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Company Profile 2008

Company Profile 2008

The company
Established in 1933 by Francesco Illy, the company produces and markets world-wide a single, leading-quality blend of espresso coffee, made using nine types of pure Arabica. From the balance of these ingredients from South and Central America, India and Africa arises the unmistakable flavour and aroma of illycoffee, always constant in every cup and in any part of the world.

The illy blend is destined for HoReCa channels (hotels, restaurants, cafés), for consumption at home and at the office; it is available in tins, pods or capsules, accordingto the channel.

Currently, the blend is sold in more than 140 countries in all five continents and is served in over 50,000 public restaurants and bars. In 2007, exports accounted for 52% of total sales.

With the aim of assuring a total and excellent experience with the cup of coffee, illy has perfected a series of elements and instruments that contribute to a perfect taste: from systems for preparing coffee and coffee machines to coffee bars – via the Espressamente illy chain of Italian style coffee bars in licensing – totraining of baristas and specialized personnel at the University of coffee.

illycaffè is based in Trieste and managed by the third generation of the Illy family withAndrea as chairman and CEO.

In 2007, illycaffé, which includes eight subsidiaries and an associate company and employs over 700 people, attained a consolidated turnover of euro 270 million and net profits of euro 7,1 millions.

Sustainability according to illy: economic, social, environmental.
According to the company, the virtuous circle of sustainability startswith the cup of coffee and goes back to the countries of origin that providethe raw material, and all in accordance with a precise strategy. On the one hand,there is the stress placed on the outlet where the coffee is consumed, to ensurean excellent result everywhere, and on the other the care taken as regards themethods and locations of production, in order to highlight and increase the cultivationof the finest coffee: this is a long-term process, in which technology, coffeecultivation and the respect for man and the environment play the leading roles.

The company’s mission of producing an excellent coffee is pursued through the idea that the chain of production must generate value for all the interlocutors involved, and each must be able to draw satisfaction and benefits: economic, social and environmental benefits for the consumer, the customers, the collaborators, the suppliers and the community with which the company interacts and, finally, the shareholders.

FROM THE BEAN TO THE CUP
The selection of green coffee. Sustainable development and quality: a fundamental pairing.
In the conviction that to produce a quality coffee, it is necessary to act upon the beginning of the chain, on the plant, illycaffè has decided to work in close contact with the coffee growers in the countries where it is cultivated, to find and work with the finest Arabica.

The supply policy of the company is based upon three pillars: working directly with the producers; transferring know-how to them, training them to produce a quality product while respecting the environment; paying them in such a way as to render the production sustainable, ensuring that they always profit in some way. This is a vision that first was implemented some time ago, given that since the end of the 1980s illycaffè buys 100% of its raw material directly from source, doing away with the international commodity markets.

The selection of suppliers is strict; in order to start up a collaborative relationship, in 1991 the Trieste-based company set up the Prêmio Brazil de Qualidade do Café Para Espresso, an award aimed at Brazilian coffee growers which is at the same time an incentive for producers.

Following the success of the prize in Brazil, the quality award has also been launched in Guatemala, in Colombia and in India; in all of these countries, it has contributed to provide an incentive for the production of quality.

In order to draw the attention of the general public to the contribution made by coffee growers to our daily beverage, illy has launched “In Principio”, a photo reportage that springs from a meeting with photographer Sebastião Salgado.

Science and innovation in the world of coffee
Over the past 100 years, of the seven radical innovations to have revolutionized the manner of making, considering and tasting coffee, three have been introduced by illy. Two were invented by the founder of the company, Francesco Illy: the “Illetta”, the progenitor of today’s espresso machines, produced in 1934, and pressurization, a system for packaging and preserving coffee in which the air inside a can is replaced with inert gases at above-atmospheric pressure, making it possible to ‘export’ the coffee outside the zone of production. This was introduced in 1935. The third innovation, instead, dates from the 1970s: the first capsule of single-portion coffee, introduced with the aim of exporting espresso to countries in which the skills of the barmen in making espresso – a critical variable in the achievement of excellence – were lacking. The other innovations were: flexible packaging (multipack), decaffeinated coffee, freeze-dried coffee and liquid coffee.

