Nespresso launches ground-breaking range of coffee machines Stylish and contemporary, new CitiZ machines provide affordable luxury for urban coffee lovers
Capitalising on the current trend for enjoying the finest food and drink at home, Nespresso, the leading innovator in luxury portioned coffee is launching a new range of machines for the styleconscious city dweller. Influenced by city life and urban culture, the Nespresso CitiZ is inspired by the landscape and ambience of major global cities and is aimed at those who appreciate affordable quality in every aspect of their busy lives. Featuring three minimalist and sleek designs, CitiZ, CitiZ&Milk and CitiZ&Co, the new range is the first to include three different models launched simultaneously by Nespresso. Able to fit into the smallest of urban living spaces, CitiZ will satisfy both convenience and quality; each machine producing the renowned, superior Nespresso coffee at the touch of a button. The ranges design is evocative of the iconic skylines and buildings of major urban hubs such as London, New York and Chicago, with the structure and colours inspired by the unique sights and shapes found on their streets. Led by renowned Industrial Designer Antoine Cahen, the Nespresso design team sourced materials that symbolise the strength, toughness and grittiness of the city, using eye-catching, shiny metals to contrast with the bright, striking colours.
Nespresso consulted its Club Members to find out their preferences for the new range and created the three machines incorporating different functions to suit the varying tastes of coffee lovers across the world: Nespresso CitiZ a single automatic espresso machine, perfect for the independent, city dweller with a passion for quality that comes with convenience. Nespresso CitiZ&Milk a single automatic espresso machine with a built-in fresh milk-frother for the coffee lover who favours cappuccinos and lattes. Nespresso CitiZ&Co. the first of its kind, this machine allows the user to make two coffees simultaneously, perfect for those who enjoy entertaining, or the city-living couple who want to enjoy their coffee together.
Today, more than half of the global population resides in urban areas - a number likely to reach 75 per cent by 2050*, and their inhabitants are increasingly looking for convenience in their lives, without having to sacrifice superior quality or the benefits of good service. Life in the city can be challenging and unpredictable but Nespresso ensures that regardless, the perfect coffee can always be enjoyed, every time. Nespresso guarantees this consistency by sourcing the highest quality of coffee from across the world, adhering to a strict production and storage process, and combining this with its award winning machine design. The 19-bar high pressure pump of each CitiZ machine guarantees the release of all the rich flavours and subtle aromas of each of the 16 Nespresso Grands Crus, produced at the optimum drinking temperature. Brema Drohan, Managing Director of Nespresso UK and Ireland commented, The launch of this range marks new territory for Nespresso in Ireland. Using the same cutting edge design for the three different models ensures that coffee aficionados can consistently enjoy the perfect cup, whether they favour espressos, cappuccinos or want the freedom to produce multiple coffees. A significant proportion of Nespresso Club Members in Ireland are based in cities and we know they are looking for a convenient and quick way to experience their favourite coffee but without having to comprise on quality. The CitiZ machines incorporate this philosophy; with a slim format designed to fit in smaller spaces, they are perfect for the 21 century urbanite. The single CitiZ machine is available in the high-tech style in steel grey and fire engine red by Krups and modern retro style of retro white and limousine black by Magimix. The CitiZ&Milk machines comes in fire engine red by Krups and limousine black by Magimix whilst the CitiZ&Co machines colours are steel grey by Krups and limousine black by Magimix. Prices start at 179 for the single CitiZ machine. The CitiZ & Milk is 249 and the CitiZ & Co is 329.

