Swiss Water Decaffeinated Coffee Inc. (SWP) Earnings Call Transcript & Summary

Hello, and welcome to the Annual General and Special Meeting of Shareholders of Swiss Water Decaffeinated Coffee Inc. Please note that today's meeting is being recorded. If you participate in today's meeting and disclose personal information, you will be deemed to consent to the recording, transfer and use of the same. If you disclose personal information of another person in today's meeting, you will be deemed to represent and warrant to Swiss Water and Computershare that you first obtained all required consents for the disclosure, recording, transfer and use of such personal information from all appropriate persons before your disclosure. During the meeting, we'll have a question-and-answer session. You can submit questions or comments at any time by clicking on the Q&A tab. It is now my pleasure to turn today's meeting over to Mr. Alan Wallace, Chair of the meeting. Mr. Wallace, the floor is yours.

Thank you, Emily. Good afternoon, ladies and gentlemen. My name is Alan Wallace, and I'm Swiss Water's Chair of the Board of Directors. I have been appointed to chair today's meeting in accordance with the articles and the bylaws of the company. On behalf of the Board of Directors, I wish to welcome shareholders, employees and guests to the 2026 Annual General and Special Meeting of Shareholders of Swiss Water Decaffeinated Coffee Inc. We are pleased that you are here today, and we look forward to reporting on our company's activities. It is now 02:02 p.m., and I would like to call the meeting to order. At the end of the meeting, management and I will be available to address your questions for those of you who have preregistered for today's meeting. As this meeting is being held virtually, I would like to begin by outlining a few rules to help ensure an orderly meeting. Firstly, voting will take place online on this meeting's platform. To vote during the meeting, you must be a registered shareholder or a duly appointed proxy holder and have your 15-digit control number or proxy holder in bike code provided by Computershare. For your convenience, all 4 voting polls are now open and will remain open throughout the meeting. I will introduce each item for a motion as we proceed, but you may vote at any time without waiting for a prompt. To vote on the online platform, please select the vote tab in your top right-hand corner of your screen. You will see the 4 voting items listed as 1, 2, 3 and 4.Please ensure you vote on each item by clicking through all ballot pages. You may cast your votes at any time from now until the polls close. I will provide a 30-second warning before the polls are closed. Guests access to the meeting is listen only. Second rule, questions may only be asked by registered shareholders who have logged in using their 15-digit control number or by duly appointed proxy holders who have preregistered and received an invite code from Computershare. Shareholders and proxy holders may submit a question by selecting the Q&A tab located -- also located at the top right-hand corner of their screen and typing their question in the space provided. Questions on procedural matters directly related to the motions will be addressed during the meeting. Any questions not related to procedural matters will be addressed at the end of the meeting. We will begin with the formal business of the Annual General and Special Meeting of Shareholders. Following the formal business, we will open the floor to questions. I would now like to introduce the executive officers, members of management and the scrutineer who are present here today. They are Iain Carswell, the Chief Financial Officer of Swiss Water; Eve Bartnik, Director of Financial Reporting and Treasury and the Secretary of the company; and Teresa Quan of Computershare Investor Services, Inc. I hereby appoint Eve Bartnik to act as Recording Secretary and Teresa Quan to act as the scrutineer for this meeting. Unfortunately, our Chief Executive Officer, Frank Dennis, is unable to attend today's meeting due to business travel and sends his regrets. As Mr. Dennis is a duly appointed proxy holder, he has appointed Mr. Carswell to act on his behalf. The notice calling this meeting, together with the management information circular and proxy form was delivered to all registered shareholders as of record as of April 13, 2026, and in accordance with the applicable securities legislation to beneficial holders of shares. I have received from the secretary a statutory declaration confirming the mailing and I direct the Secretary to attach that declaration to the minutes of this meeting. Under the company's bylaws, a quorum for a shareholders' meeting is present when at least 2 persons entitled to vote are present and together hold or represent proxies not less than 10% of the votes entitled to be cast at the meeting. I have been advised by the secretary that the scrutineer's report is complete and that a quorum is present. I therefore declare this meeting properly constituted for the transaction of the company's business. The minutes of last year's Annual General Meeting of Shareholders are available for inspection. Unless there is any objection, I will dispense with reading them. If there are any objections, please submit them using the comment box in the Q&A tab.

Mr. Chairman, no 1 asked to speak.

Thank you. Since there are no questions or objections regarding last year's minutes, could I have a motion to approve last year's minutes.

Mr. Chairman, I so move.

Mr. Chairman, I second the motion.

Thank you. I will now move on to presenting the financial statements and the auditor's report therein. I now place before the meeting the consolidated financial statements of the company for the year ended December 31, 2025, together with the independent auditor's report. This material is included in the annual report, which was made available to shareholders. Financial statements are also accessible on SEDAR and the company's website. If you have any questions regarding the financial statements, our CFO, Iain Carswell, will be available during the question-and-answer period following the formal business of the meeting. As outlined in the notice of meeting and the accompanying proxy statement, there are 4 matters presented before the shareholders. The election of directors, the appointment of auditors; confirmation of Swiss Water's Advanced Notice Bylaw #2 and ratification of Swiss Water's shareholder rights plan agreement. Following the presentation of each matter and after the first and second motions, registered shareholders and proxy holders may submit questions relevant to the item under consideration. As noted earlier, the polls are now open and will remain open until they close later in the meeting. To vote is use the vote tab and cast your vote on each item, and you can vote at any time from now until I provide a 30-second warning before the polls closed. Preliminary voting results will be shared during the meeting with final results posted on SEDAR and the company's website. Moving now to the first proposal to be voted on the election of the Board of Directors in accordance with the company's articles and bylaws, the number of directors has been set at 7. The Board of Directors has nominated the 7 individuals listed in the proxy statement for election to the Board, each to serve until the close of the next annual meeting of shareholders. The proposed visuals are Frank A. Dennis; Roland Veit, Robert B. Johnston; Nancy L. McKenzie; Eric Yanagi; Mark Venderman, and myself, Alan Wallace. Could I have a motion for the election of Mr. Dennis, Mr. Veit, Mr. Johnston, Ms. McKenzie, Mr. Yanagi, Mr. Venderman and myself to the Board of Directors.

