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Starbucks showing signs of recovery
November 8, 2009
Starbucks Corp. finished its fiscal fourth-quarter with revenues of $2.4 billion, a 4 percent decrease when compared to revenues of $2.5 billion reported for the same period last year.
According to a company earning's release, the revenue decline resulted primarily from the impact of foreign currency translation related to the strengthening of the U.S. dollar compared to UK and Canadian currencies, 385 net fewer company-operated stores open in Q409 compared to Q408, and a 1 percent decline in consolidated comparable store sales.
During the latest quarter ended Sept. 27, same-store sales fell 1 percent, an actual improvement over the 5 decrease reported for same-store sales during the company's 2008 fourth quarter.
Net income was $150 million, or 20 cents a share, compared with $5.4 million, or 1 cent a share, in the year-ago period.
"Starbucks strong performance in Q4 and fiscal 2009 overall is the result of our successful efforts to improve our customer and partner experiences, the initiatives and innovations we have introduced over the past 18 months and the significant, permanent changes we have made to our cost structure," said Howard Schultz, chairman, president and CEO. "We are seeing broad-based improvement across our global business, and are cautiously optimistic about the upcoming holiday period."
For the year, consolidated net revenues decreased 6 percent to $9.8 billion, down from $10.4 billion in fiscal 2008, predominantly due to lower U.S. company-operated retail revenues.
Company-operated retail revenues in fiscal 2009 declined 7 percent to $8.2 billion, down from $8.8 billion in fiscal 2008, primarily due to a 6 percent decline in comparable-store sales, and the effects of a stronger U.S. dollar relative to the British pound and Canadian dollar. The decline in consolidated comparable-store sales was driven by a 6 percent decline in the U.S. segment.
For the year
Starbucksis targeting revenue growth in the low-to-mid single digits for fiscal 2010, driven by modestly positive comparable store sales for 53 fiscal weeks, and approximately 300 planned net new stores.
Starbucks also is targeting 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 locations.
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