Ladies and gentlemen, please welcome to stage Robin Jansen.
Good morning, ladies and gentlemen. Here in this lovely building, the Muziekgebouw, here in Amsterdam, actually very close to our head office, which is, let's say a couple of hundred meters away from here. For those of you who don't know me, I'm Robin Jansen, and I head the Investor Relations function at JDE Peet's. On behalf of the entire team, I have the pleasure in warmly welcoming you to JDE Peet's strategic update meeting. I have to say, I'm very glad that after such a long time, we can finally convene again together here in Amsterdam and don't have to sit behind the screen and interact on the beautiful things that the coffee category can actually bring to us and to you and the entire world.
At the event today, we will provide you with an update on our achievements. We will talk about the progress we've made against our strategic roadmap. We will have a snapshot at full year 2022, and we'll take a peek into the future, and we're gonna share a little bit about what we think 2023 might bring. Before I do that, let me briefly direct your attention to this very interesting page with a lot of important information about non-IFRS measurements as well as forward-looking statements. This slide will be in the decks that we will provide you with during the event. I would kindly like to ask you to pay attention to this important information.
Now, let's have a look at the agenda for today. After my introduction, Fabien will kick it off. After Fabien, Fiona, our Chief Marketing Officer, will zoom into consumer trends, all the, let's say, potential we see and the attractiveness of the coffee category, and how we are well positioned with our brands and our innovation capabilities to be a relevant leader in the industry. After those two presentations, there's time for Q&A to ask questions you might have about Fabien's and Fiona's presentation. After that, we will have a break to enjoy a good cup of coffee or tea.
After the break, we come back here in the room, then Laurent Sagarra, the VP Sustainability at JDE Peet's, will provide an update on all the progress we're making on our three sustainability pillars, as well as touch on all the ambitions we have for the coming years. After his presentation, there is time to ask questions to Laurent about his presentation, and that's before we actually break for lunch. Lunch will be in the same area, where you could just enjoy a cup of coffee just before we started today. After lunch, Scott will be on stage, Scott will give you an update on our capital allocation, as well as on how we strengthened our capital structure.
Then he will hand over to Fabien with a concluding presentation, which will touch upon full year 2022 and an outlook for 2023 amongst others. We'll have a short break because you might want to digest a little bit of what has been provided during those two presentations. After the short break, we will come back for a concluding Q&A that will be hosted by both Fabien and Scott. I briefly touched on the presentations. Just prior to each start of a presentation, we will email you the deck relates to their presentation, and those presentations will also be posted simultaneously on the website.
With that, and without further ado, I wish you all a very engaging and insightful day, and I would like to invite Fabien to come on stage and kick off with the first presentation. Thank you.
Thank you, Robin. Good morning to all of you, and again, a very warm welcome to a full day at JDE Peet's. Last time we had such of a conference, it was virtual, as Robin alluded to, and it was soon after we entered the public market. Back then, we talked about the attractiveness of the coffee and tea category, about the attractiveness of JDE Peet's. We touched about some of the challenges we were having, but as well, greatly talking about the possibilities, and we introduced our financial mid to long-term ambition. It's fair to say that over the last two years, the world around us has been pretty turbulent.
We have had a health crisis, we've had supply chain crisis, inflation crisis, energy crisis, and sometimes even a compounding effect in some geography of all of these crises together. Our agenda over this last 2.5 years has been articulated around three things. One was to act as a leader and navigate best with quality all these external turbulences that the world have been confronted us all with. The second thing was to fix some of the challenges where we felt we were not good enough, but as well, exit that time by being a stronger company, being a more productive company, and being a more sustainable company.
The third things was to position the company into a different and more attractive growth trajectory as we have been, I would say shared, but as well committed two years ago during our last Capital Market Day. Was it around scaling up our capabilities on digital commerce, on innovations or entering into new and very attractive growth pool? You will see today we will touch on all of these topics. I have to say I'm very proud, sorry, about what the team have been achieving over the last 2.5 Years. I think we have been delivering very well on all these three topics. I think where it position us today, and I think we are totally geared up now with strengths to enter and to be successful in these new waves of coffee.
I really trust that at the end of the day, you will, you will share the same level of confidence on our success, but as well on how it's gonna position us to win in coffee in the future in the future times. I think we feel fortunate. We feel fortunate to be a focused, pure player at scale in a very attractive category. One of the characteristic of defining an attractive category, it's its resilience and relevance over time. Here, what you have on the chart is 30 years of history. I mean, the world has seen couple of crises over these last 30 years. There have been some high lows, very high, very lows, some periods of GDP decline, some periods of high inflations, is becoming a recurring themes nowadays.
There have been one constant during this time horizon, which is a rise of coffee. Whatever the economic cycle has been, coffee has always been on the rise, not only being resilient, but kept its relevance over time as it continued to evolve and to reinvent itself. The second thing that we feel grateful about is the generations of owners and of leaders before us, who over the last 250 years of history, have been going through many crises, have enabled us to be where we are today, which is the world largest pure player of coffee and tea company. Today, we will talk only about coffee, it's interesting to see on coffee today, globally, we are a strong number two players with about 10.5% market share globally.
In the places where we decided to operate, we are actually at a 14% market share, almost to the size of the next eight company after us combined. We are really a very strong player in the coffee and tea place, and in coffee in particular. You might recall this slide from two years ago, where we introduced our new growth and purpose-led strategy, which was articulated around three pillars. The first one was a relentless focus to attract consumer with serving more cups, serving more premium cups, and serving cups in more geographies. The second pillar of that strategy is to fuel and execute our growth with mastery, from farms to where consumer shop and where consumer consume their coffee without any compromises on quality.
Finally, the last pillar, is really anchored in a strong belief we have that the only way to have a long-term, enduring, sustainable performance is where you don't operate at the expense of your ecosystem, but within and with your ecosystem, and we really want to foster that inclusive ecosystem. Today, we will touch, I believe, almost on all of these topics, and, of course, we'll be very happy to answer any questions if you feel there is one of the topics we have not really touched on. I joined the first time in this company in 2014, up to the beginning of 2019, before returning mid-2020 as CEO. It's interesting to look back over this time horizon, how much the company moved and evolved. We started really from a European heritage.
That's why Europe was representing about 75%-77% of our revenues back then. We have been really greatly developing over time. Now we are a global company. Today, Europe is representing about 50% of our revenue, which means there is 50% of the revenue which is outside of Europe. Up to the point that today, our biggest market is not anymore the Dutch market like it was back then. It's really today the U.S. market, which is the largest coffee market in the world, and it is very important to ensure we have a very strong foothold there. What is interesting as well is where we decide to go, we have the ability to win.
We have the ability to challenge the incumbents. If I look at the U.S., for example, we have an amazing brand asset with Peet's that is going double digits. Where Peet's decide to play, and I will come back much more in detail, later on today, it wins. Today, Peet's is the in the U.S. is the winning premium brands. It's significantly outpacing either on K-Cup or on, or on the roasted ground or on beans the other players. As we talked about two years ago, we said emerging market is very important for us to serve more cup in more places where there is just a start of penetration of coffee, which will be a good reservoir of premiumizations going forward.
We have been putting a lot of attentions and a lot of effort in these geographies. I'm very pleased to report now in the emerging market where we play, we are winning market shares. We have been gaining 81 points of market share over the last two years. We did win market share in 2021. We did win market share in 2022 in emerging markets. Our assets have the ability to travel around the world and to be successful and challenge incumbent and to become a stronger leader going forward. Through our various agenda or organic or inorganic over the years, not only we have been now participating in all the category of coffee from single-serve, beans, instant and roasted ground, but very importantly, we have been positioning ourself to the most attractive part of coffee.
We are today over-indexed on the fast-growing category on coffee, which are single-serve and which are beans. Which means that we will, going forward, attract a bigger part of the growth of the industry. Let's look back now over the last two years. I think we've never heard that many times the word resilience over the last two years. For us, resilience was the opposite of standing still. We had to fix few things, as I've alluded to at the introductions, but as well, we wanted to ensure we would come out stronger from this from these last two years of very turbulent times. Sometimes crisis can be an opportunity to be stronger, and it's where we wanted to position ourself.
It required sometimes for us to be acting even beyond a player in coffee, but really to play as a leader in coffee. You will see in the future in some area where we believe we have been leading. Starting first with, as a leader, we have to invest behind our biggest asset, which is brands. I was clear two years ago, when I shared some of our starting point, I was really not happy by the way our share of voice has been developing. It was a shortcut to manage bottom line by investing less behind our brands. I committed to restore it, and I've said back then it will take us two years. We did it. There in coffee, we are the leader on share of voice.
We have a share of voice today which is almost two times bigger than the one we had in mid-2020. We have today a share of voice which is bigger than the one we had even before COVID started. We have a share of voice be ahead of our share of voice we had in 2019. The world of media has been changing a lot during this during this time. Have we. We have been disproportionately invested behind digital media, which represent today 40% of our media spend. We see some of the results. You can see on the bottom, right side of the chart here. If we look at the share of visibility of JDE Peet's product in online retailer stores, we come first.
We have more than 30% of visibility, which is ahead of peers on these online platforms. The other things we had to course correct was our commitment to single-serve appliances. We can say on one hand one of the most attractive part on coffee is single-serve and at the same time investing less behind it. We have been significantly scaling up our effort on innovations, on investment behind single-serve appliance. I will even share later how much more investment we have been putting behind. It is quite meaningful. It's interesting to look back on the appliances where we participate globally. First, in Europe. Senseo, up to today, is the largest part of single-serve coffee appliance used every single day by consumer. I think Senseo will get even more important giving the macroeconomic cycle in which we are entering.
Not only Senseo is the most sustainable single-serve system today existing in Europe, but it is as well for consumer, the most affordable single-serve pad solutions, meaningfully lower than the average of single-serve category. There we have been innovating. We have been opening new geographies. I think beside an anecdotal Nordics appliance launch a couple of years ago, we have not launched a new appliance, not entered a new market in Senseo for about 10 years. We have now a new appliances. You will have the opportunity to see it at a break, which we call Mastro, which blind tested is giving the same in-cup test experience than an espresso capsules. We have been opening 3 new geography in Eastern Europe in 2022. We are very happy having Senseo and very grateful having Senseo in our portfolio.
The second single-serve appliance that often comes to mind to many people globally outside of the U.S., the biggest park that exists is espresso appliance. On that one, despite a lot of competitive activities over the last few years, we built and we stayed firms on our market share to be the market leader in modern retail on aluminum capsules. We had at a peak about 44% market share. That was really at a peak. We stand firm above 40% market share despite a lot of activities that have been happening over the last few years. We had to do a lot of things for that, a lot of innovations. Fiona will talk about it.
We have even launched, I could almost say relaunched, but it's almost a launch, our new appliance espresso machine that again, you will have a chance to see at a break here. But I will talk as well a lot more during the course of today because it is really exceeding our expectations and we will do more of it. Shifting gears to the U.S. By far in the U.S. the largest single-serve park is Keurig machines. There, there is the one bonded winner. Out of all of them, many people win, participate, win, but the fastest growing one is Peet's. In the U.S., Peet's on K-Cup is growing at about 2 times the growth of the category. Finally, Tassimo, which was the first multi-beverage drinks which was introduced in Europe before any others. Again, we are taking care of our asset.
We have been doing quite a lot of renovations either on the appliance side or on the SKU we have been offering to consumer. We have really been recommitting to appliance and we know that our participation now in the number of appliance which are sold globally are going up and are very meaningful. Doubling share of voice, recommitted, reinvesting beyond appliances is not coming for free. I always say growth requires investment. We are very cautious that we have to play our part to self-fund the vast majority of this step-up of investment. For that, we have been boosted our cost agenda because we want that cost agenda to have the ability to lift our growth investment. We had really two agendas there. One is around focus simplifications and another one is around efficiency and automations.
I don't want to enter in all what's on these slides here, but we have been, for example, over the last two years, reduced our number of SKU at a double-digit level. Something we have done. We have been reducing by more than 1,000 our employee base over the last two years. Very meaningful numbers. We are talking about more than 5% of our global base. If we would talk, or if we exclude through the area which were untouchable such as field sales, such as digital commerce or innovations, we talk about a greater number than this 5%. A very, very meaningful ambition which enabled us to reinvest beyond our growth. It is an agenda now we have been regaining our cost competitiveness that we really truly intend to protect. At the end you would say, "Was it worth it?
All this reinvestment, does it work?" Yes, it did. We are tracking the health of our brands every quarter now for two years. We looked at the progress on the awareness or consideration, so all the metrics behind brand salience. We go beyond leading indicators of market share. We go on lagging indicators. What drives it long term? What drives it is the quality of your portfolio, the health of your brands. In here you have a metrics that represent countries and brands, and you can see in eight out of 10 boxes here on metrics, our brands have strengthened. This would have not been the case without investment, let's not. I think we should give more credit to the team. It's not only a question of money, it is a question of quality of executions. How you talk to consumer.
Do you have innovations? Do you have relevant things to talk to the consumer? That Fiona will be covering. We are very, very pleased with the quality of our portfolio, which is stronger than it has ever been if we look at this metrics. Why it's important? At time of inflations, one of the most important indicators is do you have pricing power with your brands? By the way we have been able to turn around the quality of our brands, we have been able to lead on pricing for the category. Here we have been putting the last 18 months price increase, we have been doing across key segments, isolating our pricing, isolating competitors' pricing, isolating private label pricings. Couple of things you can read here. The first thing is we took the lead about a quarter, sometimes two quarters on pricing.
Because this pricing were absolutely justified by cost inflations, everybody was going there. You see they are all converging. There is a bit of a lead time, but they are all converging to the same level. We believe with some places where there are some catch up to be done by some competitors, but it is converging to the right level and to the same level. We are talking about double-digit price increase. We'll talk later when we talk about 2022. It could be seen big percentage-wise, but if you would translate that into a consumer impact, we believe it is pretty responsible and reasonable.
We have to be very mindful and careful with averages, but if you would be a consumer that drinks 500 cups per year of JDE Peet's product with the inflations, the price increase we put through, the impact full year of this inflation represents EUR 5. EUR 5 for 500 cups increasing inflations. That is a price of just 1 cup you can get out of home today. That's a belief that we have. That's why, and tonight we'll talk about it, we think that even in this inflation cycle, in this difficult macroeconomic environment, in-home coffee will stay as strong as what it is today. Another things which could have been a nice temptations in difficult time would be to scale down ESG effort. Either to invest less or not progress on the agenda. We decided not to.
We decided not to, first, because it is not in our belief, in our philosophy on how you run a quality business for the long term. The second thing is we had no choice. We had no choice, I had two years ago a very direct feedback from one investor in this room. I will not name, but I have to thanks for the directness of the feedback. The feedback was, "We love the category. We love your company. The best way for me as portfolio manager to improve, to increase my ESG rating is just to sell my JDE Peet's shares." Quite a tough feedback to receive, I can tell you, when you're entering in the job. We looked in detail, and actually it was true. We have not really put any attention so far on ESG rating.
Not only we have been looking at 1 only, but we've looked really at all of the most meaningful one because we realize they all look at different things. Over the last two years, we have been really moving from what we'll consider a lagger on ESG to a leader on ESG. We have not compromised difficult time to not doing it. I think we are pretty pleased with where we are today. We know it's a non-ending journey. We know the bar is raising every time on the rating, and we ambitions to keep high. These two years were really around turnaround leadership, and they were all at the service of 1 thing. They are all at the service of growth and elevating our growth into a new trajectory.
If you remember two years ago when we had our first capital market day, we talked about opportunities which were unexploited for us. We talked about the largest coffee market in the world being the US. We talked about emerging market and in particular about the fastest-growing market probably for the next decade being China. We talked about the fastest-growing channel, which was online e-commerce. We talked about appliance. I want to share now what we have been doing on all these four topics over the last two years and where we are today. Starting with the US, an absolute fundamental market for us, our number one market, which is important not only because it's the largest coffee market in the world, because it's a market with a lot of premiumization opportunities, but as well a market where we have the asset to win with Peet's.
