Starbucks jumps as quarterly profit increases on U.S. sales gain

Store Closings

Starbucks closed 22 stores in Europe, mostly in the U.K., in the fourth quarter and through the end of October, said Jim Olson, a company spokesman. The company is closing stores in Europe amid turnaround efforts it’s making there. Earlier this year, the coffee seller added more espresso to its lattes and ran television ads in the U.K. to help boost sales and attract customers.

There may be charges related to the store closings in the company’s fiscal 2013 first and second quarters, Chief Financial Officer Troy Alstead said in an interview yesterday.

Starbucks, which gets more than 20 percent of its revenue from international locations, is expanding in India, seeking to benefit from the growing middle class there. The coffee brewer, which formed a joint venture with Tata Global Beverages Ltd., opened its first cafes in Mumbai in October and will open a store in New Delhi early next year.

India will be one of the company’s five largest markets in the long term, Schultz said during a conference call yesterday.

Revenue advanced 11 percent to $3.36 billion in the three months ended Sept. 30. Analysts estimated $3.39 billion, on average.

Starbucks has more than 17,600 stores worldwide.

(Starbucks held a conference call. To listen, visit SBUX US <Equity> EVT <GO>.)

Bloomberg News


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