Diedrich Coffee (DDRX) 8-K Regulation FD Disclosure

DIEDRICH COFFEE, INC.

DIEDRICH COFFEE, INC.

Corporate Presentation

July 2009

Corporate Presentation

July 2009

©

2009 Diedrich

Coffee, Inc. –

All Rights Reserved

NASDAQ: DDRX

Exhibit 99.1

®

NASDAQ:

DDRX

Statements in this presentation that relate to future plans, financial results or

projections,

events

or

performance

are

“forward-looking

statements”

within

the

meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of

the Securities Exchange Act of 1934, as amended, and fall under the safe harbor of

those acts. Actual results and financial position could differ materially from those

anticipated in the forward-looking statements as a result of a number of factors,

including, but not limited to, the financial and operating performance of Diedrich

Coffee's

wholesale

operations,

Diedrich

Coffee’s

ability

to

maintain

profitability

over

time,

the

successful

execution

of

Diedrich

Coffee's

growth

strategies,

the

impact

of

competition, the availability of working capital, and other risks and uncertainties

described

in

detail

under

"Risk

Factors

and

Trends

Affecting

Diedrich

Coffee

and

its

Business" in Diedrich

Coffee’s annual report on Form 10-K for the fiscal year ended

June 25, 2008 and other reports filed with the Securities and Exchange Commission.

Except

where

required

by

law,

Diedrich

Coffee

does

not

undertake

an

obligation

to

revise or update any forward-looking statements, whether as a result of new

information, future events or changed circumstances.

2

Forward-Looking Statements

Forward-Looking Statements

NASDAQ:

DDRX

Premier roaster & wholesaler of 30+ varietals of coffee through

three brands:

•

Diedrich

Coffee

•

Gloria Jean’s Coffees

•

Coffee People

Exited retail locations in 2007 and Gloria Jean’s franchise business

in 2009 to focus on more profitable wholesale coffee market

Majority of sales derived from wholesale single-serve coffee

products through partnership with Keurig

and their patented K-

Cups®

66,000 sq. ft. roasting facility in Castroville, CA; 40,000 sq. ft.

distribution facility in Salinas, CA

3

Executive Overview

Executive Overview

NASDAQ:

DDRX

4

Strategic Execution Timeline

Strategic Transition to Premier Roaster & Wholesaler

Strategic Execution Timeline

Strategic Transition to Premier Roaster & Wholesaler

Fiscal Year End: June 25, 2008

¹Sale

of

U.S.

Gloria

Jean’s

Coffee

Franchises

on

June

12

th

effectively

completed

wholesale

transition

Entered K-Cup partnership

Exited international franchise

Exited company-owned retail

Exited domestic franchise¹

NASDAQ:

DDRX

Contributing factors:

Greater

consumer

awareness

of

specialty

coffee

due

to

increased

availability (e.g. Starbucks, Peet’s)

Mainstreaming

specialty coffee (e.g. McDonald’s offering specialty

coffee system-wide in 2009)

5

Coffee Consumption Has Moved Upstream

Consumers Increasingly Demand Specialty Coffee

Coffee Consumption Has Moved Upstream

Consumers Increasingly Demand Specialty Coffee

¹Source: 2008 Report from National Coffee Association of U.S.A, Inc.

Increased

quality

differentiation

–

a

more “coffee-savvy”

consumer

Ease

of

preparation

of

specialty

coffees resulting from increased use

of “at-home”

brewers

% of Adults Consuming 1+ Gourmet

Coffee Beverages per Day¹

NASDAQ:

DDRX

Keurig¹

owns patented, single-cup brewing

system using unique capsules for coffee, tea

and hot cocoa called the “K-Cup”

Keurig

had #1 best selling coffeemaker and

three

models in the top five in dollar sales in

calendar Q1 2009²

Keurig

is the market’s only single-serve

system that promotes brand and flavor variety

(i.e. open architecture)

6

Single-Serve Premium Coffee Market

Keurig

is the Industry Leader

Single-Serve Premium Coffee Market

Keurig

is the Industry Leader

¹Green

Mountain

Coffee

Roasters

(Nasdaq:

GMCR)

acquired

Keurig

in

June

2006

²Source: Green Mountain Coffee Roasters (GMCR) Fiscal Q2 2009 Performance Investor Presentation

Diedrich

French Roast

K-Cups -

18 Pack

Keurig

K-Cup Brewing

System

NASDAQ:

DDRX

7

How the K-cup Works

How the K-cup Works

K-Cup easily inserts into

the award-winning Keurig

Brewing System

The patented K-Cup design assures a

perfect cup of coffee every time, quickly

and efficiently

NASDAQ:

