Shares of Caribou Coffee Co. dropped Thursday after the nation's second-largest coffee chain reported a wider first-quarter loss on declining coffeehouse sales.
Late Wednesday the Brooklyn Center, Minn.-based company reported its first-quarter loss widened to $6.4 million, or 33 cents per share, from a loss of $3.3 million, or 17 cents per share.
Revenue for the period ended March 30 dipped 0.2 percent to $61.8 million from $61.9 million.
Analysts polled by Thomson Financial expected a loss of 14 cents per share on revenue of $62 million. Estimates typically exclude one-time items.
Coffeehouse sales slipped to $56.6 million from $58.1 million a year earlier as same-store coffeehouse sales dropped 2.3 percent.
Same-store sales, or sales at stores open at least a year, is a key indicator of retailer performance because it measures growth at existing stores rather than newly opened ones.
Robert W. Baird & Co.'s David Tarantino said in a client note that he expects same-store sales to be limited in the near term by rising gas costs, the ongoing housing downturn and weaker consumer confidence.
The beverage industry, along with many other sectors, has been squeezed as consumers curb spending because of difficulties such as escalating food costs and eroding credit.
Paul Westra of Cowen and Co. reiterated a "Neutral" rating, saying investors should wait to buy more stock until the company shows it can expand units outside its core Minnesota market. Such growth may be delayed due to softening economic conditions and competition from companies such as Starbucks Corp. and McDonald's Corp., the analyst explained.
Shares of Caribou Coffee shed 11 cents, or 4.1 percent, to $2.55 in afternoon trading. The stock has traded in a 52-week range of $2.40 to $7.43.
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