Starbucks Corporation (NASDAQ:SBUX) recently reported its third quarter earnings and discussed the following topics in its earnings conference call.
Sharon Zackfia – William Blair: I guess, Troy, I’m going to take the easy question. I guess the comment on the comp trend not continuing that you saw in the third quarter, is there anything you are seeing specifically or anything you would like to comment on?
Troy Alstead – CFO and Chief Administrative Officer: No, that is not a message whatsoever about early trends in the fourth quarter at all. We’re not making any comments about current quarter trends as usual. That is potentially a message that the 9% comp growth in the U.S. – in the Americas in the third quarter was really a breakthrough quarter, it’s phenomenal as you know on a system size of ours. A number of fantastic things all came together in that quarter to contribute to that kind of level of comp growth. So, as we look at Q4, as we look at fiscal ’14, we expect very strong, very healthy, very consistent same-store sales growth more in line with what we saw in the first half of the year and that’s just recognition of product innovation, the loyalty program, the great experience we’re providing to our customers in the stores.
La Boulange Outlook
John Ivankoe – JPMorgan: You mentioned foods impact to this quarter and you’re achieving that without La Boulange, so I was just hoping to take this opportunity to talk about how significant La Boulange has been in your early test and what we should really expect to see from a customer receptivity point of view for the breakfast and the lunch product as we go forward into ’14 and ’15? And, of course, I asked this in terms of your comp guidance in 2014, which is obviously lower than what you just achieved it seems like food at least is one thing that could be significantly more accretive into 2014 than it was for 2013?
Troy Alstead – CFO and Chief Administrative Officer: Let me have Cliff speak to clearly, in particular, what we are seeing in La Boulange now and then I will come back and talk with you about the comp guidance for next year.
Cliff Burrows – President, Americas: You know our strategy on this, John, we said we were going to acquire La Boulange to enhance the customer experience and leverage food as part of our future growth strategy and I am delighted to say in every market we have introduced La Boulange so far has been extremely well received. The product is fantastic and we are seeing really, really encouraging results. So, the strategy is being justified and we are now through 1,000 stores by the end of Q3 and every market we open we are seeing great reception, particularly around the pastries, the croissants which is the core product of the La Boulange and it gives every confidence that we are on the road to a fantastic food platform will start with breakfast, we will then enhance lunch and the opportunity to enhance the current experience for the customers and grow sales is really strong. Looking forward to ’14 and ’15 then I am extremely optimistic that this will be a platform for growth and as we realize the results we will share more in the coming quarters.
Troy Alstead – CFO and Chief Administrative Officer: John, just typically guidance on ’14. What I would tell you is we have very good confidence in our ability, very sustainably continue to drive healthy comp growth for our stores through innovation in our stores, through productivity enhancements, through the loyalty program and yes through new things such as the La Boulange, which as Cliff mentioned in our experience so far in our stores has just been nothing short of phenomenal and we are quite confident that as La Boulange rolls throughout the system it will be a layer of comp growth for us in the system. Now with that said, as you will know comp growth doesn’t trend as a percentage, you’ve got to recreate at every single quarter and every single year with new innovation, with great experiences with new frequency among our customers and so we firmly believe that innovation such as Evolution Fresh, such as Teavana coming into the stores, such as La Boulange and (NYSE:HAS) food program all those things and many others are what allowed us to steep the confidence about our ability to drive consistent healthy comp growth into the year ahead.