Swiss Water Decaffeinated Coffee Income Fund Reports Fourth Quarter and Annual Results

11th March, 2008 : Vancouver (Website)

VANCOUVER, BC, March 11, 2008/CNW/ Swiss Water Decaffeinated Coffee Income Fund (“the Fund”) today reported financial results for the three and 12 months ended December 31, 2007. The three-month period represents the fourth quarter of its 2007 fiscal year. The Fund holds all of the outstanding securities of Swiss Water Decaffeinated Coffee Company, Inc. (“SWDCC” or “the company”) and its results are dependent on the operating results of SWDCC.

Operating Results

In $000s except per unit amounts	3 months ended December 31		9 months ended December 31
	2007	2006	2007	2006
Sales	8680	7640	31,064	31,353
Gross profit	2860	2920	10,800	12,079
EBITDA(1)	1,869	1,955	6,808	7,745
Net income	837	571	5,180	4,606
Adjusted distributable cash(1)	2,155	1,745	7,109	7,141
Distributions paid	1,502	1,417	4,924	5,671
Per unit amounts:
Net Income per unit	0.125	0.086	0.776	0.690
Adjusted distributable cash generated per unit(1)	0.323	0.261	1.065	1.070
Distributions paid per unit(1)	0.225	0.212	0.887	0.850

(1) EBITDA, adjusted distributable cash and adjusted distributable cash per unit are non-GAAP financial measures that are defined in the Management’s Discussion and Analysis to be posted on SEDAR on or before March 11, 2008.

During the fourth quarter of 2007, SWDCC’s revenues grew by 13.6% over the same period of 2006. Processing volumes declined by 10.8% during the quarter, primarily due to the inability of a major customer to deliver its Colombian coffees on schedule. This was partially offset by growing specialty coffee and mainstream coffee volumes, which were up by 30% compared to the same quarter in 2006.

SWDCC’s annual and quarterly revenue performance was affected by the continued strengthening of the Canadian dollar relative to the US dollar. Sales generated in US dollars represented approximately 87% of the company’s fourth quarter revenues and 83% of its 2007 revenues. While SWDCC enters into foreign exchange contracts to reduce its estimated net exposure to currency fluctuations on a 12-month rolling basis, these contracts only manage to dampen, not eliminate, the negative effect of a continually strengthening Canadian dollar. As the majority of SWDCC’s sales were earned in US dollars, lower foreign exchange offset the positive effects of a more favourable product mix and a modest price increase, pushing 12-month processing revenue rates down by 2%.

SWDCC’s gross profit for the quarter declined by 2% over Q4 2006 despite a 10.8% year-over-year decrease in fourth quarter sales volumes. For the 12 months ended December 31, 2007, gross profit fell by 10.6% compared to the same period in 2006. This was primarily due to the negative impact of the strengthening Canadian dollar, a 5% decrease in year-over-year processing volumes, and higher labour and distribution costs. Fourth quarter EBITDA was down by 4%, while 12-month EBITDA fell by 12%.

During the fourth quarter of 2007, SWDCC’s net income grew by 46.7% over Q4 2006. This was due to the recording of unrealized derivative gains, partially offset by lower margins on lower volumes.

On a year-over-year basis, the company’s 12-month net income was up by 12.5%, as lower processing volumes and lower tax recoveries were more than offset by the recording of unrealized derivative gains.

Distributions to unitholders in the fourth quarter were maintained at the new higher level set in March 2007, when the per-unit monthly distribution was increased by 5.9% to $0.075. On an annualized basis, the new level of monthly distributions equals $0.90 per unit. In the fourth quarter, the Fund generated adjusted distributable cash of $2.2 million, and paid $1.5 million in distributions to unitholders. During the 12 months ended December 31, 2007, the Fund generated adjusted distributable cash of $7.1 million and paid $5.9 million to unitholders.

“We are pleased with the gains we made from higher-margin specialty coffee volumes this quarter even though we were disappointed by a major customer’s inability to deliver its coffee for tolling as planned,” said Frank Dennis, President and CEO of SWDCC and a Trustee of the Fund. “Our 2007 volumes were close to the record levels achieved in 2006. We believe that the strong Canadian dollar, having attained parity with the US dollar in late 2007 has stabilized somewhat. We also believe that growing consumer interest in knowing how their food is processed will be a strong business driver for us with new and existing customers.”

A more detailed discussion of the Fund’s financial results can be found in its fourth quarter Management’s Discussion and Analysis, which is to be posted with the Fund’s audited financial statements on SEDAR (www.sedar.com) on or before March 11, 2008.

Company Profile

SWDCC is the world’s only consumer-branded chemical-free coffee decaffeinator, and is certified organic by the OCIA (Organic Crop Improvement Association).

SWDCC decaffeinates customer-owned coffees, including organically certified coffees, for a toll fee. The company also purchases high-quality green coffees from more than 10 different countries, decaffeinates them and markets them to the green coffee trade. These two revenue streams are known as the company’s “toll” and “non-toll” businesses, respectively.

Approximately 65% of SWDCC’s revenue comes from the US, 26% from Canada and the balance from international markets, including the United Kingdom, Japan and Australia. Consistent with most global, commodity based businesses, the bulk of the Fund’s revenues are earned in US dollars as noted above.

For more information, please contact:

Stan Thompson, Chief Financial Officer
Swiss Water Decaffeinated Coffee Company Inc.,
Phone: 604.444.8780 Fax: 604.420.8711
Email: sthompson@swisswater.com
Website: www.swisswater.com