Earnings release
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 1 | P a g e o f t h e P r e s s R e l e a s e Swiss Water Reports Third Quarter 2025 Results Vancouver, BC, November 6, 2025 – Swiss Water Decaffeinated Coffee Inc. (TSX:SWP) (“Swiss Water” or “the Company”), a leading specialty coffee company and premium green coffee decaffeinator, today reported financial results for the three and nine months ended September 30, 202 5. All amounts are expressed in Canadian dollars unless otherwise stated. Third Quarter 2025 Highlights • Q3’25 processed volumes increased 7% over Q3’24; • Revenue of $62.7 million, an increase of 50% over Q3’24; • Net income of $0.2 million, an increase of $1.0 million over Q3’24; • Adjusted EBITDA of $3.3 million, an increase of $1.1 million or 52% over Q3’24; • The NY’C’ coffee futures price for Arabica coffee remained volatile during Q3’25, peaking at US$4.32/lb in September. During Q3’25, the NY’C’ averaged US$3.37/lb, compared to an average of US$2.46/lb in Q3’24, an increase of 37%. Year to Date 2025 Highlights • Year to date processed volumes increased 4% over 2024; • Revenue of $192.7 million, an increase of 56% over 2024; • Net income of $0.4 million, an increase of $1.1 million over 2024; • Adjusted EBITDA of $7.1 million, a decrease of $2.3 million or 24% over 2024; • Operating credit facility renewed and expanded to $80M; • Agreement with Mill Road Capital to repurchase and cancel outstanding warrants; • Year to date repayment of $4.0 million of construction debt. “We delivered good volume growth and improved profitability in the third quarter, demonstrating the continued execution of our strategy in a volatile market. Customer demand remained strong, demonstrating the strength of our brand and geographic coverage during a period when supply imbalances have challenged the industry , and importantly, as U.S. grocery channels experience declines in tonnage volume due to rapid retail price increases. Coffee futures remained volatile throughout the quarter , ending in an elevated position, and while the inverted market and tariffs are causing rapid changes in coffee origin preferences and purchase timing, we benefited from the timing of coffee
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 2 | P a g e o f t h e P r e s s R e l e a s e purchases and favourable foreign exchange movements. These gains, combined with our ongoing hedging activities, contributed to positive Adjusted EBITDA and net income , and generated cash that we directed toward debt repayment," said Frank Dennis, CEO of Swiss Water. "The progress we've made in strengthening our balance sheet has continued this quarter through repayments of our construction loan and credit facilities. Our operational discipline and risk management approach continue to position us well to serve customers reliably and deliver value to shareholders as we navigate the ongoing complexity in the coffee market.” Summary of Operational Performance • Total processing volumes in pounds for the three and nine months ended September 30, 2025, increased by 7% and 4%, when compared to the same periods in 2024, supported by continued customer demand and order flow. • The NY’C’ coffee futures price for Arabica coffee remained volatile during Q3, peaking at US$4.32/lb in September 2025. Spot availability of green coffees remains very low, and pressure on the futures market intensified during the quarter. Moving forward, the higher prices and inverted coffee market may result in a softening of consumer demand and volumes shipped to roasters. • Swiss Water’s decaffeination process has been formally classified by US customs as “non-transformational”, allowing processed beans to retain the original country -of- origin status for tariff purposes. • During the third quarter of 2025, the US administration announced its intention to increase tariffs on most Brazilian products imported into the US from 10% to 50%, effective August 7th, 2025. Brazil is the biggest producer of green coffee globally, and all Brazilian coffees processed by Swiss Water and shipped into the US are subject to this elevated tariff. The effect of this change has been a rapid demand shift away from the highest coffee volume producing nation in the world. This is expected to cause short term disruptions and volume issues for the next 3-6 months, and potentially longer.
