Mostly good year for coffee maker

The year ends mostly well for Keurig Green Mountain Inc., as robust sales drive a rising stock price.

The Waterbury-based coffee maker posted $4.7 billion in revenue and $597 million in net profits, as the company’s stock price rose about 55 percent, from $79.63 to $136.51.

The company released its Keurig 2.0 coffee maker in February and just this month announced it would redeploy its green bean coffee-buying staff to Switzerland, as a “global beverage player.”

The news comes amid fierce Brand-X competition and a massive recall of an older product, the company’s Keurig Mini Plus Brewing Systems.

Sandy Yusen, vice president of global coffee and specialty beverages, told the Record the company is preparing for global expansion in the New Year.

An unspecified number of Vermont-based buyers of green bean coffee will move to Lausanne, Switzerland, to work for a new subsidiary, Keurig Trading GmbH.

“This new entity provides a foundation for us to further identify and implement best-in-class operational strategies in our coffee purchasing process, and creates a scalable organizational infrastructure as we prepare for global expansion,” Yusen said. “We see this as a natural part of our company’s growth and evolution toward being a global beverage player, and alignment with best practices in establishing international procurement hubs.”

Keurig plans to send a small team to Switzerland, but declined to specify how many employees from its Waterbury or Essex locations would go. However, Yusen said the coffee maker remains committed to Vermont, with about one-third of its 6,600 employees based in the state.

As the Swiss subsidiary grows, Keurig plans to hire locals in the French-speaking region. “Switzerland has become a primary and well-established hub of coffee trading and will give us a presence and foothold within a community where significant business is already taking place,” Yusen said.

The company is going global in its competition with Starbucks and other coffee retailers, but Yusen said Keurig will continue to roast, package and distribute coffee in Waterbury and at its other locations in Vermont and across North America. The Switzerland staff will serve the company through buying green beans, managing suppliers and handling quality testing.

“Vermont — and Waterbury in particular — will remain a hub for coffee expertise for North America, and our Waterbury team will continue its essential role in coffee product development for our owned and licensed coffee brands,” Yusen said. “We are committed to our roots in Waterbury and Vermont.”

Last fall, Keurig spent more than $9 million to expand its operations in Waterbury, with a new Innovation Center for beverage technology in Waterbury Center.

As the company invests in Vermont and abroad, a couple of challenges remain. Early this month, the Consumer Product Safety Commission announced the recall of 7.2 million Keurig Mini Plus Brewing Systems after 200 or so reports of defective machines, which spewed hot water that caused burn-related injuries in about 90 cases.

The company also faced increasing challenges throughout the year from competitors who manufacture generic K-Cups, the refillable coffee packages used in Keurig machines. At least two manufacturers of the refillable cups succeeded in unlocking security features on the Keurig 2.0 that had prevented use with generic brands, and one is suing for the right to sell its product.

However, analysts predict another good year for Keurig, following 22 percent growth of single-serve K-cups in the fourth quarter to $948.7 million. The company says it expects earnings to grow in the high single digits.