STARBUCKS raised its full-year profit forecast yesterday, boosting investor confidence its turnaround plan has ushered in a new phase of growth.
Rising prices and improving traffic in its stores gave the leeway to hike its fiscal 2011 outlook.
US sales at restaurants open at least 13 months jumped eight per cent in the fiscal fourth quarter from a year ago, driven by a six per cent rise in customer visits and a two per cent increase in spending per visit.
International same-restaurant sales were up seven per cent, helped by a four per cent traffic increase and a three per cent rise in average ticket.
Those factors, coupled with efficiency efforts and cost controls, prompted the company to hike its earnings target for the current 2011 fiscal year to a range of $1.41 to $1.47 per share, from $1.36 to $1.41 previously. Wall Street’s average forecast was for $1.43, near the low end of the new range. Net revenue grew more than 17 per cent to $2.8bn.
“The increase really is based on the strength of the quarter we just recorded and the momentum we bring into the new year,” Starbucks chief financial officer Troy Alstead said.