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 3 | P a g e o f t h e P r e s s R e l e a s e Summary of Financial Results 1 Adjusted EBITDA is defined in the ‘Reconciliation of Non-IFRS Measures’ section of this MD&A and is a “Non-GAAP Financial Measure” as defined by CSA Staff Notice 52-306. 2 Per-share calculations are based on the weighted average number of shares outstanding during the periods. Diluted earnings per share take into account shares that may be issued upon the exercise of equity-based RSUs. • Revenue for the three and nine months ended September 30, 2025, was $62.7 million and $192.7 million, which represents a $21.0 million or 50% increase and a $68.8 million or 56% increase, when compared to the same periods in 2024. The increases were primarily driven by a higher NY’C’ coffee commodity price and enhanced further by tariff expense recovery, volume growth, and increased activity within our storage and distribution business. • Gross profit for the three and nine months ended September 30, 2025, was $6.4 million and $19.0 million, which represents a negligible difference and a $0.2 million or 1% decrease, when compared to the same periods in 2024. In Q3, the positive impact of higher volumes was offset by lower green coffee differential margins and foreign exchange losses on green coffee cost recovery associated with the fluctuations in the US$ dollar. Year to date, the incremental gross margin generated by higher volumes was also primarily offset by lower green coffee differential margins and foreign exchange losses on green coffee cost recovery, as well as the reversal of an inventory provision in 2025 2024 $ Change % Change 2025 2024 % Change % Change Revenue 62,747 41,778 20,969 50% 192,714 123,880 68,834 56% Cost of sales (56,307) (35,342) (20,965) 59% (173,739) (104,664) (69,075) 66% Gross profit 6,440 6,436 4 0% 18,975 19,216 (241) -1% Operating expenses (4,226) (3,656) (570) 16% (11,479) (11,324) (155) 1% Operating income 2,214 2,780 (566) -20% 7,496 7,892 (396) -5% (1,812) (3,880) 2,068 -53% (7,044) (8,445) 1,401 -17% (186) 309 (495) -160% (95) (191) 96 -50% Net income (loss) 216 (791) 1,007 -127% 357 (744) 1,101 -148% Adjusted EBITDA (1) 3,294 2,161 1,133 52% 7,129 9,433 (2,304) -24% Basic and diluted 0.02 (0.08) 0.04 (0.08) Diluted 0.02 (0.08) (0.13) (0.08) 3 months ended September 30 9 months ended September 30 except for per share amounts In C$ ‘000s Non-operating or other Income tax recovery (expense) Earnings (loss) per share (2)
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 4 | P a g e o f t h e P r e s s R e l e a s e 2024. This provision had a positive impact on gross profit in the prior year, but there was no such reversal in 2025. • For the three and nine months ended September 30, 2025, we recorded net income after taxes of $0.2 million and $0.4 million, compared to a net loss after taxes of $0.8 million and $0.7 million for the same periods in 2024. The increase in Q3 was primarily driven by reduced losses on risk management activities, lower net finance expense and foreign exchange gains , partially offset by higher stock based compensation expense driven by an increase in the Company’s share price in Q3. The increase year to date was primarily driven by a gain on the fair value of an embedded option and reduced net finance expense, partially offset by a small decrease in gross profit. Adjusted EBITDA Swiss Water defines Adjusted EBITDA as net income before interest, depreciation, amortization, impairments, share-based compensation, gains/losses on foreign exchange, gains/losses on disposal of property and capital equipment, fair value adjustments on embedded options, loss on extinguishment of debt, adjustment for the impact of IFRS 16 - Leases, and provision for income taxes and other non -cash gains related to a remeasurement of asset retirement obligation. The Company’s definition of Adjusted EBITDA also excludes unrealized gains and losses on the undesignated portion of foreign exchange forward contracts.
