Lacomba - coffee with a dream taste презентация

offer to Your attention some variants of joint cooperation of
Your Company and "UkrCoffee" LLC (Ukraine).
The company I represent – “UkrCoffee” LLC is modern and dynamically developing enterprise, the only plant in Ukraine that : roasted coffee beans, roasted ground coffee, instant coffee powder, instant granulated coffee, coffee mixes “3 in 1” (coffee, creamer, sugar), coffee in sticks… New modern production company provides products to the markets of Ukraine, Europe, , USA, CIS, Asia countries. The products of the plant are manufactured under TM “Lacomba” ( http://www.lacomba-coffee.com/ ). The enterprise and products are certified for compliance with ISO 9001, ISO 22000, ISO 14001, and certificate CT-1, EURO.
Products are manufactured “UkrCoffee” LLC as follows:
- in package: soft plastic packets, doypack, tin can, sticks…
- in different blends and assortment;
- for wholesale in bulk;
under private label for trading networks and trademarks.
Options of cooperation modalities that we offer:
Secure investments into equity capital of the “UkrCoffee” LLC. We offer the strategic partner of the “UkrCoffee” LLC to consider our proposal as to purchasing package of equity rights of the “UkrCoffee” LLC more 40%.
Considering the potential of Your Company, presence of coffee products in the market of Ukraine and CIS, we are interested in expanding the geography of joint sales, long-term cooperation with Your Company, and considering the following possibility:
 - strategic partnership (makes sense for Your Company, as it is already planned to implement the restrictions on sale of imported products 
- distribution of Your Company products in Ukraine (makes sense for Your Company, as there is synergy of transport processes, sales points, different price segment, and the manufactured assortment of products does not cross with TM “Lacomba”) 
manufacture of products for Your Company for CIS countries (reduction of transport expenses and customs duties, optimization of production and logistics processes). We offer owners of coffee trade marks to manufacture produce by our factory

We kindly invite You to visit our plant at any time convenient to You to discuss the possible variants of cooperation.

Contact person at “UkrCoffee” LLC :
Mr. Oleg Drotenko
Member of the Supervisory Board of “UkrCoffee” LLC
Tel.: +38 (050) 316 91 21
Skype: Drotenko_Oleg
E-mail: kda@ukrcoffee.com.ua

Investment proposal.

Strictly confidential

by Ukrainian manufacturers.
In Ukraine there are no manufacturers of instant coffee to apply modern agglomeration technology.
Preferential taxation regime for imports of raw materials, exemption from VAT at exports of coffee. Newly signed European Association treaty with EU allows to export TM Laсomba products with no custom duties. Production in Ukraine, allows for the import of raw materials do not pay fees (10%) and the import tax (10%)
Low labor costs.

The product mix is represented by over 25 SKUs (stock keeping units).
The plant manufactures the following products: roasted coffee beans, grind coffee, instant coffee powder, instant granulated coffee, coffee mixes “3 in 1” (coffee, cream, sugar), coffee in sticks.
The Company and the products are certified with ISO 9001, ISO 22000, ISO 14001 compliance, the CT-1 certificate is also available, EURO.
In-house dynamically developing brand, supported by advertising and promotional activities.
Production distribution is performed via retail chains and other sales channels.

Favorable business environment

Full assortment of coffee based products

Project Summary

Ukraine — country with over 46m population. It is dynamically growing coffee market with an annual growth rate of 23.6% coffee consumption compared to the average 3.6% in developing world. Coffee market industry wide sales is over $750m per annum.
Consumption of instant coffee is at 63% of national coffee consumption
There is potential for growth of demand for coffee in the context of Ukraine’s lagging behind the European countries against the indicator of annual coffee consumption per capita.
It is possible to supply products to the markets of Europe, CIS, Asia and USA — manufactured both under the in-house brand or under the brands of other trademarks.

Growing consumer market

Newly built plant in Ukraine using modern technology of agglomeration for instant coffee production.
Production capacity (PC) range between 3 900 tons and 16 244 tons of coffee-based products per annum upon selected product mix and different upgrade options.
Current I Phase investment into construction of the plant comprised in excess of USD $23m.
Working capital on 1st|01| 2016 –23,9m UAH ( USD $1,05m.) Credit portfolio of the Company – USD $3m and ₴40m UAH ($ 1,67 m).
Total Revenue at current I Phase – USD $24.2 – $46.3m per annum (depending on the pricing policy and product mix, after increasing working capital by USD $3 – 10m correspondingly).
EBITDA at current I Phase – USD $4.9 – $10.2m per annum.
Strategically beneficial location of the plant – Southern Ukraine, Black Sea transportation hub at port of Odessa.
The plant was launched in 2011. Current capacity utilization is at 10% of the minimal production capacity.
Food retail market of Ukraine consists of more than 3,247 VIP retail outlets (hyper- and supermarkets, discounters, convenience stores, smaller food chain formats) and more than 60,000 other retail units (open market kiosks, pavilions and points of sale).
Company’s products are presented in 1,346 VIP retail outlets and in over 1,500 other retail units.

