Headquartered in Waterbury, Vermont, Green Mountain Coffee Roasters is a provider of premium, specialty coffees through multiple wholesale distribution channels and also to the single cup brewing industry through the acquisition of Keurig in June 2006. Since the acquisition of Keurig, Green Mountain Coffee operates in two business segments: stand-alone Green Mountain Coffee Roasters and Keurig. The majority of Green Mountain Coffee's revenue is derived from over 8,000 wholesale customer accounts located primarily in the Eastern United States, serving supermarkets, specialty food stores, convenience stores, offices, hotels, restaurants, universities, and food service customers. Wholesale customers resell the coffee both in whole bean and ground form for home consumption and/or brew and sell coffee beverages at retail locations. Through the acquisition of Keurig, Green Mountain Coffee has a presence in the premium quality, single-cup brew market. Keurig sells single cup brewers along with coffee and tea in K-Cups produced by licensed roaster partners, who package coffee and tea in the patented K-cups in 11 gourmet brands and in over 130 varieties. The roaster partners pay Green Mountain Coffee Roasters a royalty when the K-cups are shipped. Keurig sells the brewers and K-Cups to both wholesale and retail markets.

Green Mountain Coffee Roasters has changed the company's quarterly calendar in fiscal 2007 to report four thirteen-week quarters ending on the last Saturday in September (which is the same year-end as in prior years). The prior quarterly calendar was 16 weeks for the first quarter, twelve weeks for the second, third and fourth quarters except in the years with the additional 53rd week.

Green Mountain Coffee Roasters is a growth company in a growth industry. The premium coffee industry has experienced strong growth over the past decade and the company is targeting the growing consumer demand for the coffee experience. The company has reported 20 consecutive quarters of double-digit sales growth and eighth consecutive quarter with growth in excess of 25%. Over the next few years, management's financial goals are to grow both sales and EPS in the 20% to 25% range. In fiscal 2008, management expects top-line growth of 35% to 40%.

Management's core business model involves the implementation of a multi-channel geographic penetration strategy, which entails expanding distribution through multiple channels and through geographic expansion. The use of multiple distribution channels increases the presence of the company's coffees. Green Mountain Coffee provides coffee pounds at the office through the Office Coffee Service (OCS) channel, at the supermarket through the Supermarket channel, at home through the Consumer Direct channel, on the road through the Convenience Store channel, and at restaurants, hospitality and foodservice locations through the Food Service channel. Geographically, the company's operations were concentrated in New England until 2003, when sales outside the region began to comprise over 50% of sales. The company is in the process of growing from a regional to a national company.

Green Mountain Coffee Roasters acquires and roasts high-quality Arabica coffees under various brand names and licensing agreements. The most successful brands are the Fair Trade Certified , proprietary blends, and flavored coffees sold under the Green Mountain Coffee Roasters and Newman's Own Organics brand names. Green Mountain Coffee Roasters enjoys an exclusive licensing agreement with Newman's Own Organics. In fiscal 2007, the Fair Trade Certified product lines, including Newman's Own Organics, grew 12% and represented 28% of total volume. Seasonal offerings account for approximately 5% of total annual volume. In fiscal 2006, the seasonal coffee promotions included Raspberry Rhapsody and Silver Celebration Blend, along with the seasonal favorites of Golden French Toast , Island Coconut , Pumpkin Spice, and Spicy Eggnog. In 2007, the company introduced newly designed coffee packaging for Newman's Own Organic line of coffees, which is composed of Newman's Special Blend, Newman's French Roast, Newman's Special Decaf, Caf Almond Biscotti, Nell's Breakfast Blend, and Columbian Especial. In addition, the company introduced a new Vanilla Caramel flavored coffee.

In June 2006, Green Mountain Coffee Roasters acquired Keurig, a gourmet single cup coffee company. Keurig employs a royalty-based business model, selling patented/proprietary single cup coffee and tea brewing systems. Keurig brewers consistently and conveniently provide coffee drinkers with gourmet coffee and tea on demand with "coffee house taste", one cup at a time. The patented and proprietary portion pack system (K-Cup) uses a specially designed filter and eliminates mess and coffee waste. The brewers precisely control the amount, temperature and pressure of the water to consistently produce a high quality cup of coffee or tea in less than a minute. The company offers a variety of brewers for large, medium, and small offices. The key to growth from the K-Cup royalty income stream is to increase the installed base of brewing systems. Keurig has a 33% unit market share and 48% dollar market share for coffeemakers in the single-cup category up from 18% and 26 %, respectively, in the comparable quarter last year. (source: NPD). In addition, by December 2007, the retail store count is expected to grow to over 9,000 from about 7,000 and the retail outlets for K-Cups is expected to increase to over 10,000 in the U.S and Canada. The installed base of brewers has generated substantial incremental demand for take-up shipments of K-Cups and the increased demand has prompted the company to expand its existing manufacturing facilities. Two new high-speed K-Cup manufacturing lines were installed at Waterbury in the third quarter of 2007, and management indicated that additional packaging lines would soon be operational. The increased efficiencies of the new manufacturing lines are expected to lower costs, which should positively impact margins.

In addition, the company is targeting the upscale hotel room market with single cup brewers (Model B130), which was launched in August of 2007. Through mid-November, the company has sold about 10,000 units. Management estimates that there are about 5 million coffeemakers in hotel rooms with over 40% in upscale hotels. The Lowes hotel group will be converting all of its 7,500 rooms to the Keurig gourmet single cup system. Green Mountain Coffee financed the cash portion of the purchase price of Keurig through a new five-year $125 million syndicated revolving credit line.

On November 1, 2005, Green Mountain Coffee Roasters began a one year test with McDonald's in the Northeast. Green Mountain Coffee is providing coffee to over 650 McDonald's restaurants in New England and New York. In fiscal 2007, the food service channel increased 9.4% in coffee pounds shipped with the majority of the increase driven by sales to existing customers, including McDonald's. A potential long-term relationship could add considerable sales potential to Green Mountain Coffee Roasters.

Green Mountain Coffee adheres to socially responsible business practices. The company allocates at least 5% of pretax income towards social and environmental projects. The projects involve direct or indirect financial support, donations of products or equipment, and paid employee time.

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