On Tuesday we reported on Starbucks rumoured to cut more jobs. Wednesday it was official: 6,700 jobs must go. The world’s largest chain of coffee shops said it will cut 6,700 jobs as well as close 300 further stores after reporting first quarter profit that fell more than analysts estimated.

From the 6,700 jobs around 6,000 will be store jobs and 700 at corporate level. The 300 locations to go are ontop of the 600 the company announced it will close last year. 200 stores will be closed in the U.S. and 100 around the globe.

Consolidated net revenues were $2.6 billion for the first quarter of fiscal 2009, a decrease of six percent, compared with $2.8 billion for the first quarter of 2008, driven by a decline in consolidated comparable store sales of nine percent. During the quarter, the company recognized $75.5 million in pre-tax restructuring charges, primarily related to the U.S. company-operated store closures, which impacted first quarter of fiscal 2009 earnings per share (EPS) by approximately $0.06 per share. For the 13-week period ended December 28, 2008, Starbucks reported net income of $64.3 million and non-GAAP net income of $113.1 million, compared with reported net income of $208.1 million for the same period a year ago. Earnings per share for the quarter was $0.09 and non-GAAP EPS was $0.15, compared with reported EPS of $0.28 in the first quarter of fiscal 2008.

“In the midst of the weakening global consumer environment, Starbucks is following a well-developed plan to strengthen our business through more efficient operations and by preserving the fundamental strengths and values of our brand,” commented Howard Schultz, chairman, president and ceo. “We remain focused on driving the discipline and rigor necessary to create long-term shareholder value, and we are taking aggressive steps to excite customers by providing relevant value and innovation, even during this challenging time.”

Actions to tighten the belt

Starbucks today announced the following actions aimed at aligning its business with the current operating environment:

As a result of the ongoing, rigorous evaluation of its global store portfolio, the company plans to close approximately 300 additional underperforming company-operated stores, approximately 200 in the U.S. and the remainder in international markets. These stores are in addition to the approximately 600 U.S. and 61 Australian market store closures announced in July 2008. The majority of the new store closures are expected to occur during the remainder of fiscal 2009.

Starbucks has further reduced its fiscal 2009 new company-operated store openings target in the U.S. to 140 new stores from its previous target of 200 new stores. Internationally, the company now plans to open 170 new stores in fiscal 2009, down from the company’s previous expectation to open 270 new stores. Accordingly, capital expenditures for fiscal 2009 are now expected to be approximately $600 million, a $100 million reduction from the company’s previous estimate. The company has also lowered its net new licensed store opening target, and is now expecting to open approximately 125 net new licensed stores in the U.S. and approximately 360 net new licensed stores internationally.

The company anticipates that the store closures, combined with reduced store openings for fiscal 2009 and other labor efficiency initiatives, could result in a reduction of as many as 6,000 store positions over the course of fiscal 2009. Wherever possible, Starbucks plans to place affected store employees (partners) elsewhere in its store organization.

As part of the effort to align the company’s non-retail support organization with the current operating environment, Starbucks plans a global workforce reduction that will result in approximately 700 non-store partners being separated.

Starbucks shares have lost 51% in value over the past 12 months. Shares closed Wednesday at $9.65 and are currently trading at $9.72.