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Last Update: 26-Apr-13 07:45 ET
Starbucks shares fall 2% following downside guidance
Starbucks (SBUX $59.20 -1.30) reported second quarter earnings of $0.48 per share, excluding non-recurring items ($0.03 gain --see below), in-line with the Capital IQ Consensus Estimate consensus of $0.48, while revenues rose 11.3% year/year to $3.56 billion versus the $3.59 billion consensus. The company issued downside guidance for the third quarter with revenues of $0.50-0.53 versus the $0.54 Capital IQ consensus. The company issued in-line guidance for Q4 (Sep), sees EPS of $0.54-0.57 versus the $0.57 Capital IQ consensus. Q2 EPS of $0.51 per share 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%. Global comparable store sales grew 6%, driven by a 4% increase in traffic and a 2% increase in average ticket, marking the 13th consecutive quarter of global comp growth greater than 5%. Net revenues for the Americas segment were $2.6 billion in Q2 FY13, an increase of 10% over Q2 FY12. The increase was primarily due to a 6% increase in comparable store sales, comprised of a 5% increase in the number of transactions and a 2% increase in average ticket. Net revenues for the China/Asia Pacific segment were $213.6 million in Q2 FY13, an increase of 22% over Q2 FY12. The increase was primarily due to incremental revenues from 516 net new store openings over the past 12 months and an 8% increase in comparable store sales. Operating margin expanded 180 basis points to a Q2 record 15.3% "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."
