McDonald’s Left With Millions Of Dollars Of Russian Food It Can’t Use. Here’s Why.
McDonald’s is in a pickle.
The fast-food titan announced last month that it would temporarily close its nearly 850 locations in Russia due the country’s invasion of Ukraine.
McDonald’s also pulled the plug on its restaurants in Ukraine, which cost the chain $127 million last quarter, according to CNN.
Last month, McDonald’s said in a statement that it would continue to pay full salaries to all Ukrainian and Russian employees. The company also donated $5 million to its Employee Assistance Fund.
Maintaining staff costs, alongside payments for leases and supplies, cost the company $27 million. The other whopping $100 million deficit stemmed from food and other unused items that now must be nixed.
“Results included … $100 million of costs for inventory in the company’s supply chain that likely will be disposed of due to restaurants being temporarily closed,” the fast-food powerhouse said in a statement.
Keeping a spirit of optimism for the company’s recovery, CFO Kevin Ozan said: “We expect this to be temporary and we certainly don’t take this decision lightly, but for us this is about doing what we think is the right thing to do, both for the global business and for our people locally.”
At this time no further updates have been issued on the company’s plans for its locations in Ukraine and Russia.
“As we move forward, McDonald’s will continue to assess the situation and determine if any additional measures are required. At this juncture, it’s impossible to predict when we might be able to reopen our restaurants in Russia.”