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

Starbucks Corp., the world’s largest coffee-shop operator, rose in the most in 19 months after yesterday reporting fourth-quarter profit increased as new products helped boost U.S. sales.

Starbucks rose 9.9 percent to $51.25 at 9:41 a.m. in New York, after climbing as much as 10 percent for the biggest intraday gain since March 10, 2011. The shares had advanced 1.3 percent this year through yesterday.

Net income climbed 0.1 percent to $359 million from $358.5 million a year earlier, the Seattle-based company said in a statement yesterday. Profit per share fell 1 cent to 46 cents as the number of shares outstanding increased. Fourth-quarter profit per share included 2 cents of charges related to store closings in Europe. The average estimate of 26 analysts was 45 cents, according to data compiled by Bloomberg.

Chief Executive Officer Howard Schultz has sought to boost sales by selling non-coffee items such as juice, tea and energy drinks at Starbucks shops. The company also recently introduced a single-serve coffee machine, the Verismo, to compete with brewers made by Green Mountain Coffee Roasters Inc. and Nestle SA.

“They’re really searching for life even beyond coffee,” Jack Russo, a St. Louis-based analyst at Edward Jones & Co., said in an interview. “They’re trying to diversify the business model a little bit” and those different things “have all helped” U.S. revenue, he said.

The company said that profit in its fiscal 2013 will be $2.06 a share to $2.15 a share. That compares with a previous projection of $2.04 to $2.14.

Americas Sales

Sales at stores open at least 13 months in the U.S., Canada and Latin America advanced 7 percent in the quarter, helped by the U.S. retail business, Starbucks said in the statement. Analysts estimated a 5.1 percent increase, according to the average of 25 projections from Consensus Metrix.

U.S. consumer confidence rose in October from the month before to the highest level since before the last recession began five years ago. The Thomson Reuters/University of Michigan final consumer sentiment index climbed to 82.6, the highest since September 2007.

Global same-store sales rose 6 percent, compared with the 5 percent analysts’ estimate, according to Consensus Metrix, a researcher owned by Wayne, New Jersey-based Kaul Advisory Group. Same-store sales in the company’s Europe, Middle East and Africa region declined 1 percent in the quarter. Analysts estimated a gain of 0.6 percent.

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