Strictly confidential

Guinea, India, Brazil, Vietnam

The plant is located:
-at the crossing of routes of raw materials supplies and sales channels of end products in a country with a 46m population;
-in close vicinity to sea commercial port of Illichivsk (1,5km), city of Odesa (15km);
-in the center of the region.

Coffee beans

Roasted coffee

Coffee extract

Agglomerate

Coffee mix “3in1”

Ground coffee

1 After the 2nd phase in introduced
2 The enterprise can totally produce from 3,900 tons to 16,244 tons of ready product (at 80% capacity utilization). These figures depend on the issued product range and the fact that each kind of the aggregate product range makes a semi-product (raw material) for production of the next product. The set working mode is: 336 work days, 20 working hours. Discounting capacities for packaging the product.
3 Twofold increase of production of coffee powder, granulated coffee and coffee drinks «3 in1» is possible provided the existing evaporation dryer is upgraded.

The plant equipment was purchased from the leading global manufacturers

Ukraine

Russia

Strictly confidential

7753-15506

1008-2016

1008-2016

5030

5080

6048

Coffee powder

Sulimate 1008 1

potential clients in Ukraine, CIS, Europe and the USA are ongoing.
Commercial offers were sent to such chains as Billa, Magnit (Russia), Fozzy Group (Ukraine), Bedronka (Poland) and others.

Product Mix Manufactured Under LACOMBA TM

Exhibitions

Advertising

Sponsorships

Promotional offers

Distribution channels of the Company in Ukraine:
- over 3,247 VIP retail shops (current presence of Company’s products in 1,346 shops),
- over 60,000 of other retail units (current presence of Company’s products in over 1,500 shops).
Plans for 2016-2017:
-to cover cities with more than 100 thousand inhabitants,
-to get presentations in new retail chains and shops,
-widen the geography of sales,
-to start manufacturing products for the TM under a private label.

* Potential expansion of product mix

The Company created
its own brand and a
product mix to meet various tastes and preferences of
potential consumers.

The Company performs marketing activities to support the brand.

Strictly confidential

in Ukraine (main distribution channels)

Источник: Государственная служба статистики Украины

77% of coffee sales in Ukraine are done for home consumption from Other retail units. Potential for widening sales in Ukraine – direct sales in national chains and distribution in Other retail units.
28,4% of coffee sales in Ukraine are performed by VIP retail.
Potential for sales growth of the LACOMBA TM is possible due to growth of coffee consumption in Ukraine, entering into new sales points, VIP and Other retail units, widening the product line of the LACOMBA TM (manufacture of: roasted and grind coffee for HoReCa, variety of tastes of “3in1” coffee mixes, sublimate).
High quality standards, modern production technologies, selected blends according to European trends – allow plant production capacities to manufacture products under any brand.

Strictly confidential

market share in Ukraine, inclusive of potential growth of share of the LACOMBA TM, in physical terms, %

Источник: Расчеты ООО «UkrCoffee»

Market share of “UkrCoffee” LLC in Ukraine. Sales growth potential in Ukraine.

Динамика импорта кофе в Украину, mln USD

Источник: Государственная служба статистики

Источник: Государственная служба статистики

Actual market share of the ТМ in Ukraine in 2014, in physical terms, %

Ukrainian coffee market is a growing one. On average, a Ukrainian consumes one coffee cup a day, while in other European countries this indicator reaches 3 and more cups per day.
Production capacities of the “UkrCoffee” LLC allow to manufacture produce in any of the coffee segments: roasted coffee beans, grind coffee, instant coffee, “3in1” coffee mixes.
Ukrainian governmental and retail chains policy is aimed at import substitution.
Actual share of LACOMBA TM in the total national sales of coffee in Ukraine in 2013 constituted 0,6%. 100% utilisation of production capacities of the “UkrCoffee” LLC will provide for an 8% market share of the LACOMBA TM of the total coffee market in Ukraine (in physical terms) and more than a 40% market share of the “3in1” coffee drinks market. This will allow “UkrCoffee” LLC to become one of three top coffee sellers in Ukraine.

Other Ukrainian TM

Other foreign TM

Videnska Kava LLC

Galka LLC

Jockey TM, Jardin TM

Source: State Statistical Service of Ukraine

Source: Calculations of the “UkrCoffee” LLC

Source: State Statistical Service of Ukraine

Instant coffee

Roasted and grind coffee

Coffee drinks

Green coffee beans

Total imports

Trend of coffee imports to Ukraine, mln USD

Strictly confidential

range for coffee products,1kg/UAH

Shares of Ukrainian coffee manufacturers 2015 (%)

Источник: Государственная служба статистики Украины

Purchasing power of Ukrainian citizens decreased in 2015. “LACOMBA” TM products are sold in the low price segment which makes it easier to augment potential sales against the decreasing purchase power.
LACOMBA TM products mean high quality standards at an acceptable price.
Ukrainian consumers prefer products manufactured in Ukraine.
After two years of operations of the “UkrCoffee” LLC its products under the “LACOMBA” TM occupied a 3.5% share of the total sales of coffee by all manufacturers in Ukraine. In 2014 the share of “LACOMBA” TM products on the natural coffee market of Ukraine is gradually increasing.
We develop the LACOMBA TM together with distributors aiming at high sales, offering comfortable employment conditions and opportunities for competitive salaries.

