Peet's sees profit jump in fourth-quarter

EMERYVILLE, Calif. - Peet's Coffee & Tea Inc. said after the market closed Thursday that its investments in the business are paying off as the company's profit jumped 21 percent in the fourth-quarter.

The coffee and tea chain said its net income grew to $4 million, or 29 cents per share, compared with $3.3 million, or 23 cents per share, for the same quarter last year.

Revenue grew 12 percent to $79.1 million from $70.9 million.

Analysts expected Peet's to earn $3.8 million, or 28 cents per share for the quarter on $80.6 million in revenue.

Patrick O'Dea, president and chief executive officer of Peet's said the company is proud of the results and said productivity improvements from past investments are improving margins for the company.

For the full 2008 fiscal year, the Emeryville, Calif.-based company said net income grew to $11.2 million, or 80 cents per share, compared with $8.4 million, or 59 cents per share, in 2007. The 2007 results include a $900,000, or 6 cents per share, cost for stock option review professional fees.

The company also reaffirmed its guidance for 2009. It expects to earn 94 cents to $1 per share for the year. Peet's also said it plans to open 10 new retail site and 30 to 40 licensed locations.

"Clearly, 2009 will be a challenging year for all businesses," O'Dea said. "I believe, however, we are better positioned than most to continue delivering strong earnings growth."

The company carries no debt and has $13 million of cash on hand.

The strong quarter report from Peet's comes the same week as its larger competitor Starbucks Corp. told about 1,370 employees that their jobs will be cut as the Seattle company tried to control costs by closing stores and laying off employees.

Shares of Peet's fell slightly, dropping 29 cents to close at $20.69 Thursday.

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