DDRX

Four

companies

license

the

Keurig

K-Cup

packaging

technology

Green

Mountain

Coffee

Roaster,(NASDAQ:

GMCR),

Keurig’s

parent

company, has greater than 50% market share¹

8

Single-Serve Competitive Landscape

Only Four Companies Manufacture K-Cups

Single-Serve Competitive Landscape

Only Four Companies Manufacture K-Cups

Green

Mountain

Coffee

Roasters

(NASDAQ:

GMCR)

manufactures

under

five

brands: Green Mountain, Newman’s Own Organic, Tully’s, Celestial

Seasonings, and Caribou.

Diedrich

Coffee (NASDAQ: DDRX) manufactures under three brands: Diedrich

Coffee, Gloria Jeans, and Coffee People.

Van Houtte

Coffee (private), based in Montreal, Canada, manufactures their

own brand name and tea under a licensing agreement with Bigelow Tea.

Timothy’s Coffee (private) of Toronto, Canada, manufactures under their

own brand and Emeril’s

under license. Acquired by Sun Capital Partners in

March 2008.

¹Source: Canaccord

Adams February 2009 Equity Research Report

NASDAQ:

DDRX

9

Single-Cup Capsule Shares

K-Cup Format Currently Dominates Single-Serve Market

Single-Cup Capsule Shares

K-Cup Format Currently Dominates Single-Serve Market

Source: Canaccord

Adams February 2009 Equity Research Report

NASDAQ:

DDRX

10

Diedrich

Benefits from K-Cup Growth…

Keurig

K-Cup Shipments –

All Roasters

Diedrich

Benefits from K-Cup Growth…

Keurig

K-Cup Shipments –

All Roasters

Source: Green Mountain Coffee Roasters (GMCR) Fiscal Q2 2009 Performance Investor Presentation

GMCR most recent fiscal year end: Sept 27, 2008

NASDAQ:

DDRX

11

…and Increased Brewer Penetration…

Keurig

Brewer Shipments (all channels)

…and Increased Brewer Penetration…

Keurig

Brewer Shipments (all channels)

Source: Green Mountain Coffee Roasters (GMCR) Fiscal Q2 2009 Performance Investor Presentation

GMCR most recent fiscal year end: Sept 27, 2008

NASDAQ:

DDRX

12

…Into Major Retailers

Locations Selling Keurig

At-Home Brewers

…Into Major Retailers

Locations Selling Keurig

At-Home Brewers

Source: Green Mountain Coffee Roasters (GMCR) Fiscal Q2 2009 Performance Investor Presentation

GMCR most recent fiscal year end: Sept 27, 2008

NASDAQ:

DDRX

Entered

license

&

distribution

agreement

with

Keurig

in

2000

as

2

nd

roaster

of

K-Cups

(vs.

four

today)

License allows for utilization of Keurig’s

patented

single serve coffee brewing technology to produce

Diedrich-branded K-Cups

Keurig

handles all distribution and sales of Diedrich

K-

Cups throughout 16,000+ retail locations selling Keurig

single-cup brewers

Agreement expires July 2013 and “Evergreens”

thereafter based upon certain volume thresholds,

which are currently being exceeded

13

Diedrich’s

Fit in Single-Serve Story

Partnership with Keurig

Signed in 2000

Diedrich’s

Fit in Single-Serve Story

Partnership with Keurig

Signed in 2000

NASDAQ:

DDRX

Keurig’s

focus has always been on

specialty/premium coffee

Keurig

promotes

brand

and

flavor

variety

Keurig

systems are applicable to

multiple channels (e.g. home,

office coffee systems and hotels)

14

Why Keurig’s

System Works So Well

“Consumer Choice”

Why Keurig’s

System Works So Well

“Consumer Choice”

Keurig

K-Cups and Brewer Display

Bed, Bath & Beyond -

Raleigh, NC

NASDAQ:

DDRX

1.

At-home (Reseller) Market

•

Diedrich-branded K-Cups sold to Keurig

and distributed to retail

•

Diedrich-branded K-Cups sold to

Amazon.com

2.