Available at Nespresso Boutiques, Brown Thomas Dublin and Brown Thomas Cork, leading department stores and online at www.nespresso.com
Notes to Editors Nespresso, the market leader in highest-quality premium portioned coffee, introduced consumers to the very highest quality Grands Crus to be enjoyed in the comfort of their own homes, as well as to be savoured at locations outside the home, such as gourmet restaurants, high-end hotels, luxury outlets and offices. Nespresso comprises of a trilogy, a unique combination of the worlds highest-quality coffees, smart and stylish coffee machines and exceptional customer service. The culmination of these three elements is the Nespresso Ultimate Coffee Experience. Headquartered in Switzerland with more than 2,500 employees, Nespresso is a division of Nestl and sells products in more than 50 countries directly to its customers and at the end of 2007 operated more than 117 boutiques in key cities around the world. For the second year in a row, it was named the fastest growing company within the Nestl Group and one of its "billionaire brands", having achieved a growth rate of more than 40 percent in 2007. For more information, visit www.Nespresso.com
For further information please contact Jennifer Hayes @ Kennedy PR / jhayes@kennedypr.ie

Corporate backgrounder

March 2011 Worldwide, 12,300 cups of Nespresso coffee are consumed every minute. AT A GLANCE Coffee is at the heart of all we do. Yet consumer pleasure is why we do it. The Nespresso story began with a simple but revolutionary idea: enable anyone to create the perfect cup of espresso coffee just like a skilled barista. From its beginning in 1986, the Nespresso brand concept has redefined and revolutionized the way millions of people enjoy their espresso coffee today, and it has shaped the global coffee culture. Nespresso is not just a coffee. It is a genuine experience that combines perfection and pleasure, simplicity and aesthetics. Nespresso has evolved from being the pioneer and trendsetter into the reference of the portioned coffee category through a singular focus on delivering the ultimate coffee experience to our consumers cup after cup. This is the cornerstone upon which the company was founded, and it is the foundation that has fostered the incredible growth we have enjoyed over the last 25 years. Our success is built on creating the highest quality Grand Cru coffees, long-lasting consumer relationships and sustainable business success. These will continue to be the Key Growth Drivers of our business moving forward, as we compete in the dynamic and growing portioned coffee category. Nestl Nespresso is a company without boundaries, with both a direct business-to-consumer and business-to-business approach. Our Unique Business Model provides a competitive advantage and a strong a platform for continued, sustainable growth as we continue to innovate to deliver moments of pleasure and indulgence in everyday life. The strength of our brand, the quality of our coffees and our unique service offering also provide Nestl Nespresso with enormous growth opportunities in the professional sector as well as unique client engagement and service opportunities for business partners.

Organic growth

Performance In 2010, Nespresso sales exceeded CHF 3 billion. The company demonstrated strong organic growth of over 20%, with double digit sales increases in all markets around the globe. Worldwide, 12,300 cups of Nespresso coffee were consumed every minute, up from 10,000 in 2009. An autonomous, globally managed business of the Nestl Group, Nestl Nespresso is present in more than 50 countries worldwide and is headquartered in Lausanne, Switzerland. Our over 5,500 employees around the world are focused on continuing to provide the best coffee and exclusive services to consumers around the world.
Unsurpassed Coffee Quality and Deep Coffee Expertise Nespresso Grand Cru coffees are produced from an exclusive selection of the finest green coffee grown in the world. Our choice of exceptional blends and pure, single origin coffees is specially developed to suit every taste preference and to be at home in every environment. Only an estimated 1-2% of the coffee grown globally meets our specific taste and aroma profiles and our high standards of quality and sustainability. The Nespresso coffee experts at our state-of-the-art production centers in Switzerland orchestrate the subtle interplay of each coffees complex properties, including acidity and body, to compose a range of Grand Cru coffees with unique flavour and aroma profiles and a tantalizing crema.

Gourmet coffee

nespresso

Commercial grades

of the world's green coffee crop
For us, EcolaborationTM has truly become our way of doing business. Unstoppable Drive for Innovation, Distinctive Design and In-House R&D Expertise Continuous innovation and our passion for perfection have been key drivers in our quest to consistently deliver the highest quality coffee to consumers worldwide for enjoyment at home and away from home. The entire Nespresso system from the genuine aluminium capsule, to the brewing and extraction unit is designed to work as one to deliver the perfect cup of coffee time after time. It is a technology unique to Nespresso, refined over 25 years by our in-house R&D experts. The interaction between the machine and the original capsule enables Nespresso to control every variable. Our unrelenting focus on innovation and R&D led to the invention of unique technology that delivers a balance between the right water temperature, quantity and speed, along with 19 bars of pressure, creating the perfect cup every time. Today, Nespresso machines range from the compact Essenza model to the full CitiZ and Pixie ranges to our new range of specifically designed business-to-business machines.

