Starbucks 1Q earnings up nearly 18 pct.

Starbucks 1Q earnings up nearly 18 pct.

	Published : Thu, 01 Feb 2007 00:47 By : Agencies Print this Story

SEATTLE (AFX) - Starbucks Corp. said Wednesday its fiscal first-quarter profit climbed nearly 18 percent on a record number of store openings and ramped-up breakfast and lunch offerings.

For the 13 weeks ended Dec. 31, the world's largest specialty coffee retailer posted net earnings of $205 million, or 26 cents a share, compared with $174 million, or 22 cents a share, for the same period a year ago.

Analysts polled by Thomson Financial were expecting profit of $202.6 million, or 26 cents per share.

The Seattle-based company said comparable-store sales, those at stores open at least a year, grew 6 percent for the quarter, which includes the holiday sales period.

Starbucks also said it opened a quarterly record of 728 retail stores, and it reaffirmed its fiscal-year target of at least 2,400 more stores around the world.

'The record number of store openings during the period puts our aggressive 2007 store opening target well within reach,' company president and chief executive Jim Donald said in a statement.

Starbucks' revenue for the quarter was $2.35 billion, in line with analysts' estimates and up from $1.9 billion in the prior year's quarter.

Starbucks shares rose 38 cents, or 1.1 percent, to close at $34.94 on the Nasdaq Stock Market before climbing an additional 42 cents to $35.36 in after-hours trading. The stock has traded in a 52-week range of $28.72 to 40.01.

In a conference call with analysts, Donald said Starbucks continued to boost the number of U.S. stores offering both lunch and breakfast.

Oven-warmed breakfast sandwiches alone were offered in nearly 1,000 more stores during the first quarter, Donald said. Some 200 of those locations were in New York, he said.

'We have aggressive plans to again continue rolling out our warming platform over the next few years,' he said.

The company said its retail store operating expenses as a percentage of sales were up slightly from the year-ago period, mostly due to an hourly wage increase for retail employees.

Chief Financial Officer Michael Casey told analysts the raises were mostly covered by an October increase in Starbucks' retail coffee prices, but he said the company also would cancel its planned 2007 leadership conference to help offset the higher wages.

The company also reinforced its guidance for the full fiscal year: net revenue growth of about 20 percent, comparable-store sales growth of 3 percent to 7 percent, and earnings of between 87 cents and 89 cents per share.