Today, Peet's is getting greater and bigger. Peet's just crossed the $1 billion and EUR 1 billion. We don't play with currency here. Over the last two years, it's really reached the scale. It's increased significantly its household penetrations by 20% over the last two years, and we are still very low. It's only at 6.7% at the end of December of 2022, with a lot of headrooms. Where Peet's decide to go, Peet's wins. Peet's is outgoing the other top three premium brands on roast and ground and beans. Peet's is growing at 2x the rate of the market on K-Cup. Both Peet's and L'OR have been climbing now to number three and number four positions on Amazon. As you know, Amazon in the U.S. market is about 25% of that category.
It's a very meaningful channel to be powerful at. Next one, the U.S. U.S. has not been an easy an easy round over the last few years. What's interesting is one of the few category in China that remained boiling during this time is coffee. We shared why China is very important for us and why, although it's in an investment phase for us, we intend to do that. We do that with having an agenda of penetration and premiumizations and an agenda of omnichannels. If we look at on the in-home side in China, I'm very pleased that in 2022, we have been growing 20% again in-home in China.
In China, there had been a change of landscape over the last couple of years with much more momentum growth from local players. We have been keeping the pace of the growth, even participating on that with local players ahead of a lot of other international companies. We have been changing our innovation approach. We have been innovating more for China, by China, at the pace of China, and in the digital way for China. We have been as well introducing some of our great premium assets that resonate very well for Chinese consumer, which is L'OR and Moccona. In away from home, with spits, we have been accelerating. After five years, we've reached 13 stores. Over the last two years, we have well crossed the 100 stores at 117 stores at the end of December 2022. Without compromising on quality.
We have just been rated the best quality coffee chain in China at the end of 2022 for quality of beverage, for quality of service, for quality of stores, ahead every other local, regional or international players. We are at the beginning of a journey in China. We know China will have opportunities to reach our top five markets over time. The other one we talked about is online. If there is one thing that COVID has been accelerated, is really the trend on digital commerce. We see a confluence sometime of geographic opportunities as well as channel opportunities. We have been doing a lot. We've really stepped up and scaled up on digital commerce.
At the end of 2022, digital commerce represented 9.5% of total JDE Peet's revenue, which is about 2x-3x bigger than what it was represented couple of years ago. What you see as well is the interesting momentum we have on some of the most attractive market at the same time, playing, turbocharging this online performance. In China, 60% of our in-home business is online. In the U.S., more than 25% of our in-home coffee business is online. These two numbers are pretty competitive in the consumer good world. Definitely, digital commerce is a significant accretive growth, growing at a much higher level than the average of the company. The other one is appliance. I talked briefly about appliance before.
Here I want to zoom in a bit on our new crown asset called L'OR Barista, our proprietary espresso system, and you will have a chance to see it outside. I think we had it 2018, but to be honest, it was kind of left in a drawer. People were not much interested about it. We awaken a sleeping beauty. Why do we think it's a sleeping beauty? It's not us saying it's the consumer. We have been very intentional over the last two years, investing to understand more about it and what consumer were saying on our L'OR Barista machines. Here a couple of data, external data.
In the market where we focused first, which are big espresso market in the world, France, Spain, Belgium, we are selling between 1.5 x- 2 x more L'OR Barista machines than other competitors' new fast-growing appliance in the space. As well, you would see now we have to place machine to sell and keep our freedom on the capsule side. On top, we have a return. When we look at the throughput of JDE Peet's capsules in the L'OR Barista system versus other system, it is more than 30% higher. It's really exceeding our expectations. We are very encouraged with these numbers, and we are rolling it out in a very disciplined way.
We started at the end of 2021 to launch it in the Dutch market, we see already a similar numbers on the sellout on machines that we have been seeing on the three other market I presented before. We've just been launching it in the U.K. and in Ireland at the end of 2022. I would say when you have your organic growth in order, you can look back and resume more inorganic agenda. We've been doing that in two instances on strategic partnership and on M&A. We have been increasing partnership in the coffee world with some of the most reputable coffee company around the world.
We already had illy, where we have significantly expanded numbers of markets over the last two years. We have as well entered a partnership with The J.M. Smucker Co. in the U.S. market on out of home, or with Tim Hortons in Canada. We have as well been very disciplined unlocking opportunity in a super premium space in Australia with the brand Campos Coffee. Again, you will have the opportunity outside later today to see this fantastic brand. As well on the infusion tea in France with Les 2 Marmottes, which when we acquired it, was the number four infusion brand in the French market. Last read, it's already number two. We have fantastic asset that we can even turn to move to the next level.
Last two years, we're really around turnaround leadership and coming stronger, being a more productive company, being a more sustainable company. As well positioning ourself into a much higher growth territory, unlocking, fueling new growth upsides. Before I return later on Q&A or later in the day to talk about how all of that is translating even in numbers in 2022 or even since the beginning of our journey, I want now to hand over to Fiona, who will share some very exciting consumer trends, but as well innovations of JDE Peet's. Thank you.
Thanks, Fabien, and welcome everybody. Consumers today we know are facing increasing prices. We know it's kinda tough for consumers today, and as such, it's forcing them to evaluate and reevaluate their buyer behavior. Every day they need to look at the choices that they are taking. You could say there is a new reality which is being defined by the consumer, and it's influenced through the lens of uncertainty. Within that context, what we see is that the role of coffee, the resilience of coffee is very clear and very evident despite the disorder that we are seeing. There's a core reason for this. Put simply, it's because of the role that coffee plays in consumers' lives. It's really important to consumers. Coffee does so much more than just wake us up in the morning. Coffee brings people together.
Coffee fuels conversation, it drives decision-making, and it inspires creativity. In the words of Egbert Douwes himself, "It adds to the pleasures of our everyday lives." That is why we, at JDE Peet's, believe it's amazing what can happen over a cup of coffee. When we look at the coffee category in totality, it's very clear to see that the relevance and the opportunity of coffee is very evident. Why? It's big, it's growing, it's premiumizing, and it's on trend. In terms of the size of the coffee category, it represents roughly EUR 340 billion worldwide. I think the size of the coffee category is best understood when we put it into context. It is the third most consumed beverage on the planet.
In terms of growth, we have seen growth in the coffee category, and importantly, we see sustained growth in the coffee category. We've seen growth in value, and we also see growth in consumption. Importantly, we also see that our emerging markets are growing at roughly 2x the pace of our developed markets. We see more cups, and we also see better cups. Premiumization in coffee, it's real. Consumers have clearly demonstrated that they are prepared to pay more for what they perceive as an elevated experience. The data supports that, whereby we see that within the higher perceived quality categories of single-serve and beans, they are growing at 2x the rate of the other parts of the market. Finally, we know that coffee is on trend. This is the case because of the versatility of the drink.
Coffee appeals to multiple need states, and it appeals to multiple occasions. It is drunk by just about everybody. We also know that coffee is a very broad repertoire category. In terms of the repertoires that it covers, it covers a repertoire of channels, of formats, and of price points. When we look at the repertoire of channels, I said before, EUR 340 billion, this represents approximately 1.2 trillion cups of coffee per year. This is roughly 200 cups of coffee per person on the planet. When we look at the consumption of coffee, it is consumed both in-home as well as away from home. Indeed, 80% of the cups are consumed in-home, and we see a slightly inverse relationship with value, where we see that 75% of that value comes from the away from home channel.
The away from home channel is important because through that, we can observe many of the trends that are occurring, shifts in consumption patterns, and that can also inform our innovation agenda. When we look at the repertoire of formats, there are many different ways to consume and enjoy coffee. Coffee comes in the form of roast and ground, in instant, in beans, as well as within the single-serve format as well. We see growth across all of those formats. As said before, with the accelerated growth within single-serve and beans, we see that those formats start to take up a greater share of their overall place within the total coffee category. Finally, we see a repertoire of different price points as well.
They're very broad, the price points that we see within coffee, whereby you can enter with a cup of roast and ground at roughly $0.06 all the way up to single serve at around $0.35 a cup. This repertoire nature of the category is also commensurate with consumer buying behavior, that is that consumers tend to buy across different channels, formats, and price points. There is a fair degree of promiscuity that exists within coffee, consumers are on a relentless pursuit of finding something different and new at times, and that comes through with these different repertoires. We also know that coffee is consumed all over the world, coffee is not consumed in the same way all over the world. There's no such thing as a global homogeneous coffee consumer. We know that consumer interests and hence taste preferences do vary in different markets.
We know that hot beverages are very much a part of culture in many countries, therefore, we see that the differences that occur within the different drinking profiles and indeed taste preferences. As we move forward, we feel very confident about the runway that exists for growth both in volume and value within the coffee category. We estimate around 4%-5% long-term growth trajectory within the category, and we see that coming from three distinct, yet somewhat interdependent drivers. These drivers are more consumers, more cups, and more value. When we look at more consumers, the opportunity to continue to drive penetration within coffee very definitely exists.
You can see here the example of a highly penetrated coffee market at around 79% consumer penetration to a mid-level market such as South Africa, where we see 58% penetration all the way to China, where we see just 16% penetration. The opportunity to convert consumers to coffee and thus realize incremental penetration still very much exists within the coffee category. We also see growth opportunity through more cups. What do I mean by more cups? To enhance the frequency of consumption as well as to cover the occasions that exist within coffee. An example here within Western Europe, where approximately 400 cups are consumed per year per person versus Asia, where just 40 cups are consumed per year per person. There is significant headroom in existence in order to accelerate that frequency of consumption.
We also see opportunity in occasions. I already mentioned that coffee does much more than just wake us up in the morning. Coffee increasingly is consumed throughout the day, and indeed, many people navigate their day around their coffee consumption. We see that coffee can be consumed in the morning, in the afternoon, and all the way into the evening occasion as well. It can be consumed at home, on the go or away from home. We also see another driver, which is more value. This is because consumers have clearly demonstrated their preparedness to trade up, to trade up within a category, or to trade up by experiencing a new category. The example that you see here is our own example of Jacobs, where consumers can enjoy a cup of Jacobs instant for roughly EUR 0.07 a cup.
Indeed, they can also enjoy a cup of Jacobs specialty mixes at EUR 0.36 a cup. These same consumers sometimes move out or complement their existing instant usage by trying Jacobs capsules at EUR 0.36 a cup. Within capsules, you also have the opportunity to trade up to more value with a sub-range of Jacobs Barista for around EUR 0.44 a cup. We certainly see that there is clear runway and headroom for accelerated growth within the coffee category. One of the further reasons why we believe this is because of the history of this category. Over time, coffee has shown that it has very definitely come a long way. If we go back just approximately 20 years, where coffee was dominated by a brown sea of sameness.
If we fast-forward to today, what we see is a vibrant world of inspiration, aspiration, and indeed possibility as well. Through this time, coffee has moved through a number of what are now quite well-known waves, as we call them. Through that journey, it's moved from a commodity to a cultural cornerstone. It began with the first wave, where consumers valued price and consumption, to the second wave, where we saw the rise and rise of the modern coffee shop, to the third wave, where coffee became something of an art form. We saw the barista became the hero, and we saw small roasters focused on specialty coffees and origins of where that coffee came from. Then we moved into the fourth wave, where we start to hit the cultural cornerstone and where socioeconomic impact and sustainability became more important than ever before.
Our ability to understand these waves and indeed project into the future is dependent upon our ability to understand the consumer, to understand consumer insight and the trends that exist. Right now, things are behaving just a little bit differently. There are a number of different impacts at play in the world today. We know that disorder is fast becoming the new order. What we're seeing as a consequence of that is that consumers are experiencing things a little bit differently. Their mindset can behave a little bit differently as we enter into a new macroeconomic cycle, coupled with many of the societal disruptions that we are seeing. As a consequence, disruption is the new normal, and our consumers are experiencing heightened levels of fear and anxiety. The fear and anxiety that our consumers feel, it's real. When they feel that, they look for certain things.
They look for what they know, they look for what they trust, they look for familiarity, and they look for the benefits of what they find in their local environment. They are also seeking for cognitive ease to ensure that they can make their life as simple as possible. In essence, what consumers are looking for is to feel safe, to feel good, and to feel connected. This then links to what does this mean for the coffee category and what does this mean for our brands at JDE Peet's? For the coffee category, the essential nature and the resilience of coffee is what we start to see. We know that coffee can play a role to help to manage stress and anxiety by helping to manage energy in its purest form. We also know in these stressful times that consumers crave familiarity, trust, and localization.
That positions our own brands, particularly our local or heritage brands, very well. Our local brands have long been a sign and symbol of home. Right now, home is a sign and symbol of safety, connectedness, and a safe harbor for consumers. If we look a little bit more deeply at coffee now, I've already said that coffee plays a role to help manage energy. Coffee can play other roles as well. Coffee can be seen as a pleasurable treat. It can be seen as something that helps us relax and provide us with comfort. We know that consumers are seeking for just small pleasures in their lives during times of stress. You see on the chart here that the third thing that consumers are reaching out for during these times is a good cup of coffee.
What you also see here is that coffee is indeed the first consumable that consumers are also reaching out for in order to find just a very small pleasurable treat. Just looking at coffee as a category in totality. This chart again reinforces the role that coffee plays in consumers' lives. I've already said that consumers are needing to make choices every day. What we are seeing is that coffee is remaining in the basket. When consumers need to make trade-offs across the entire basket, the choices will be made, and coffee is still seen by greater than 50% of consumers as an essential within the basket. The consumer's desire to trade off against coffee is a lot less than some of the other staples within the basket.
What you also see here is that coffee sits at a 25% area here in terms of a treat, and we know that consumers will reach out for a treat during this time as well. Coffee can play both roles very well within the basket choices that are made. On the other side of the chart, if we deep dive into beverages specifically, what we see here is that behind milk, coffee is the one that remains in the basket within the beverage category. Again, reinforces the importance and the role that coffee is playing for our consumers and where it sits in those choices that are being made. What we're also witnessing in coffee at the moment is that consumers are not moving around too much at the moment. There's not a lot of trade-offs being made within the coffee category.
Specifically, what you see here is a representation of the share of the different price indexes that exist within coffee from mainstream and mass to premium and super premium, and then forward to luxury, which sits at the greater than 200 index price point. What you can see on the chart is that within our mature markets, we're not seeing a lot of trading differences occurring. We're seeing a very small movement towards mass and mainstream, but not a great deal of movement, essentially is occurring. Within our emerging markets, again, not a great deal of shifting occurring either. Indeed, what we are seeing is just a very small increase in some of the higher price point indexes within the market. We do believe that coffee will remain essential and resilient during these times.
Then comes the role of our brands, our portfolio of brands. We know that at JDE Peet's, we have some of the world's most globally iconic coffee brands. These brands play a role. They are important within our consumers' lives. We cover the category landscape with these brands offering affordability, accessibility, and availability through covering in full the category landscape. We know that moving forward, we will be able to deploy a ubiquitous portfolio of price points to ensure that we're best placed to capture any trading up or trading down. We know that we will be able to deploy a unique portfolio of categories to capture any shifts in consumption that may or may not occur. We also have our iconic portfolio of brands, which is versatile enough to meet the needs of consumers' desires for familiarity, for localness, as well as for trust.
We're very proud of the brands that we have within our portfolio. Increasingly, as we move forward, we will also be able to bring to life our compelling ESG agenda to ensure that our brands are at the forefront of the role that coffee will play in social consciousness. To that end, we will selectively bring to life the purpose of our brands in line with our ESG agenda. The purpose of our brands will complement very well the agenda that we have around nutrition, packaging, as well as sourcing. A few examples here. Purpose can be subtle, and Douwe Egberts as a brand is a great example of this. Douwe Egberts has always existed to bring people closer together and to create a strong sense of community. What could be more important than that right now?
Some of the other brands that we have with Senseo. Senseo has always existed to enable consumers to make choices that matter for themselves. As Fabien has alluded to, now with Senseo, consumers can make choices that matter for the planet as well. Jacobs will exist to stimulate prosperity. L'OR has always existed to unleash pleasure. Moving forward, we're partnering with the World Coffee Research to ensure that we play a role to protect that pleasure for generations to come through the protection of some of the rare Arabica species. With Tassimo has always served everyone with happiness, and this is a brand that's earned its right to play within the space of DE&I. Then finally, with Peet's.
