GO
Loading...

'Now Is the Time' to Retire: McDonald's CEO

Josephine Hernandez hands a tray of drinks to a drive thru customer at a McDonald's restaurant in Redwood City, California.
Getty Images
Josephine Hernandez hands a tray of drinks to a drive thru customer at a McDonald's restaurant in Redwood City, California.

After 41 years with the fast food giant, the last seven and a half as CEO, "now is the time" for Jim Skinner to retire from McDonald's, he told CNBC Friday.

"If true succession plans work effectively, CEOs make the handoff to the next person at the right time, and we think it’s the right time at McDonald's, and I certainly think it’s the right time," he said.

Skinner came in as CEO during a time of upheaval when the company's two previous CEOs, Jim Cantalupo and then Charlie Bell, died suddenly. He called that initial period when he had to prove himself despite being in the C-Suite for several years the toughest period of his tenure.

"You never know how the continuity is going to play out with the leadership even though I had a lot of credibility" having been "around a long time" and was part of leadership team, he said.

Skinner will be handing off to Don Thompson, the chief operating officer and former head of McDonald's USA, on June 30. He said his greatest accomplishment as CEO, besides the success of the company, has been putting together a management team that will run McDonald's as well, if not better, than he did.

"The success of the CEO is measured a couple of years after he’s gone, not necessarily during his tenure," Skinner said, "and I’m confident McDonald's growth will continue" under Thompson.

Skinner dismissed Wall Street concern his successor doesn't have enough international experience to run a company that has more than 33,000 restaurants in 119 countries.

As chief operating officer for the past two years, Thompson has gained a lot of international experience, Skinner said, and has traveled to every market that is "critical to the momentum" of the company. "He’s ready to go. He’s the real deal. Don has ketchup in his veins and the capacity of leading this great company forward."

Like other companies, McDonald's is again facing rising commodities costs, but Skinner said the company is "in a position of strength to adapt to these challenges." He thinks the second half of the year will be better than the first half where these costs are concerned. And while the European economy is "not good" and China's economy is slowing, the McDonald's business model "serves us very well in those markets and in how we relate to our customers."

Those customers, he added, will ensure McDonald's stock price will stay as high as the number of those served.

In 2011, shares of McDonald's were the best performing stock in the Dow Jones Industrial Average, with shares rising 31 percent. However, since hitting a 52-week high of $102.22 in January, the company's stock has been trending lower.

"When we perform well and get the sales, which leads to the earnings and the multiple…we expect the share price will continue to grow as we deliver on the fundamentals," he said, namely, "delivering a hot meal in a clean environment at a great price. It's no more complicated than that...the moment of truth."

Questions? Comments? Email us at consumernation@cnbc.com.

Symbol
Price
 
Change
%Change
MCD
---

Featured

Retail