Starbucks beats fiscal 4Q forecasts on higher sales

SEATTLE – A jump in U.S. sales helped Starbucks end its fiscal year on a high note.

Starbucks Corp. said same-store sales — a critical measure for retailers — rose 4 per cent in the U.S. in its fiscal fourth quarter. That helped global same-store sales rise 3 per cent, ahead of analysts’ expectations, according to FactSet.

Same-store sales rose 1 per cent in China, another critical market for the company and an improvement from the prior quarter.

Starbucks shares rose sharply in after-hours trading.

Seattle-based Starbuck said U.S. buyers spent more during the quarter, partly because of a price increase that the company announced in June. It also saw a 15-per cent increase in the number of U.S. loyalty program members during the July-September period, up to 15.3 million.

Starbucks reported net income of $755.8 million for the quarter, for a profit of 56 cents per share. Earnings, adjusted for non-recurring costs, were 62 cents per share.

That beat Wall Street’s expectations. The average estimate of 13 analysts surveyed by Zacks Investment Research was for earnings of 59 cents per share.

The coffee chain posted revenue of $6.3 billion in the period, which also beat forecasts.

Starbucks has been struggling with sluggish sales in its biggest markets. In June, the company announced it would close 150 underperforming U.S. stores next year, up from the usual rate of 50 closings per year.

Starbucks shares have risen 2 per cent since the beginning of the year, in line with the Standard & Poor’s 500 index. Shares hit $58.63 in the final minutes of trading Thursday, an increase of slightly more than 6 per cent over the last 12 months.

_____

A portion of this story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on SBUX at https://www.zacks.com/ap/SBUX