Starbucks 2008 Annual Report Download - page 35

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Fiscal Year Ended
Sep 28,
2008
Sep 30,
2007 % Change
Sep 28,
2008
Sep 30,
2007
As a % of CPG
Total Net Revenues
Net revenues:
Licensing ................................... $392.6 $366.3 7.2% 100.0% 100.0%
Total specialty ............................. 392.6 366.3 7.2 100.0 100.0
Total net revenues increased primarily due to higher royalties and product sales in the international ready-to-drink
business and increased sales of US packaged tea and International club packaged coffee.
Fiscal Year Ended
Sep 28,
2008
Sep 30,
2007 % Change
Sep 28,
2008
Sep 30,
2007
As a % of CPG
Total Net Revenues
Cost of sales ................................... $219.6 $218.3 0.6% 55.9% 59.6%
Other operating expenses.......................... 22.0 19.5 12.8 5.6 5.3
Depreciation and amortization expenses ............... — 0.1 — — —
General and administrative expenses ................. 6.4 6.3 1.6 1.6 1.7
Total operating expenses ........................ 248.0 244.2 1.6 63.2 66.7
Income from equity investees . . .................... 60.7 61.5 (1.3) 15.5 16.8
Operating income ............................ $205.3 $183.6 11.8% 52.3% 50.1%
Growth of operating margin was primarily due to lower cost of sales as a percentage of related revenues, partially
offset by lower income from equity investees. Lower cost of sales was primarily due to a sales mix shift to more
profitable products.
Unallocated Corporate
Unallocated corporate expenses pertain to corporate administrative functions that support, but are not specifically
attributable to the Company’s operating segments.
Fiscal Year Ended
Sep 28,
2008
Sep 30,
2007 % Change
Sep 28,
2008
Sep 30,
2007
As a % of Total Net
Revenues
Depreciation and amortization expenses.............. $ 38.8 $ 34.7 11.8% 0.4% 0.4%
General and administrative expenses ................ 263.9 303.2 (13.0) 2.5 3.2
Restructuring charges ........................... 36.8 — nm 0.4 —
Operating loss .............................. $(339.5) $(337.9) 0.5% (3.3)% (3.6)%
Total unallocated corporate expenses remained relatively flat due to lower payroll-related expenditures, which were
offset by restructuring charges incurred for corporate office facilities that were no longer occupied by the Company
due to the reduction in positions within Starbucks leadership structure and non-store organization.
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