Starbucks Reports Record First Quarter Fiscal 2013 Results

“Starbucks strong performance in Q1 demonstrates the strength, and unique resilience, of our increasingly global business, and the power and growing relevance of the Starbucks brand to consumers and communities all around the world,” said Howard Schultz, chairman, president and chief executive officer, Starbucks Coffee Company.

28 Jan 2013 --- Starbucks Corporation reported financial results for its 13-week fiscal first quarter ended December 30, 2012.

Fiscal First Quarter 2013 Highlights:

- Total net revenues increased 11% to a record $3.8 billion
- Global comparable store sales grew 6%, driven by a 4% increase in traffic and a 2% increase in average ticket
- Americas comparable store sales grew 7%, China/Asia Pacific comparable store sales grew 11%
- Consolidated operating margin expanded 40 basis points to 16.6%
- EPS increased 14% to a record $0.57 per share, compared to $0.50 per share in Q1 FY12
- Opened 212 net new stores globally, including the first 3 stores in India
- Sold more than 150,000 Verismo® machines since launch, marking a strong debut of this emerging platform
- Added 1.4 million new My Starbucks Rewards members in the U.S., up 86% over the 778,000 new members added in the U.S. in Q1 FY12
- Acquired Teavana Holdings, Inc. on December 31, making Teavana a wholly-owned subsidiary of Starbucks and positioning Starbucks to become the global leader in tea

“Starbucks strong performance in Q1 demonstrates the strength, and unique resilience, of our increasingly global business, and the power and growing relevance of the Starbucks brand to consumers and communities all around the world,” said Howard Schultz, chairman, president and chief executive officer, Starbucks Coffee Company. “Solid growth in our U.S. retail business, further expansion of our Channel Development initiatives and continued successful execution against our expansion plans throughout China and Asia Pacific all contributed to the record results we announced today. Starbucks has never been better positioned to achieve the goals we have set for ourselves around the world and I have never been more optimistic about our future.”

“Record earnings in the first quarter continued our strong momentum, reflecting the underlying strength in our core business,” commented Troy Alstead, chief financial officer. “We delivered excellent holiday results with 6% global comps, marking the 12th consecutive quarter of comps in excess of 5%. Our first quarter results demonstrate both efficiency, with record US productivity, and innovation, with the successful launch of Verismo, our newest growth platform.”

Added Alstead, “Despite significant and unexpected cost pressures in the quarter, we achieved our earnings growth target and delivered record EPS. Starbucks strong Q1 performance reaffirms our confidence in the aggressive FY13 growth targets we announced in early November. The quality and diversity of growth drivers in the business, combined with our continued focus on operational excellence, gives us confidence in sustainable, strong profitable growth.”

Consolidated net revenues reached a record $3.8 billion in Q1 FY13, an increase of 11% over Q1 FY12. The increase was primarily due to a 6% increase in global comparable store sales, and incremental revenues from 401 net new company-operated store openings over the past 12 months. The 6% increase in comparable store sales was comprised of a 4% increase in the number of transactions and a 2% increase in average ticket. Also contributing to consolidated net revenue growth was 13% revenue growth in Channel Development and 14% revenue growth in licensed stores.

Consolidated operating income increased 13% to a record $630.6 million, compared to $556.0 million for the same period a year ago. Operating margin expanded 40 basis points to 16.6% this quarter, compared to 16.2% in the same period last year. The margin increase was primarily due to increased sales leverage.