Peet's as a brand has always been on a relentless pursuit or quest for better, and it will take the lead in our portfolio in the territory of sourcing with impact. We also know that our brands play a key role within our innovation agenda, and actually, innovation comes to life through our brands. Innovation is very important for our brands because it gives us the opportunity to ensure that our brands remain relevant, they remain modern, and they remain timely. We utilize innovation for many reasons within JDE Peet's and for many ways to drive our growth agenda as well. For example, we use innovation to strengthen our leadership. We use innovation to access new profit pools, to fuel our channel development.
We know that consumers increasingly wanna have an omni-channel experience. We can use innovation to ensure that we win where consumers are and where shoppers wanna shop. We also use innovation to fuel our geographic expansion agenda. Finally, to ensure that we have the right level of pricing power within the market, and particularly at the moment, that becomes very important. At JDE Peet's, we have a strong track record of success, of innovation. We have a strong track record of disruptive and proprietary technology. We have a portfolio of patents that we use to not only protect our current business but also to secure our future business as well. A few examples here. Fabien already mentioned Senseo. We were the first to bring to the retail environment a single-serve system within Western Europe.
With Tassimo, we were the first to bring an intelligent multi-drinks system with a barcode reader capability to Western Europe as well. With our L'OR brand, we were the first to bring the ubiquitous availability of aluminum capsules to the grocery market. With our free stride instant technology, we were first to bring creamer capability for an elevated experience for our consumers. With our frozen liquid technology, we're the only ones with the frozen liquid technology, which is able to offer rapid and hygienic dispensing within away-from-home environments. We do have a track record, and we utilize that track record to inform where we're going in the future as well. We have been able to identify six key innovation platforms which we innovate around in order to drive global scale whilst also and always respecting local relevance.
These 6 innovation platforms are our compass for future innovation. They are agnostic. They cover all our brands, all of our categories, our regions, our countries. They also cover marketing, R&D technology, as well as our grocery and our away-from-home business too. What do these platforms mean? Just as a couple of examples, when we look at exciting experiences, this is about being multisensorial, it's about the new and different, and it's about the surprise and novelty effect for our consumers. Health and wellbeing is an increasingly important territory within coffee and an increasing opportunity within coffee too. This is where we will balance both mental and physical wellbeing. When it comes to authenticity, this gives us an opportunity to be able to elevate the consumer experience by focusing quality improvements around freshness, around craftsmanship and connoisseurship.
Mastery for everyone gives our ability to be able to offer our consumer an elevated competency level to ensure that they can enjoy more personalized experiences. At arm's reach is about being available, being where consumers and shoppers are, whether that is indeed in a physical world or a virtual world. Finally, brewing a better future is very much our sustainability play, and this is where we are focused on ensuring that we are offering the right products, the right packs, the right propositions to create a better future. A few examples where we have innovated against these platforms. Against exciting experiences, we have brought to China a new single-serve cold brew proposition, which is in line with the consumers' heightened desire for novelty.
This is also another example of where we're able to work at pace and have a level of agility to ensure, again, that we have the global scale together with ensuring local relevance. Against authenticity, our L'OR brand really shines against this platform. You see a couple of examples here. One is the launch and the continued launches that we have within limited creations for our L'OR capsules, together with L'OR Artiste, which is a recent execution and launch around our instant and whole bean instant proposition. This is also an example of how we can ensure that our premium or super premium brand is able to travel into all of the categories or formats that exist within coffee. When it travels to the adjacent categories, it's able to do so at a more premium price point.
Another example here is where we are able to combine our health and wellbeing together with our Brew a Better Future platform. Jacobs is the example where we've been focused on reducing fat, sugar, and salt content. This will enable us to ensure that we meet our 2025 nutritional agenda, which forms part of our overall ESG agenda. Against our Mastery for Everyone, together with our Brew a Better Future platform, we see the Senseo brand. Again, Fabien talked a bit about the role of Senseo in terms of affordability and sustainability. Senseo still holds the largest part in Western Europe, and it really has been at the forefront of our sustainability agenda. Senseo offers compostable pads, certified coffee, farmer projects. It offers appliances that have a greater propensity of recycled materials as well as lower energy usage.
As I said earlier, this is a brand that really is able to ensure that consumers can make choices that matter for the planet, and it's a brand where conscious choices is permeating through everything that we are doing. Then again on our Mastery for Everyone platform, again, Fabien talked about the launch of L'OR Barista, the success of our L'OR Barista appliance as well. We're very proud of the performance of L'OR Barista. Another example of how our brands can travel into other categories and indeed own the space of appliances as well. Another example of the power of our L'OR brand, a brand where passion and inspiration meets imagination to really create a super premium brand that has the power to captivate our audience.
Today, I'm not going to share with you our entire innovation pipeline, but I do want to share with you one new launch that is coming this year. With our L'OR brand and our success within the espresso part of the market, again, mentioned already our ability to hold that number one share position within espresso capsules. We have successfully done that through focusing on being born from gold. As we move forward into this year, we will complement that with also being born from nature. I trust that you will be as excited about that launch as we are. As I said, it will be launched this year, and it will complement our very strong performance within the espresso capsules part of the market and also the strength of our L'OR brand.
In summary, I think at JDE Peet's, we have a clear sense of who we are and why we do what we do. Our vision is clear and compelling. As the champions of coffee democracy, we will continue to deploy our portfolio of brands, formats, categories, price points, and geographies to ensure that no matter who you are, where you are, or how you drink it, we have a coffee for every cup. Thank you.
Thank you very much, Fiona and Fabien. We've now had the first two presentations, and I can imagine you might have some questions you would like to raise to either Fabien or Fiona on their presentations. We will start a Q&A session, and I would kindly like to ask you, if you would like to raise a question, you raise your hand, somebody will come with a microphone to you. If you could state your name and the company you represent, ask your question, then we'll take your questions from there. With that, I would like to invite Fabien and Fiona to come on stage to host the Q&A session. Thank you.
Thanks. There we go. There are questions here in the front, so if somebody would come with the mic.
Hi. Oh, stand up as well. Fine. Hello, I'm David Hayes from SocGen. Two questions from me. Just in terms of the higher pricing that you showed, particularly against the branded companies where it's a fairer comparison 'cause obviously private label has a lower cost base. It looked like you're consistently higher. Is there a reason for that? Is that partly that you're financing the investments you've been making through higher prices? Is it that you're more exposed to the spot prices? There's something that drives that delta across each of the different categories you showed. The second question on China, you showed the store rollout. I just wonder whether they have been slightly delayed by COVID, 'cause that's all happened over the COVID disruption.
Would that be even more if you didn't have the lockdowns and so forth? Have you got a number that you're aspiring to in terms of going from the 117 to X in so many years? Thank you.
Yeah. I think on pricing, you had a couple of questions. One is kind of the competitiveness on pricing. Did we put more or less percentage absolute? Here, I think what is very fundamental, and I have seen in some categories where there were some time even some suspicions, do people put more pricing than what they had to? On coffee, and we have been very clear about it, our role is not to create value by speculating on coffee, putting more pricing than what is necessary related to the commodity side. It is a pass-through category and will behave both sides. What we have been putting through is only related to the commodity inflations. Nothing more, nothing less.
You have part of the portfolio where indeed you may be a bit more exposed on some other part. If you are more in a host and ground and beans category, because you have, I would say less packaging, added value compared to single-serve propositions, the level of pricing we had to put through in this category is much greater than when we had to put through single-serve or instant, for example. If you look at what's happening now with more energy crisis, it is most likely the part of the portfolio that use more energy will have to carry more pricing like instant, for instance. Of course, there is always the point of departure is different from absolute price point.
If I would have taken, for instance, roast and ground and beans in EUR per kilo, it could have been another matrix we could have presented. We see the exact same level of convergence, which is happening across the various players. Second question was around China. Yes, it had been more difficult to open stores during COVID. There is no doubt about it, we decided to not slow down. We would have not opened more if there would have been no COVID there, we could have decided to do much less because of course today, during COVID, the throughput per stores is almost 50% to where it would have been in a normal normal time. We decided not to do that because we look long-term.
We know, we, at the time, we had no idea when the world in China would recover post-COVID, when it will reopen. We know when we reopen, we want to be ready. That's why we did not slow down our opening. As a reminder, at the time of the IPO, we said, "By 2025, we will have 150 stores." Two years later, we are 120 almost. Now the agenda is how we double it. We will, for sure, be much greater than what we have been originally presented. We will give regular updates on the pace at which we want to open. We don't have the intent to open too much stores.
Because when you open too much stores, you very quickly becoming to mass, we want to protect the premiumness, the very attractive segment that Peet's is carrying, which is a master roaster in the coffee world. We want to protect that with really being disciplined on the number of stores, on the exclusivity in the number of stores, in the premiumization number of stores. When that is done, we can go in even more aggressively on the, on the omni-channel, even with Peet's.
Celine? Yeah.
Thank you. Celine Pannuti, JP Morgan. I have two questions. My first one is on the volume in the mass market in Europe, which we've seen as being quite under pressure as a category, and I think as well for you. I wanted to know to which extent this is due to a step-up in consumption, a high base, and, you know, if we can quantify that, and how we as well look at that versus the maybe impact from higher pricing. Is it a bit less defensive than you thought, given the high level of prices? My second question is on the comments that you made on premiumization and value.
You seem to say that, having a more value offering in Senseo, for instance, is quite important for Europe. At the same time, Peet's plays in the premium. I mean, is Peet's under pressure to be too premium now in the U.S.? If you could clarify that. Thank you.
Yeah. Let me try to answer, and Fiona, feel free to add to add things more from a consumer standpoint. Let me start with the second part. I think you see, of course, in the world different trends. There is no, as Fiona says, no one-size-fits-all average consumer. We see all this price point agenda very fundamental, depending if you're driving penetrations, if you're driving premiumizations or pending all the consumer tension which are happening here and there. On your question on Peet's has absolutely zero pressure points today on price point. What the data suggests, I will take a bit of a shortcut on the way I will say it. Today in the U.S., there are two winners that probably explain and illustrate your point.
The two winners today in the US are private label and Peet's. By winner, I mean the fastest-growing one. Of course, there is multiple winner, multiple growing one, but the ones that grow at a higher pace are both the value side with private label, that is growing at a higher pace than before, and the second one is Peet's. That's why playing on various price point is important. In the US, we made the choice to play the premium side of the market, which means that we play smaller, at least from the beginning, because when you enter a new market, you can go mass scale because then you go for lower price point. We decided to go premium, and we have an absolute fantastic asset with Peet's that is outperforming in every partition it plays.
Now we are even globalizing Peet's by accelerating the presence in China. We have as well, just announced at the end of last year a partnership with Americana in the Middle East. We have opened last week or the week before. Sorry for the date, I forget exactly. I think two weeks ago, our first Peet's stores in Dubai. We are expanding. We are planning to expand even further the footprint of Peet's because in the world of a course for better, more convenience, better taste of coffee, Peet's is really one of the heroic brand. Your second question was around Europe and volumes. I cover that a bit more in detail when I talk about 2022 with very transparent data that is very rarely presented, you will see. I would say two things at this stage.
One is, in Europe, we have been waving a very high COVID period, which have been elevated in home consumption, and there have been a form of readjustment in 2022. At the same time, for some players in particular, including ourselves, I will not hide behind the fact we have been losing volume, we have been losing market share in Europe. I will even share how much we have been doing that. For us, we see that a very temporary event because it is one of the consequences of playing the leadership role in pricing. As competitors are converging to the pricing that is totally justified by commodity inflations, we see a normalization of market share, and I will come back to that later. I see more hands. At the same time, I don't know how to prioritize.
I have the mic. My name is Robert Jan Vos, ABN AMRO. I have two questions. I think one for Fiona, one for Fabien. The first question is on the L'OR Barista appliance. It's a success, as you have mentioned. What is the distinction between this appliance and let's say, what the difference, the main difference between your appliance and the original machines? Is that price? Is that functionality? Or in other words, why is it a success in those markets? My second question, that was from your presentation, I think, Fiona, is what you said on market growth, 4%-5% medium-term growth, consumption, consumer premiumization.
This percentage is lower than what you've set on your organic sales growth, target for the medium term of 3%-5%. Can you remind me what the reason for that is? Is that maybe the high exposure still to Europe, or is there another reason? Thank you.
Why don't I take the Barista question and you take the other one? If we start with your question on L'OR Barista. What makes L'OR Barista an attractive proposition for the consumer? The L'OR Barista machine is able to brew espresso capsules, and it has the ability to offer what we call a double shot, double pleasure. With the L'OR Barista machine, you can brew two cups at one time, and you have a level of versatility, which is advanced versus some other propositions. You can actually brew with a small capsule, so the capsule that we know very well today, and you can also brew with a larger capsule, which gives you that level of versatility around the number of cups that you can brew, as well as the size of the drink that you can brew as well.
That's really the key influences that we have on the L'OR Barista appliance and of course, the power of the brand associated with the appliance as well.
What I would say to complement is what we've learned in the history of coffee appliances around the world, is that coffee appliances with the highest penetrations are the open system appliances. Consumer doesn't want to stack up multiple appliances on their kitchen counter, and when they have the beliefs or perceptions that a system can offer multiple brands, multiple choice, they are the ones that they will favor. We've learned that with Senseo when it became open. We've learned that with Keurig when it became open. We learned that with an espresso system when it became more open. On your second question was around the algorithm, and you will see again, I will talk about the outlook for 2023. We have been showing the long-term trend history of coffee, which was around four to five.
I even presented five at one of my earlier stage by category, which was partially boosted, at Covid, was the end of 2021. All our agenda, as I was presented, before, is really to position us the closest, if not higher, on the high side of our original growth rate of 3% to 5%. Historically, we were not. Let's be very clear. If you look back at the history, we were around the zero type of territories.
We have been moving our portfolio, our agenda, our investment, our innovations to ensure we will be more anchored towards this high side of growth rate in difficult time for pricing, because we should not underestimate our being able to do, yes, elevated organic growth at time of inflations come with pricing, but you need to ensure your brands can carry that, and you don't pay, you don't have the negative effect on too much on the volume side on the long term. It can be as well, in, I would say, easier time when you have your innovation and your portfolio supporting growth, and our intentions is to elevate it. It's all the reason of what we have been doing over the last two years. Why?
Because we are clear that what drives value long term is growth, is growth of quality.
Hi, it's Jeremy Fialko, HSBC. I've just got one question, which is about your kind of online versus offline market share. You've given the total, I think, which was 9.5%. You gave a bit of data for China and the US. Could you perhaps give us a bit more information about your kind of online versus offline shares in some of the other markets where you think you're sort of underweight, overweight, and what you think you can do to close the gap if you are underweight? Thanks.
The question was hard to hear. Your question was around market share online, offline, right? Market share, definitely offline, we all read the same data. Although sometimes you have a subset, we have the full read, and I will come back as well on that later on. And on the online, we feel much better on where we are now, not only on the market share, where we feel now we are competitive, and we don't see us being underrepresented there, but as well on the profitability side. Because growing is always easy. Growing profitably, sometimes it's a bit more challenging, and we have had to do quite a lot to ensure that it was not dilutive anymore.
Now we feel and on market share and on the profitability good with our omnichannel approach.
Hi, Patrick Folan from Barclays here. Just two questions. The first one, I'm gonna ask you, the reduction program. Can you kind of elaborate on how much of group sales the SKU reduction program is representing? Have we seen impact over the last six months to nine months and maybe how that could evolve over the next nine months-12 months? Then the second question's on the Senseo system in terms of what you've seen in terms of market share gains over the last six months, considering the current macro pressure. Thanks.
Do you want me to start?
Mm-hmm.
