INDIVIDUALITY COMBINED WITH CHARM

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1 INDIVIDUALITY COMBINED WITH CHARM In conversation with the fruit processing company, Iprona The Iprona Company is one of the international corporations involved in handling, processing and marketing fruit. The company is based and has its production plant in Lana, amidst the South-Tyrolean Alps, one of the most beautiful alpine regions and one of the largest fruit-growing areas in Europe. The philosophy of the company calls for the preservation of the fruit in its natural form. Our success is based on the quality of our products, a range that is in line with market conditions, the experience and specialized knowledge of our employees, the use of new technology and continuous, intensive research and development conclude Stephan Breitenberger, Executive Director, and Stefan Schwanzer, Director Business Unit Compounds, in this interview with BREWING AND BEVERAGE INDUSTRY INTERNATIONAL. Brewing and Beverage Industry International: Herr Breitenberger, please outline for us the most important business milestones in the history of Iprona. Stephan Breitenberger: The firm of Iprona AG was founded in 1981 as a joint venture of Henkel KgaA, Düsseldorf, and Dragoco Gerberding & Co. GmbH, Holz - minden. In 1983 the whole parcel of shares was taken over by the Philipps, an entrepreneur family in Bavaria. Initially they were focussed on concentrates and in 1993 they entered into a collaboration with Beerenfrost GmbH, Styria, Austria, for the cultivation of elderberry plants. There is also a strong network of connections to partner companies Trentofrutta AG, Trento, Italy, and Vulcolor, Güssing, Austria. From its foundation, Iprona has stood for high quality standards and product safety. S. Breitenberger In 1995 the product portfolio was expanded to include the business segment extracts. In 2011 the idea, and the need, to expand the plant arose plans were made in 2004 and in 2009, the company moved into its new premises in Lana, just 500 meters from the old plant. Two years later the product portfolio was expanded again to include the business unit compounds. BBII: Please tell us some of the most important data of the company. Breitenberger: With around 125 employees (25 per cent labor, 20 per cent administration, 55 per cent production/sales) the company generates about 100 million Euros in turnover annually. We have the latest pro - duction equipment and unique production techniques. Emphasis should be put on the frozen concentrate plant, with its high quality standards for juice concentrates. Stephan Breitenberger (rh.) and Stefan Schwanzer (middle) were absolutely sure at their interview with Andreas Hofbauer, editor BREWING AND BEVERAGE INDUSTRY INTERNATIONAL, that Iprona will be one of the most innovative, flexible and likeable companies of the industry by the year 2020.

2 In addition, we use the traditional filtration method, thermal concen - t ration, spray drying and a blending and mixing station for the product ion of our compounds. The new equipment was conceived against the backdrop of optimized effi - c iency and a high level of auto - mation, so the highest possible levels of control and product safety are guaranteed. Through consistent observation of the market and the intensive exchange of ideas with our customers and suppliers, we always stay in close touch with the market. S. Breitenberger BBII: Please give us some more details on the fruit. Breitenberger: It can be any of a wide variety of fruits, from pine - apples to lemons with certification (organic, Halal, Kosher) supplied from all over the world, but our focus is on red fruits. We supply The headquarters and the production facility in Lana are located right amid the South-Tyrolean Alps. around 15 per cent within Italy and export around 85 per cent to 60 other countries worldwide, including all of Europe, Japan, Australia, New Zealand, USA, Russia, Ukraine, Iran, Saudi Arabia, Turkey, China, India, Indonesia, Malaysia, Nicaragua, Thailand, and many more. We have a large worldwide network of importers and representatives to help us serve these countries in the best possible way. We also draw the fruit for pro - cessing from all over the world, depending on the product characteristics. Apart from the production plant, we have an automated high-bay warehouse with 5,200 spaces in cooling areas of between 18ºC and 0/4 ºC, which ensures that customized deliveries from 20 kg up to con - tainer units full can be made on time. BBII 3/

