SEATTLE – Howard Schultz, chairman, president and ceo of Starbucks Coffee Company, opened the company’s Annual Meeting of Shareholders by showcasing how Starbucks 200,000 partners (employees) are leveraging the company’s unique combination of physical and digital assets to deliver long-term global growth through the lens of humanity.
“We’re still in the early stages of the growth and development of Starbucks, we’re delivering record profits and revenue, sharing our success with our partners and heading towards and past a $100 billion market cap,” said Schultz.
“No other brick-and-mortar retailer matches our size and growth profile nor the relevancy and strength of the Starbucks brand. Together we’re building one of the world’s most trusted, admired and enduring brands, and redefining the role of a public company while we do it. There has never been a more exciting time to be a Starbucks partner and shareholder.”
Delivering Record Performance through the Lens of Humanity
Legendary American television writer and producer Norman Lear kicked-off the meeting by introducing the Playing For Change Band, whose third album will be available in select Starbucks stores in June.
Schultz then highlighted the company’s significant achievements over the six years since Starbucks returned from the height of the cataclysmic financial crisis in November 2008 following the implementation of the company’s 2008 Transformation Agenda and 2011 Blueprint for Profitable Growth, including:
- Stock price growth of 948 percent;
- Market cap expansion from $5 billion to $57 billion;
- A more than ten-fold increase in total shareholder return; and
- Serving more than 70 million customers per week in more than 20,000 stores in 64 countries.
Schultz and Starbucks chief operating officer Troy Alstead also highlighted the company’s significant accomplishments since last year’s meeting, including:
- Record revenues of $14.9 billion (12 percent growth) and record earnings per share of $2.261 (26 percent growth) in fiscal 2013;
- $2.5 billion2 in net operating income (23 percent growth) in fiscal 2013;
- 55 percent total shareholder return in fiscal 2013, following a 38 percent return in fiscal 2012 and a 46 percent return in fiscal 2011;
- Four years of seven percent or greater global comp growth; and
- $1.2 billion in cash returned to shareholders in the form of dividends and share repurchases.
With $15 billion in revenue and an average sale of $5, Schultz emphasized the importance of the unique relationship Starbucks partners have built with customers around the world, and attributed the company’s success to partners’ contributions.
“The equity of the Starbucks brand has been built by the experience, which comes to life through our partners and the relationships they have with our customers,” Schultz said. “At a time when many companies are cutting benefits, we are continuing to invest in our most important assets: our people.”
Last year Starbucks invested $250 million in healthcare benefits for eligible full and part-timers, shared $234 million in pre-tax stock gains with partners, and matched $50 million in 401(k) contributions. Since the company started offering equity to partners in 1991, it has shared more than $1 billion in value in the form of stock with partners at every level of the company.
Schultz also highlighted how the company is redefining the role and responsibility of a public company in response to critical societal challenges, citing several examples:
Create Jobs for USA: In 2011 amid greater than nine percent unemployment rate, Starbucks collaborated with the non-profit Opportunity Finance Network to launch the Create Jobs for USA program, which funds loans to small businesses who face challenges getting credit.
The effort has raised $15 million, which has been leveraged to deliver $105 million in loans and create or retain more than 5,000 jobs over the past several years.
Come Together: Last October in the middle of the 16-day federal government shutdown which cost the country $2 billion in lost productivity and more than 120,000 private sector jobs, Starbucks launched a nationwide petition in its more than 7,000 company-operated U.S. stores urging the government to re-open, pay its debts on time and reach a long-term, bipartisan budget deal by the end of the year.
In less than a week, the company collected and delivered nearly two million signatures to the U.S. Congress and the White House.
Veterans and Military Families: More than one million service members will transition back to civilian life after a decade of war over the next several years, facing an unemployment rate that is more than double the national average despite having valuable skills and directly transferable experience that can benefit many of the nation’s top-performing companies and non-profit organizations.
