Swiss Water Decaffeinated Coffee (SWP) Q1 2025 earnings summary

Executive summary

• Entered 2025 with strong operational momentum, consolidated production in Delta, and both decaffeination lines running 24/7, serving a broad and growing customer base in North America and internationally.

• Q1 2025 processed volumes increased 6% year-over-year, with revenue up 61% to CAD 62.3 million and gross profit up 42% to CAD 7.3 million.

• Net income reached CAD 515,000, reversing a CAD 900,000 loss in Q1 2024; Adjusted EBITDA declined 28% to CAD 2 million due to timing-related hedge losses.

• Maintained focus on execution, cost management, and customer relationships amid dynamic market conditions.

• Strategic inventory positioning enabled quick response to customer needs, supporting volume growth over the prior year.

Financial highlights

• Q1 revenue rose 61% year-over-year to CAD 62.3 million, driven by higher coffee prices and a 6% increase in processed volume.

• Q1 gross profit was CAD 7.3 million, up 42% year-over-year; gross margin percentage decreased slightly to 12% from 13%.

• Net income for Q1 was CAD 515,000, compared to a loss of CAD 900,000 in Q1 2024; operating income increased 186% to CAD 3.9 million.

• Adjusted EBITDA was CAD 2 million, down 28% year-over-year, impacted by risk management losses expected to be recovered.

• Cost of sales increased 64% year-over-year to CAD 55 million, reflecting higher green coffee costs and increased volume.

Outlook and guidance

• Expect continued variability throughout the year due to market volatility, tariffs, and elevated coffee prices.

• Inventory levels anticipated to normalize as demand plays out over coming quarters.

• Do not expect NYC futures market to return to historical averages within 2025; more likely in late 2026.

• Revised pricing initiatives are expected to recover incremental hedge losses incurred in 2025.

• Strategic direction and outlook remain unchanged despite new tariffs.