Источник: данные предприятия

Competitors’ price range for coffee products, 1kg/UAH

Source: State Statistical Service of Ukraine

Odesskiy kofe

Specific features of coffee market in Ukraine

Strictly confidential

market of Ukraine

* Manufacture of glass jars is planned for 2016

LACOMBA TM products :
delicate taste
pleasant, budget-friendly, good-looking packaging
new product of European quality
wide range of products
possibility to manufacture products in any price segment
Possibility to manufacture products under a private label of any trademark
All these product features contribute to the loyalty of customers to our trade mark and stimulate the growing sales

Strictly confidential

of the factory is launched
Source: in-house data

Sales and EBITDA, USD $ m,
in the given assortment of output

Annual utilization of production capacities (AUPC)
for estimating financial performance under the given assortment of output, (t)

Potential scenarios of business development

Future financial performance

Different utilisation of AUPC. Manufacture of coffee (tons) and utilisation of capacities (%), inclusive of manufacture of sublimate

Maximum utilization of production capacities. Using existing production capacities to manufacture products in accordance with market demand. Currently this model is the basic one for the sales scheme of the “UkrCoffee” LLC. The amount of additional investments into the working capital ranges from USD $3 to $8m.
Manufacture of products of a specific assortment. This model allows to accentuate the manufacturing process: “3in1”, roasted and grind coffee. This will enable occupying leading positions in Ukraine in the segment of “3in1” coffee mixes, roasted and grind coffee.
Combined model. Increased output at the cost of modernising the production:
Increased output of agglomerated coffee. The amount of additional capital investments will constitute up to USD $1-$1.5m.
Construction of a sublimation facility. Will allow to manufacture up to 1008 tons of sublimated instant coffee. The amount of additional capital investments will constitute from USD $16 to $18m.

Strictly confidential

producing powder or agglomerated coffee (as required, in case of focusing on production of instant coffee, production of coffee beverages «3 in1» in maximally possible production amount up to 15 500 tons/ year)

Business development scenarios

Capital investments in amount $1 mln.

1a. Production of coffee under Lacomba brand

1b. Production of coffee under another brand. Investments depending on offered cooperation terms.

Gradual increase of facilities and production amounts of various types of coffee. Entering new trading networks. Distribution development.
Brand development and sales system formation
Formation of brand awareness and loyalty to the brand

Transfer to full facility utilization
Increasing sales amount
Expanding regional representation, export of production to countries of the near abroad

Doubling production amount of agglomerated coffee – from1 700 to 2 000 tons/year
Compliance with taste preferences of Ukrainian consumer
High marginality of production
Lack of producers of instant coffee in Ukraine, using modern agglomeration technology
Focusing on producing coffee mixes «3 in1», which would permit to produce up to15 500 t./year of the product «3 in1».

distribution

Articles and Layout Placing in Magazines

Internet Advertisement

Tasting

Promo T-shirts and caps

Promotional activities ‘Cap as a gift’

Audio-clip placing

Outdoor advertisement

Bus advertisement

Sumy

Kharkiv

Kyiv

Cherkasy

Poltava

Kirovograd

Dnepropetrovsk

Rivne

Ivano-Frankovsk

Lviv

Chernivtsi Region

Vinnitsa

Lugansk

Donetsk

Crimea

Kherson

Zhytomyr

Chernigiv

Lutsk

Mykolaiv

Ternopil

Khmelnytsk

Zaporizhya

Uzhgorod

Odesa

Advertisement in ATB retail chain

Printed products

All Regions

‘Valuable Prizes from Lacomba’ (car is the jack-pot)

Strictly confidential

or in bulk
Weight, g: 45/90 and 100

Wide Range of Products

Product: Roasted coffee in beans
Name: Lacomba Classimo Beans
Packaging: paper bag
Weight, g: 250

Product: Roasted ground coffee
Name: Lacomba Classimo Ground
Packaging: paper bag
Weight, g: 100/250

Product: Instant granulated coffee
Name: Lacomba Classimo Granulated
Packaging: paper bag
Weight, g: 50/75/100/150/200

Product: Instant granulated/powder coffee
Name: Lacomba Classimo Instant
Packaging: stick
Weight, g: 2g*20 units in package

Product: Instant ground coffee mixed with creams and sugar
Name: Lacomba Mix ‘3 in 1’1
Packaging: stick/doypack
Weight, g: 18g *12 units in package

Product: Instant granulated / powder coffee  
Name: Lacomba Classimo Soluble
Packaging: tin
Weight, g: 45/90

Product: Roasted ground coffee
Name: Lacomba Classimo Ground
Packaging: stick
Weight, g: 14g*12 units in package

1Two new tastes added: Hazelnut and Cream caramel
2An option for business expansion

Strictly confidential