Starbucks earnings up 2% in quarter

by FoodBusinessNews.net Staff
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SEATTLE — For the first quarter ended Dec. 30, Starbucks Corp. posted net earnings of $208,100,000, equal to 28c per share on the common stock, up 2% compared with $205,000,000, or 26c per share, during the same quarter of the previous year.

Net revenue for the quarter was $2,767,600,000, up 18% from $2,355,700,000 during the same quarter of the previous year.

"Over the coming months, our management team will focus on building a long-term model to realize our transformation agenda and drive long-term shareholder value," said Howard Schultz, chairman, president and chief executive officer. "We will do that by being laser focused on delivering what our customers want and expect and providing our partners with the tools to help them exceed our customers’ expectations. Our actions will dramatically change the business, which will enable us to offer a renewed Starbucks Experience to our customers while systematically building the foundation for strong, sustainable growth in fiscal 2009 and beyond."

Operating income in the international segment was $54,100,000, up 63% from $33,100,000 during the same quarter of the previous year, and operating income in the U.S. was $310,900,000, down 4% from $325,100,000 during the previous year.

The company is reducing its fiscal 2008 global net new store opening target to about 2,150 stores, which is down from 2,500.

The company also announced it is discontinuing warm breakfast sandwiches in North American stores.

"We will continue warming pastries and selling lunch with some modifications to the lineup," Mr. Schultz said. "We recognize that there could be a short-term revenue impact to this decision, but it is the right decision for the business. If we execute flawlessly on our core, which we are committed to, our coffee, then we will drive customer engagement and longer-term top-and bottom-line growth."

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