Quarterly loss no reason for jitters, Starbucks says
Coffeehouse chain Starbucks Corp. said Wednesday that weak sales in the U.S. and costs related to its closure of 600 underperforming stores led it to post a loss for its fiscal third quarter.
The company also cut its guidance for the year and said it would open fewer stores in the U.S. and internationally, in both 2008 and 2009.
But Starbucks kept its profit guidance intact for 2009, easing investors’ fears about the economy’s effect on the year ahead.
“I don’t think anyone’s really focused on the quarter,” said Edward Jones analyst Jack Russo. “Everyone is thinking of next year.”
Starbucks shares rose 59 cents, or 4%, to $15.26 in after-hours trading. During regular trading they had fallen 2%.
The Seattle-based company reported a loss of $6.7 million, or 1 cent a share, contrasted with a profit of $158.3 million, or 21 cents, a year earlier.
Starbucks said it earned 16 cents a share excluding the costs for restructuring and closing stores.
Analysts polled by Thomson Financial expected a profit of 18 cents a share on revenue of $2.61 billion.
Starbucks said revenue rose 9% to $2.57 billion. Most of the increase was from sales at the company’s international locations and at newer stores in the U.S. Same-store sales, or sales at U.S. stores open at least a year, fell in the mid-single digits.
Starbucks cut its profit guidance for 2008 to the “mid-70-cent"-a-share range, excluding costs. Previously, the company had warned that its profit might fall below the 87 cents a share it earned a year ago.
Analysts are expecting 81 cents a share for the year.