Office Coffee Service –

“OCS”

•

Diedrich-branded K-Cups sold to Keurig

Authorized Distributors (KADs) for resale

to offices, hotels and e-commerce sites

•

Includes remaining Gloria Jean’s

franchises

15

Diedrich-Branded K-Cup by Channel

K-Cups Distributed Through Two Channels

Diedrich-Branded K-Cup by Channel

K-Cups Distributed Through Two Channels

NASDAQ:

DDRX

16

Roasting & Distribution Facility

Castroville, CA

Roasting & Distribution Facility

Castroville, CA

66,000 square feet

New management instituted process & utilization improvements

Operate 5 production lines, 5 days per week in three 8-hour shifts

Keurig capacity and quality control on-site audits twice per year

Ample capacity in place to meet forecasted demand

Salinas, CA

40,000 square feet

Central distribution point

NASDAQ:

DDRX

17

Brand Breakdown

Three Brand Names Selling 30+ K-Cup Varieties

Brand Breakdown

Three Brand Names Selling 30+ K-Cup Varieties

•

Traditional customer

•

Premium, high-end roasts

•

Younger demographic, bold flavors, edgy packaging

•

Includes Donut Shop blend -

#1 grocery seller on

Amazon.com

and in the Top 10 customer choices on

Keurig.com¹

•

Flavored coffee

•

Includes hazelnut blend –

in the Top 10 customer

choices on Keurig.com¹

¹Source:

Keurig.com

and

Amazon.com

as

of

June

22,

2009

NASDAQ:

DDRX

18

Annual Wholesale Net Revenue

33 % CAGR Fueled by K-Cup Volume Growth

Annual Wholesale Net Revenue

33 % CAGR Fueled by K-Cup Volume Growth

NASDAQ:

DDRX

19

Quarterly Net Revenue by Segment

79% Quarter-over-Quarter Wholesale Revenue Growth

Quarterly Net Revenue by Segment

79% Quarter-over-Quarter Wholesale Revenue Growth

NASDAQ:

DDRX

20

Diedrich

K-Cup Revenue

58% K-Cup Revenue CAGR

Diedrich

K-Cup Revenue

58% K-Cup Revenue CAGR

NASDAQ:

DDRX

Cash and short-term investment balance of $1.8 million, with $5

million of outstanding borrowings under current credit facilities

(Sequoia Enterprises)

$2 million note due Mar. 2010; $3 million term loan ($1 million due

Aug. 2009, $2 million due Aug. 2011)

Accounts receivable increased 97% to $9.9 million, and accounts

payable increased 61% to $8.3 million, primarily from 45%+ average

increase in wholesale sales compared to Q4 of fiscal 2008

21

Balance Sheet & Cash Flow Highlights

As of Fiscal Q3 2009

Balance Sheet & Cash Flow Highlights

As of Fiscal Q3 2009

NASDAQ:

DDRX

22

Key Financial Highlights: DDRX

Key Financial Highlights: DDRX

Trading Data

Stock Price

(06/25/09)

$18.95

52 Week Low/High

$0.21 -

$19.20

Avg.

Daily

Vol.

(3

months)

156,000

Basic/Diluted Shares

5.8M/7.8M

Public

Float,

est.

3.0M

Institutional Holdings

14%

Insider Holdings

45%

Valuation

Measures¹

Market Cap

$147.2M

Enterprise Value

$149.6M

EV/Revenue

(ttm)

2.4x

Financial

Highlights

(mrq

-

Mar

‘09)

Net Sales

$19.5M

EBITDA

$2.0M

EPS

$0.25

Net Cash

$1.8M

Total Debt

$4.2M

Current Ratio

1.2:1

Source: Bloomberg, company filings

¹Based on diluted shares outstanding, calculated using treasury method

NASDAQ:

DDRX

Favorable macro coffee market trends:

a more sophisticated

customer demanding gourmet coffee

Strong

industry

growth

trends:

Keurig

forecasts

~1.6

billion

K-

Cup shipments in fiscal 2009; 52% CAGR from 2005 and 63%

growth year-over-year¹

66,000

sq.

ft.

roasting

facility

with

ample

roasting

capacity

to

meet forecasted demand

Outstanding

brand

reputation

and

35

years

of

experience

sourcing and roasting high-quality specialty coffees

Diedrich

Coffee Q3’09 vs. Q3’08 at-home revenue growth of 165%

23

Diedrich

Coffee Key Take-Aways

Diedrich

Coffee Key Take-Aways

¹Source: Green Mountain Coffee Roasters (GMCR) Fiscal Q2 2009 Performance Investor Presentation

NASDAQ:

DDRX

24

For More Information

For More Information

Diedrich Coffee Inc.

28 Executive Park, Suite 200

Irvine, CA 92614

Phone: (949) 260-6700

Company Contact

Sean McCarthy, CFO

(949) 260-6700

Investor Relations

Liolios Group

Scott Liolios or Cody Slach

949-574-3860

info@liolios.com

NASDAQ: DDRX