Starbucks Conference Call Highlights

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Starbucks Corporation SBUX reported its third quarter earnings. Shares of the company are down 3 percent.

Below are some key highlights from its conference call.

• Meaningful contributions from each of our business units drove a better than 10% increase in Q4 revenues, to a record $4.2 billion.
• While improved store operations enabled us to deliver an elevated experience for our customers and our 19th consecutive quarter of comp store sales growth at or above 5%.
• Sales leverage, increased operating efficiency, and disciplined expense management each contributed to a 280 basis point increase in operating margin over last year to a record 20.5%.
• For the full fiscal year, Starbucks grew revenues by 11% to a record $16.4 billion.
• Posted global comp store sales growth of 6%, squarely in line with our targets, and grew non-GAAP EPS by 21% to a record $2.66 per share.
• Starbucks benefited enormously from the consumer shift towards gift giving cards instead of traditional physical goods.
• For us, that translated into our record card sales, roughly one in eight Americans receiving a Starbucks gift card, and $1.4 billion in Q1 card loads last fiscal year.
• Starbucks is approaching 1,400 stores in China, and customer engagement with our brand has never been stronger.
• We continue to expand and leverage our mobile, digital, and loyalty assets and become an increasing relevant part of the daily ritual for a rapidly growing customer base.
• Turning to Japan. Last month, we entered into an agreement to acquire the shares in Starbucks Japan we did not already own.
• Opened in 1996 in our first country market outside of North America, Japan today represents over 1,000 stores.
• Besides being EPS-accretive in year one, when completed, the transaction will enable us to increase the pace of new store openings that have benefited us in the U.S., China, and certainly in other markets around the world.
• Expand the availability of Starbucks products in multiple CPG channels.
• We will also be able to leverage more fully our loyalty digital mobile and new product development programs in Japan.
• Starbucks store, that means we had 90% share of mobile payments in 2013, while bricks-and-mortar commerce in 2013 totaled more than $4.2 trillion.
• Already, close to 7 million transactions per week, 16% of all transactions conducted in U.S. Starbucks stores, occurs via a customer's use of a mobile device.
• Our fourth quarter results were strong once again. Total net revenue grew 21% to $310 million in Q4, a new all-time record

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Posted In: EarningsNewsconference call
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