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Starbucks China and Asia-Pacific Segment Reports Record Sales
The Starbucks China and Asia-Pacific segment grew 85% to $495 million, up from $266 million year-over-year.
The Starbucks year-to-date return was 7.5% compared to an average return of 4.9% among its rivals.
Starbucks will sell small-lot, rare, and limited coffees that offer a more premium experience to its customers.
Starbucks net profit margins were up to 20% compared to 13% in the first quarter of 2014. Net income nearly doubled year-over-year.
Share volume was ~18 million shares compared to the 90-day average daily volume of ~5 million shares. Starbucks stocks closed at $88.12, up 6.5%.
Starbucks operating income grew 13% to $916 million, and the operating margin came in at 19.1%. Its EBITDA margin was 23.3%.
In the restaurant sector, the cost of doing business include food costs, occupancy costs, labor, and general and administrative costs.
Channel development contributed 9.2% toward Starbucks (SBUX) revenues in 1Q 2015. Alternate channels are a good way to diversify revenue streams.
By opening Teavana Fine Teas and Tea Bars, Starbucks has shown how it’s focused on generating revenues from relevant products.
Starbucks unit growth saw increases across all segments in 1Q 2015. Most net unit additions came in the China and Asia-Pacific segment.
Starbucks Mobile transactions represented 16% of the company’s total as of 1Q 2015, with an average of 7 million mobile transactions per week.
Last quarter, Starbucks US traffic and traffic worldwide had a more pronounced impact on same-store sales than the ticket.
Same-store sales are an important indicator in the restaurant industry and directly drive revenues. Starbucks same-store sales increased by 5% worldwide.
Starbucks reported revenues of $4.8 billion, a 13% increase over $4.2 billion reported in the same quarter last year.
Brinker International’s earnings for th second quarter of 2015 are due on January 28. Year-to-date, the stock increased 3.5% as of the January 16.
EBITDA margins are expected to increase to 14.6% from 13.8%. Sequentially, too, margins are expected to increase from 12.6% in the first quarter of 2015.
The prices of poultry, meat, dairy, seafood, and produce remained stable in November and December. So EAT may report moderated food costs.
Wall Street analysts estimate that the company’s unit growth will add 14 new Chili’s restaurants in the upcoming quarter.
Brinker International (EAT) has also made progress towards integrating more a digital platform in its restaurants—particularly Chili’s.
“Fresh is Happening Now” was one of the marketing initiatives the company launched during the year.