LONDON, February 2 /PRNewswire/ --
- ATTN. FEATURE EDITORS
Cafédirect, the UK's largest Fairtrade hot drinks company(1), announces its intention to launch a public share issue in the Spring of 2004.
The company, which has blazed a trail for ethical trading, has proved that businesses can balance making money with making lives better. Cafédirect owns the country's sixth largest coffee brand and has also developed Teadirect into one of the fastest growing tea brands in the UK market.
Triodos Bank is working with Cafédirect to offer UK consumers the chance to buy shares and realise a social as well as a financial return.
Penny Newman, Cafédirect's Chief Executive Officer, comments, "Now you can do more than buy the coffee, you can buy into Cafédirect itself. With an investment as little as GBP300, you can help us shape a better future for millions of people - those who grow the products as well as those who drink them. As more and more people discover the benefits of ethically sourced products, the time has come to realise the full potential of our 100% Fairtrade brands."
The company's growth emerged from the unique long-term relationships built over the past twelve years with over one million coffee, tea and cocoa small producers and their families. Cafédirect always pays them guaranteed fair prices above market rates. In return they supply the pick of their crops and people enjoy excellent coffees, teas and chocolate drinks.
Unique to the company, Cafédirect's Gold Standard policies go even further than the stringent standards of the Fairtrade Mark. Beyond paying guaranteed minimum prices, such policies commit the company to long-term investment in its producer partners' organisations. In the last year, Cafédirect re-invested 8% of its gross profits in tailor-made programmes to support a wide range of activities, including market information, management training and many other elements required to grow sustainable businesses. In a fiercely competitive marketplace, these partnerships mean producers have the security to invest in their farms and create a better future for their families.
"Our way of trading benefits everyone - it's a way of working that people trust. We're doing today what many will do tomorrow. By investing in Cafédirect, we're offering you the chance to buy into a better future," concludes Ms. Newman.
Rosario Gutiérrez Villarreal, Union de Ejidos San Fernando, Chiapas, Mexico comments: "As smallholder farmers from indigenous backgrounds, living in a country like Mexico, we understand the importance of working hard together to produce a great coffee while loving and respecting the earth where we live. All those who collaborate with Cafédirect hope to make strides forward through sacrifice, hope and hard work and to leave something for our children.'
Investing is simple. Follow the steps outlined below or call Triodos on Tel: +44 (0)845 600 9662 to register your interest.
Notes to Editors:
(1)Cafédirect is the largest Fairtrade hot drinks company in the UK by value
- In 2002, UK sales of FAIRTRADE products reached a retail value of GBP63million, a 90% increase from 2000 (source: Fairtrade Foundation)
- A new report suggests that the FAIRTRADE market could be worth US$25 billion (GBP15.63 billion) by 2020, if it mirrors the growth curve seen in organic food. (Source: Leatherhead Food International - a food research consultancy).
- FAIRTRADE brands now account for 14% of the total UK roast and ground coffee market. (source: Fairtrade Foundation)
- The British public is drinking 1.7 million cups of FAIRTRADE tea, coffee and cocoa each day. (Source: Fairtrade Foundation)
- Cafédirect is the only hot drinks company selling 100% FAIRTRADE products in the UK. Sales across its three product ranges are experiencing tremendous growth: the premium instant coffee Cafédirect 5065 has increased by 38%, Teadirect black tea is up by 34% and Cafédirect's ground coffee has grown by 30% By way of a comparison, sales for the total instant market has increased by 1.9% while the total tea bags market has declined by 2.3%. (Source: IRI MAT 52 w/e 1 Nov 2003)
Triodos Bank is the UK's leading social bank, only financing enterprises which create social, environmental or cultural added value. Key sectors include organic food and farming, renewable energy, social housing, and Fairtrade. It is a market leader in ethical share and bond issues and runs Triodos Ethex, a matched bargain market offering investors the opportunity to trade in truly ethical stocks and shares. Triodos Bank is an independent bank founded in The Netherlands in 1980. Its principles and independence are protected through a special shareholding trust. The UK office opened in 1995 and is based in Bristol. For more visit www.triodos.co.uk or call +44 (0)117 980 9721.
