Starbucks vs. Peet's Coffee & Tea Inc. (incl.

Diedrich Coffee) - 10 y

SBUX
2008 2007 2006 2005 2004 2003 2002
Revenues $9,775 $10,383 $9,412 $7,787 $6,369 $5,294 $4,076
less: COGS 7,750 8,390 7,215 5,867 4,771 3,982 3,061
Gross Profit $2,025 $1,993 $2,196 $1,920 $1,598 $1,313 $1,015
less: SG&A 453 456 489 479 362 304 245
EBITDA $1,572 $1,537 $1,707 $1,441 $1,237 $1,008 $770
less: D&A 535 549 467 387 340 289 245
EBIT $1,037 $987 $1,240 $1,054 $896 $719 $525
less: Operating Leases 715 741 638 499 417 338 273
less: Taxes 168 144 384 325 302 232 167
NOPAT $154 $102 $218 $230 $178 $149 $85

Total Debt $550 $1,263 $1,261 $703 $281 $4 $5

PV of Operating Leases 4,389 5,098 5,017 3,893 3,097 2,609 2,259
Total Preferred Stock 0 0 0 0 0 0 0
Total Equity 3,046 2,491 2,284 2,229 2,090 2,470 2,071
Total Capital $7,984 $8,852 $8,562 $6,824 $5,468 $5,084 $4,336

ROIC 1.7% 1.2% 3.2% 4.2% 3.5% 3.4% 2.3%

Gross Margin 20.7% 19.2% 23.3% 24.7% 25.1% 24.8% 24.9%

EBITDA Margin 16.1% 14.8% 18.1% 18.5% 19.4% 19.0% 18.9%
EBIT Margin 10.6% 9.5% 13.2% 13.5% 14.1% 13.6% 12.9%
NOPAT Margin 1.6% 1.0% 2.3% 3.0% 2.8% 2.8% 2.1%

Debt/EBITDA 0.35x 0.82x 0.74x 0.49x 0.23x 0.00x 0.01x

Debt/Total Capital 6.9% 14.3% 14.7% 10.3% 5.1% 0.1% 0.1%

CFO $1,389 $1,259 $1,331 $1,132 $923 $863 $616

Capex 446 985 1,080 771 643 417 378
FCF $943 $274 $251 $360 $280 $446 $238

CFO / Revs 14.2% 12.1% 14.1% 14.5% 14.5% 16.3% 15.1%

Capex / Revs 4.6% 9.5% 11.5% 9.9% 10.1% 7.9% 9.3%
FCF / Revs 9.7% 2.6% 2.7% 4.6% 4.4% 8.4% 5.8%

Total Assets $5,577 $5,673 $5,344 $4,429 $3,514 $3,387 $2,779

Asset Turnover 1.75x 1.83x 1.76x 1.76x 1.81x 1.56x 1.47x

Issuance of Stock $57 $112 $177 $159 $164 $138 $107

Repurchase of Stock 0 (311) (997) (854) (1,114) (203) (76)
Net Repurchases $57 $424 $1,174 $1,013 $1,277 $341 $183
Dividends 0 0 0 0 0 0 0
Return of Capital $57 $424 $1,174 $1,013 $1,277 $341 $183

RoC/CFO 4.1% 33.7% 88.2% 89.5% 138.4% 39.5% 29.7%

PEET
2008 2007 2006 2005 2004 2003 2002
Revenues $285 $249 $210 $175 $146 $120 $104
less: COGS 134 118 99 81 68 55 48
Gross Profit $151 $131 $112 $94 $78 $65 $56
less: SG&A 23 23 21 13 11 10 11
EBITDA $129 $108 $91 $81 $66 $55 $45
less: D&A 13 11 9 7 6 5 5
EBIT $116 $97 $82 $74 $61 $50 $40
less: Operating Leases 15 12 10 8 8 6 5
less: Taxes 7 5 5 7 5 3 3
NOPAT $95 $80 $68 $59 $48 $40 $32

Total Debt $0 $0 $0 $0 $0 $0 $1
PV of Operating Leases 103 98 75 49 35 28 24
Total Preferred Stock 0 0 0 0 0 0 0
Total Equity 144 147 127 127 109 95 81
Total Capital $247 $246 $203 $176 $144 $124 $105