Maybe I'll start with the latest one, which was on market share of Senseo. I think market share last six months, you have to be careful to not overread into it. I think we alluded to that with a question from Celine. There had been some disruptions in Western Europe as we have been leading on pricing. I have to say, if I would now take a longer time horizon, let's take a two years to thretwo years time horizon, our market share of Senseo have been continuing to go up. We've been very pleased with that and mostly on the back, on innovations and on the back of executions, which has been strengthening. Your other questions was around SKU. Was it on innovation? Was it on the rationalizations? I'm not sure.
On the innovation part.
We can.
On the reduction, sorry. Yes. On the reduction side, to be transparent, we had when we started the journey two years ago, we had almost 8,000 SKU. At the end of 2022, we are below 7,000. It was very, very significant. We have seen. I think it represented less than 2% of our volume. We know this agenda is not finished. We have fixed ourself a very aggressive target, we give us two years for that. I think a very good piece is done now, but we feel we have another opportunities that we expect to be completed in 2023. I think in the middle. Oh, yeah. The hand have been raised for quite some time.
Hi. John Ennis from Goldman. Just one question for me. Fabien, on slide 10, you showed the market growth up until 2021, so it excludes a lot of the 2022 volatility that we've seen. If you look at where you're positioned, your market-weighted growth is around 6%. When we look at JDE Peet's performance, admittedly since 2018, it looks like your growth has been closer to 2%. Can you help bridge that gap between the two and the six? The two might be wrong because we don't have the 16, 17 data, of course. Can you help bridge that gap between regional mix, channel mix, market share loss, just high level to help us square the two points?
Yeah.
Thank you.
I'll take a generic answer because that alone can be a bit of a complicated story. If I would exclude the part of 2022, which is short-term temporary period on market share loss, and again, I will be transparent about that later on. We have been gaining market share during this time horizon. We've seen it in emerging market. We've seen it in the U.S. The only piece which is missing is Europe, and again, I will be transparent on that one. We do have over the last, if I take seven, eight years, I think the growth of the category on coffee was about 4%-4.2%, if my memory is correct.
The 5% was on the shorter time horizon with a boost 2020 and 2021, related to Covid. It was more around the 4%, but it doesn't change much, I think your questions. We had to evolve our portfolio during this time horizon to ensure at geographic level, at channel level, but as well at category level, that we'll be well positioned to capture it. We were not, really five years ago, and over time we are getting closer to it. Where we do have some gap is global presence. We've said one of our agenda besides penetration, optimization is globalization. We are global, but we feel not global enough, and that is capturing a small growth, which is not today in our, in our reach, but we want to progressively be there.
That's why we have been intentional over the last two years. I think it was more a transition period, but I think we are entering now into the most attractive phase, which is the one we have been very transparently at the time of the IPO and reconfirmed two years ago. We want to be to the 3%-5%. You think the last 10 year was four, of course, there is period we want to be at a higher level, like we have been this year and we'll talk as well on how we see 2023 happening. Warren. Oh, I see. Go ahead. Sorry.
Hello. Question for a long time.
Brilliant. Farhan Baig, Credit Suisse. Two questions for me, please. Number one on the share of voice. Your share of voice is now, I guess, higher than levels in 2018 and 2019 that you depicted. If I look at your advertising and promotion spend since that period, it's down high single digits. I would love to understand how you've been able to improve the return on investment in that marketing area. Then second question. In 2021, you also alluded to expanding in the ready-to-drink coffee subcategory. I note it was excluded in most of your slides thus far.
One of your closest peers sees it as a driving agenda in emerging markets, particularly Asia, to grow the penetration of the category. Could we get an update where you are on ready-to-drink and the plans you have there? Thank you.
Yeah. I can take the ready-to-drink and maybe Shawnna can take the advertising and share of voice part. On the ready-to-drink, I think I have not said two years ago that ready-to-drink was a priority for us. I think it's what I've said is ready-to-drink, it's a place which requires different capabilities. It requires beyond being a brand, a branded player in coffee, being hosters. It requires bottlers type of capabilities, and we don't have these capabilities. Sometimes you have to be clear on what you are good at, what you are not good at, and the question is, do you want to become good at what you're not good yet? Ready-to-drink, I don't think it's a place where we will deploy a lot of resources.
When we would go there, we would go there with partnership. We see there are places indeed where ready-to-drink is important. I'm thinking about Japan, I'm thinking about Southeast Asia, I'm thinking about U.S., but it's not really a universal, and it is a very, very difficult place to be profitable. For that you need a lot of scale and a lot of capabilities. That's why it's not an accident if many players who go there are going with partnerships. We have partnerships. If I take the Dutch market, we do have partnership. Actually we are the market leader on ready to drink on our brands in the Dutch market. In the U.S. market, we decided to partner with KDP.
We tried to have our own system, our own cold chain, did not work out. We stopped it. We decided to go with ready to drink. Now we do have a peach ready to drink offer in the U.S. market. That's the way we'll approach it. Your second question was share of voice advertising.
The first question was around share of voice and the increase that we've been able to achieve in share of voice over time, and I think how do we evaluate that or how do we measure that as well? I think share of voice is one metric around our advertising and promotion investments. It's a very important metric, and it's obviously the metric that gives us an ability to understand our competitive position. As Fabien showed, we've significantly improved in that area. We've also improved in a number of other areas to focus on both the balance of effectiveness as well as efficiency within our advertising and promotion investments. To be specific, we look at other input measures as well, such as what are the portfolio choices that we are making?
Behind what do we want to invest? Which brands, which categories, which countries? We also look at sufficiency metrics to ensure that we have the right levels of investment behind our brands to ensure that we achieve the rich impacts and the cut-throughs that we require within specific countries. Then, of course, the effectiveness of our copy and our content is another key input metric to that as well. We've been able to improve over time, not just on the output metric almost of the share of voice, but as well as some of those other input metrics that I just mentioned.
Of course, the effectiveness of the copy and content is really key to ensure that the investments that we are putting behind our brands are in the best place to work, as a consequence of having compelling copy content behind those brands.
Fabien.
You had a specific question.
Sorry, Fabien. Fiona, in view of time, I would like to suggest that you take two last questions.
Two last question. I just want to complement the last question. We had a specific point around in absolutes of the case. I don't want to enter too much into 2022 trading. We'll do that later today, and we'll have an opportunity on the 22nd of February. You will see in absolute euro, it is greater. Ryan. I see Ryan and John both having questions.
Um-
Need a mic here as well? Yeah. Sorry.
Yeah, I've got a mic, so I'm gonna quickly jump in there. Jon Cox with Kepler Cheuvreux. You didn't actually the percent AMP my colleague asked you. I think you're about 6.7%. You've been trying a lot of stuff on investment there. Just wondering what your AMP was last year. I'm sure you'll give it to us maybe later. I'm more interested in the cost savings. You know, 1,000 people is quite a big number. Four factories, that's about 10% of your factory network. I wonder if you can just give us a bit more details on that. I guess the broader question is really, you had a 19% + operating margin three years ago. You're probably gonna be 400 basis points lower than that in 2022.
How should we think about that rebuild of margin over the last couple of years? Was this effort we've already seen maybe in 2022 with 1,000 staff and the four factories, et cetera, et cetera, is that part of that rebuild? Can you ever get back to that sort of margin over the next couple of years? Thank you.
Look, Jon, I think again, without entering into the detail of 2022 here, I think your two question had a common theme, which is around percentage. What I want to remind and encourage people is when you are looking in coffee in detail, don't overly focus on percentage because there is a lot of volatility on the input cost, which doesn't mean you have volatility on the P&L in absolute. The way we run the business is more in number of cups, in absolute gross profit per cup, in EBIT per cup, in absolute free cash flow, not in p ercentage . P ercentage can vary widely, but it doesn't mean that if you have a higher p ercentage , you have a stronger business. We have to be very, very mindful of that.
Of course, you are comparing times where coffee price was very low. As a consequence, the percentages were high. We know, and I've said that six months ago, coffee price was higher than the cost of production, that it will normalize. As a consequence, some percentages would materialize, but it will not mean that the business is better or worse because of this percentage.
Yeah. Hi. It's Warren Ackerman at Barclays. Oh, think I'm supposed to stand up. Two questions. In terms of consumer behavior, we're picking up that other companies are talking about appliance sales being under pressure. Are you seeing any evidence that not necessarily, you know, coffee machines, but in other sectors we've been picking up that consumers are really pulling back on appliance sales? Are you seeing any evidence of that? We're seeing that Nestlé, for example, are moving to a kinda $100 new Nespresso machine. There does seem to be arguably a little bit of price competition. Is there a risk later down the road, you know, you talk about innovation, that we could start to see a bit of a price war in terms of the applied or the installed coffee base and coffee machines? What's your view on that?
The second one is just on delistings. I know you might kind of touch on this later when you talk about the outlook, but you said that you've suffered because of your price leadership and that there's a temporary impact on market share. Just wondering whether you can give any more color on what you mean, temporary impact, and are we seeing any evidence of relistings? Just trying to understand when do you expect the volume impacts to trough in Europe, and when are we gonna see it in the, in the data? Thank you.
Yeah. I will start with the second, not answering now, but I will answer later today in a very transparent way, and we will show the case, we prove the case why we deem it temporary. You will see in a very transparent way. On the first questions on appliances, what we have seen is, for sure, during COVID, where home was a retreat, a significant acceleration well above past trend on appliance sale. It coincide at the same time for us at the moment where we recommitted to it. On our side, actually, and I will be as well a little transparent a bit later, we are investing more beyond appliance. For us meaning investing more beyond appliance, being ceding more appliance.
The L'OR Barista one is giving a very positive impact into that longer time horizon number of appliance sold. Of course, we have to be mindful. There is a danger on appliance to try to load the market with appliances with low price point. When you do too much of that, what is happening, it's becoming a gift or something that stays somewhere, either for two weeks in your kitchen, then that move to your cellar very quickly. We want to be very mindful of that, and we want to ensure that we are protecting the value that comes with it. At the same time, when we talk about inflation, there have been inflations on plastic, on component, on energy that has an impact on the appliance.
We see a bit these two dynamics, some price increases because of inflation, at the same time, some more competitions with some lower pricing. We need to find all the times the right balance in between to avoid having what we call a dormant pack, which is not the type of business model you want to build.
Welcome back, everybody. I hope you could enjoy a nice cup of tea or a nice cup of coffee during the break and had some conversations with the presenters. We will continue with our next presentation, which will be hosted by Laurent Sagarra, our VP Sustainability. He will tell you all the ins and outs about the progress we've made on sustainability as well as the ambitions we have for the coming years. With that, Laurent, I would like to invite you to come to the stage. Thank you.
Good morning, everybody. Very happy to be here today to take you through, actually, our progress in 2022, but also to give you already some insight about 2023 and where we are heading in our sustainability journey. Let's start. As mentioned by Fabien, I mean, coffee and tea are great category to be, not only from a financial perspective, but also from a non-financial perspective. As you can see here, we start from a very favorable position.
First of all, when you look at climate, I mean, you will see that coffee and tea actually have a much lower carbon footprint than many other beverage category, which put us, again, in a favorable position. We are working within JDE to actually take this carbon footprint to net zero by 2050 and to eradicate all our emissions.
The other part is around the living of people. Coffee and tea is a great category in the sense that they create living for hundreds of millions of farmers and their family today around the world. They are spread across 70 countries in the intertropical area. At the end, both together, coffee and tea is a huge category which generate more than EUR 400 billions of revenue. Finally, as was mentioned also by Fiona, it delivers two key consumer attributes. You've all enjoyed a cup of coffee a few minutes ago. I mean, it brings positive energy, it brings relaxation, it allows us to unwind, and all that with zero calories, so in a healthy way, contributing to your healthy lifestyle.
At the end, it's an inclusive beverage in the sense that it's one of the most drink beverage in the planet, but it's also one of the most affordable one, allowing all income level to actually access tea and coffee. This is why in JDE Peet's, for more than 300 years, tea and coffee is who we are and what we do. This is why through Common Grounds, we are investing in our supply chain, in our operation to ensure that we continue to enjoy coffee in the year to come. This is why we are living our purpose today, to ensure that we create a better future for the people, for the planet, but also for JDE Peet's. When we talk about creating a better future, for a lot of people, it's not always clear what we mean by that.
For us at JDE Peet's, what is a better future? Well, first of all, it's a future where farmers are prosperous. Prosperous in a way that is respectful of nature, not at the detriment of nature. It's a future where our rivers, our oceans are free from waste and pollution. A future where us at JDE Peet's, we use energy that is clean, and we ensure that the air you breathe remain clear also. Finally, it's a future where community thrives, when people can be who they are and grow and develop. Of course, for all of that to happen, I mean, a greater future is a future where JDE Peet's delivers sustainable growth. Because without sustainable growth, all that won't be able to happen so that we can create value for our shareholders and for our stakeholders. How are we going to deliver all that?
By living our purpose and by leveraging the power of our brands. Our brands are the ambassadors of our journey, and they will allow us to deliver with every cup this great purpose. We will do that, first of all, in a regenerative way. We will work on our greenhouse gas emissions, we will promote circularity of our products, and above all, we will work on regenerative agricultural practices for our farmers. We will contribute to build this tea and coffee-resilient industry. We will do that in the way we do everything in JDE Peet's, in an authentic way, meaning we will be transparent, we will walk the talk, and we will make sure that we deliver true change and impact. This is when you think about sustainability, it's all about impact. Finally, the last way is around inclusivity.
How do we ensure that as we progress in our journey, we embark with us the entire supply chain? We empower farmers, we engage the full value chain suppliers, our operations, our customers, to actually support the well-being and promote equal opportunity for all of us. This is how we will approach the whole project. Now let me tell you about 2022. I mean, we have done a lot of progress this year. I will take you through our three pillars. The first pillar is the responsible sourcing. You've heard in April, May this year, we announced that we will leapfrog to 100% responsibly sourced coffee. Actually we did it, we delivered it, we moved from 30% responsibly sourced coffee in JDE Peet's to actually 77% of responsibly sourced coffee.
This is a huge step towards our 100% target, and this had some other impacts. It makes us actually increase tremendously the amount of farmers we reached, because where we make the difference is through the engagement we do with farmers. Last year we actually reached nearly a quarter of a million farmers. If you remember, we had this half a million farmer target to reach by 2025. Well, actually, we've exceeded this target this last year, at the end of last year. We are actually now working with more than half a million farmers. What we expect by 2025 is actually to reach around 1 million farmers. The other part, of course, is the minimized footprint. In 2021, we committed to our SBTi target, and actually this year we progressed on our roadmap.
First of all, on our Scope 1 and 2, which are the emission from our operations, you can see that we've decreased by 15% of our emission. This is three times the target we have. This was accelerated due also to the situation on energy costs and so on. Because we brought back some investment. I will give you more detail afterwards. Also what we started this year is our journey on the Scope 3 emission, which are the rest of the supply chain, where we delivered 1% decrease. Finally, on connected people, we also launched in 2021 our roadmap. I'm very pleased to announce that this year we measured for the first time our pay equity gap in JDE Peet's. We actually landed below 1%.
This below 1% is actually considered as no gap, which is a fantastic performance that reflects all the effort that have been done by our teams over the years. In addition to that, also, we joined last year the UN Global Compact to actually accelerate our journey on human rights. As mentioned by Fabien, this of course, was reflected in our investor ratings on ESG, and you saw that we moved in a position today which is at parity or even in a leadership position versus our competition. This was achieved by having a very structured approach to that. First of all, filling all the gaps. If you've been on our website in the past few months, you've seen that we launched our human rights policy, our climate strategy. We worked on animal welfare, so we fill all the gap that we had in our strategy.
We've also expanded the scope of our approach, and we start, of course, delivering results. This is why we've seen our results increasing and we expect further improvement also moving forward as we release our annual reports in March this year. Let's start by the first pillar, which is responsible sourcing. Responsible sourcing is our most challenging pillar, but also the one where there is the most opportunities, because this is where we create a better livelihood for our farmers and where do we ensure our supply of coffee and tea for the years to come. If I go through, in more detail through the achievement, as I said before, we've on our way to 100% responsibly sourced coffee, and we reached 77% this year.