How to invest
To invest, you will need to have a copy of the prospectus which is anticipated to be published in the Spring of 2004. The prospectus includes the application form to buy shares.
To order a copy of the prospectus please call +44 (0)845 600 9662 (local rate call) or visit our website www.cafedirect.co.uk.
Buying shares in Cafédirect - How it works:
1. First read the prospectus - this tells you about Cafédirect, what it does, who benefits from its work, what it plans to do with the money it raises, and what the risks are.
2. If you are not sure about whether to invest, you should consult a professional adviser authorised under the Financial Services and Markets Act 2000, who specialises in advising on investment in shares.
3. Fill in the application form and send it in. If you decide to buy Cafédirect shares, you can only do so using the application form in the prospectus.
4. If you buy shares, you will become a part-owner of the Company. You will be issued with share certificates and will be entitled to dividends when declared.
5. Since there is no certainty that a buyer will be found, it may take time to sell your shares. You should be aware that since it is an unlisted stock, it may be difficult to sell, or to obtain reliable information about its value or the risks to which it is exposed.
This press release does not constitute an offer or invitation to subscribe for shares. It is anticipated that Cafédirect will publish a prospectus in the Spring of 2004. Applications can only be made on the application form that will be contained in the prospectus and on the basis of, and subject to, the information that will be contained in the prospectus. Investment in Cafédirect is intended to be for the long term and income from your investment may fluctuate. An investment in the Company may go down as well as up and you may not get back the full amount invested. Cafédirect is the trading name of Cafédirect plc a company registered in Scotland (registered no. 141496). This press release has been approved by Triodos Bank NV. The Cafédirect share issue is sponsored by Triodos Bank NV, 11 The Promenade, Bristol, BS8 3NN.
Cafédirect Fact File January 2004
What you should know about coffee
- The collapse of world coffee prices is contributing to societal meltdowns affecting an estimated 125 million people (Source: Wall Street Journal - 8 July 2002).
- At the end of the 1980s coffee-exporting nations received US$10 billion (33%) of a US$30 billion annual retail market. The latest estimates indicate the global coffee market is around US$55 billion with exporting countries receiving less than US$8 billion (approx. 15%). (Source: International Coffee Organisation 2001).
- The top 5 companies (Nestle, Kraft, Sara Lee, Procter & Gamble and Tchibo) buy almost half the world's coffee beans each year (Source: Oxfam's "Mugged: Poverty in Your Coffee Cup" Report 2002)
- For the average non-Fairtrade jar of instant coffee, farmers only receive around 11p(2) (5%) of the price you pay in shops ((2)Based on an average 100g jar RRP of GBP2.14). (Source: Oxfam's "Mugged: Poverty in Your Coffee Cup" Report 2002)
- In contrast, for Cafédirect 5065, farmers receive 52pV (20%) of the price you pay in the shops (V Based on 100g jar RRP of GBP2.59). (Source: Cafédirect).
- Coffee farmers capture only a fraction of the value of production - they receive less than 1% of the average retail price of coffee sold in a coffee bar (Source: Oxfam's "Mugged: Poverty in Your Coffee Cup" Report 2002)
- The UK coffee market is dominated by three major brands: Nescafé (Nestlé), Kenco (Kraft) and Douwe Egberts (Sara Lee) (Source: IRI MAT 1 Nov 2003).