215 boutiques

Unique Business Model and Route to Market We are responsible for every stage of the sourcing, production and sale of our coffees. Our Unique Business Model enables us to guarantee quality at every stage of the value chain and to maintain a direct dialogue with our consumers and Club Members. Our unique route to market encompassing our e-commerce platform, our exclusive boutiques and our dedicated call centres, along with our partner model for machine distribution provides us with a unique competitive advantage versus our competitors. Business-to-business sales provide an exciting area of growth. We continue to innovate in our business-to-business offerings, providing solutions designed to meet the needs of some of the most discerning hosts in the business and hospitality industry.

worldwide

Aspirational, Global Brand and Passionate Global Brand Community Over 25 years, Nespresso has grown into one of the most well recognized brands in the world of coffee, trusted by millions of consumers as a mark of passion, authenticity and service the world over. The combination of the brands entrepreneurial roots and the modern, forward-looking approach to innovation continues to keep Nespresso relevant in the minds of consumers. It has also allowed it to transcend the product category to become a truly global symbol of understated elegance. Our global network of boutiques offers an insight into the brand, providing consumers with a unique opportunity to experience Nespresso with all their senses. In 2010, we opened new boutiques in Brussels, Miami, Munich, New York, Santiago, Shanghai and Sydney, among others. We now have over 215 boutiques. For more detail, see section on our Unique Business Model and Route to Market around the world.

Unique Expertise and a Holistic Approach to Sustainable Quality Development We recognise our obligations as the leader in portioned coffee worldwide, and we are committed to ensuring sustainability throughout our operations. It is an important component of what our Club Members and partners expect from us, and it is a core value of our company. The Nespresso EcolaborationTM program provides a framework for partnership and innovation to drive ongoing, sustainable development. The program examines all aspects of coffee sourcing, the production, use and disposal of our capsules, and the lifecycle of our machines. By 2013, we have committed to: Source 80% of our coffee through our unique AAA Sustainable QualityTM Coffee Program, including Rainforest Alliance certification Put systems in place to triple our capacity to recycle used capsules to 75% Reduce the overall carbon footprint required to produce every cup of Nespresso coffee by 20%. For more information on Nespresso, please visit us at: www.nespresso.com/mediacenter. 2
Nespresso is a brand focused on creating perfect experiences and moments of pleasure. The brand welcomes coffee lovers and invites them into an exclusive relationship. The Nespresso Club, with over 10 million members, has grown organically into a global community of some of the most discerning coffee connoisseurs, and it has played a part in evolving the global coffee culture. These Club Members stand as the true representation of our brand and a lifestyle that is selective, yet inviting; accomplished, yet inspiring; simple, yet refined.
creating HIGHEST quality grand cru coffees
March 2011 To us, coffee is more than a commodity.
Nespresso offers consumers exquisite Grand Cru coffees produced from an exclusive selection of the finest green coffee grown in the world. Our selection of exceptional blends and pure, single origin coffees is specially developed to suit every taste preference and to be at home in every environment. Only 1-2% of the coffee grown globally meets our specific taste and aroma profiles and our high standards of quality.
In 2003, we put in place our unique AAA Sustainable QualityTM Program based on the direct relationship with individual farm communities and over 40,000 farmers. Today more than 60% of our green coffee is sourced from AAA Program farms, with a goal to increase this to 80% by 2013. The program seeks to ensure the highest quality and sustainability in our coffee supply chain, while helping to improve the standard of living for farmers and their families