ROIC 38.6% 39.6% 38.5% 40.6% 38.6% 38.1% 59.7%

Gross Margin 53.1% 52.5% 53.0% 53.9% 53.5% 54.1% 53.7%

EBITDA Margin 45.2% 43.4% 43.2% 46.2% 45.6% 45.5% 42.9%
EBIT Margin 40.7% 39.1% 39.1% 42.1% 41.6% 41.4% 38.5%
NOPAT Margin 33.3% 32.2% 32.2% 33.4% 32.7% 33.5% 31.0%

Debt/EBITDA 0.00x 0.00x 0.00x 0.00x 0.00x 0.00x 0.02x

Debt/Total Capital 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.8%

CFO $25 $20 $18 $20 $20 $17 $12

Capex 26 31 44 14 15 10 9
FCF ($0) ($11) ($27) $5 $5 $7 $2

CFO / Revs 8.9% 8.1% 8.4% 11.1% 13.4% 13.9% 11.2%

Capex / Revs 9.1% 12.4% 21.1% 8.0% 10.3% 8.3% 9.0%
FCF / Revs (0.2%) (4.3%) (12.7%) 3.1% 3.2% 5.6% 2.2%

Total Assets $176 $178 $153 $149 $128 $110 $95

Asset Turnover 1.62x 1.40x 1.38x 1.18x 1.14x 1.08x 1.09x

Issuance of Stock $3 $7 $4 $8 $7 $6 $45

Repurchase of Stock (21) 0 (16) (5) (5) 0 0
Net Repurchases $24 $7 $20 $13 $12 $6 $45
Dividends 0 0 0 0 0 0 0
Return of Capital $24 $7 $20 $13 $12 $6 $45

RoC/CFO 93.4% 36.4% 111.5% 65.0% 62.3% 36.5% 386.4%

Coffee) - 10 years

2001 2000 1999 1998

$3,289 $2,649 $2,178 $1,687
2,457 1,981 1,667 1,291
$832 $668 $511 $396
235 180 110 90
$598 $488 $401 $306
211 164 130 98
$387 $325 $270 $208
225 171 131 97
126 108 66 62
$36 $47 $73 $49

$6 $6 $7 $8
2,011 1,655 1,039 805
0 0 0 0
1,723 1,376 1,148 961
$3,740 $3,037 $2,195 $1,774

1.2% 2.1% 4.1%

25.3% 25.2% 23.5% 23.5%

18.2% 18.4% 18.4% 18.1%
11.8% 12.3% 12.4% 12.3%
1.1% 1.8% 3.4% 2.9%

0.01x 0.01x 0.02x 0.03x

0.2% 0.2% 0.3% 0.4%

$497 $456 $319

394 384 316
$102 $72 $2

15.1% 17.2% 14.6%

12.0% 14.5% 14.5%
3.1% 2.7% 0.1%

$2,214 $1,847 $1,492

1.49x 1.43x 1.46x

$107 $60 $10

(52) (50) 0
$160 $109 $10
0 0 0
$160 $109 $10

32.2% 24.0% 3.2%

DDRX
2001 2000 1999 1998 2008 2007 2006 2005
$94 $84 $69 $60 Revenues $62 $40 $37 $31
45 41 34 30 less: COGS 48 33 24 19
$49 $44 $35 $29 Gross Prof $14 $7 $12 $12
11 12 9 7 less: SG&A 7 7 7 11
$38 $32 $26 $22 EBITDA $7 ($0) $6 $0
5 5 3 3 less: D&A 2 1 1 1
$33 $27 $23 $19 EBIT $5 ($1) $5 ($1)
5 4 3 3 less: Opera 1 1 4 4
1 (1) 0 0 less: Taxes (0) (0) (2) (1)
$27 $23 $19 $16 NOPAT $5 ($2) $3 ($5)

$3 $21 $16 $12 Total Debt $4 $2 $0 $0

22 24 24 24 PV of Oper 7 21 25 46
0 0 0 0 Total Prefe 0 0 0 0
29 9 11 11 Total Equit 14 9 23 24
$54 $54 $51 $47 Total Capi $25 $32 $49 $70

