Shares of Peet's Coffee & Tea, Inc. (PEET) fell more than 3 percent in extended trade on Tuesday after the company reported a 39 percent decline in first-quarter profit, as higher revenues were offset by coffee cost inflation.
Both earnings and revenue missed analysts' estimates. However, the company reaffirmed its earnings and revenue growth outlook for fiscal 2012.
Patrick O'Dea, president and CEO of Peet's Coffee & Tea, said, "We knew the first half of 2012 would be challenging for us. In the first quarter we faced the highest coffee cost inflation of the year, and while our results reflect it, they were in line with our expectations."
The Emeryville, California-based specialty coffee and tea company said its retail net revenue increased 4 percent to $54.12 million, driven by a 5 percent rise in sales of beverages and pastries as well as an increase in whole-bean and related sales.
Specialty net revenue rose 12 percent from the year-ago period to $40.66 million. Within specialty, grocery sales increased 12 percent, foodservice and office sales grew 16 percent, and home delivery sales were flat. Cost of sales and related occupancy expenses increased as a percent of total net revenue to 51 percent for the quarter, compared to 46.6 percent for the corresponding period last year. The increase was caused by higher green coffee cost, which was 44 percent more expensive per pound than the same quarter last year.
Peet's first-quarter net income was $3.38 million or $0.25 per share, down from $5.51 million or $0.41 per share in the year-ago period.
On average, nine analysts polled by Thomson Reuters expected earnings of $0.31 per share for the quarter. Analysts' estimates typically exclude one-time items.
Net revenues for the quarter grew 7 percent to $94.77 million from $88.47 million in the same period last year, but missed analysts' consensus estimate of $96.87 million.
Looking ahead to fiscal year 2012, Peet's reaffirmed its earnings outlook in a range of $1.70 to $1.80 per share and net revenue growth of around 10 percent. Analysts currently expect earnings of $1.78 per share for the year on revenues of $409.15 million.
CEO Patrick O'Dea said, "As we previously indicated, we expect to gain significant momentum in the second half as coffee cost inflation abates, and we remain excited about the strategic growth initiatives we're investing in this year."
PEET closed Tuesday's trading at $75.23, down $1.59 or 2.07 percent on a volume of 141,000 shares. In after-hours, the stock further declined $2.78 or 3.70 percent to $72.45.
For comments and feedback contact: editorial@rttnews.com
Business News
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.