Blending, Roasting and Grinding Extreme care and attention is invested in the blending, roasting and grinding processes by passionate and skilled experts in our two Swiss state-of-the-art production centers. The Nespresso coffee experts orchestrate the subtle interplay of each coffees complex properties, including acidity and body, to compose a range of Grand Cru coffees with unique flavor and aroma profiles and a tantalizing crema.
The Range Our coffee experts in our state-of-the-art production centers specially blend, roast and create each Grand Cru and then preserve their taste and aroma inside the hermetically sealed, iconic Nespresso capsules. Nespresso is involved in every aspect of the coffee value chain from the coffee tree to the coffee cup. This allows us to guarantee consumers unsurpassed coffee quality in every cup of Nespresso coffee. Nespresso is not just coffee, it is another dimension in the world of coffee. It is a genuine experience that combines perfection and pleasure, simplicity and aesthetics. Nespresso offers the widest range of Grand Cru coffees. There a variety for every taste and occasion, and each Nespresso Grand Cru offers unique aromatic notes to meet individual taste preferences. 16 Premium Grands Crus for Home Enjoyment Our consumers can choose from our unique collection of 16 premium coffees plus two special editions for enjoyment at home: 7 Espresso blends 3 Lungo blends 3 Decaffeinated blends (2 Espresso, 1 Lungo) 3 Pure Origins (three extraordinary espressos, each exclusively composed 100% of coffees sourced from a single country of origin) In addition to its permanent collections, Nespresso typically introduces two extraordinary and rare Grands Crus for a limited period each year. 8 Premium Grands Crus for Fine Restaurants, Hotels and Offices 2 Ristretto Grands Crus 2 Espresso Grands Crus 2 Lungo Grands Crus 2 Decaffeinated Grands Crus
Sourcing We constantly travel to and visit the worlds top coffee-growing regions. We create long term relationships with farm communities so that we are able to select individual crops by their quality and aroma profiles and bring this home to our consumers around the world. To us, coffee is more than a commodity. While others buy coffee on global markets, sight unseen, we always want to know what we are buying, where it comes from, how it has been grown and what taste and experience it will provide in the cup.
unstoppable drive for machine innovation
March 2011 Nespresso has reinvented coffee machines. Nespresso has reinvented coffee machines and the way coffee is prepared with a range of smartly designed and easy-to-use machines. Nespresso machines are specifically developed to complement and enhance the aroma, crema and flavor of Nespresso Grand Cru coffees. The evolution of the Nespresso System and the distinctive design of our machines has been the backbone of this focus. The unique Nespresso system - the interaction between the machine and the genuine Nespresso capsule enables us to control every variable in order to produce perfect coffee cup after cup. Innovation is not new for us. Since 1986, when we introduced our first machine, we have been constantly reinventing how consumers experience their coffee. We continue to spearhead machine innovations, offering ever more convenience and ease of use for consumers. Our innovations and cutting-edge designs have continually reinvented the coffee machine and quite appropriately, have been recognized with successive design awards, including:

8 prestigious Red Dot Design Awards, including one for Pixie, the newest Nespresso machine innovation 2 iF Product Design Awards We design and manufacture all Nespresso coffee machines in collaboration with our machine partners, allowing us to build the patented extraction and brewing unit to manage the interplay of all factors. Through 25 years of continuous innovation, our in-house Research and Development team has obtained over 1,700 patents. Nespresso machines reflect timeless designs, which continue to evolve. The initial Nespresso machine resembled a mini version of a professional espresso machine, while today we offer a range of machines based on fresh and revolutionary designs, which fit into any environment.
Pixie The smartest and smallest coffee machine ever from Nespresso. Fast and intuitive, it minimizes time, space and energy consumption while still creating the perfect cup of coffee. Sleek and compact, it has side panels in anodized aluminium inspired by industrial, minimalist design. Available in six bold and vibrant colors, it takes 25 to 30 seconds to pre-heat, and it automatically powers off after 9 minutes of inactivity. CitiZ Designed in a slim-format to easily fit into smaller urban spaces, the CitiZ machine range evokes an urban vibe and a daring style. The CitiZ machine range comprises three different coffee machines, to suit all lifestyles and needs: Nespresso CitiZ a single-head automatic espresso machine, Nespresso CitiZ&Milk a single-head automatic espresso machine combined with a built-in fresh milk frother, and Nespresso CitiZ&Co. the first-ever double-headed machine designed to enable consumers to prepare two coffees simultaneously.
Lattissima The Lattissima coffee machine, created with long-time machine partner DeLonghi, offers the most convenient fresh milk solution for milk recipe lovers. The automated fresh milk froth function enables coffee aficionados to create espresso, lungo, cappuccino or latte coffees at the touch of a button. The one touch cappuccino system provides the optimal combination of steam, milk and air to create milk froth with perfect consistency. Essenza The Essenza machine seamlessly integrates innovative technology and contemporary design, and is beautifully finished with high-tech materials. Its name says it all and the model contains in a compact form all of the essential elements of the Nespresso system. Essenza models are available in two styles: a pure, slightly curved design and a more curvaceous body.