3 BBII: You have already pointed out some of the points in the company s philosophy, please elaborate. Breitenberger: Our philosophy can be divided into a number of points: Innovation and experience: We employ a healthy mixture of young, innovative people and experienced specialists, who bring their expertise to many different areas of the company. Customer orientation and service: We always adjust our service to the needs of the customer. Short decision paths and direct contact promote positive cooperation. Quality and safety: Quality is the result of intensive control and constant, continuous improve ment. Since its found ation, Iprona has stood for the highest standards in quality and product safety. Flexibility: Life is about contin - uous change. It is therefore our aim to find the necessary ways and methods of adjusting to changes in conditions. In addition, we wish to and must, react appropriately and quickly to any future requirements. BBII: What are the particular strengths of a mid-sized company in this respect? Breitenberger: Through consist - ent observation of the market and the intensive exchange of ideas with our customers and suppliers, we always stay in close touch with the market. Our qualities are flexible production planning and volumes, guaranteed product quality and safety and a serviceoriented approach to all our dealings. Quality is the result of intensive control and constant, continuous improvement, Stephan Breitenberger is pointing out. BBII: Standardizing processes within the company is important for maintaining product quality. It also fosters trust in the con - sumer. Which quality management systems do you use within the company? Breitenberger: Our company philosophy calls for the preser - vation of the natural qualities of the fruit. This means that the fruit has to be of a very high quality. Iprona has stood for high quality standards since its foundation. We use an integrated manage - ment system, which is certified according to several internationally recognized ISO norms regarding quality, food safety, environmental protection, and industrial safety: ISO 9001, ISO 14001, ISF, BRC, OHSAS By the end of this year we aim to also be certified according to FSSC BBII: The company s success is also founded on the use of new technology. It can be supplied any of a wide variety of fruits, from pineapples to lemons with certification (organic, Halal, Kosher) from all over the world. Breitenberger: That s absolutely right. In order to take into account both our customers needs and our own concept of innovation, we recognized the need for our own R & D department very early and made that investment. We have for example an excellently equipped technical center, where we can quickly and efficiently realize new products and production processes. We use the decades of experience we have been able to gather in the processing of fruit for specific product applications and for recognizing the pertinent raw materials, enhances Stefan Schwanzer. This means that we can react quickly, which makes the whole process very service-oriented. The basis for any new develop - ment is always the beverage. The ideas and the input come from the client and are realized in cooperation with our development department. The compound business division is a purely project-based area that is oriented towards development and goals. BBII: Now we have arrived at the second topic of our interview: the compounds. What are these primary products used for? Stefan Schwanzer: Our comp ounds are mainly used by the beverage industry for very diverse product applications. Starting with near water, through energy drinks to soft drinks, nectars and syrups. BBII: Where do you see Iprona in a world of Wilds, Döhlers, Symrises? Schwanzer: Without wishing to draw any specific comparisons: You can feel the South Tyrolean charm and our attitude towards life in conversation with us and 14 BBII 3/ 2014

4 in our services. We think differently and have a different manner. We are a young and ambitious company, but at the same time very down-to-earth, with a lot of know-how, experience and the will to make (new) things happen. We want to reach our clients more directly and show that we are capable of mass production. It is not possible to compare us with the big companies in this business because the structures are so different. The compounds business division has done a lot in the last three years but in future we want to operate on an even more global scale with regard to innovations, development and marketing. BBII: How does the company stand up to such powerful competition? Schwanzer: Our methods make it possible for us to work in a fast and focused way. For example, we don t act according to the watering can principle but adapt to the wishes of each individual customer; our mid-sized structure allows us to deal with their demands flexibly and individually so we are also very close to our customers. Each of our basis products is tailor-made. Our worldwide distribution network also gives us direct access to the most important markets around the world. BBII: So you can also develop products more closely with your customers. Schwanzer: Exactly. If a customer comes to us with an idea for a product, then we usually get a briefing on the required product characteristics, develop it on those lines and have follow-up consultations on the progress of the project. Or we might present a project ourselves and then adjust it to meet the customer s needs. It makes no difference which way it goes, the customer is always involved in every phase of the project. Although we can also copy (match) existing products using various technological means, this is not our main focus. We much prefer to develop new and successful products with our customers. BBII: The raw materials for manufacturing the compounds come from You can feel the South Tyrolean charm and our attitude towards life in conversation with us and in our services. S. Schwanzer Schwanzer: largely from our own processing, or from partner companies, or as Herr Breiten - berger mentioned, we buy them on the international market, tailored to the product in question. We also guarantee consistent quality in the ingredients of our compounds. A clever man once said Know-how is easy if you know how so we make use of the many years of experience and knowledge of other firms bringing proven elements together. Naturally the final product devel - op ment happens at Iprona. BBII: How do you recognize flavor trends early? Schwanzer: We use the known channels in market research. We are very closely linked to international markets and we keep our ears open in order to identify trends early on. Then we continue to develop these trends internally so that we can present new pro duct cate - gories and innovative products.

