Starbucks shuts half of China stores amid coronavirus outbreak

Starbucks has closed more than half of its stores in China as a result of the coronavirus and warned that the outbreak will “materially affect” its financial results for the year.
The US-based chain said that as well as the closures it was continuing to “monitor and modify” the opening hours of all stores in the country in response to the spread of the illness.

Starbucks said the moves were “expected to be temporary”.
It added: “Given the dynamic nature of these circumstances, the duration of business disruption, reduced customer traffic and related financial impact cannot reasonably be estimated at this time.”
Starbucks said it was expected to “materially affect” financial results for the year.


“The company will update its guidance for 2020 when we can reasonably estimate the impact of the coronavirus,” it added.

Shares slipped lower in after-hours trading.

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The disclosure about the impact of the coronavirus on the chain came as Starbucks reported better than expected sales growth of 5% for the three months to the end of December.
But the results were overshadowed by the chain becoming the latest business to reveal the impact of the spread of the coronavirus in China, where it has more than 4,000 stores.
McDonald’s has suspended business in five cities in the affected Hubei province while the owner of KFC and Pizza Hut has closed outlets in Wuhan.
Meanwhile, Disney has closed its Shanghai and Hong Kong resorts.

Source : Sky News