global brand community

March 2011 Nespresso counts over 10 million of Club Members in 2010 One of the most valuable aspects of the Nespresso brand is the enthusiastic role played by our more than 10 million Club Members worldwide who engage with us and share the pleasure of Nespresso with others. Half our new Members meet the brand through an existing the brand and fellow coffee connoisseurs and become part of the Member a unique asset for any brand. Our direct consumer relaNespresso brands culture and success. Their involvement with loyalty tionship through the Club means that every day we are in dialogue to the brand truly makes them our best advocates. This two way process with over 100,000 consumers who are passionate about coffee and of engagement, between consumer and brand, and between brand and the Nespresso brand. Our focus on developing and delivering the ulticonsumer, is a hallmark of a truly successful brand in the 21st Century. mate coffee experiences to our consumers is Already the Nespresso underpinned by the interaction and feedback For example, 2010 saw the fifth instalment Facebook community has grown to that our direct relationship with our Club of our George Clooney campaign. In 2004, nearly 750,000 fans Members allows. Thanks to it, we are able our Club Members chose George Clooney to deliver personalized service through our boutiques, our customer as their Ambassador and his charm and humour has been central relationship centers and the convenience of our website. to the popular campaign that really lets Club Members identify with the brand. In recent years, this campaign has also included online engagement where consumers have been asked, for example, to A brand you join guess the ending to the commercials story line. This communication enhances the consumer experience and assists in positioning the The Nespresso Club has grown organically into a global community brand as accessible as well as desirable. of some of the most discerning coffee connoisseurs, and has played a part in evolving the global coffee culture while giving it a local Already the Nespresso Facebook community has grown to nearly identity. These Club Members stand as the true representation of 750,000 fans. This offers a further opportunity to engage with the our brand and a lifestyle that is selective, yet inviting; accomplished, brand, make it a part of our Members daily lives, and an opportunity yet inspiring; simple and refined. to share their delight with others. Yet the Nespresso Club does not simply operate like consumer clubs in other industries. We offer advice and help our Members learn about the coffee we offer, which in turn enriches the experience of the coffee Members enjoy. One of the little known facts about Nespresso is that it is a brand our Members seek to join, to make a part of their way of life. Nespresso enjoys a Net Promoter Score that averages nearly 60% and in some markets more than 80%, putting it the same league as legendary brands like Apple, Amazon and Harley Davidson. Here are some more facts about our Club Members the power behind our brand: The Nespresso Club counts over 10 million enthusiastic fans and advocates, versus 600,000 only ten years ago Membership in the Nespresso Club grew 35% in 2010 The enthusiasm of our fans has created a global community of passionate ambassadors. In fact, Nespresso Club Members are our best advocates more than 50% of our new Club Members experience Nespresso for the first time through friends or family.

