Starbucks Corp. has seen a same-store sales increase of 7 percent in its second quarter ended March 28, 2010, a positive reflection of a corporate restructure that included the closure of locations across the globe.
The increase in U.S. comps was driven by a 3 percent rise in traffic and a 5 percent increase in the average ticket, according to the company earnings report. Meanwhile, international same-store sales also spiked 7 percent, driven by a 6 percent increase in traffic and a 1 percent increase in average ticket
"Starbucks second quarter results demonstrate the impact of innovation and the success of our efforts to dramatically transform our business over the last two years," Howard Schultz, chairman, president and CEO, said in the company's earnings release. "Much credit goes to our partners all around the world who continue to deliver an improved experience to our customers."
Global consolidated net revenues also increased 9 percent to $2.5 billion, up from $2.3 billion reported during the same quarter last year. The company attributes the increase to the rise in same-store sales and the impact of foreign currency translation related to stronger Canadian and United Kingdom currencies, partially offset by a smaller store base.
Revenue from U.S. operations increased 5 percent to $1.8 billion, up from $1.7 billion reported during the 2009 second quarter.
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The increase was due to the rise in comparable store sales and the net closure of 299 underperforming company-operated stores over the last 12 months.
In the company's international markets (those locations outside the U.S.), revenue jumped 23 percent to $534 million, up from $433 million reported in the same period last year. The increase was primarily driven by the impact of foreign currency translation related to stronger Canadian and UK currencies, the increase in same-store sales, and the effect of consolidating the company's previous joint venture operations in France.
So far this year, Starbucks global same-store sales are up 6 percent compared to -8 percent reported during the same period last year. The company also has added 29 new locations for the first 26 weeks ended March 28, 2010, a much smaller number than the 182 locations the company opened during the same period last year.
YTD Highlights
On March 24, Starbucks announced its first-ever cash dividend and a share repurchase authorization of 15 million additional shares, bringing the total authorized amount to approximately 21 million shares.
In February, Seattle's Best Coffee announced that its premium coffee would be sold in approximately 7,250 Burger King restaurants throughout the U.S.
In March, the company launched Starbucks VIA in its company-operated stores in the UK. Earlier this month, Starbucks VIA also became available in Starbucks Japan stores.
For the year, Starbucks is now targeting mid-single-digit revenue growth over the comparable 52-week period, and high-single-digit revenue growth with the inclusion of a 53rd week, driven by mid-single-digit comparable store sales growth.
The company also will target approximately 100 net new stores in the U.S. and approximately 200 net new stores in International markets. Both the U.S. and International net new additions are expected to be primarily licensed stores.
