Starbucks profit jumped led by food sales

Starbucks Corp. Chief Executive Officer Howard Schultz’s shift into food is starting to pay off, driving traffic into U.S. stores and lifting sales and profit.

Starbucks’s fiscal third-quarter net income advanced 25% to $417.8 million, or 55 cents a share, from $333.1 million, or 43 cents, a year earlier, the coffee shop chain said yesterday in a statement. Analysts projected 53 cents a share, the average of 28 estimates compiled by Bloomberg.

“Foods have been phenomenal for us,” Chief Financial Officer Troy Alstead said during an interview, cited by Bloomberg. Refreshers energy drinks and macchiato espresso coffees also helped U.S. sales during the quarter, he said.

Revenue advanced 13% to $3.74 billion in the three months ended June 30, and according to analysts estimates it will increase 12% to $14.8 billion in the company’s fiscal 2013. The shares rose 6.5% to $72.58 at 7:43 a.m. in New York. Starbucks added 27% this year through the close of regular trading yesterday, compared with a 15% increase for the Standard & Poor’s 500 Restaurants Index. Sales at stores open at least 13 months gained 9% in the Americas, topping the 6.1% average of 22 analysts’ estimates compiled by Consensus Metrix.

Starbucks raised prices for some of its offerings at U.S. company operated cafes last month. “They’re positioned like an affordable luxury,” Peter Saleh, a New York-based analyst at Telsey Advisory Group, said in an interview. “Even if they take a couple percentage points in price, I don’t think that people notice.”

Starbucks increased its forecast for fiscal 2013 profit excluding certain items to as much as $2.23 a share from a previous estimate of as much as $2.18. Analysts project $2.18 a share, on average.

Profit in the company’s fourth quarter will be as much as 60 cents a share, which includes a 3-cent gain from the sale of its equity in some operations in Argentina and Chile, Starbucks said. That compares with analysts’ average estimate of 57 cents.