Recognised as a leading global brand Over 25 years, Nespresso has grown into one of the most well recognized brands in the world of coffee, representing a refined mark of passion, authenticity and service the world over. The combination of the brands entrepreneurial roots and the modern, forward looking approach to innovation continue to keep Nespresso relevant in the minds of consumers and allow it to transcend the product category to become a truly global symbol of understated elegance. The growth of Nespresso as a consumer centric global brand has been recognised by leading experts around the world: Nespresso was included in the Top 100 most Powerful Brands Ranked, Number 1 in the category. Nespresso was also the first roast-and-ground coffee brand to achieve global status, as ranked by Millward Brown in 2008. Nespresso was chosen as number one European Trusted Coffee Brand in 2010 by Readers Digest in a survey of 16 markets. The Clooney campaign has enjoyed industry recognition, winning the prestigious EFFIE awards in France and on a European basis. Awards EFFIE France, 2009 (Grand Prix) EFFIE France, 2009 (Winner) for Food & Beverage EURO EFFIES, 2010 (Bronze)
The Means to Engage The global brand community that has developed around Nespresso provides Club Members with a unique opportunity to interact with
unique business model and route to market
March 2011 Global Boutique Network, 215. In 2011, it will grow beyond 250. AT A GLANCE Nestl Nespresso is a global autonomous operating business unit of the Nestl Group. The Nespresso company's Unique Business Model enables us to guarantee quality at every stage of the sourcing, production and sale of our coffees and to maintain a direct dialogue with our consumers and Club Members. Our unique route to market encompassing our e-commerce platform, our exclusive boutiques and our dedicated call centers, along with our partner model for machine distribution provides us with a unique competitive advantage versus our competitors. Business-to-business sales provide an exciting area of growth. Today B2B represents only 11% of Nespresso sales. We continue to innovate in our business-to-business offerings, providing solutions designed to meet the needs of some of the most discerning hosts in the business and hospitality industry. Consumers worldwide interact with us through an array of consumer contact points. In total, we have more than 4,000 customer facing Nespresso Coffee Specialists. International retail network of 215 exclusive boutiques Online 24/7 global Internet boutique Global network of Customer Care Centers On call Nespresso Coffee Specialists

In 2011, the Nespresso retail network will grow beyond 250 boutiques in cities from Berlin to Paris and from Johannesburg to St Petersburg.
Online The Nespresso e-commerce platform allows consumers to tap into the world of Nespresso whenever they want and wherever they may be. It provides a 24-hour ordering system for coffees, machines and accessories. Over 130,000 unique customers visit our site on a daily basis. Our online boutique is the leading sales outlet for Nespresso, accounting for 51% of our sales.
Customer Relationship Centers Customer Relationship Centers provide consumers another means to easily connect with Nespresso. Their needs can be met on the phone by one of our over 1,000 friendly, knowledgeable coffee specialists who provide advice on coffees and machines and instantaneous ordering of Nespresso products.
Boutiques Our global retail network of boutiques offers an insight into the brand, providing consumers with a unique opportunity to experience Nespresso with all their senses. In 2010, we opened 36 new boutiques from Munich to Miami and from Shanghai to Sydney bringing the total number of boutiques in our global retail network to 215. Nespresso boutiques provide a window into the heart of the brand and also serve as a key sales outlet, generating around 35% of the companys sales. Many boutiques include an area where coffee enthusiasts can savor and learn about premium coffee quality. Nespresso boutiques incorporate a gallery of coffee machines so that consumers can choose the model best suited to their lifestyles. Each location showcases collections of accessories and coffee preparation ideas to enable consumers to re-create their own ultimate coffee experiences at home.