Cafédirect - coffee, tea and cocoa brand information
- Cafédirect is the UK's largest Fairtrade hot drinks company (Source: Fairtrade Foundation)
- Cafédirect's retail sales have reached GBP18.4 million (IRI MAT 1 Nov 2003)
- Cafédirect has grown to be the 6th largest coffee brand in the UK - value sales = GBP14.3 million - since coming into the market more than 13 years ago. (Source: IRI MAT 1 Nov 2003)
- Cafédirect Roast and Ground coffee is now 4th largest roast and ground coffee brand in the UK -value sales = GBP6.5 million (Source: IRI MAT 1 Nov 2003)
- Teadirect is ranked 8th in the top 10 UK tea brands - value sales = GBP4 million - having launched only six years ago in 1998. (Source: IRI MAT 1 Nov 2003)
- Cafédirect's Medium Roast Fresh Ground was voted best coffee by Best magazine, awarded 5 stars by Prima magazine and voted favourite coffee by the UK's leading consumer magazine - Which? Cafédirect was also voted the best tea and coffee by Linux Format Awards 2002, and 5065 was voted favourite instant coffee in 2003 by Ethical Consumer Magazine
- Cafédirect and Teadirect are listed by most of the major supermarket groups in the UK
- Cafédirect and Teadirect are sold in all UK branches of Costa Coffee. It was the first Fairtrade brand to be sold in a major coffee chain (Cafédirect)
- Prompted brand awareness of Cafédirect has increased over recent years: 1998 - 38%, 1999 - 43%, 2000 - 55%, 2001 - 56% (Source: Taylor Nelson - 2001)
- Cafédirect audited accounts (turnover):
Year GBP Year GBP 1995 505,494 1996 2,905,956 1997 4,225,164 1998 6,261,823 1999 6,774,942 2000 7,206,973 2001(a) 12,080,779 2002 10,356,179 2003 13,646,454
(a) 18-month period to Sept 01
- Cafédirect audited pre tax profits
Year GBP Year GBP 1995 1,391 1996 1,270 1997 44,144 1998 422,235 1999 239,363 2000 304,997 2001(a) 512,122 2002 419,450 2003 487,959
(a) 18-month period to Sept 01
Cafédirect - drinking more by the day
- Roast & Ground Coffee - Cafédirect is one of the fastest growing brands in the roast & ground category with a 7.7% value share, (Source: IRI MAT - 52 weeks ending 1 Nov 2003)
- Freeze dried coffee - Cafédirect is the only Fairtrade brand available in the freeze-dried category with a 3.5% value share (Source: IRI MAT - 52 weeks ending 1 Nov 2003)
- Teadirect has a 0.8% value share and has grown by 34.1% in the past year. (Source: IRI MAT- 52 weeks ending 1 Nov 2003)
- Out-of-home - Cafédirect also supplies the food service sector with catering products. In 2001-2002, the company's sales grew by 60% in this sector. It currently supplies organisations like Costa, KPMG LLP, Youth Hostels Association and the Eden Project, as well as a host of universities and councils nationwide.
- Over 33 million cups of Teadirect and Cafédirect are sold through food service outlets every year (Cafédirect)
- 20 billion cups of hot drinks are consumed out-of-home each year (Nestle Hot Beverages Report 1999)
- Of this, approximately 80% are consumed in the workplace and the rest are consumed across a variety of outlets including pubs, hotels, restaurants and educational institutions. (Nestle Hot Beverages Report 1999)
Ethical Trading & Fairtrade - getting bigger all the time
- Consumers who boycott big brands for ethical reasons cost firms GBP2.6 billion last year. More than half of people say they avoided at least one product. (Cooperative Bank's Ethical Purchasing Index 2003)
- The UK's ethical market is now worth GBP19.9 billion (Cooperative Bank's Ethical Purchasing Index 2003)
- There are 29 Fairtrade Towns (Dec 2003) in the UK (Source: Fairtrade Foundation, 4 Nov 2003)
- Research shows the growth of ethical investment has soared in the last five years. EIRIS (Ethical Investment Research Service 2001) estimates the size of ethically screened funds in the UK stood at GBP4 billion, compared to GBP1.5 billion in 1997. Around 500,000 private individuals are now seeking ethical investments, compared to 137,00 just five years ago in 1997. (Source: EIRIS)
- Fairtrade, which ensures that farmers in developing countries receive a fair price for their crops, has reached an all time high. Between 2000-2002, UK sales rose by 90% with a retail value of GBP63 million. (Source: Fairtrade Foundation)
- Unprompted recognition of the Fairtrade Mark has risen from 12% in 2000 to 25% in 2003, up 5% from the previous year, according to a MORI poll. (Source: Fairtrade Foundation, 4 Nov 2003)
- There are over 175 retail products that hold the Fairtrade Mark (Source: Fairtrade Foundation, 4 Nov 2003)
Cafédirect - blazing a trail for ethical trading
Cafédirect's Gold Standard Policy:
- Cafédirect pays guaranteed fair prices for coffee, tea and cocoa to get the 'pick of the crop' to produce the finest hot drinks for its consumers, while ensuring its farmers benefit from a good income. In buying its coffee, tea and cocoa direct from the growers, Cafédirect impacts on the lives of over a quarter of a million growers worldwide.