As I said, we're more than doubling actually our impact on farmers. From an investment perspective, we are also on track with our investment. We have EUR 150 million that we had planned for the next four years, and today we are around 80% run rate at this stage in our responsible sourcing. You will tell me, how do you manage that? How do you achieve this huge leapfrog in one year? Let me tell you about it. When you look at responsible sourcing, you have two way to approach that. You have the traditional way that we've all used, I would say, in the past, through certification. The way certification works, it's a compliance process. So farmers are being audited versus the coffee reference code. If farmers pass the audit, they will get certified.
They will pay their fee, and they will be able to supply certified coffee. Of course, this approach was very innovative when it was launched, more than 20 years ago, but it has its limits. First of all, not all the farmers can access certification because it has a cost. Above all, the requirement for certification are getting stricter and stricter every year, meaning that the pool of farmers that can actually comply with the standard is getting smaller. This is why in 2019, Peet's worked with Enveritas, an American NGO, whose purpose is really to improve farmer livelihood through industry engagement. They're starting this collaboration to actually drive this distinctive approach that we call Assess, Address, Progress, which is a continuous improvement process.
This process allows us actually to reach the small farmers, the one that actually needs support and which are excluded today from the certification approach. This is what we've launched actually at JDE level last years to deliver this progress. Let me get into a little bit more of detail to explain to you what it means. The first thing that we did is the assess stage, meaning that farmers are being assessed by Enveritas at no cost for them. Based on that, we get data about the issue at origin. This give us full transparency on what are the challenge and the opportunity that we can solve. If you see the example here about Africa.
On our African sourcing, we have about 200,000 farmers. Out of those 200,000 farmers, 15,000 farmers were actually approached and evaluated this year. Enveritas identified some gaps in opportunity. We were requested to implement 45,000 farmer trainings and activities to actually bridge the gap. What we delivered this year actually just for Africa, it wasn't 45,000, it was nearly 160,000 farmer reach. Actually went above and beyond the request. This is the assessing step. Of course, to answer the gap, what we do is that we implement programs. Those programs today, they are happening all over the world. We have about 50 projects in JDE Peet's running. Those program are addressing the issue identified by Enveritas.
Finally, the last step is the progress because it's nice to identify issues, it's nice to put program in place, but you have to ensure that you deliver impact. This is what we do through the progress stage, where Enveritas is actually checking our project, ensuring that they are implemented at the scale that was required, and of course also checking the impact. When you put those three phase together, this is the Assess, Address, Progress protocol that allows us to access actually the responsibly sourced status delivered by the Global Coffee Platform. To show you in more detail actually what this progress step means, I would like to show you a small video about one of our initiative in Tanzania.
At JDE Peet's, we're investing to secure a sustainable long-term supply of coffee, protecting the future of farmers from a diversity of origins through our Common Grounds program. The western region of Tanzania produces around 45% of the country's coffee. The challenges facing farmers here are low yields, mostly due to old coffee trees, inadequate technical assistance, and lack of financial services that lead to low investments in inputs and renovation of farms. Since 2019, we are partnering with Café Africa to rejuvenate the production of Robusta coffee and improve the well-being of the farmers. To ensure the projects can reach scale and achieve long-term impact, we also bring together local partners from the coffee cooperative unions, Tanzania Coffee Research Institutions and the Tanzania Coffee Board.
Three new coffee nurseries have been set up, producing over 640,000 high-quality, disease-resistant coffee seedlings that have been distributed to farmers who needed to plant new trees. Some of these seedlings were produced using cuttings, a technique that boosts the harvesting of coffee cherry to under 18 months, while regular seedlings produce the first harvest after 36 months. 458 technical extension officers have been trained who visit the farmers and advise on good agricultural practices and evaluate if the coffee tree should be removed or rejuvenated by a pruning technique called stumping. After two years of stumping, the coffee tree plants can produce three times more than before as the pruning releases new productive branches. The project has stumped more than 27,000 coffee plants so far.
Together with Café Africa and local partners, we continue on our journey to revitalize the production of Robusta coffee in Western Tanzania and improve the livelihoods of farmers. The program continues to extend more technical assistance to farmers, increase the renovation and rejuvenation of coffee farms, and further engage the youth into coffee.
This project is just one example of how we make impact at origin. As I mentioned before, we have about 50 project today running in parallel. Actually from March this year, when you will log on our website, you will be able to see all the detail of all those initiatives per country with the impact that they're having. This is really how we make the difference today. We invest at origin to tackle the issues that we identified and remediate to them in a sustainable way. As I said, here you saw the example of Tanzania. We have project in Ethiopia also in rejuvenation, and we generally adapt the project to the local need of the population. Typically, if I look at Honduras. Honduras, we focus more on the labor issues.
This is why we start re-renovating and building school in Honduras to ensure that when workers come to work with their children, there is a school to leave the children during the day while they are picking coffee. This is how we make impact at origin. The other area where we are focusing is on the long-term of coffee. What is the future of coffee? Fiona mentioned our collaboration with the World Coffee Research. Today, we are one of the largest funding part of the World Coffee Research, and this organization is actually developing the coffee varieties of the future. Coffees that will deliver more yield, coffee that will deliver more quality, coffee that will be resistant to climate change, that will be resistant to pest, so that the farmers have access to those more resilient coffee roots.
When you plant a coffee tree, it will stay in your farm for 20 years , 30 years. You need to make sure that you put in place the right coffee plant because it's your asset for the future. Of course, a lot of the challenges that we identify at the origin are not specific to JDE Peet's supply chain. They are systemic challenges that the entire industry is facing, and that's why we're very happy to see that other company actually joining us in our approach with Enveritas. Typically, recently, Dunkin', Merkur, Tchibo in Germany, and Tim Hortons have some of the large companies that have joined the initiative to actually make more impact at origin. Of course, we don't limit our work on coffee.
We are progressing on tea, one of the major challenge that we had on tea was our recent acquisition in Ofçay in Turkey. We actually this year, partnered with Rainforest Alliance to actually implement a program similar to what we do with Enveritas to drive also the responsible sourcing journey with our coffee farmers. This will allow us actually to reach our 100% responsibly sourced tea by 2025. On palm oil, we announced last year that we had reached 100% responsibly sourced palm oil, and we of course, continue with this this level of responsible sourcing. This year, we launched a new KPI on the responsible sourcing. It's around animal welfare. We made public actually our commitment last year, and we are now progressing on our cage-free eggs journey.
You can see we are only at 3% because it's the first year on it. You might ask yourself, "Well, why do they use eggs?" Well, today we have two entities in JDE Peet's using eggs in the sandwich that you eat at Peet's, but also in the noodles that we manufacture in OldTown business. Again, we were one of the first company in Southeast Asia also to engage in this commitment against cage-free eggs, and we're very proud of the difference we're making there to ensure not only the well-being of people, but also ensuring that on the animal side, there is no abuse in the supply chain.
The second pillar of our Common Grounds program is minimizing footprints, which deals with our climate strategy and also with our activities to reduce waste and pollution on the planet. As I mentioned before, we've made significant progress in reducing our Scope 1 and 2 emissions, which are the one under our control with 15% reduction since 2020. In two years, which is far above the 5% that we were targeted. Of course, we are also starting our journey on Scope 3. How did we deliver all those changes? First of all, at the manufacturing level, we make substantial investment to actually move to low carbon energy.
We invested in biomass burner for the spent coffee, but also in some other geography, like in Turkey, we went for more innovative approach, where actually we also have biomass burner, which are using the hulls from the hazelnut industry. We also improved our instant coffee process to be more energy efficient. Across operation, there is a multitude of small initiatives to actually always drive efficiency. At the end, efficiency and sustainability works together because it's all about not wasting resources, whether it's energy, packaging or others. We progress also on our procurement journey. I mean, we reach near more than 40% of renewable electricity purchase in JDE Peet's. All of Europe and Brazil are now on renewable electricity, and we are progressing with the other regions.
Finally, we've also initiated our program with our vendors, because at the end, our carbon ambition is a domino effect. We need to engage every step of the supply chain into this journey to be able to deliver our ambition. So we have commitments from our largest suppliers also to move to SBTi, so then they can contribute with us to this full journey. On logistic parts, we've also implemented a lot of change. What is interesting with logistic, they were the first part of our organization who had carbon accounting. It means that for two years now, the logistic team have been adamant to optimize the route, to optimize the type of logistic transport they're using, you know, between train, boat and road, to deliver incredible improvement and reduction in their carbon emission, but also in a financially positive way.
Finally, the two last point are quite critical. On the responsible sourcing, we will release this year our deforestation policy, but we're already acting on it on several aspects, through programs in Indonesia, but also in Peru. One other things which is critical, we had the pre-competitive project with USAID and USDA this year, along with Nestlé and Lavazza, where we defined the rules for the calculation of the carbon footprint for green coffee. Because that was something that we didn't have in the industry properly defined, so we all worked together to come out to a consensus on a methodology so that we all measure it in the same way. Of course, finally, the research and development team in JDE Peet's has a huge role to play.
They've been delivering already disruptive innovation on the sustainability side on Senseo, on our pad material this year. We transition our teabag in Pickwick to compostable material, also the pouch of Senseo pods. We're also progressing on our nutritional journey, because when you reduce sugar, you reduce carbon. All those activity this year has contributed to the delivery of our ambition. Of course, to deliver all that, well, you need people. This is why our people journey is so important, because through the passion for tea and coffee of all our associates, we're able to deliver this journey. Of course, if you want to take care of the planet, you need to take care of your people. That's what we do through our connected people pillar. The focus last year was on two aspect that I would like to emphasize here.
First of all, on the human right, and then on our diversity, equity and inclusion journey. You've heard last year that we committed to our UN Global Compact, and following this commitment, we actually increased our engagement. We made public our human right policy, and then we deploy our due diligence program. This means that through Sedex, we actually implemented in our plant, but also with our suppliers, excluding tea and coffee, a whole program to identify the risk, to assess those risks, and then to implement remediation activities. On the coffee and tea sourcing, of course, we did a similar approach, but with our on-the-ground partner like Rainforest Alliance, Enveritas or Fairtrade, to also identify and remediate our issues.
There was a lot of progress on this side made in 2022, and we will continue moving forwards to remediate to the issue identified. Of course, the second part is our commitment to close gender gap. When we speak about gender gaps in JDE Peet's, we look at two things. First of all, ensuring that our proportion of women in leadership position is at the same level as in the rest of our workforce. What you can see on the slide here is actually now we are at 41% women in leadership position in JDE Peet's, versus 43% across all our employee. We have nearly bridged this gap between the representation of women in leadership position, which is a great progress.
As I said before, not only did we bridge the ratio, but we also ensure that this is done ensuring that there's no gender pay gap. This number of below one person might not be very meaningful for you, but as I said before, it means no gap. If you compare it to the rest of the world, the gender pay gap in the U.S. is around 17%. In Europe, it's 13%, and in the rest of the world, it's 23%. In the new EU directive that is going to be addicted very soon, the target to implement action is when you are above 5%. This result is something we are extremely proud of, because it also reflects all the work that has been done within JDE with our people team to actually close the gender gap over the past years.
That's a fantastic achievement for us. The last point, we did a lot of things in our supply chain with our farmers, with our people, but we did that without compromising on the quality of our products and to ensure the satisfaction of our consumers. We've progressed on our nutrition strategy to ensure that we deliver healthy product every day. Now 75% of our full portfolio is compliant with our guidelines. We also did that ensuring that our product are safe, because this is critical when you sell food. Today, out of our 100-plus manufacturing site internally and externally, 75% are already certified at the highest standard of food safety. As I said before, on the compromise on quality, we continue to deliver exceptional quality performance in the company.
This year, we actually reached the best performance ever with below four complaints per million units sold, which is a fantastic performance for the group. What's next? Well, today our next challenge is to prepare for the net zero future. This is key for us to ensure that we continue our journey and do it. We have this positive impact on the planet and protect our farmers. In 2022, we committed to a two-degree pathway. Following that, we defined the full roadmap in terms of investment, in terms of initiative. We embed those investments into our value creation plan. We've developed actually it's being launched this month, our tool to actually measure our performance when it comes to carbon.
Now in this current position, we are ready to commit to our 1.5 degree pathway that will take us to this net zero future. How are we going to do that? Well, as I said, we have a clear roadmap. You can see here on the slide our emission Scope 1, 2, and 3 and where we need to go by 2050. First of all, on the Scope 1 and 2, we will continue to invest in our biomass burner. We continue to transition to cleaner energy. We'll also complete our journey to 100% renewable electricity. Of course, we are also investigating new technologies because we need to find solutions for roasting, for extraction, using renewable source of energy. This is the next challenge where our R&D teams are working off.
We'll also transition part of our fleet to electric vehicle, and all that will take our Scope 1 and 2 to this net zero target. On Scope 3, as I mentioned before, our priority is farmers. We need to ensure that our sourcing of coffee is deforestation free because this is the first driver of carbon in green coffee. We need to drive agricultural practices that do not damage nature. This is all the regenerative practices program. We need to get more coffee actually from the same piece of land. When you look at coffee farmers today, some coffee farmers generate 100 kilo of coffee per hectare. Some coffee farmer in Brazil generate 4,000 kilo of coffee per hectare.
When you see the gap, you also see the opportunity to increase the revenue and the yield per hectare for the farmers at 100. This will allow us to ensure resilient and sustainable future without having to deforest, improving the revenue of the farmers, and also stabilizing the price of coffee by having better yield. The other part also, which is fantastic when you work in tea and coffee, is coffee or tea are a plant, and by default, plant absorb carbon. Today, the millions or the billions of coffee tree on the planet actually contributing to decarbonizing the planet. In the berries, in the leaves, in the trunks, they capture carbon from the atmosphere.
The huge opportunity we have today actually is how do we ensure that this carbon, when we harvest the coffee, instead of being released when we burn the coffee, is actually being captured. Now we are working with different research institute on groundbreaking technology to be able to capture this carbon and actually inset carbons at the farm level, so that the coffee plantation can contribute to actually the decarbonization of the planet, which is a huge opportunity for coffee. On the Scope 3, we'll continue our innovation journey. We'll continue to reduce packaging. We'll continue to move to recyclable or compostable packaging. We'll improve the nutrition of our product. The last thing also, we'll work on our portfolio to ensure that we move to a low carbon portfolio.
All those initiative will also take us to our net zero. I would say at the end of the journey, when we reach the last 10%, then we will look at offsetting to be able to reach the zero, the zero carbon. So to support us in this journey, I mentioned at the beginning, we talk about impact, and impact equal data. We are very pleased because this year we've developed with our team a in-house tool that will allow us to deliver carbon accounting. This tool is based on all our internal system, whether it's SAP for ERP, our Sphere reporting system, our specification systems, our vendor data tool. It pulls all the data from the system to actually automatically generate carbon footprinting of all our product.
For every SKU we sell, the same way we have the GP per cup or the revenue per cup, we have the carbon per cup. We can of course go from the cup, the SKU to the market, to the category, to the country, to the customer. This allows us to actually embed carbon into our decision processes, so that when we move forward, when we de-develop innovation, when we do CapEx investment, when we do promotion, we can understand the financial impact and the non-financial impact of a decision and takes the best solution, the best decision for JDE Peet's. This is what we are launching this month within JD, this full carbon accounting. It will really contribute to the direct support of our strategy and to deliver our ambition. I wanted to give you some example of what carbon footprinting means.
The first one is on portfolio management. You can see here the Kenco portfolio on instant coffee. You see today it's a mix between jar, glass jar, small refill, and big refill. By playing with your portfolio through promotion, through pricing, you can actually have a direct impact of your carbon. The test portfolio that is being evaluated by our team locally will actually lead just by changing this portfolio balance to 3.5% of reduction. No innovation. No long development or change of packaging, simply understanding the impact of the product. This is why we're also pushing our team now is to understand how do you manipulate your portfolio to actually optimize your revenue, but also your carbon. Another example is around nutrition.
