SBUX » Topics » Fiscal 2009 - The View Ahead

This excerpt taken from the SBUX 10-K filed Nov 20, 2009.
Fiscal 2010 — The View Ahead
 
For fiscal 2010, the Company expects revenues to grow in the low-to-mid single digits compared to fiscal 2009, driven by modestly positive comparable store sales, a 53rd fiscal week, and approximately 100 planned net new


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stores in the US and approximately 200 net new stores in International markets. Both the US and International net new additions are expected to be primarily licensed stores.
 
Given these revenue expectations, combined with the Company’s reduced cost structure, in-store operating efficiencies, and lower restructuring charges, Starbucks currently expects significant improvement in its consolidated operating margin in fiscal 2010. Operating cash flow for fiscal 2010 is currently expected to reach approximately $1.4 billion and capital expenditures are expected to range from $500 million to $550 million.
 
These excerpts taken from the SBUX 10-K filed Nov 24, 2008.
Fiscal 2009 — The View Ahead
 
Management expects the Company to continue to face a very difficult economic environment throughout fiscal 2009, both in the US and internationally, including in its two largest Company-operated markets of Canada and the UK. As the global financial crisis has broadened and intensified, other sectors of the global economy have been adversely impacted and a severe global recession of uncertain length now appears likely. As a retailer that is dependent upon consumer discretionary spending, the Company expects to face an extremely challenging fiscal 2009 because of these economic conditions. Accordingly, Starbucks expects to report negative comparable store sales for fiscal 2009. Additionally, the Company’s earnings for fiscal 2009 will be impacted by lease termination and severance costs from the US and Australia store closures, totaling up to an estimated $0.12 of EPS for fiscal 2009. The Company estimates that the combination of the US and Australia store closures and head count reductions will result in a pre-tax benefit to operating income of approximately $200 million to $210 million in fiscal 2009, which equates to approximately $0.17 to $0.18 of EPS.
 
Starbucks plans to be disciplined in its approach to new store openings, in both Company-operated and licensed markets, and adjust as needed in response to further worsening in the global economy. Starbucks fiscal 2009 US store opening target is approximately a negative 20 net new stores, which includes a nearly 225 Company-operated store decline and approximately 205 net new licensed stores. Internationally, Starbucks is planning to open approximately 700 net new stores in fiscal 2009, two-thirds of which are expected to be licensed, as it factors in the current global economic climate, with a more cautious approach in the UK and western Europe.
 
Fiscal
2009 — The View Ahead



 



Management expects the Company to continue to face a very
difficult economic environment throughout fiscal 2009, both in
the US and internationally, including in its two largest
Company-operated markets of Canada and the UK. As the global
financial crisis has broadened and intensified, other sectors of
the global economy have been adversely impacted and a severe
global recession of uncertain length now appears likely. As a
retailer that is dependent upon consumer discretionary spending,
the Company expects to face an extremely challenging fiscal 2009
because of these economic conditions. Accordingly, Starbucks
expects to report negative comparable store sales for fiscal
2009. Additionally, the Company’s earnings for fiscal 2009
will be impacted by lease termination and severance costs from
the US and Australia store closures, totaling up to an estimated
$0.12 of EPS for fiscal 2009. The Company estimates that the
combination of the US and Australia store closures and head
count reductions will result in a pre-tax benefit to operating
income of approximately $200 million to $210 million
in fiscal 2009, which equates to approximately $0.17 to $0.18 of
EPS.


 



Starbucks plans to be disciplined in its approach to new store
openings, in both Company-operated and licensed markets, and
adjust as needed in response to further worsening in the global
economy. Starbucks fiscal 2009 US store opening target is
approximately a negative 20 net new stores, which includes
a nearly 225 Company-operated store decline and approximately
205 net new licensed stores. Internationally, Starbucks is
planning to open approximately 700 net new stores in fiscal
2009, two-thirds of which are expected to be licensed, as it
factors in the current global economic climate, with a more
cautious approach in the UK and western Europe.


 




This excerpt taken from the SBUX 10-K filed Nov 29, 2007.
Fiscal 2008 — The View Ahead
 
Throughout fiscal 2007, Starbucks experienced a consistent weakening in its U.S. business, exiting the year with a negative trend in transactions. Management recognizes that it faces a more challenging environment from an economic, operational and competitive standpoint entering fiscal 2008. In response to those challenges, management intends to focus in the following key areas:
 
  •  Better operational excellence at the store level;
 
  •  More meaningful innovation to continue to differentiate the store experience; and
 
  •  Increased efficiencies and effectiveness in the general and administrative infrastructure, to become more capable of navigating through the fluctuations in the external environment.


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In setting targets for fiscal 2008, management’s goal was to balance the long-term opportunity for store growth with the near-term realities of the challenging economic and operating environment. For fiscal 2008 the Company is targeting:
 
  •  Opening approximately 2,500 new stores;
 
  •  Comparable store sales growth in the range of 3% to 5%;
 
  •  Total net revenue growth in the range of approximately 17% to 18%, to over $11 billion; and
 
  •  Earnings per share in the range of $1.02 to $1.05, representing 17% to 21% growth, with earnings per share expansion expected to be greater in the second half of fiscal 2008.
 
In summary, management believes these targets are balanced for fiscal 2008. The Company intends to continue to build out stores to take advantage of its global opportunity, to better execute in its U.S. business, to grow and deliver significant margin expansion in its International business, and to deliver margin improvement for the Company on a consolidated basis.
 
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