50.6% 45.7% 41.2% ROIC 14.3% (3.9%) 4.4% (7.0%)

51.9% 51.8% 51.3% 49.3% Gross Mar 23.1% 17.5% 33.8% 38.1%
40.2% 37.6% 38.2% 36.8% EBITDA Ma 11.5% (0.0%) 15.6% 0.7%
34.9% 32.1% 33.3% 32.3% EBIT Marg 8.5% (2.9%) 12.7% (3.1%)
29.1% 27.7% 28.2% 27.3% NOPAT Ma 7.3% (4.7%) 8.4% (14.7%)

0.09x 0.66x 0.59x 0.55x Debt/EBIT 0.60x (174.00x) 0.00x 0.00x

6.3% 38.4% 30.6% 25.7% Debt/Total 17.1% 5.5% 0.0% 0.0%

$6 $3 $6 CFO ($3) ($6) ($7) ($5)

7 6 10 Capex 1 4 2 1
($1) ($3) ($4) FCF ($4) ($10) ($9) ($6)

6.1% 3.2% 9.1% CFO / Rev (4.8%) (15.3%) (18.7%) (15.3%)

7.3% 6.9% 14.6% Capex / R 1.1% 10.8% 6.7% 4.1%
(1.1%) (3.7%) (5.5%) FCF / Rev (5.9%) (26.0%) (25.3%) (19.5%)

$41 $40 $35 Total Asse $27 $22 $33 $34

 2.28x 2.12x 1.99x Asset Tur 2.31x 1.80x 1.10x 0.90x

$20 $0 $0 Issuance of $0 $0 $0 $0
0 0 0 Repurchase 0 0 0 0
$20 $0 $0 Net Repur $0 $0 $0 $0
0 0 0 Dividends 0 0 0 0
$20 $0 $0 Return of $0 $0 $0 $0

339.6% 0.4% 6.9% RoC/CFO 0.0% 0.0% 0.0% 0.0%

 2004 2003 2002 2001 2000 1999 1998
$26 $51 $53 $62 $72 $74 $10
15 41 43 48 57 59 8
$11 $10 $10 $14 $15 $15 $2
10 10 9 10 11 16 2
$1 ($0) $1 $4 $4 ($1) ($0)
1 2 2 2 4 4 1
$0 ($2) ($2) $2 $0 ($5) ($1)
3 4 5 6 7 8 3
(2) (1) (1) 0 0 0 0
($2) ($5) ($6) ($4) ($7) ($13) ($4)

$0 $2 $4 $4 $7 $12 $4
33 30 15 18 20 31 9
0 0 0 0 0 0 0
32 16 16 18 17 15 4
$64 $48 $35 $40 $43 $58 $17

(3.5%) (15.8%) (14.0%) (9.1%) (12.3%) (76.8%)

42.7% 18.8% 18.6% 22.2% 21.0% 20.4% 18.9%

4.8% (0.1%) 1.3% 6.7% 6.2% (0.9%) (0.5%)
0.5% (4.7%) (2.9%) 2.8% 0.0% (6.7%) (12.2%)
(6.6%) (10.8%) (10.6%) (6.3%) (9.8%) (17.4%) (40.0%)

0.33x (30.60x) 5.58x 0.99x 1.46x (18.31x) (78.20x)

0.6% 3.2% 10.6% 10.5% 15.2% 20.4% 23.3%

($3) $4 $2 $0 ($0) ($1)

1 3 2 1 2 3
($4) $1 ($0) ($0) ($2) ($4)

(11.3%) 7.4% 2.9% 0.7% (0.3%) (0.9%)

5.6% 5.0% 3.7% 1.5% 2.4% 4.6%
(16.9%) 2.4% (0.8%) (0.8%) (2.7%) (5.5%)