As I say, sugar is carbon, we had a fantastic program in APAC to actually reduce the sugar from our product to improve the health of our consumer, to also reduce our exposure to sugar tax. This led not only to the reduction of sugar, as you can see on this example here, but actually by reducing the sugar, we also reduced by nearly 9% or 8.5% our carbon emissions. Again, all that goes together to create a better future. The last example is around what our sales team are doing in actually optimizing not just the product, but also how we sell the product. Today our team in the U.K. is actually moving from point of sale materials which are made of cardboard and plastic to actually pure cardboard.
First of all, that allows us to decrease waste, especially plastic waste. It had a positive financial impact, and we end a reduction of the carbon. Again, you see that financial and non-financial goes together because it's about reducing waste, understanding your impact, and making the right decision. To complete, well, today, as I said at the beginning, coffee and tea are great drinks for the world. We are in a fantastic category, and we are thriving to make it better day after day in JDE Peet's. I mean, we want to leverage and to unleash the possibility of coffee and tea to create a better future, and we will do that in a regenerative, authentic, and inclusive way. We've made already great progress for 2022. We have more to come in 2023. As mentioned by Fabien, this is a nonstop journey.
This is a journey that at the end will take us to this climate neutral future. Finally, we are ready for this net zero commitment. Our tool are in place, our roadmap is in place, we'll work to make this public in the coming months. This is our idea on how JDE Peet's all together, we are creating a better future. It's the sum of all those actions in all the function across the organization that put together will deliver this better future for the people, for the planet, and for JDE Peet's. I'll be happy to take your questions on the topic and before we move to our lunch break.
Hi, my name is Lilia from Triodos. I have a couple of questions. Yeah, sorry.
Oh. Sorry, I couldn't see you.
No. I was just wondering if a couple of questions on the supply chain. The first one would be whether if you can tell us some of the main issues that have been identified in the supply chain. You mentioned that Sedex did an evaluation. The second one would be on if you are considering to set a target for living wages?
Oops, I can barely hear you on the stage.
Can you hear me now?
Yeah, a bit better.
Okay. The first question is regarding the main challenges identified in the supply chain. The second one is regarding a target for living wages for farmers. The third one is whether you already evaluated how much of the sourced coffee or tea comes from deforested areas. Thank you.
Okay. When it comes to the issues, I mean, the issues are really, and the challenge are very, region dependent. Every area has different issues. When you will actually log on our website from March, you will be able to see for each sourcing area, what are the challenge and the opportunities that we've identified. We have 9 key, I would say, what we call focus area on which we work in JDE Peet's. You mentioned deforestation with biodiversity. That's one of them. We work on the agricultural practices when it comes to yield. We work on labor issues, so we work also on. Well, there's 9 of them all put together on livelihood and so on.
You will be able to have all the detail and really see place by place what it is. If I take, for example, the big one like Vietnam. Today, the larger challenge in Vietnam is around agricultural practices and the use of agrochemical. To answer that, well, we have the, a specific program called EcoVadis, which is a pre-competitive program with CIRAD and a lot of other companies where we're actually working with farmers to, again, do education on agrochemical usage and so on. It's very, it's very region specific. It's not a one-size-fits-all. That's why it's very important for us to understand what are the specific issue in all our sourcing areas, and this is the transparency we get through Enveritas. Based on that, implement action to actually address those issues and drive improvement.
That's where we are on the issue. You will have all the detail and all the transparency in the coming months. When it comes to the living wage, when we look at the revenue of farmers, first of all, there is, as we always say, a lot of people growing coffee, but there is very few coffee farmers. If you exclude big countries like Brazil and Vietnam, where they have real coffee farmers who live from coffee farming. In a lot of the other region, the revenue of the farmers comes from a pool of activities.
I mean, the average size of our farmers is around, well, actually it's below 1.5 hectares per farmer, so it's quite small. The coffee is one of the component of the living wage of farmers. What we're doing on the living wage, as I said before, when I quote the yield in Africa, an African farmers get around 100 kilo of coffee per hectare. The best way to improve the living wage of those farmers is to work on the productivity. Because if you bring the yield from 100 to 200, you double the revenue you get from coffee. This is really where we are getting engaged today, is how do we improve the yield of those farmers, because this is where we have the largest opportunity.
This is where we bring also durable improvement on their livelihood, because they will be able to get a better yield to sell more coffee and to get more out of it. This is really where we want to make the difference and why we also engage on the grounds in all those initiatives to train farmers, to educate farmers, because you give them an asset, something nobody can ever take from them. They will be able to get better income from their land. We, we had a huge initiative in Uganda over three years, where we educate farmers on yield, and we've reached an average, and that's the average, a 70% increase in the yield, with some farmers having up to 300% increase.
For us, this is how we do lasting improvement in the livelihood of farmers, by educating them, by giving them the right coffee seedlings. As I said, when you plant a coffee seedlings, it's here for 20 year. Meaning that if you plant the wrong one, you will also be stuck with a low yield for 20 year. This is all those initiative we do around the wages of the farmers. When it comes to deforestation, the biggest concern with deforestation today is to measure it. The EU is defining clear guideline now on what deforestation means. It means more than 0.5 hectare of forest that is above 5 meters. The question is: How do we measure it?
We are partnering also with Enveritas and also pre-competitively through the European Coffee Federation to actually assess technologies to be able to get some satellite picture which are being analyzed so that to know, okay, here there may be something. When you see something on a satellite picture, you need to send somebody on the ground to actually check that it's really deforestation. 'Cause when we did the first evaluation, we realized that when farmers were cutting their coffee tree to renew them, because you renew the coffee tree every 10 years , 20 years. Actually, this was counting for deforestation. Of course, when you measure it properly, we will be able to implement programs.
We already have program in some area where we know there is deforestation, like Indonesia. We have reforestation program, we have restoration program. Same thing in Peru, where we are replanting large acreage of trees to compensate for past deforestation. This one, we know it. On the rest, we're progressing with the industry to really evaluate what is the situation. That's where all the data we get by putting together satellite pictures with the on-the-ground assessment by our different partners, will help us to actually map exactly where is the deforestation in coffee.
Good morning. Bruno Monteyne from Bernstein. You put out the statistic there that you went from 30% responsibly sourced to 77%. That's nearly half your farmers have moved from irresponsible sourcing to responsible farming. That's such an enormous leap in one year. It makes you wonder how we can have such a dramatic impact on half of all your farmers. The second and sort of related to it, because from your answer on the living income or living wage question, I think I can deduce that earning a living income, which is one of the human rights, is not part of being responsibly sourced.
Why is your farmers earning a living income not part of responsibly sourcing? 'Cause I think if it was, you'd be a lot lower. Thank you.
Okay. To answer your first question on the how do we move from 30% to 77%, they were not irresponsible sourcing, first of all. It's the first thing is we had no data. That's the work we did, is all the responsible sourcing is a, it's a due diligence process when you assess your farmers, and either those farmers are compliant, and in this case, they can be certified, or they are not compliant yet, and in this case, you invest in program to help those farmers to become compliant. That's what mean responsible sourcing.
What we did to move from 30% to 77% is actually invest in getting those assessment of the farmers, meaning that now 77% of the volumes that we have been assessed to understand what are the issues, and either move through certification or through the assessment program to actually implement action to solve the issues. That's what it means. It means we are acting responsibly by understanding the issues at the origin, implementing action to remediate the issues, and then measure the impact. If you look at the definition of responsible sourcing in the Green Deal of the EU, this is exactly what they define. This continuous improvement cycle where you assess issues, you address issues, and you progress. Acting responsibility mean that we understand our issue today on 77% of our volume.
We address those issue and we are progressing. This is how we, how we move on this journey. This is completely also aligned with the Green Deal requirement on addressing problem and fixing problem. So that's on the, on the, 37%. On the living wage, I'm not saying that we don't work on living wage because we identified through our sourcing. It's just that the way we remediate to living wage is by bringing sustainable solution to farmers, by improving the education so that we improve the yield, by supplying them with seedlings that will deliver higher yield, resistant to climate change, resistant to disease for the future, by building schools so that the workers can take their children to the school while they are picking coffee.
This is how we make the difference on the ground, by actually bringing those durable assets that they will keep for the rest of their lives to generate a better coffee farming. That's where we make the difference because this will generate, at the end, a better living for the farmers and contribute to their livelihood. This is completely part of our, of our journey, improving the livelihood, but also at the same time, making sure that we improve it in a way that is respectful of the nature. You can improve the yield by deforesting and planting more coffee, or you can improve the yield by improving the quantity of coffee you actually get on your existing plant, and this is how we target it.
Yeah. Hello, Jon Cox from Kepler Cheuvreux again. Just a question on the... You know, you keep saying that you're ready for net zero. When are you actually gonna sign on the dotted line in terms of the SBTi and net zero? Because you've been sort of getting ready for a long time. Just wondering what is stopping you from actually, we are now, you know, officially committed and everything's documented, where you have been lagging some of your peers. Second question, just on the financials, and I know you have given out some financials. I think there was a press release a year or so ago, about, you know, the programs and what you were doing and how much you'd spend. Maybe you could elaborate a little bit more on that.
Also in terms of the offset, you know, you obviously are putting out less, you know, less sugar or less whatever, then obviously you're saving money as well and I'm wondering if there's any way to move to a net zero in terms of the financial expense involved. Then a last one, just on the carbon offset, which you said would be about 10% of the total, you know, when you get down to net zero. There's been a lot of stuff in the press saying that carbon offsets are just a total waste of time and don't do anything. Just on a broader level, just wondering what your thoughts are on that as a sustainability specialist. Thank you.
Okay, thank you. To start with the commitment, we already have a SBTi target that has been validated since January 2022. When you look at the SBTi targets, you have different level of targets, and the targets we have is what we call the two-degree pathway. This is the target that got approved in 2022 and validated by SBTi. Now we are moving to the one-point-five-degree pathway, a more stringent target. This is also part of the SBTi requirement. We are committed. It's just that we are going to increase our ambition to move from a well below two degrees to a one-point-five degree. The reason why we started with well below two degrees, our climate strategy is something new for us.
We started, as I said, a year and a half ago, and we say we started with this two degree because we wanted to have like net zero. Let's start by understanding what it means, building our roadmap, embedding it in our company. 'Cause it's nice to put a very high target, but at the end, if people have no idea how they're gonna deliver it can be very demotivating. Because when you look at how you manage sustainability, it's also a mindset change in an organization. You need to actually embed next to the financial, all those non-financial KPIs. And that's why we say, let's start with a well below two degree commitment, what we did, so that we could put the tool in place, educate people, show them some first success to actually drive engagement.
When you see the performance on the Scope 1 and 2 of our organization, it's incredible what they have done. They've embraced the journey, and now the roadmap is defined, the tools are ready, and this is why from our initial well below 2 degrees commitment, we're going to move to a 1.5 degree commitment, which is fully aligned with the net zero strategy. That's the big change, but we are committed already. It's just we're going to commit to a more stringent level, which is aligned with the net zero. Concerning the financial on the EUR 150 million financial, this is purely on the responsible sourcing. This covers the cost associated with all the actions and the program that we have on the ground to be able to assess and address the issues.
As I mentioned, we've already reached 80% run rate, and by 2024, end of 2024, we'll be at 100% responsibly sourced, and this case will be at the full run rate. On the offsetting, today within the scope of SBTi, we are authorized at the end of the journey and only at the end of the journey to actually offset 10% of our emission because there will be some emission that we won't be able to inset. That's why the whole SBTi framework allows us to this 10% offsetting, and this is something that we'll use only at the end where we have no choice. At the end, when you inset, you drive productivity, you drive efficiency, and so on. Whereas if you start offsetting, you just spend money.
This is why today we will only keep it as the last resource at the end to bridge the gap on those 10%. This is definitely not a strategy that we have to make a noise around climate neutral claim. There is two type of communication you see on companies today. There is companies who are claiming to be climate neutral, but who are literally offsetting all their carbon emission. It means they are not improving their efficiency. They are not reducing their consumption of energy. They're just paying to get carbon neutral claim.
There is us, where we are investing in our supply chain to be more efficient, because at the end, it's about reducing waste, making sure that we have the right equipment so that we can be more efficient and inset our emission. That's why on this one, we will only use the offsetting at the end of the journey, when we reach the last 10%. Within SBTi, in any case, we are not allowed to use offsetting. If we offset, we will just waste money because it will not count in our carbon footprint. The first thing is drive the change, drive the improvement across your entire value chain to save on all the different parameters that affect your carbon footprint. I think that was. Did I miss anything, Jon?
If you're saving money on plastic, you know, is there a possibility to offset all of the, you know, the spending you need in terms of. I'm talking about the greater journey to net zero. You know, we've seen some of your competitors talk about we need to spend EUR 1 billion over the next five years. You know, you seem to be a bit more progressive. I don't want to use a Unilever-esque, Paul Polman sort of like, you know, if you have less reductions, you save costs, yeah? That's the.
Yeah. As I said at the beginning, it's our approach is authentic. I mean, we want to have an impact, and that's also we were late to start, but I think we are very quick to catch up. A lot of the initiatives we are implementing today, not only driving sustainability, but also driving efficiency and productivity. It's not about being the first, but it's about doing the right things, and that's really where we are today. I mean, we have integrated sustainability in our decision process.
When our teams, for example, are doing an investment, they will look at the return on investment, but they will also look at it, not only just financial, but they will look at carbon emission, and they will look at water usage. You start looking at that thing in a different way to make sure that at the end, it ticks all the box. It's not profit or sustainability, it's sustainable profit put together.
That's where really our approach is different in the sense that we look at the full picture to take the right decision for the planet, for people, but also for JDE. That's where we are today, and that's where we're moving to make sure we combine both. To be able to combine both, you need to have data, you need to have systems. That's why we were extremely happy when we launched at the beginning of the month our new carbon accounting, because it allows us to have this transparency internally to take the right decision.
Welcome back, everybody, for the second part of the day. A bit shorter than the first part. We will have two more presentations, one from Scott, one from Fabien. Because it took a bit more time than we had initially expected, we will not do the break after Fabien's presentation. After Fabien's presentation, we will go directly into Q&A to save a bit of time and to make sure that you can still, let's say, be part of the entire program and then still catch any flight or transportation that you need to take. Without further ado, I would like to invite Scott to come to the stage for his presentation. Thank you.
Thanks, Robin. All right. I hope everybody's having a good session so far. Had a good lunch. Enjoyed the conversations. I now have the opportunity to discuss with you, give you an update on our capital allocation and our capital structure. Actually, almost two years ago, actually at this very forum, we shared with you the first time our capital allocation framework. We'd had the capital allocation framework in place since just after the IPO. That was the first time that we were able to share it with you. It has not changed since we shared it with you last time, but I just want to remind you of the priorities. Our first priority is organic growth. It's investing behind the opportunities within our existing business.
As we reviewed what we have done over the last couple years versus what we committed to do and where our strategic priorities are and what Fabien took you through, you can see that's where we invested. That was priority number one, stepping up on a lot of our intentional investments behind these key strategic priorities. Our second priority is our optimal leverage, and we target to maintain our optimal leverage at around 2.5 x. Now, this may be a little bit different than other people in terms of what we mean by our optimal leverage. This is not a target that we select for a particular ratings category or a particular commitment. This is actually the level of leverage that we should run the company at in order to maximize the theoretical equity value of the company.
This comes from our financial models, and we do refresh, and it's in the range of 2.4x-2.6x. Now, this doesn't mean that we can't deviate and increase our leverage above 2.5 x. We can, for a short period of time, of course, to pursue a strategic opportunity. The key is we always have to have a line of sight to get back down to 2.5x without too much delay, and if we were to cut off sides for too long, theoretically, we would destroy some value. We always are incentivized to get our optimal leverage to around 2.5 x. If our leverage drops below that level, you don't want it to have it too far below, of course, because that's the efficient level, but that creates additional financial flexibility.
Our third priority is inorganic growth. As you've seen, and Fabien was talking about the formation of the company, the history of the company, of course, M&A has played an important role in building what is currently JDE Peet's. Here, in terms of our priority number three, it's not just M&A, it's also strategic partnerships. We are also conservative with our balance sheet. As you've seen, we're quite selective when doing our M&As, and we have had a couple of acquisitions and several partnerships since our last strategic update. Our next priority is return of cash to shareholders, which we do primarily via a stable dividend flow, which we expect to grow over time.