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 5 | P a g e o f t h e P r e s s R e l e a s e The reconciliation of net income, an IFRS measure, to Adjusted EBITDA is as follows: Company By-Law no.2 The Board of Directors of Swiss Water approved By-Law No. 2, a by-law to provide a clear and transparent process for advance notice of nominations of directors by shareholders, in accordance with good governance practices. The by-law is effective November 3, 2025 and will be brought to the shareholders for confirmation at the next general meeting of Swiss Water. A Call Details A conference call to discuss Swiss Water’s recent financial results will be held on Friday, November 7, 2025, at 1:00 pm Pacific (4:00 pm Eastern). To access the conference call, please dial: • 1-888-506-0062 (toll-free) or • 1-973-528-0011 (international); In C$ ‘000s 2025 2024 2025 2024 Net income (loss) $ 216 $ (791) $ 357 $ (744) Income tax (recovery) expense 186 (309) 95 191 Income (loss) before tax $ 402 $ (1,100) $ 452 $ (553) Finance income (407) (509) (1,147) (1,415) Finance expense 1,635 2,294 5,055 6,875 Depreciation & amortization 1,729 1,765 5,357 5,160 Unrealized gain on foreign exchange forward contracts (147) (25) (76) (37) Fair value (gain) loss on the embedded option - (144) (1,657) 664 (Gain) loss on foreign exchange (144) 269 125 (317) Share-based compensation 875 251 942 975 Impact of IFRS 16 - Leases (649) (640) (1,922) (1,919) Adjusted EBITDA $ 3,294 $ 2,161 $ 7,129 $ 9,433 3 months ended September 30 9 months ended September 30
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 6 | P a g e o f t h e P r e s s R e l e a s e • Listeners will be prompted to provide an access code: 805987. If a listener does not have this code, they can reference the Company name as an alternative passcode. A replay will be available through Friday, November 21, 2025, at • 1-877-481-4010 (toll-free) or • 1-919-882-2331 (international); replay passcode: 53094 A more detailed discussion of Swiss Water Decaffeinated Coffee Inc.’s recent financial results is provided in the Company’s Management Discussion and Analysis filed on SEDAR+ and Swiss Water’s website (investor.swisswater.com). For more information, please contact: Iain Carswell, Chief Financial Officer Swiss Water Decaffeinated Coffee Inc. Phone: 1-604-420-4050 Email: investor-relations@swisswater.com Website: investor.swisswater.com About Swiss Water Swiss Water Decaffeinated Coffee Inc. is a leading specialty coffee company and a premium green coffee decaffeinator that employs the proprietary Swiss Water® Process to decaffeinate green coffee without the use of chemical solvents such as methylene chloride. It also owns Seaforth Supply Chain Solutions Inc., a green coffee handling and storage business. Both businesses are located in Delta, British Columbia, Canada.
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Swiss Water Decaffeinated Coffee Inc. 7750 Beedie Way | Delta | British Columbia | Canada V4G 0A5 7 | P a g e o f t h e P r e s s R e l e a s e Forward-Looking Statements Certain statements in this press release may constitute “forward -looking” statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward -looking statemen ts. When used in this press release, such statements may include such words as “may”, “will”, “expect”, “believe”, “plan ”, “anticipate” and other similar terminology. These statements reflect management’s current expectations regarding future events and operating performance, as well as management’s current estimates, which are based on numerous assumptions and may prove to be incorrect. These statements are neither promises nor guarantees but involve known and unknown risks and uncertainties, including, but not limited to, risks related to processing volumes and sales growth, operating results, the supply of utilities, the supply of coffee and packaging materials, supply of labour force, general industry conditions, commodity price risks, technology, competition, foreign exchange rates, construction timing, costs and financing of capital projects, a potential impact of any pandemics, global and local climate changes, changes in interest rates, inflation, transportation availability, and general economic conditions. The forward -looking statements and financial outlook information contained herein are made as of the date of thi s press release and are expressly qualified in their entirety by this cautionary statement. Except to the extent required by applicable securities law, Swiss Water undertakes no obligation to publicly update or revise any such statements to reflect any change in management’s expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those described.