Starbucks, the giant of the coffee shop world, will power ahead with its quest for global caffeine domination by opening another 1,800 new stores this year.
This is more than the Seattle-based group has ever opened in a single year before. Just under one-third of the new stores will outside the US, the company said. Starbucks already dominates the UK coffee house market with about 500 stores.
Details of its expansion plans came as the group revealed that its fourth quarter earnings had soared by 21 per cent, beating estimates on Wall Street. Investors had hoped this would prompt the company to boost its outlook for next year, but it held back.
The US group has earmarked China as the most exciting overseas market. Although it makes a profit in the world's most populous nation, its finance director, Michael Casey, said it would be willing to stomach a few years of losses to pursue the "biggest opportunity outside North America". To date it has opened 200 stores in China.
The company, which buys 2 per cent of all the coffee produced in the world, said imaginative new drinks such as its green tea Frappuccinos had enticed consumers into its ubiquitous stores.
Yesterday it announced a further push into the breakfast market as it seeks to boost its appeal beyond coffees and teas. It plans to offer hot breakfast sandwiches by the end of the year in about 600 US stores - some 8 per cent of its existing US shops.
As the group has expanded around the world its fixed costs have shrunk, allowing the benefit of extra sales to fall through to its bottom line. Net income for the three months to 2 October rose to $124m, or 16 cents per share, from $103m, or 12 cents per share, a year ago.Reuse content