When you look at the potential of the category, the fundamentals of the business, and if you add to it our financial discipline, we have a very strong financial profile. This discipline is applied across the P&L, across the cash flow statement, and throughout the balance sheet. If you look at our first pillar, our financial strategy, it's to protect our gross profit. This is about making sure that we have the right level of visibility on our inflation, that we price through at SKU level all of our inflation, and we manage and we make sure to protect our gross profit. That's pillar number one. The second pillar of our financial strategy is to have strict cost control. We, of course, try to have strict cost control across all of our lines.
This is by containing our cost, and as we've talked about some of our cost initiatives already, by containing our cost, this gives us the ability to be intentional about having step-ups in investments behind our strategic priorities. If you were to look at our SG&A, and you were to isolate the step up behind our strategic investments, some of the FX and M&A scopes, and you looked at our core SG&A, our core SG&A over the last couple of years is actually declining net of inflation. Of course, we're stepping up on our investment level. Our next pillar of our financial strategy is strong cash flow management, and this is driving our cash flow across all of the lines, and I'll come back to that in a moment.
Lastly, we seek to have a very strong balance sheet and always to have sufficient liquidity. All of this creates financial flexibility, and our capital allocation framework is what governs and prioritizes our financial flexibility. I'll come back to that. First, I wanna go, as we've talked a little bit, and we'll come back to gross profit. We've talked about our strict cost control. I wanna go into a little bit of detail on our cash flow management. Here you can see that on the left-hand side, if you look at a rolling three-year average, this allows you to go through full cycles on cash flow, on working cap, et cetera. You can see that taking a three-year average as of year-end 2021, we generated EUR 1.1 billion of free cash flow.
Again, the potential of the company to deliver a lot of free cash flow. If you update it through the last reporting period, which is the half of 2022, the three-year average moved to EUR 1.2 billion. I'm very happy to say that for full year 2022, we expect we are going to deliver more than EUR 1.3 billion of free cash flow, which means our three-year average stays at EUR 1.2 billion. In order to look at the efficiency of dropping our EBITDA and converting it into free cash flow, we look at cash conversion. In order to make that relative, 'cause all companies have a little bit different metric for cash conversion. Our cash conversion, it's operational cash flow minus CapEx, and here for cash conversion as a percentage of EBITDA.
If you put our full peer set by the same metric just to compare it, you can see that as of year-end 2021, we had 73% cash conversion. As of the most recent reporting period, as we shared with you, 77% free cash flow conversion. With our most recent with 2022 cash flow, it will stay at 77%. This is above our medium-term to long-term range of 70% cash conversion that over time, we expect to be around. If you go back to peer set, you can see that we perform much better in terms of cash conversion than peers at those two periods, respectively, of 59% and 60%.
This is all supported by our consistently competitive negative working capital, and of course, it can go through a little bit of cycles with commodity inflation, et cetera, but you can see that it's quite consistent. Actually, when you look at it, the trend is even a little bit negative here as we continue to improve and optimize. Now I wanna go through a little bit of the status of our balance sheet and look at our liquidity. If you look at the time of the IPO, first of all, we had a very different capital structure. Today, looking at the bottom, you can see that we've improved our capital structure quite a bit.
The capital structure at the time of the IPO, we had quite a concentration of debt, particularly in the 1.5- year to three-year bucket, with 80% of the debt in the one bucket, that was with loans. Since then, we've smoothed out our debt maturities, you can see, the profile has improved on the bottom half. Also, we have doubled our liquidity from EUR 1.2 billion to EUR 2.4 billion. We have improved our cost of debt from what was an attractive level of cost of debt at 2.4%, now we have our cost of debt is a half a percent.
If you look at the bottom debt maturity profile, you can see that we don't have any debt coming due within the next 1.5 years, so we don't need to do any refinancings. The amount of liquidity that we have, $2.4 billion, is actually enough to cover all of our maturities through 2027. Quite a strong capital structure. If we were to open up that concentration of maturities, the way we look at it in rolling 12-month increments, so we always look to see do we have any concentration, those towers tend to be around $500 million-$750 million in any 12-month rolling basis.
If you go back to the free cash flow that we generate using the three-year average, EUR 1.2 billion, obviously our free cash flow easily services in any stress environment, any debt coming due. If you look at our cost of debt, half a percent, obviously, that also gives us a very low net interest expense as well. We're very efficient in terms of our below free cash flow, even down to net cash on hand. We have very little risk in the profile. A strong capital structure. If we chart this versus peers, just to say how does this position us on a relative basis, if you look at the Y-axis here, where we've charted cost of debt, the X-axis is the amount of debt that needs to be refinanced within the next 18 months.
You can see at cost of debt, we're at the leading end of that with one of the lowest cost of debt. In terms of the amount of debt we need to refinance, we don't have any debt that we need to refinance in the 18 months, so we're in the low end range here. Very competitive versus a broad spectrum of CPG peers. Importantly, we entered the current inflationary environment, rising rate environment with a very strong hand because we had finished our capital structure and well-positioned going into this environment that we saw coming. All of this creates a lot of flexibility because we're very efficient all the way down to net cash. Our capital allocation framework governs how we deploy this cash.
I'm gonna go into a little bit more detail now on our capital allocation framework. Back to this, and I'm gonna go through it. And the best way to look at how we use, how our capital allocation framework governs the deployment of cash, is actually to look at our track record and to look at the last few years in terms of how we've deployed that cash. I think that's the most effective way. And now that we've had a couple years since the last time we shared it, we can now look back and you can see that we do what we say we're gonna do, and it's the way that we behave. Starting at the top in terms of organic growth, so investing behind the growth opportunities in the existing business.
Just to demonstrate it a little bit on a couple of examples here, this is always where we start. We always make sure that we have the right investments to fuel our long-term ambition. A couple ways to demonstrate this on the left-hand side, for example, if you look at since 2020 when we said we wanted to step up on our AMP, and here I put our investments and our working media and also the investments behind our appliances. If you look at the two-year CAGR since 2020 when we said we're gonna do that, it's grown by 23%. That's the two-year CAGR, the step up there. Another way to demonstrate fueling our organic growth and in-investing priority number one is if you look at our CapEx.
Here again, I used a three-year average, and you can see that if you look at our CapEx in the last three years, on average, 20% of our CapEx is for maintenance CapEx. This is the core CapEx, the sustaining CapEx. We have good control of our core CapEx. We have quite a centralized process, and that allows us to be efficient on our maintenance CapEx. Importantly, allows us to allocate more of our CapEx envelope to growth. In the last three years, on average, 80% of our CapEx has been allocated to growth. This is for capacity expansion, this is for expansion, for example, of our footprint of our China stores, these type of investments. I know everybody likes to look at CapEx as a percentage of sales, so I added that here as well.
You can see that on average, the last three years, our CapEx has been 3.7% of our sales, which is quite an efficient level. The important thing is that 80% of it has been allocated to growth. That's priority one. If you look at priority two, our leverage around 2.5x. I wanna show you our track record of leverage over the last few years. As the other priorities come after that, I wanna show those also in the context of leverage because we start with leverage and those things happen at the same time and after that priority. I'm gonna walk you through it all together here.
If we step back to before the IPO, as of December 2019, our net leverage, this was legacy JDE, was 3.1 x net debt to EBITDA. A lot of times when people talk about M&A, recent bolt-on M&As, they forget one of the biggest bolt-on M&As in the history of the company, which is Peet's, the acquisition of Peet's. This was an important M&A for JDE Peet's, and that took us to 3.4 x leverage as of June 20th. This is right after the IPO. With the IPO, with some additional deleveraging, we landed at 3.4 x. At that time, we gave a public commitment to reduce our leverage to below 3 x by the middle of 2021. As you will recall, we delivered on that commitment.
As of June 2021, we were actually slightly below 3 x. All during this time of deleveraging, you can see on the upper right-hand corner, we continued to step up our investments on A&P and growth CapEx investments. We didn't put that behind the leverage. Of course, we continued to invest in organic growth, and that's key. We didn't stop there. We continued to deleverage. By the middle of 2022, we got to 2.5 x leverage, so optimal leverage. This is pro forma without share buyback, and I'm gonna come back to that, and I'll explain why I show it that way. Actually, as of around May, we were at 2.5 x, pro forma for June, we were at 2.5x.
As we're deleveraging, we get to 2.5 times. In the background, we can still do M&As. We did two bolt-on M&As during this period of time in getting to our optimal leverage. We did our acquisition of Campos in Australia, the Les 2 Marmottes in France, and so you were able to try one of those out during the break. We continued to do bolt-on M&As, and we'll consistently do that. Because of our strong free cash flow generation, it gives us a lot of financial flexibility. Our next priority is return of cash to shareholders. We also implemented a stable dividend flow, and you can see our four installments here in our dividend flow. Importantly, we built a cadence that fit our cash flow profile.
As I mentioned, in May of 2022, we did a 500 million share buyback that increased our leverage by 0.3x to just under 2.8 x. I'm happy to say that with the strong free cash flow generation that we have for full year 2022, that we're gonna look at in a moment, that we expect to finish our year in terms of leverage at 2.65 times, which is actually a little bit below where we started the year. Once again, following the cycle, and we are almost to our optimal leverage range, which is around 2.4x-2.6x, the midpoint being 2.5x. You can see our consistent delivery.
We follow our framework, so we adhere to it in terms of our capital, our cash flow deployments, and we do what we say we are gonna do. This gives us a strengthened business and financial profile. Actually, if you, if you step back and you think about what we've gone through today, what Fabian talked about in terms of our improved fundamentals, Fiona talked about, Laurent talked about in terms of our improving fundamentals, we have a significantly strengthened business and financial profile. If you were to look at, again, versus peers, and you were to look at some operational metrics, some cash metrics versus a broad peer set, and here I broke it up in terms of beverage, broader CPG, and then brought it together in terms of a total group average here.
You can see here that this data's since the IPO, since the middle of 2020 for most metrics or looking at LTM on a two-year basis, up until the most recent reporting period for consistency. This is with H1 data. You can see here, if you look at top line and you look at a revenue CAGR, JDE Peet's delivered 9.7% revenue growth. That compares almost to the level of beverage peers and ahead of the all peer median here for this timeframe. If you look at bottom line, looking at underlying EPS growth as a proxy, you can see here that also we are ahead of the all peer median here as well.
If you look at cash metrics, and we put free cash flow yield here, looking at the average free cash flow yield during this period of time, and I just talked about our strong free cash flow generation. We're best in class in terms of free cash flow yield, leading the peer set and using return of cash to shareholders using dividend yield as a proxy here. You can see that we have a competitive dividend yield. Despite that, if you were to look at valuations, we're at the low end of the range versus this broad peer set. Whether you look at EV/EBITDA multiple or P/E ratios. Of course, our job is not to focus on valuations. Our job is to focus on improving the fundamentals of the business.
We focus on operating the business, and we know that if we continue to do that and improve our fundamentals, and we have consistent delivery over time, we will narrow the gap to our peer set. I'm gonna stop there, and at this point, actually, I'm gonna hand it back over to Fabien, who's gonna give you a preview of our 2022 results, and he's gonna look at the outlook, and then we're gonna rejoin for a Q&A. On that note, Fabien.
Thank you, Scott. Can you hear me? Well, okay, perfect. We thought it would be appropriate, being close to end of January, to share with you our preliminary number for 2022. Of course, we don't want to convert a capital market day into a trading update neither. We will not share more information than the ones that I will disclose now, because we have been keeping our 22nd of February date to talk more about our results as well as about our outlook, but you will see a pretty good level already now. 2022 was a year of choices, and there were choices to be made. You could have choices to go in full of pricing, being the first of pricing, paying a bit of the price of being the first of pricing.
You could have a choice to say, "I'm gonna wait for somebody else, and I'm gonna follow." A choice to put less pricing than what was needed, hoping maybe to get more volume and gaining market share as a consequence. Could be a year of not pricing in full, but as a consequence, maybe to slow down the investment to deliver bottom line at any cost, possibly even to play with quality. Actually, we make choices for the long term. I've been saying it earlier at my lunch break. I'm committed here for the long term. When you're committed for the long term, you're committed to do the right things and not looking after any shortcut to manage your financials. What are the choices we made? Is first to not compromise on the quality of the business and our fundamentals. What do we mean by that?
Laurent has been alluded a bit to that. In 2022, it was, we kept very high our customer service level with on time in full level above 98% consistently. In 2022, it was the lowest ever consumer complaint on JDE product. In 2022, it was the best ever safety performance across our factory. In 2022, we refused to play some game which sometimes happening on coffee to change a blend, to go to lower grade coffee, to manage your cost, but not to deliver the same value to customers and to consumers. You have seen throughout this morning, we refuse to slow down the investment we have to catch up on working media, on appliance, on sustainability, on innovations.
By that it means that when you make the choice, it implies you have no other option than to be absolutely ruthless to protect your absolute gross profit, the profit per cup. For that, you have to be a bit aggressive on your cost side, and we have been sharing what we have been doing there, but as well on leading on pricing. I stand behind these choices because these choices makes us stronger. Knowing what had been happening throughout the years, if I would have to do it again, I would do exactly the same choices. We know these choices are making us stronger, and I know these choices as well is making us delivering on our commitment. Here you can see what we have been delivering in 2022.
You see on the left part of the slide what we committed to at the beginning of the year. To be honest, we did not know how bad the year would turn with a lot of external events which had been happening. We have not changed our outlook. We said we would deliver a double-digit organic sales growth, being very disciplined on pricing. We know already we had to be very disciplined on pricing. We said as well that we will defend our absolute gross profit. We said that we committed to reinvest in the business. We committed to end manage the short term and prepare to get a better long term. That we have for that to invest behind strategic growth opportunities. I trust you have seen today where we have been deploying this investment.
Finally, we said we would deliver a minimum of EUR 1 billion of free cash flow for 2022. What have we done? We've done what we said we would do. We have been increasing our sales by 16.4% with double-digit organic sales growth of 11.3%, with pricing playing the biggest part there of 15.8%. We have been improving our absolute gross profit by 3.3%. We have been increasing our SG&A investment, and we wanted to share really the detail of that on our working media, on our appliances throughout the day. Our SG&A has been stepping up by 10.6%. To the earlier questions, you will see on the P&L absolutely greater than where they were even in 2019.
Consequently, our adjusted EBIT has been decreasing by 5.9% and organically by 9.3% as we have been stepping up our investment for long-term growth. On free cash flow, we generated more than EUR 1.3 billion of free cash flow in 2022 and, achieving, as Scott has been talking to, a net debt leverage of 2.65x. I want to share a couple of more information, especially to answer some of the questions we have had this morning, and I know has been a lot written about over the last couple of months about pricing, volume, Europe, shares in one simple slide. How we break down this 11.3% organic sales growth in 2022, 15.8% pricing minus 4.5% on volume mix.
This volume mix part had been very, very much coming from Europe. Here we are showing something that I think is rarely disclosed from any company. It's very transparently, month by month in 2022, our volume sell-in in 2022. What do you see? You see a period of a gap. You see a period of a gap in July, in August, in September, in October. Yes, it is the case. Yes, it is true. It is where we were on our last wave of negotiation on 2022, which was difficult. We have been delisted in many places. Of course, when you're delisted, you lose market share. Of course, when you're delisted, your volume is going down. What's important is not that. What's important is when you are long-term focused, what's happening when you're relisted again.
You can see our November volume sell-in in Europe, you can see our December volume sell-in in Europe is back. You don't yet see it on the NielsenIQ report because you have about a monthly time between the sell-in and the sell-out. I promise you it's gonna come back on the next read you're gonna see on market share NielsenIQ. We have been, in the meantime, losing market share. We were prepared for it. We knew it. We've seen that two times in similar cycle in the past. If we look from July to the latest market share we had in November, which coincide exactly to these low windows with a one-month delay, we have been losing 79 basis points of market share in Europe. That is correct.