Boutiques

Internet Customer Relationship Centers (CRC)
Customer Relationship Centers are important in maintaining customer loyalty and are responsible for around 14% of Nespresso sales.
Working together for a sustainable future
March 2011 We are committed to producing the highest quality coffee for our Club Members. AT A GLANCE The Nespresso sustainability journey started in 2003 with the launch of the Nespresso AAA Sustainable Quality Program. The Nespresso vision for sustainability was defined in 2009 with the launch of Ecolaboration. In 2009 Nespresso made three new sustainability commitments: Coffee, Capsules and Carbon Footprint. Beyond these goals, Ecolaboration is about making sure that sustainability is integral to everyday business decisions and working together to find new ways to create more value for society.
WHY WE HAVE MADE THESE COMMITMENTS
Within the Nespresso community, we have a single word to describe our approach to sustainability and creating value for society. Ecolaboration. Richard Girardot, CEO, Nespresso We know that sustainability issues are central to the future prosperity of our communities. It is therefore essential that we make sustainability core to every part of our business. This means we are committed to producing the highest quality coffee for our Club Members, while balancing the economic, environmental and social impacts of our business, so that we are sustainable in the long term. But it also means going beyond sustainability and thinking about how our business can create more value for the Nespresso community, from coffee farmers to Club Members.

OUR ECOLABORATION COMMITMENTS & PERFORMANCE Today, Ecolaboration focuses on three commitments: Coffee, Capsules and Carbon Footprint. Coffee Source 80% of our coffee from the Nespresso AAA Sustainable Quality Coffee Program, including Rainforest Alliance certification by 2013. At the end of 2010, we were already sourcing more than 60% of our coffee from roughly 40,000 farmers who are part of the program. Capsules Put collection systems in place to triple our capacity to recycle used capsules to 75% by 2013. We have made good progress in meeting our goal. We have evaluated our current collection capacity at the end of 2010 to be just above 60%, with about 7,000 dedicated collection points around the world. Carbon Footprint Between 2009 and 2013, reduce the carbon footprint of each cup of coffee by 20%. We use an approach called life cycle assessment to under-stand how we generate carbon emissions in every aspect of our business. But we are already taking action to improve our environmental impact across our entire business, from the cherry to the cup.

AAA coffee

A COLLABORATIVE APPROACH The approach for Ecolaboration is to work together with our partners to protect the future of our Grands Crus for coffee-lovers worldwide and manage the social and environmental impacts of our business, while improving the lives of coffee farmers and their communities. Sustainability is a journey we must take together. At the heart of the Ecolaboration program are the strong relationships with our committed and passionate partners. Each and every one of our partners plays an essential role in meeting our shared vision. We are working with our many partners around the world, including grassroots NGOs, global financial institutions and other business.

collection points

> 20%

carbon footprint

PLANNING FOR THE FUTURE Our three commitments are essential to Ecolaboration, but they are only part of our journey; it is about making sure that sustainability is integral to the decisions we make everyday. For instance: We have started to develop more sophisticated ways to measure our impacts in areas like coffee farm management and profitability, water and biodiversity. And we have launched a new companywide initiative, called MyEcolaboration, which encourages our employees to put forward their ideas to help to make Ecolaboration even stronger.

Quality Maintaining Highest quality Sustainability Respecting people & environment Productivity Farm management
WHAT THE EXPERTS SAY ABOUT ECOLABORATIONTM "Nespressos innovative program, which helps farmers achieve higher prices, better yields, and greater environmental performance and sustainability, is not driven by charity but by creating value. Nespresso will benefit strategically from the quality improvements that farmers achieve and coffee supplies that will be far more sustainable over time. It is this alignment between corporations and social challenges, not a mindset of separation and tradeoffs, which is the key to both economic and social progress."1 Michael Porter 2, Professor Business Strategy, Harvard Business School
Sustainable Value Creation

