Let’s face it, buying over-priced coffee everyday from the likes of Starbucks (SBUX) must be one of the most unnecessary expenses an American can have.
Add it up across a year and a retail coffee habit can be pricey.
Thus if you’re still regularly buying premium coffee one cup at a time from a place like Starbucks, then you clearly haven’t cut to the bone on your expenses.
Likewise, if you’re actually increasing your frivolous java expenses, then you’re clearly less concerned with your financial situation than you used to be.
Hence it was good news that Starbucks raised its fiscal 2010 earnings outlook yesterday evening to about $0.92 – $0.96 per share, expecting moderate sales growth. Encouragingly, they’ve even started to see a pick-up amongst their most loyal customers.
CEO Howard Schultz: “More than 3.5 million customers are registered Starbucks cardholders. We’ve seen statistically significant increases in frequency and ticket from these loyal customers.”
Fiscal Fourth Quarter 2009 Highlights:
- Comparable store sales trends improved in U.S. and International segments on both sequential quarter and year-over-year basis.
- Consolidated same store sales improved to negative 1% from negative 5% in the previous quarter.
- Operating margin improved 760 basis points to 8.2%.
- Non-GAAP operating margin improved 570 basis points to 10.4%.
- EPS of $0.20 compared to $0.01 in Q408 Non-GAAP EPS increased to $0.24, a 140% increase from $0.10 in the prior year period.
Full Fiscal Year 2009 Highlights:
- Cost savings initiatives delivered full-year savings of approximately $580 million, exceeding target by $30 million.
- Operating margin improved 80 basis points to 5.7%.
- Non-GAAP operating margin improved 110 basis points to 9.2%.
- EPS increased 21% to $0.52 from $0.43 in the prior year; Non-GAAP EPS increased 13% to $0.80 from $0.71 in the prior year.
- Operating cash flow totaled $1.4 billion and free cash flow exceeded $900 million.