By Elisa Anzolin
MILAN (Reuters) - Italian premium coffee maker Illycaffè, which reported a 16% increase in operating profit last year despite cost inflation, aims to expand in the United States, already its second biggest market after Italy.
"We want to grow further, with another double digit increase," Chief Executive Cristina Scocchia told Reuters. North America already accounts for one fifth of the Italian group's revenues and reported a 27% increase in sales last year.
"We want to accelerate the investments to increase the brand awareness, make distribution more widespread and reach more consumers," Scocchia said in a telephone interview.
The growth in North America is expected to be organic but Scocchia did not rule out an acquisition should an opportunity arise. She added the company was also looking at growing in the Chinese market, where at the moment it sells its products mainly online.
The Illycaffe CEO confirmed that the family-owned group still planned to go public by 2026. The Illy family sold a 20% stake in the business to private equity firm Rhone Capital in 2021.
Scocchia, who in the past worked as CEO of cosmetic company Kiko and head of L'Oreal Italy, was named Illycaffe's chief executive at the beginning of 2022 with a mandate to take the company public.
Illycaffè reported a 14% increase in revenues to 568 million euros ($615 million) last year. Operating profit grew to 71.4 million euros, despite a 43 million euro increase in costs, mainly linked to increased prices for raw coffee beans, energy and logistics.
Illycaffe increased prices last year by around 3% and another 3% increase is planned for 2023 to partially offset the higher costs.
"Inflation weighed on the shopping cart, led families to reduce purchases of premium price products, but we still closed the year with the highest result in the last 10 years," Scocchia said.
Scocchia expects an increase in revenues and profitability this year, but the sales growth could be slower compared to last year.
The group plans 270 million euro in investments by 2026, with 120 million euros earmarked to enlarge its plant in Trieste in northeast Italy which will double its production capacity.
($1 = 0.9228 euros)