5 The new equipment was conceived against the backdrop of optimized efficiency and a high level of automation. BBII: How important is the naturalness of a product to the consumer? Schwanzer: Geographically we have noticed huge differences in consumer behavior but if we are talking about Europe, then the naturalness of products is very important and topical. Since our slogan is the fruit company, we are very close to the natural raw materials and therefore to the consumers wishes. BBII: What role does the color of a beverage play in the develop - ment of a beverage base? Schwanzer: A beverage can taste wonderful, but if the color is not attractive, it is generally a problem. As with the subject of naturalness, there are regional differences regarding the color a product is expected to be. Division Concentrates Extracts Products Besides, we are also competent in the natural colouring segment and the use of so-called coloring foodstuffs. This is also one of our focuses for next year. BBII: What are the actual advantages of your compounds? Schwanzer: Because we focus on our core competences, not all of the raw materials for a primary product have to come from our own company, as is the case with many other companies. This allows us to buy the best raw materials, without bias, when necessary. These are then applied to a compound by the relevant specialists. Iprona s product range is organized into three divisions Compounds Our methods make it possible for us to work in a fast and focused way. S. Schwanzer Juice concentrates: cloudy, clear or powder Puree concentrates: triple concentration Pulp concentrates: with/ without chunks Fruit mixtures: individual solutions for clients (e.g. woodland fruits, tropical fruits) Application in the beverage and tea industries, confectionary and baked goods, milk and ice cream industries, jams Natural colorings, liquid or powdered: used for coloring fruit preparations, non-alcoholic and alcoholic beverages, nectars, confectionary, ice cream, jams etc. The best-known product is Rubini, a coloring foodstuff with a strong red color, extracted from elderberries in a special process. Various blossom extracts (e.g. elderflower, hibiscus flower) Beverage powders Powders with standardized anthocyan content, manufact ured by Iprona and distributed by the BerryPharma Division for the food supplement and pharmaceutical industries. The tailor-made all-in-one solution for the beverage industry In addition, we are very flexible regarding, for example, production volume so we are in a position to cater for start-up companies and small production volumes without problems. These range from plastic buckets with 20-liter aseptic lining sacks to 24 ton freight trains. For all our filling units we pay particular attention to quality, so that transportation by road/air/sea is always assured. And naturally we set great store by punctual delivery! BBII: Another advantage is that you have the additional benefit of the core business you have developed over many years: the processing of red fruits and berries. Schwanzer: That s right. We use the decades of experience we have been able to gather in the proces - sing of fruit for specific product applications and for recognizing the pertinent raw materials. We are also very close to what is happe - ning on the market, since red fruits are often used in beverage bases. BBII: As you mentioned, Iprona stands for high standards of product quality. How can these standards be maintained, particularly in view of variations in the quality of raw materials? Schwanzer: We guarantee high quality and standardized products by processing the fruit and raw materials ourselves, and by applying sustainable and long-term purchase strategies. BBII: Where do you see Iprona in the area of primary products in 2020? Schwanzer: Without mentioning any figures I am sure that in 2020 Iprona will be one of the most innovative, versatile and likeable companies in the industry. BBII: Gentlemen, thank you for the interview. (hof) Stephan Breitenberger Born 1973; active for more than 15 years in various positions of responsibility at Iprona AG. Since October 2013 Executive Director of Iprona AG ( Stefan Schwanzer Born 1977; active for more than twelve years in the B2B industry in national and international positions, most recently as Global Business Director with the Döhler Group. Since April 2014 Director of the Compounds Business Unit at Iprona AG. 16 BBII 3/ 2014