Swiss Water Decaffeinated Coffee (SWP) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue increased 56% year-over-year to CAD 67.7 million (or $67.7M), with stable processed volumes and a net loss of CAD 374,000 (or $0.4M), down from net income in Q2 2024.

• Strategic inventory positioning and consolidated production supported strong execution and customer demand.

• Profitability was impacted by hedge losses, US dollar depreciation, higher production and maintenance costs, and tariff changes.

• Market volatility, including elevated coffee futures and tariff uncertainty, continues to impact industry behavior and purchasing patterns.

• Early signs of price sensitivity in the U.S. grocery segment, but overall demand remains steady.

Financial highlights

• Q2 2025 revenue increased 56% year-over-year to CAD 67.7 million, driven by NYCE effects, tariff cost recoveries, customer mix, and improved logistics subsidiary revenue.

• Q2 gross profit was CAD 5.2 million (or $5.2M), up 22% year-over-year, but gross margin declined to 8% from 18% due to sales mix and cost factors.

• Q2 net loss was CAD 374,000 (or $0.4M) compared to net income of CAD 947,000 (or $0.9M) in Q2 2024, impacted by a CAD 1.1 million loss on risk management activities.

• Q2 adjusted EBITDA was CAD 1.8 million (or $1.8M), down 59% year-over-year, mainly due to risk management losses expected to be recovered through pricing.

• Total steady volumes increased by 2% in the first half of 2025.

Outlook and guidance

• Expectation that inversion costs and hedge losses will be recovered over the remainder of 2025 and into 2026 through pricing initiatives.

• Management anticipates continued market inversion and volatility into 2026 but is confident in the ability to manage with discipline and strategy.

• Ongoing focus on risk management, inventory positioning, and supporting customer demand.