Second

We are also exploring new ways of working to ensure that we are creating more value for the Nespresso community, from farmers to Club Members, today and in the future.
http://www.creatingsharedvalue.org/post/2009/11/20/Nespresso-shares-new-insights-on-coffee-farm-economics.aspx Michael Porters recent article in the Harvard Business Review cited Nespresso as an example of the shared value model. Michael E. Porter and Mark R. Kramer, Creating Shared Value: How to reinvent capitalism and unleash a wave of innovation and growth Harvard Business Review January-February 2011 From left to right: Dean Sanders, founder of Good Brand & Co., Guillaume Le Cunff, Nespresso International Marketing & Sustainability Director and Michael Porter
KEY PERFORMANCE INDICATORs
March 2011 More than 5,500 employees worldwide. 70% in the markets are customer facing. Nespresso has demonstrated spectacular growth since we first pioneered the portioned coffee segment 25 years ago. In 2010, the Nespresso brand again demonstrated its dynamic leadership, as reflected in our double digit growth and continued selective global expansion. Our success has been built on creating the highest quality Grand Cru coffees and long lasting consumer relationships and on operating our business in a sustainable way. These will continue to be the Key Growth Drivers of our business moving forward, as we compete in the dynamic and growing portioned coffee category. The strength of our brand, the quality of our coffees and our unique service offering provide Nespresso with exciting growth opportunities moving forward to engage and delight coffee lovers who demand authentic quality and moments of pleasure.

our way of doing buisiness Building on the principles of Nestl "Creating Shared Value", Nestl Nespresso is working together with its EcolaborationTM partners to continously improve the sustainability performance of Nespresso from the cherry to the cup. We believe that this will deliver sustained future growth for our company, respecting the environment by actively contributing to the safeguard of the planet's resources for future generations.
OUR ecolaborationTM COMMITMENTS FOR 2013 1. Source 80% of our coffee from Nespresso AAA Sustainable QualityTM farms certified by Rainforest Alliance. 2. Triple our capacity to recycle capsules to 75% 3. Reduce the CO2 footprint per cup by 20% For me, my family, my environment and for our planet. more together: www.ecolaboration.com
Our Company Overall global sales of over CHF 3 billion in 2010. Sales of 26.9 billion coffee capsules and 13 million coffee machines since 1986. Organic growth
HIGHEST QUALITY COFFEE Almost 60% is sourced through the Nespresso AAA Sustainable QualityTM Program. Highest-quality beans selected from the estimated top 1-2% of the world's green coffee crop. Unique range of 16 Grands Crus for enjoyment at home and 8 for out-of-home.
An autonomous globally managed business of the Nestl Group. More than 5,500 employees worldwide in 2010, versus 331 in 2000. 70% of our employees in the markets are in direct contact with consumers Present in more than 50 countries

2000 2010

of the world's green coffee crop 1

331employees

5,500employees
12,300 cups of Nespresso coffee consumed per minute, versus 868 in 2000.
12,300 CUPS OF NESPRESSO COFFEE CONSUMED PER MINUTE, VERSUS 868 IN 2000
UNMATCHED PERSONAL SERVICE Exclusive boutiques around the globe provide personalized services and a unique gateway to the Nespresso brand. Over 50 boutiques to open worlwide in 2011. The extensive Nespresso website offers 24-hour information and ordering in over 29 different languages, with orders shipped to homes or offices within 48 hours.

SMART STYLISH MACHINES

12,300

14% 51%

CRC Boutique

Internet

A full range of smart and stylish coffee machines with a variety of designs, functionalities and prices, for both home and out-of-home. Our full range of smart and stylish coffee machines includes 37 models from the Compact Essenza to he high-end Miele Built-In as well as B2B machines developed with 6 machine partners.
Nespresso + 31.6 Dolce gusto Nespresso 19.7% Dolce gusto 11.9% Full Automate 2010
Customer Relationship Centres provide access to Nespresso coffee experts. 3 Sales Channels: Internet 51%, Boutiques 35%, CRC 14% Global Retail Boutique Network: 215, up from 191 in 2009. 2 Business Units: Business-to-Consumers (B2C) 89% and Business-to-Business (B2B) 11%.

OUR CUSTOMERS Around 10 million Club Members
Global market share (around 20%) in the segment of espresso & filter portioned coffee machines (GFK source based on 12 main European countries).
Portioned coffee market size and value

2000 100% 2009 2010

R&G/Soluable Coffee

Value Volume

Our Global community of coffee connoisseurs serve as our strongest ambassadors since 50% of all new Nespresso Club Members first experience the brand through existing Members.

25% 2000

Source: AC Nielsen, Europe & North America 2010

8% 2010