Starbucks Reports Record Second Quarter 2013

Starbucks Corp. reported financial results for its 13-week fiscal second quarter and 26-week fiscal year to date ended March 31, 2013. The company reported total net revenues increased 11 percent to $3.6 billion. Global comparable store sales grew 6 percent, driven by a 4 percent increase in traffic and a 2 percent increase in average ticket, marking the 13th consecutive quarter of global comp growth greater than 5 percent. The operating margin expanded 180 basis points to a second quarter record of 15.3 percent. Consolidated operating income grew 26 percent to $544 million.

The company also reported a record second quarter earnings per share (EPS) of $0.51 per share, which included a $0.03 non-routine gain on the sale of the company's equity in the joint venture that operates Starbucks stores in Mexico; excluding this gain, EPS grew 20 percent. The dollars loaded on Starbucks Cards through both new card activations and reloads increased 32 percent over the second quarter fiscal year 2012. Starbucks added 590 net new stores globally, including 337 Teavana stores. Additionally, the company has raised its full year earnings per share target range to $2.12 to $2.18 from the previous target range of $2.06 to $2.15.

"Starbucks record operating performance in Q2 continues to demonstrate the underlying strength and resilience of our expanding global business, and the increasing relevance of the Starbucks brand to consumers all around the world,” said Howard Schultz, chairman, president and chief executive officer, in a prepared statement. “Innovation and an enhanced customer experience drove strong comp sales and revenue growth, while a laser focus on improving efficiency and controlling costs enabled us to deliver record margins and earnings. Starbucks has never been better positioned to achieve the aspirational goal we have set of becoming one of the world's most respected, admired and enduring brands.”

“Record second quarter results once again illustrate the power of the Starbucks business and brand,” commented Troy Alstead, chief financial officer. “Continued strength in our US operations, despite ongoing uncertainty in the macro environment, has fueled our performance and allows us to pursue long term strategic initiatives across our segments. Given our performance in the first half of the year and the considerable momentum in the business as we enter the second-half, we are raising our full year earnings growth target.”

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