Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

INTERVIEW-UPDATE 1-Starbucks sees no slowdown impact on China

Published 01/13/2009, 04:30 AM
Updated 01/13/2009, 04:32 AM
SBUX
-

(Adds details, comments)

By Kirby Chien

BEIJING, Jan 13 (Reuters) - Starbucks Corp said on Tuesday that it had not seen any impact on its China business even as it closes stores in other markets, and expected its growth in the mainland to accelerate down the road.

China accounts for just over 350 stores out of Starbucks' global portfolio of some 17,000, but is one of its fastest growing markets, Martin Coles, president of Starbucks Coffee Co International, told Reuters in an interview.

"We have not seen a drop-off at all in the demand for Starbucks in China," he said.

Coles did not give any growth forecast for China, saying only it would take less than 10 years to open the next 350 stores.

"We have seen an acceleration in our (China) business," he said at an event marking the firm's first 10 years in China.

"International is the future engine for our company."

The comments come as Starbucks has already closed 205 of the 600 stores due to be shut by the end of fiscal 2009, and also lowered its forecast for fiscal 2009 net new international stores to 700 from 900.

Part of Starbucks' push into China includes increasing the current small amount of coffee it sources from the mainland.

"This is about how we introduce China coffee to the world," said the executive, seated on a sofa at one of the coffee shop operator's newest stores in Beijing.

Starbucks will sign cooperation agreements in the next couple of days with local governments in southern Yunnan province aimed at helping farmers increase coffee yields and improve quality.

"Our ambition is to have a far greater presence in Greater China," he said.

The China outlook contrasts sharply with the company's recent earnings results.

Starbucks' net profit for the fiscal fourth quarter ended Sept. 28 dropped 97 percent to $5.4 million, while comparable sales fell 5 percent in the United States during fiscal 2008, with results worsening throughout the year.

($=6.84 yuan) (Reporting by Kirby Chien; Editing by Nick Macfie)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.