Food and tea hoists Starbucks sales

Increased food and tea offerings at Starbucks advanced sales and traffic to the world's largest coffee chain.

Profits at Starbucks rose 16 per cent to $495m, or 33 cents per share, in the three months to the end of March from a year earlier, as traffic at its stores climbed and the company took greater control of its Japanese business. Sales rose 18 per cent to $4.56bn.

Wall St analysts expected the Seattle-based company to report earnings of 32 cents a share and sales of $4.53bn.

Starbucks shares, which have climbed 20 per cent this year, rose another 5 per cent in after-hours trading.

Starbucks has invested recently in new food offerings in a bid to buoy sales, opening its first ever tasting room late last year in Seattle, with plans to test delivery service in some metro areas.

Same-store sales climbed 7 per cent in the period, ahead of forecasts for a 5 per cent gain.

Sales in the Americas advanced 11 per cent from the year ago period, offsetting a 10 per cent fall in revenues in Europe, the Middle East and Africa as the US dollar slices results of multinationals translating results from the euro and other currencies back into the greenback.

In China and Asia Pacific sales jumped 124 per cent, largely a result of Starbucks taking increasing control of its Japanese business.

Howard Schultz, chief executive, said: "Innovation is the force that will continue to drive our business and enable us to expand and increase revenues and profits - always through the lens of humanity - long into the future."

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