Espresso coffee is a complex beverage made up of 1,500 chemical substances (of which 800 volatile), which must blend harmoniously to form a complete aroma, and over 13 chemical and physical variables, which affect the correct preparation. For this reason, the study and research applied to coffee and all the production processes – from selection to preparation – have been a strategic feature of the company’s stance ever since its foundation. With a multidisciplinary approach that involves numerous areas of study, illy has become involved in scientific research geared to attaining excellence in quality. illycaffè’s Technological Research & Development division – recognized internationally as a centre of excellence in the study of coffee – consists of two research centres, one in Trieste and one at São Paulo in Brazil, and four laboratories: Aromalab, SensoryLab, Biolab and TechLab.

The production process
While it takes fifty coffee beans to prepare an excellent espresso coffee, it needs only one bad one to ruin it. For this reason, constant checks are necessary: from the supply, selecting only the finest lots, to the processing undertaken by the company itself, during which the product undergoes 114 checks before being packaged. illycaffè also has an electronic selection system for the coffee beans, which makes it possible to evaluate each single one, at the rate of 5,000 a second, eliminating any that are imperfect. These controls are in addition to the most sophisticated of the instruments: the palate of the company’s “sommeliers”, who taste the different lots of product that will make up the illy blend. Every lot of coffee, before becoming illy coffee, is submitted to eight sensorial tasting.

The processes used for the toasting, which is done after blending, the cooling by air and the pressurized packaging, make it possible to make a product with an intense aroma and balanced taste preserving all its flavour over time.

Thanks to the care taken over its production processes, illycaffè is the only foodstuffs company in the world to have obtained a double certification: the quality system on the basis of ISO 9001 regulations, and product conformity, in accordance with the regulations agreed with Qualitè France. Its commitment to the environment has also been certified: in 2003, illycaffè was awarded ISO 14001 environmental certification, and in 2004 EMAS registration, winning the EMAS Award in 2005 for its commitment to improving its performance with regard to all of the environmental aspects of the company.

THE SPREAD OF COFFEE CULTURE
With the aim of contributing to an increase and spread of a coffee culture, illy has founded the University of Coffee. The courses are structured in relation to the public they address: coffee growers; entrepreneurs and bar staff, restaurants and hotels; consumers and curious enthusiasts, all of them attentive to quality and keen on increasing their knowledge of the world of coffee.

Based in Trieste, the University also has branches throughout the world: Bangalore, Cairo, Munich, Opatja, Paris, Rotterdam, São Paulo, Seoul, Shanghai. To date, it has provided courses for about 7,700 people (600 coffee growers, 4,400 professionals, 2.000 connoisseurs) around the world, a figure that will exceed 25,000 over the next three years.

Espressamente illy is the illycaffè retail project planned for bars, and is based on a striving for quality as business philosophy. Espressamente illy is a chain of licensed coffee bars of innovative design, which interpret the culture of “Italian-style coffee” through stressing the genius loci, the manager who, through his choices, personality and presence, makes each bar into something unique.

Launched in 2003 as a selective distribution project, over 175 coffee bars have been created so far in 30 countries of which at least half will be in Italy (for examples Australia, Belgium, China, Croatia, Cyprus, France, Germany, Hungary, Japan, Italy, Mexico, Morocco, Norway, Portugal, Qatar, Russia, South Korea, Spain, Sweden, United Kingdom and Ukraina).

THE AESTHETICS OF COFFEE
In the conviction that coffee has an aesthetic and sensorial side to it such as to provide a perfect pairing with culture, illy has chosen art and creativity as the language through which to express its own values and philosophy. For over ten years, it has been contributing actively to the spread of contemporary art, backing major international exhibitions. In 1997, 2003, 2005, and in 2007 the company was a partner of the Venice Art Biennale.

From Michelangelo Pistoletto to Marina Abramovich, Sandro Chia to Julian Schnabel, Bob Rauschenberg to Jeff Koons – together with emerging talent representing the international panorama of art: these are just some of the protagonists of the art world to have collaborated with illy.

From these collaborations springs the illy collection – now known as the illy Art Collection - a series of artists’ cups produced by illy since 1992, and which has become the symbol of how the fantasy of artists has transformed an everyday object – the coffee cup designed by Matteo Thun, architect and designer – into a cult object.

The current illy logo was designed in 1996 by James Rosenquist, one of the founding fathers of American Pop Art.

For further information:
Anna Adriani/Christine Pascolo, illycaffè Trieste - Tel.: +39-040-3890111
Susanna Picucci/Meretti Giorgia, Cohn & Wolfe Milano - Tel.: +39-02-20239.386/375
susanna_picucci@cohnwolfe.com; mailto:giorgia_meretti.ce@cohnwolfe.com