We don't yet have the full consolidations number at the end of December, but we have markets who are starting to share some very good results at the end of December. We will share again the very transparent way our market share at the end of December during our presentation on the 22nd of February. We know already it's recovering. That is the choice we made, and we stand again behind this choice because we know the exit rate of the company is stronger. Now looking at the channel level, our organic sales growth between in home and away from home as well. We are gonna be very transparent here. We continue to recover on our away from home business, which have had a 21%, almost 22% organic sales growth in 2022.
We see when we do have recovery on top line in away from home, giving the hard work we have been doing on the cost side, giving the operational leverage that additional growth is giving, that our bottom line is growing at a much faster pace than the top line. At the same time, we have to acknowledge in 2022, COVID in China continued to have an impact. We have to acknowledge that there had been a far more sticking work from home behaviors than what we had been anticipating. I got that wrong. Two and a half years ago, I said it would most likely take three years to come back to pre-COVID level. I was right that it's gonna take time. I was wrong on the exit. We thought it would be around 95%-90%. It's below that.
On the coffee store side, it's mostly impacted by China. We know what's happening on China. We are expecting to see further recovery. We know on other channels where we are exposed, we are below 80%, which will provide, of course, further upside when it's gonna happen. We'll continue to work on our cost side if we see that not happening. If I look back now over 2.5 years, so since we became public, what has been our performance? Scott has been ear-earlied to about some of the numbers which were since IPO, but from middle of the year because we don't have data yet for other companies on the full year 2022.
I have to say, we have been delivering a pretty good performance. I would say we've been delivering a superior performance on our operational metrics. On revenue growth, 18% bigger company today than where we were at the time of the IPO, and 7% compounding annual growth rate. Of course, there is pricing into it, but we have had as well already last year some volume mix momentum. This year we should not think that doing pricing is easy. You need to ensure your brands can carry this pricing, and they had. We have been increasing our bottom line at a faster pace than our top line, with an earning per share 21% higher than when they were in June of 2020. Which gives a compounding level of a double-digit level. What is very important for me is almost the second column here.
We have not delivered this number without shortcut. We could have got that number bigger. We could have got our bottom line bigger in 2022. We make the choices to ensure we would be a well-invested company. For investors, when they look at JDE Peet's, when they look at the company, they can be totally reinsured. It is a well-invested company. We have restored that. We have our share of voice today, which is above 40%. We have been investing more than 44% behind our appliances, and we have been explaining which appliances we have been invested behind a bit earlier. No shortcut made in the business. We have been returning cash to shareholders. We have been returning EUR 1 billion cash to shareholders.
Over the last 2.5 years, we generated between EUR 2.8 billion and EUR 3 billion free cash flow in 2.5 years. We have returned cash to shareholders at the same time as reducing our net debt by EUR 1.1 billion. Very important in our strategic framework is inclusiveness on our performance. We are as well very pleased on what Laurent has been presented, on the step up we have been doing on sustainability. We have not been improving our performance at the expense of our ecosystem, but we have been improving our impact in the ecosystem with a reduction of 15% on our Scope 1 and our Scope 2, with significant step up on visibility on our sourcing on coffee, moving to 77% responsible source coffee. How does it lead to?
It led us to being reassured that we have a stronger company and as a consequence, our long-term algorithm impact remains unchanged. You have seen it. It is exactly the same that what we have been presenting in the past. What does it mean for 2023? How do we look at it? We had the questions a bit earlier. We believe that in 2023, we are well positioned to be on the high side on our organic sales growth as of algorithm. We believe we are gonna be on the high end of it. We are gonna go back to positive organic adjusted EBIT that we are at this stage estimated on the low single-digit level.
Without compromising on the quality, without compromising on the investment, with what we call moderate SG&A investment, because I would say the reset is completed, the reset is done. As we continue to evolve into new growth pool, we need to ensure we continue to support our investment and stable dividend for 2023. We want to be as well very transparent that we see the year as a year of two halves. We see the year of negative EBIT, adjusted EBIT in H one and a year of positive adjusted EBIT in H two, but the balance of the two are gonna be positive. We usually never present our outlook in two halves, but we thought that, for the sake of transparency and avoiding any surprises, we wanted to be transparent here.
Now, that leads me actually to my conclusions of this day before we go into Q&A. I believe we are a much stronger company than we have ever been. I trust that you took the key messages we have been trying to convey today, which are, on one hand, we have been delivering on our outlook in 2021. We have been delivering on our outlook in 2022. We have been delivering on what we said we want to reinvest in the business. We have been delivering on what we said to be more intentional behind the new growth pool. Actually, we have been delivering all of that despite turbulences and without making any compromises on the fundamental of the business. The second thing is we have been transforming the company as well.
A company that is today, I've used many times the word stronger, but is correctly invested. A company that is more productive and a company that is more sustainable and more inclusive. It is not sufficient to move us up to the next level. It was very critical that at the same time, we were managing disruptions, strengthening the company, positioning ourself to much better growth in the futures. We have been doing that by really fueling new growth pool for us. We are successful and outgoing in the U.S. We are successful and outgoing in emerging market and in China in particular. We have significantly stepped up our capabilities on digital commerce. We have stepped up our intentionality and our agenda on appliances.
I'm sure you've seen from Fiona some impressive things on innovations that we really have back now. Not in one specific category, but across consumer needs that we have very well identified, behind which we are innovating. If you put all of that together, we are very confident that we have all the asset to win in the category, to win in the new wave that is coming in front of us. We have as well a very strong capital structure that will enable us to fuel this organic growth. At the same time, to seed opportunity or to seize opportunities, sorry, when we are gonna see them arising.
I trust that during this full day, you are sharing the same conclusion on the journey of what we have been doing, I would say, over the last two and a half years, and we are expecting a further exciting journey ahead. Thank you.
We'll probably do a few seconds break, probably even not, we go straight to Q&A. Let's go straight to Q&A. Maybe I'll invite Scott back on stage.
I will just ask, as I've been sharing before, to be mindful, it is not a trading update of the company. Try to focus more on the overall day, important questions you may have. Of course, if there are questions that we have not answered today, we'll be very happy to have some follow-up with Robin offline.
Thanks. Farhan Khan, Credit Suisse. I wanna go back to the chart you showed on the improving performance that we haven't seen in the NielsenIQ data yet. Could you just elaborate how you've managed to potentially turn the corner in terms of both volume declines and share growth? Is it as simple as resolving the delistings? If so, how have you been able to do that? Have you had to give back on some of the price increases you've taken? Secondly, you mentioned competition normally comes back with price increases, a quarter or two later. Have you seen that play out in the recent data as well? Thank you.
I will start maybe with the second part. I believe we have been answering that one this morning when we have been showing that there is a convergence now of price increase, which has been happening throughout the industry. Of course, there could always be some adjustment or catch up to be done here and there. I believe there is really a convergence. That has been led to your first question, which is, what have we done? We just stay firm. That's why this dip was not a weak dip. In some markets, it has been four months dip because we stay firm. When you increase at the same time your innovation pipeline, the strength of your brands, you still being on air, you still being visible, you still being creative, creating a pool for your consumer, you're coming back on shelf.
Because you come back on shelf, your volume are back and your market share is back. We did not have to compromise, if it's maybe what you were alluding to come back. If you would have taken 1 month more, it would have taken 1 month more.
Hi, Celine.
Thank you. Celine Pannuti, JPMorgan. I want to come back to the same question I asked you this morning. Organically, basically, you're saying that your volumes are back. What is the volume in the industry? Do we still have to comp a high level of at-home consumption? Are we seeing more elasticity? Maybe, I don't know if you will answer that, but I'm a bit surprised of your 3%-5% or top end of 3%-5% for this year. Does it mean there's no volume bounce back that you are expecting in 2023? Thank you.
Remind me, the first part was about?
Volume.
The volume. Yes, the volume in Europe in particular. It is fair if you look at NielsenIQ data across players in Europe, if I recall well the data, it's about -6, -7 volume. I would say this is even before any summer impact on some, on some volume from negotiation. We believe that is purely a readjustment on a post-COVID phenomena that you see back, by the way, in most majority in a recovery in volume, in away from home, even in our business. We don't see a trade-off or or or trade down there. Your second question was on.
The sales
On the, on the, on-
On the sales guidance on the top.
Yeah, on sales guidance. Sorry for that.
Yeah.
Again, we have to be careful. We will answer more of these questions on the 22nd of February. We are expecting, I would say, healthy structures of our organic sales growth in 2022. You know, it's still a year where you have had some different comparison, we have pricing, you have delisting, so all things together. We are expecting to have a healthy organic sales growth. I would say more balanced organic sales growth than the one we have had in 2022. I really should not ask the questions.
Hi. Yeah, Patrick from Barclays. I guess, just to first credit the results, well done managing the volatility the past year. Looking forward ahead, can you talk about the phasing H1 versus H2 on the organic EBIT side? I guess second of all, I guess the top end of three to five, can you give some of the moving parts behind that? I think some of the risk was, you know, in terms of pricing being rolled back. You know, how do we see that kind of going through into the second half of next year, considering the tough comps this year and maybe the negotiations you're gonna have with retailers?
There's a lot of that I can't answer, and I don't want to answer at this stage. Just to give some directions, still, you see there is some ease on the commodity side, but at the same time, you see that there are still some underlying inflation on services, on labor, on energy, although there have been some short-term positive impact on currency if you look year-on-year. There are still underlying input costs which are happening, which might be at a different time when you have it, I would say, when you read it on the newspaper and when you have it in a P&L.
At the same time, what I said earlier, we want to be known by the retailer as a company that will behave on the value cycle on the commodity coffee side in particular. When coffee goes up, we'll be relentless. Will be difficult because we know what we do is the right things for the entire industry to price. When we will have tailwind, we will share this tailwind with the retailers. Of course, we'll do that in a mutual way. We need to ensure that there is either from a timing or intensity standpoint, the similar thing happening, I mean, the reverse happening in 2023 of what had been happening in 2022.
As far as H1, H2, I don't want to enter too much in that conversations today, but they are comparison bases. They are inflation bases, pricing bases, investment phasing bases. I'm sure you are doing all your computing work to get an estimate between H1 and H2 of 2022 of our investment. It's probably most likely gonna be a bit more balanced next year, which is, which have a different impact, H1 and H2, which are the main driver, but nothing really fancy beyond this for 2023.
Hi, it's Tom Sykes from Deutsche. Just in terms of the variability of the cost lines, I suppose it's in addition to the last question, and particularly on energy and freight, which obviously have been coming down, but I think you probably fixed quite far ahead. Would those be a benefit to 2023 as it stands? Or is the main benefit on profitability going to be sort of holding your volumes and your sales as the, as the green coffee price comes off? Then, what's the sort of further outlook of out of home or away from home versus at home improvement, please? Can you still generate operational leverage out of your away from home business in 2023, please?
Great question. I will start maybe with the second one, and Scott, if you want to answer the first one maybe on commodity.
Sure. Sure. Go ahead.
On away from home, I think it's one topic, to be absolutely frank, we don't have full clarity about at this stage. We believe there are gonna be most likely some recovery on the coffee store side, in particular in China, and we feel very pleased about it because we have not slowed down our store openings. On the working from home, working in offices, it's so much in balance today. We are hearing company today who are forcing people to come back. We are hearing company as well saying stay all home, sometime in the same country, in the same industry on services. It's very difficult to have a point of view, and we don't want to have our operational performance relying on hope of things we don't know. We will continue to do our job.
Either when we see a faster recovery, we'll participate into it and provide operational leverage, or we don't, and we'll continue to work on our cost structures. Of course, as time progress, we'll know more. Most likely around April, May of this year, we will know more, but we are preparing for both agenda as we speak.
Yeah. I'll take the first question. believe your question was on energy and freight and what is coming through with some of the market trends that you see there. On energy, depends a little bit by market as well, because some of those markets saw a little bit less in 2022, and then that inflation comes in 2023, depending upon if it's a regulated market or not and how that gets passed through. Some of the markets know it's actually in 2023 where you have that inflation. In some of the markets where it's open and it's more, you can buy spot and you can do hedging, we have some of that also locked in. That's not gonna come into the first half.
In some markets, maybe in the later part of the year, we'll get a little bit more visibility there as we go forward. That's a little bit H1, H2. Also in terms of ocean freight, you're right that you do need to secure things up front. You do have some tenders that cover a portion of the year. We still have some inflation that's coming through with the lag effect there. But we do have... Let's see if that also continues with the current trend. We do see freight coming down, and that could come through a little bit in the second half, but it's a little bit early to share.
I don't wanna give too much in terms of what's locked in and what's unlocked at this point, but that would be later in the year for the areas that we see some benefits. There's a lag on that.
Yeah. No, thank you.
It's Jeremy Fialko, HSBC again. Can you share a bit more on your views about single serve in 2023? If you're, like, lapping some quite high bases there or, you know, you've got a bit of kind of COVID stuff still to come out, does that mean that you could have a certain element of negative mix in your business if that's a part of your business that's perhaps declining quicker just because of the base effect versus others? Maybe you could give us a bit more perspective on that. Thanks.
I will answer that more talking about the past and the future, because it can be a bit more commercial sensitive. When we looked at 2022 in the second part of the year and in Europe in particular, it's just impossible to look what is volume, what is mix driven, because when you're delisted with the retailers, it delists absolutely everything. It's very difficult to say, do I see a trend happening on my mix or not? But we are expecting all of that to normalize. As it normalize, I think consumer are back to their normal routine, and where we see disproportionate growth on single serve, on beans, on premium instant versus the rest of the portfolio.
Fabien, Scott, in view of time, I would like to take the last question.
John and David.
Yeah, from David, because there are some people who have to catch a plane, so then we can wrap it up.
David Hayes at Soc Gen. Just a couple of bits on the 23% increase in working media in appliances 2020-2022. Just so I understand that, just to check, that's all OpEx, isn't it? You can't capitalize any of the appliances or anything. Okay.
Correct.
Just, I kind of just wanna check back what you said. The big step up in investment is done, therefore that number will be much lower in 2023. Was that the point that you were saying?
Yes. The step up of investment, the reset of investment is completed by now. Yes.
you can't quantify the estimated.
That's why we talked about a moderate increase next year.
Moderate.
I think, As I always say, growth requires investment, ESG requires investment, and you always have to ensure that you're putting the right money, especially when you see an attractive opportunity.
Okay. The last one for me-
That, that was a two-year CAGR reported step up.
The last one was just on the terms of the delistings and the recovery. We understand from a lot of companies that you go from 100 delisted to zero, and it takes, let's say, 12 weeks to get back to 95. Actually, you can never get back to 100 immediately. Is that what you would say? Would you concur with that? Therefore this is still towards the back end of the year, you're going back from zero to towards 100 in that, in that November/December number, and therefore it should build through the first half of 2023.
I think, in reality, there have been multiple wave of negotiations throughout the years, which means that you have some market where you come 100%, you have some market where you come 95%. There are always sometimes some retaliations. You have as well some market when you come 105%. We have a bit of a combination of all of that. I think it's probably getting closer to the average of 100% across the market. It doesn't mean it's absolutely perfect everywhere. We still have few areas here and there where we are not totally satisfied with the recovery. All in all, very much so.
Thank you.
I see. John, I think you had a question earlier. No? Not anymore. I thought you had a question earlier, John. No? Yeah. We answered it. Okay, perfect. I think we see Robin Jansen, we probably have to stop here. Look, I will I don't want to do another conclusion after doing a conclusion, and I see some people have to really catch their flight. I would say thank you very much for for coming over. Thank you very much for your interest in JDE Peet's. You can see that we have been doing our best to answer most of the questions which have been arising throughout the company over the last year. Is it the weight in Europe? Is it impact on pricing? Is it investment recovery on the company?
To give a lot of transparency, we thought we deemed to share that with you as investors or as analysts. We'll have another window of opportunity on the 22nd of February. We'll be very pleased to share in more detail our results. If in the meantime, you think that there is really a burning question we have not answered, we'll be very happy with Robin to answer it. A big thank you for your interest and for coming over today. Thank you.
Thank you.