Zurich, June 21 - Nespresso, the premium coffee-capsule division of food group Nestle, may bring its sales targets forward by one year as turnover surges and it prepares an expansion into fast-growing emerging markets.
Nespresso CEO Gerhard Berssenbruegge told Reuters in an interview that his unit may hit 2 billion Swiss francs ($1.61 billion) in sales in 2009, instead of 2010 as planned, as it readies rollouts in India, Mexico, Thailand and South Korea this year and next.
The Nespresso division, an investors' darling for its chic image and rocketing sales, had seen strong growth in turnover so far in 2007 and was "well on its way" to hitting the 2 billion franc level in 2010, he said.
"It could be that we reach this level in 2009," he said by telephone. Earnings margins for the division should remain mostly flat in 2007 compared with 2006, he said, shrugging off fluctuations in coffee prices.
Berssenbruegge said Nespresso's business model applied worldwide and that the group had a "master plan" to tap fast-growing markets for coffee capsules such as North America and selected developing countries.
Earlier on Thursday, Nespresso kicked off construction of its second capsule factory in Switzerland -- a plant that recycles rainwater and is meant to convey Nespresso's image as ecological, ethical and state of the art.
Nespresso's drive into the super-premium coffee niche through chic machines and cameo endorsements by Hollywood stars has quickly made it one of the most high-profile divisions at Nestle, the world's largest food group.
Analysts say Nestle is on track to break the 100 billion franc turnover barrier in 2007, driven by expansion in luxury, sports and medical foods showcased by brands such as PowerBar, Perrier and Nespresso.
HUNGRY FOR GROWTH
Not easily sated, the group aims for more expansion in its Nutrition division and in the rapidly growing market for premium chocolate, Nestle management board member Lars Olofsson said.
Olofsson told Reuters the Nestle group would not rule out small acquisitions in its fast-growing Nutrition division as it expands further into fields such as infant, sports, dietary and medical foods.
"We can see growth from the organic side. There may also be some bolt-on things," he said by telephone.
Olofsson declined to comment on speculation that Nestle could seize growth in premium chocolate through acquisitions, but said, "We have a clear ambition to grow in the premium and super-premium segments."
Some analysts speculate that Nestle could consider an alliance with Swiss rival Lindt & Spruengli, one of the world's biggest makers of premium chocolate.
Olofsson said the warm European spring had benefited sales of ice cream and bottled water. "The good weather has had a positive instance," he said.