Company Recognizes the Contributions of its 200,000 Global Partners
(Employees) in Delivering Record Financial Performance and a 38% Total
Return to Shareholders in Fiscal 2012, Reaffirms Long-Term Growth Targets
SEATTLE--(BUSINESS WIRE)--Mar. 20, 2013--
Howard Schultz, chairman, president and ceo of Starbucks Coffee Company
(NASDAQ:SBUX), opened the company’s Annual Meeting of Shareholders by
recognizing company partners (employees) and highlighting the company’s
continuing robust operating performance. Schultz and other company
executives announced a breakthrough innovation in Starbucks loyalty and
rewards program, shared progress and future plans for its recent La
Boulange, Evolution Fresh and Teavana acquisitions and offered a
comprehensive overview of how Starbucks is using its global scale to
create positive, local impact in the communities where it operates and
where its partners and customers live and work.
Annual meeting highlights included:
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Thanks and appreciation from company shareholders via webcast to the
200,000 Starbucks partners around the world who deliver the Starbucks
Experience to over 70 million customers in 62 countries each week.
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The announcement by Adam Brotman, chief digital officer, of an
expansion of the company’s loyalty and rewards program, and an
industry-first innovation that will enable customers to earn rewards
for grocery channel purchases that can be redeemed in Starbucks retail
stores and is expected to double the number of customers enrolled in
the company’s programs in fiscal 2013.
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Brotman also announced that Starbucks mobile payment platform is now
generating over three million U.S. mobile payment transactions per
week.
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Blair Taylor, Starbucks chief community officer, announced the launch
of a new nonprofit corporation with a $1 million seed grant to
introduce job skills, leadership and apprenticeship programs to young
people across the company’s multi-billion-dollar supply chain, and
further expansion of the company’s support for U.S. manufacturing
through an order for 100,000 ceramic mugs from a supplier in Ohio
whose operations Starbucks helped expand through previous purchasing
commitments.
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A discussion by Troy Alstead, chief financial officer, of
region-by-region and individual segment performance for fiscal 2012
and a reaffirmation of the company’s fiscal 2013 revenue and EPS
growth targets.
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Schultz’s recognition of Starbucks 15-year business partnership with
Mohammed Alshaya, Executive Chairman, M.H. Alshaya Co., including
comments about how bringing specialty coffee to the Middle East serves
as a model for the company’s future expansion initiatives.
“The opportunity we have to create value for our shareholders is
exceeded only by our unique ability to contribute meaningfully to the
communities we serve around the world,” said Schultz. “From leveraging
and expanding our strong global business partnerships, to bringing
innovation to our customers and each of the markets and channels in
which we operate, to expanding our broad array of digital customer touch
points and deepening our ethical sourcing model, Starbucks is continuing
to grow with passion and intent to become one of the world’s most
relevant, admired and trusted brands.”
Starbucks Continues its Robust Trajectory of Growth and Profitability
Schultz opened the annual meeting by asking Starbucks shareholders to
stand and recognize the company’s 200,000 partners around the world who
deliver the Starbucks Experience to customers each day, then
highlighted key accomplishments since last year’s meeting:
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Record revenues of $13.3 billion and record earnings per share of
$1.79 in fiscal 2012,
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38% total shareholder return in 2012, following a 46% return in 2011
and a 32% return in 2010,
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14% revenue growth in 2012, capping off the eleventh consecutive
quarter of 5%+ global comp store sales growth,
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18% earnings per share growth in 2012 despite significant commodity
headwinds, and
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Continued outperformance of key industry financial performance
metrics, record cash flow of $1.8 billion, record returns on invested
capital of 22.4% and over $1.1 billion returned to shareholders
through dividends and share repurchases in 2012.
Digital and Loyalty Momentum Around the World
Starbucks world-class My Starbucks Rewards™ loyalty program continues to
resonate with customers, driving increased revenue, traffic and
purchases and further differentiating Starbucks from competitors. Adam
Brotman, chief digital officer, announced the exciting evolution of the
My Starbucks Rewards™ loyalty program into the world’s first
cross-channel, multi-brand loyalty program, reflecting further
successful execution against the company’s Blueprint for Profitable
Growth strategy. Key highlights of the new program:
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Beginning in May, customers will earn My Starbucks Rewards™ Stars for
purchases of Starbucks packaged coffee in grocery channels. These
Stars can then be redeemed for free food or beverages in Starbucks
retail stores. The program is expected to be expanded to include other
Starbucks products sold through grocery channels this fall.
