked invasion of neighboring Ukraine and has started selling its entire portfolio of restaurants. The humanitarian crisis caused by the war in Ukraine and the precipitating unpredictable operating environment have led McDonald's to conclude that continued ownership of business in Russia is no longer tenable, nor is it consistent with McDonald's values, the fast-food chain said in a statement. It is looking to make future employment for its 62,000 workers part of the terms because it is pursuing a sale to a local buyer. The company expects to book a charge of $1.2 billion to $1.4 billion to cover the costs of the move. The sale will involve de Arching all restaurants, which will no longer allow the use of its name, logo, branding and menu, although it will retain its trademarks in Russia. McDonald's restaurants in Ukraine are closed for now, although workers are still being paid and the company is supporting aid and relief efforts for refugees across Europe. The Russian charge will cause a 40% operating margin for the company's 2022 operating margin. It expects an adjusted operating margin in the mid- 40% range. It expects to have a capex from $2.1 billion to $2.3 billion in the year 2022. The Dow Jones Industrial Average DJIA fell 11.4%, while the premarket shares were slightly lower and have fallen 9% in the year to date. Yale professors monitoring companies still doing business in Russia ups the ante by highlighting those that are now digging in.