Starbucks UK hails record performance

A 20 per cent rise in sales of gingerbread and toffee nut lattes helped Starbucks UK record its sixth straight month of like-for-like sales growth in December.

The coffee giant, which has 661 stores across the UK, said an “exceptionally busy Christmas period” saw like-for-like sales last month rise six per cent leading to an overall 3.9 per cent increase in sales for the three months to December compared to the same period last year. In total, Starbucks said it sold 1.5m Christmas drinks in the period.

The Seattle-based company, which has closed a number of stores in the UK, as part of a recent programme to shed some 900 shops, said UK customers had now hit a record level of more than 2m a week.

It is hoping the coffee culture could become a tradition to rival the English pub as the black stuff becomes “an extension of people’s lives,” as discretionary spending picks up during the economic recovery.

“It still is a luxury you can afford. You’re not giving up your retirement to be able to enjoy that great experience every morning,” said chief financial officer Troy Alstead.

The UK results echo its strong US performance which saw the coffee chain make a net profit of £148m in the three months to the end of December – it made just £40m a year earlier, while revenue grew by a billion dollars to £1.6bn.

Sales at US stores open at least a year rose four per cent during the quarter to December, signaling a return to growth in its crucial US market as recession-weary customers return to small luxuries.

As he revealed the UK breakdown of the results, Darcy Willson-Rymer, UK managing director, said: “I’m pleased that the big investment we are making in the UK business is finding favour with customers, but we do expect 2010 to remain challenging and we’re taking nothing for granted.”