$40 $25 $26 $28 $32 $40

0.64x 2.02x 2.02x 2.19x 2.26x 1.83x

$0 $0 $0 $0 $0 $0
0 0 0 0 0 0
$0 $0 $0 $0 $0 $0
0 0 0 0 0 0
$0 $0 $0 $0 $0 $0

0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

 PEET & DDRX
2008 2007 2006 2005 2004 2003 2002
Revenues $347 $289 $247 $206 $171 $171 $157
less: COGS 181 151 123 100 83 96 91
Gross Profit $166 $138 $124 $106 $89 $74 $66
less: SG&A 30 30 27 25 21 20 20
EBITDA $136 $108 $97 $81 $68 $54 $45
less: D&A 15 12 10 8 7 7 7
EBIT $121 $96 $87 $73 $61 $47 $39
less: Operating Leases 15 13 14 12 11 10 10
less: Taxes 6 5 3 6 4 2 2
NOPAT $99 $78 $71 $54 $46 $35 $27

Total Debt $4 $2 $0 $0 $0 $2 $5
PV of Operating Leases 110 119 101 95 68 58 39
Total Preferred Stock 0 0 0 0 0 0 0
Total Equity 158 156 151 151 141 112 97
Total Capital $272 $277 $251 $246 $209 $172 $140

ROIC 35.8% 31.2% 28.7% 25.9% 26.8% 24.8% 28.5%

Gross Margin 47.7% 47.7% 50.2% 51.5% 51.8% 43.6% 41.9%

EBITDA Margin 39.2% 37.4% 39.1% 39.5% 39.5% 31.9% 28.9%
EBIT Margin 34.9% 33.3% 35.2% 35.3% 35.4% 27.7% 24.6%
NOPAT Margin 28.6% 27.1% 28.6% 26.3% 26.8% 20.3% 17.0%

Debt/EBITDA 0.03x 0.02x 0.00x 0.00x 0.01x 0.03x 0.10x

Debt/Total Capital 1.6% 0.6% 0.0% 0.0% 0.2% 0.9% 3.3%

CFO $22 $14 $11 $15 $17 $20 $13

Capex 27 35 47 15 16 12 11
FCF ($4) ($21) ($36) ($1) $0 $8 $2

CFO / Revs 6.5% 4.8% 4.4% 7.2% 9.7% 12.0% 8.4%

Capex / Revs 7.7% 12.1% 19.0% 7.4% 9.6% 7.3% 7.2%
FCF / Revs (1.2%) (7.3%) (14.5%) (0.2%) 0.1% 4.7% 1.2%

Total Assets $203 $200 $186 $183 $168 $136 $121

Asset Turnover 1.71x 1.45x 1.33x 1.13x 1.02x 1.26x 1.29x

Issuance of Stock $3 $7 $4 $8 $7 $6 $45

Repurchase of Stock (21) 0 (16) (5) (5) 0 0
Net Repurchases $24 $7 $20 $13 $12 $6 $45
Dividends 0 0 0 0 0 0 0
Return of Capital $24 $7 $20 $13 $12 $6 $45

RoC/CFO 106.0% 52.2% 181.3% 85.7% 73.1% 29.7% 340.9%

 2001 2000 1999 1998
$156 $157 $143 $70
94 98 93 39
$63 $59 $51 $31
21 23 25 9
$42 $36 $26 $22
8 9 8 4
$35 $27 $18 $18
10 11 11 6
1 (1) 0 0
$24 $16 $7 $12

$8 $27 $27 $16

40 44 55 33
0 0 0 0
47 26 26 15
$94 $97 $109 $64

24.3% 15.0% 10.3%

40.2% 37.6% 35.3% 44.8%

27.0% 23.1% 18.0% 31.3%
22.2% 17.3% 12.6% 25.7%
15.1% 10.4% 4.6% 17.4%

0.18x 0.76x 1.06x 0.73x

8.0% 28.2% 25.2% 25.1%

$6 $2 $6
8 8 14
($2) ($5) ($8)

4.0% 1.6% 3.9%

5.0% 4.8% 9.4%
(1.0%) (3.3%) (5.5%)

$70 $72 $75

 2.24x 2.19x 1.91x

$20 $0 $0
0 0 0
$20 $0 $0
0 0 0
$20 $0 $0

315.1% 0.4% 7.7%