Los Angeles, November 24, 2008 - Starbucks Corp said on Monday it expects sales at established restaurants to decline in its fiscal year ending September 2009, sending shares down 4 percent in extended trade.
Starbucks said in a filing it expects to report negative comparable-store sales for fiscal 2009. It also said lease termination and severance costs from the U.S. and Australia store closures will cut fiscal 2009 earnings by about 12 cents per share.
On November 10, Starbucks executives gave multiple scenarios for what could happen to fiscal 2009 earnings, but declined to issue a new forecast. Analysts at the time interpreted the comments as effectively lowering its full-year outlook.
In fiscal 2008, Starbucks closed 205 of the 600 stores slated to be shuttered by the end of fiscal 2009. It closed 61 Australia stores in August 2008.
Seattle-based Starbucks was feeling the effects of overbuilding in the United States before the economy took a sharp turn for the worse.
Comparable sales fell 5 percent in the United States during fiscal 2008, with results worsening throughout the year. Comparable sales also declined in Canada and the United Kingdom, two of the company's top international markets.
"Management expects the company to continue to face a very difficult economic environment throughout fiscal 2009," in the United States and internationally, including in the two largest company-operated markets, Canada and the United Kingdom, the company said in its filing.
Shares in Starbucks retreated to $8.10 in after-hours trade after rising nearly 8 percent to $8.45 on Nasdaq. About a year ago, Starbucks' stock traded at nearly $23.87.