- Cafédirect's Fairtrade approach includes more than just paying a fair price. Its 'Gold Standard' policies offer a unique partnership programme with the 33 co-operatives spanning 11 countries across the globe. This programme includes tailor-made business, community support and development projects, providing producers with advice, market information, management support, training in new agricultural techniques, etc - all the elements required when making premium products
- Cafédirect's 'Gold Standard' policies go beyond the traditional basic principles of Fairtrade:
- For coffee, Cafédirect always pays an extra 10% social premium on top of the market price or the minimum Fairtrade price, whichever is the higher
- For tea, Cafédirect pays a guaranteed minimum price of US$1.95 per kg or the auction price plus a US$0.60 Gold Standard premium, whichever is the higher
- For cocoa, Cafédirect pays a premium on top of the world market price of US$250 per metric tonne or the minimum Fairtrade guaranteed price of US$1,750 per metric tonne - whichever is the higher
Coffee (Prices correct at close of trade on 4th December 2003)
World Market Price Cafédirect Pay % more paid by (US cents/lb) (US cents/lb) Cafédirect Arabica 63.70 126 97.80 Robusta 31.71 106 234.32
Tea (Prices correct as at close of trade 13 January 2004)
Auction Price Cafédirect Pay % more paid by (US$/kg) (US$/kg) Cafédirect Tea 1.46 2.06 41%
Cocoa (Prices correct at close of trade on 2nd December 2003)
World Market Price Cafédirect Pay % more paid by (US $/MT) (US$/MT) Cafédirect Cocoa 1540 1790 16.2
A word from the growers
Rosario Gutiérrez Villarreal, Union de Ejidos San Fernando, Chiapas, Mexico, one of the coffee suppliers to Cafédirect, says: "As smallholder farmers from indigenous backgrounds, living in a country like Mexico, we understand the importance of working hard together to produce a great coffee while loving and respecting the earth where we live. All those who collaborate with Cafédirect hope to make strides forward through sacrifice, hope and hard work and to leave something for our children."
Miss Araka Mgina, who works at Kibena Tea Ltd in Tanzania, who sells tea to Teadirect, says: "Over the past three to four years Kibena, Tea Fairtrade Fund, has contributed to the social development of various villages in and around the tea estates. For example, in the last year alone, over Tsh (Tanzanian shillings) 60m (GBP34K) has gone into the construction of schools, Tsh 11m (GBP6K) have gone into health facilities and TSh 24m (GBP13K) has gone into water projects. Various other projects totalling about Tsh 25m (GBP14K) have also been supported. A significant improvement in the social well-being of the villagers and workers is evident. These projects and improvements would not have come about without the flow of Fairtrade premiums from Cafédirect."
For further information visit www.cafedirect.co.uk or contact the press office:
Louise Leadbetter: +44 (0)7973 223404 or +44 (0)1691 611876
Wendy Richmond: +44 (0)7866 263242
Kat Byles: +44 (0)7901 701334 or +44 (0)1225 833942
Or, James Niven, Triodos Bank Press Office Tel: +44 (0)117 980 9721
A high resolution image to accompany this release is available to the media free of charge at www.newscast.co.uk (+44 207 608 1000).
SOURCE CAFEDIRECT PLC