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Integration of the Starbucks Card and My Starbucks Rewards™ loyalty
program across several of its emerging brands, including Teavana.
Beginning next month, registered customers who make purchases with a
Starbucks Card or through the Starbucks mobile app at any of over 300
Teavana retail stores will be able to earn Stars for their purchases.
Together, Brotman reported, these new program innovations are expected
to contribute towards a rapid and substantial increase in My Starbucks
Rewards™ membership, from 4.5 million active members at the end of
October 2012 to approximately 9 million members by the end of
fiscal 2013.
In January 2011, Starbucks became the first national retailer to offer
its own mobile payment technology combined with a world-class loyalty
program, and the company now generates over three million mobile
transactions each week in the U.S. alone – accounting for
approximately 10% of total U.S. tender (Starbucks card, broadly,
represents 1 in 3 transactions in the U.S.). New mobile users report
that they are embracing the Starbucks mobile payment experience because
of the benefits they receive and because it enables them to track their
loyalty status in an interactive and engaging way directly on their
mobile device.
Also highlighted at the meeting was the five-year anniversary of My
Starbucks Idea, the company’s online community that encourages customers
to share their ideas, engage in conversation and have a voice in shaping
the Starbucks of the future. Found on the web at www.MyStarbucksIdea.com,
over the last five years My Starbucks Idea has received over 150,000
submissions from customers around the world that have helped launch 275
ideas into Starbucks stores.
Leveraging Global Scale for Local Good
With more than 200,000 partners in more than 18,000 stores in 62
countries around the world, Starbucks growth has also enabled the
company to leverage its global operational scale for good in a variety
of different ways across the enterprise.
Blair Taylor, chief community officer, affirmed Starbucks commitment to
U.S. manufacturing and announced a first-of-its-kind supply chain
initiative that will leverage Starbucks multi-billion-dollar network to
create leadership and job skills training for disengaged youth.
Highlights of Taylor’s discussion include:
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Made in the U.S.A.: Starting in the fall, American Pioneer
Manufacturing will begin producing a Starbucks siren mug that
represents a core product in the company’s overall drinkware lineup.
Based in New Waterford, Ohio, this automated facility is the first of
its kind in an historic potting community. To help build capacity for
the new facility, Starbucks has placed an initial order for 100,000
units for delivery in the fall and is making the mug available for
purchase in U.S. stores starting in winter. As a result, American
Pioneer Manufacturing expects to hire as many as 20 U.S. workers by
the end of the year.
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Supply Chain Coalition: Building on the learnings and success
of the Starbucks Youth Grants initiative, Starbucks also announced an
initial $1 million grant for the development of a nonprofit
corporation – LeadersUp – that will tap into Starbucks supply chain to
bring new job and leadership skills training to young people with the
eventual linking of trainees to job experiences within our collective
companies and beyond. In the first year, this organization has the
goal to raise $10 million to support this work over the next year,
with a long-term strategy of establishing up to a $100 million annual
fund.
Earlier this week, Starbucks also announced the purchase of a
240-hectare coffee farm as part of its ongoing commitment to ethically
source 100 percent of its coffee by 2015:
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Sustainable Farming Investment: To help farming communities
around the world mitigate climate change impact and ensure long-term
crop stability, Starbucks will expand its existing $70 million
comprehensive ethical sourcing program with a new coffee farming
research and development center in Costa Rica. The company will adapt
this 240-hectare working coffee farm into a global agronomy center,
expanding its Coffee and Farming Equity practices (C.A.F.E.) program
that seeks to ensure coffee quality while promoting social,
environmental and economic standards.
About Starbucks Corporation:
Since 1971, Starbucks Coffee Company has been committed to ethically
sourcing and roasting high-quality arabica coffee. Today, with
stores around the globe, the company is the premier roaster and retailer
of specialty coffee in the world. Through our unwavering commitment to
excellence and our guiding principles, we bring the unique Starbucks
Experience to life for every customer through every cup. To share in
the experience, please visit us in our stores or online at www.starbucks.com.
Source: Starbucks Coffee Company
Starbucks Coffee Company
Media Relations, 206-318-7100
press@starbucks.com