Starbucks UK reports 2% revenue loss for FY 2017
The coffee chain’s presence in Europe, Middle East, and Africa (EMEA) region also generated a 5% turnover increase.
Starbucks UK has reported that its financial results for fiscal year ended last October 1, 2017 had seen a 2% decline in terms of its total revenue to £372 million compared to 2016.
Its loss was blamed on the coffee chain’s moves to transfer company-operated stores to local licensee business partners, which is a part of their overall strategy to improve profitability.
Despite the decrease, they also added that their like-for-like sales went up to 1.2% Operating costs also increased to £301 million as the company claims that it is driven by ongoing investment into higher quality products.
Operating profit also decreased to £0.7 million from £6.4 million in the prior period. Pre-tax profits are reported to be £4.5 million from last year’s £13.4 million.
"These results demonstrate our commitment to quality and delivering the best customer experience, through investment and innovation. It’s still challenging to operate in the UK, as one of the world’s most competitive coffee markets, but we will continue to invest for long-term growth,” Martin Brok, president for Starbucks EMEA, said.
Financial Times also reported that Starbucks EMEA paid the effective UK tax rate of 2.8% for FY17, totalling to USD$5.9 million on profits of USD$213 million.
Their tax bill is said to have cut down as “tax effect of expenses that are not deductible in determining taxable profit.” However, the company reported that they paid a total corporation tax of £13.7 million (USD$18.3 million).
Meanwhile, Starbucks EMEA also announced that 47 of their employees have recently finished from the company’s apprenticeship programme.
Last 2015, they vowed to create around 1000 apprenticeship places by 2020.
“Apprenticeships work for our business and our people, providing the catalyst for growth and progression. We have numerous partners who have progressed through different apprenticeship programmes, culminating in our first ever higher-level management graduates - a landmark milestone and a very proud moment for us all,” Russell Butcher, Starbucks’ senior manager for education, skills and qualifications, said.