Mr. Chairman, I so move.

Mr. Chairman, I second the motion.

Thank you. As of November 3, 2025, the directors approved the adoption of bylaw #2, a bylaw relating to the advanced notice of nomination of Directors. The purpose of this bylaw is to provide shareholders, directors and management with guidance on the nomination of directors and fixes a deadline by which holders of record of shares of the company carrying the right to vote must submit director nominations prior to any annual or special meeting of shareholders. I will now ask the secretary to confirm that no director nominations were submitted in accordance with Bylaw #2, and there are no additional nominees for election to the Board of Directors. Meanwhile, registered shareholders and proxy holders who have questions may raise them using the comment box in the Q&A tab.

Mr. Chairman, there were no director nominations submitted in the accordance with bylaw #2, and there are no additional nominees for election for the Board of Directors. Also, Mr. Chairman, no questions were raised, and there are no objections.

Thank you. Since there are no other nominations, I declare that the 7 persons nominated to be put forward for election as directors of the corporation. Online voting is open for a motion to elect the directors. Please navigate to the vote tab to view your voting options and cast your vote. The next item of business is the appointment of the company's independent auditors for the ensuing year and authorization for the Board of Directors to fix their remuneration. The Board of Directors recommends the appointment of MNP LLP as the company's auditors, subject to shareholders. May I have a motion for the appointment of MNP LLP as the company's auditors.

Mr. Chairman, I so move.

Mr. Chairman, I second the motion.

Thank you. At this time, if there are any questions objective or alternative nominations for the company's auditor, registered shareholders and proxy holders may submit them using the comment box in the Q&A tab.

Mr. Chairman, no one raised any questions or objections nor proposed nominations for an alternate auditor.

Thank you. Since there are no questions, objections or other nominations for the company's auditor, we will move on to voting to appoint the auditor. Online voting is open, please navigate to the vote tab to view your voting options and cast your vote. The next item of business is the confirmation of Swiss Water's Advance Notice Bylaw #2. The Board of Directors is recommending the confirmation of Swiss Water's Advance Notice Bylaw #2. May I have a motion for the confirmation of Swiss Water's advanced notice bylaw #2.

Mr. Chairman, I so move.

Mr. Chairman, I second the motion.

Thank you. At this time, if there are any objections or questions about the confirmation of Swiss Water's advanced notice bylaw number 2 registered shareholders and proxy holders may submit them using the comment box in the Q&A tab.

Mr. Chairman, no 1 raised any questions or objections.

Thank you. Since there are no questions or objections regarding the confirmation of advance notice by line #2, we will move on to the vote. Online voting is open, please navigate to the vote tab to view your voting options and cash to vote. The next item of business is the ratification of Swiss Water's shareholders' rights plan agreement. The Board of Directors is recommending the ratification of Swiss Water's shareholder rights plan agreement. May I have a motion for the ratification of Swiss Water's shareholder rights plan agreement.

Mr. Chairman, I still move.

Mr. Chairman, I second the motion.

Thank you. At this time, if there are any objections or questions about the ratification of Swiss Water's shareholder rights plan agreement, registered shareholders and proxy holders may submit them using the comment box in the Q&A tab.

Mr. Chairman, no 1 raised questions or objections.

Thank you. Since there are no questions or objections regarding the ratification of Swiss Water shareholders rights plan agreement, we will move on to the vote. Online voting is open, please navigate to the vote tab to view your voting options and cast your vote. Please note that polls for all voting will close in 30 seconds. We will wait for 30 seconds for the poll to close. The polls are now closed. Madam Scrutineer, please compile the results.

Mr. Chairman, the scrutineer has compiled their report on both on all business matters.

Thank you. The ballots have been counted and the votes tabulated by the scrutineer who has provided preliminary results. There were 4,594,693 shares or 47.9% of the total issued and outstanding shares present and voting in person or by proxy. The preliminary results are as follows. On the first proposal, each of the 7 nominees has been elected as a director of the company to serve until the next Annual Meeting of Shareholders or until their successors are elected or appointed. On the second proposal, the appointment of MNP LLP as the independent auditors of the company has been approved, and the Board of Directors of the company has been authorized to fix their remuneration. On the third proposal, the confirmation of Swiss Water's advanced notice bylaw #2 is approved. On the fourth proposal, the ratification of Swiss Water shareholders rights plan agreement is approved. I direct that the results of the poll be included with the minutes of this meeting. The final voting results will be announced by press release in accordance with TSX requirements and filed on SEDAR. All of the business for which this annual general and special meeting of shareholders was called has been completed. At this time, I request that all other business be brought before we terminate the meeting. Registered shareholders and proxy holders. All questions will be submitted through the Q&A tab on the online portal.

Mr. Chairman, no one raised any other business.

Thank you. Could I have a motion to terminate the meeting?

Mr. Chairman, I so move.

Mr. Chairman, I second the motion.

Thank you. As there is no other business to come before the meeting, I declare the formal part of the meeting to be concluded. I would now like to open up the meeting to any questions that you may have, where I and Iain Carswell, our CFO of the company will answer. I ask that all attendees who would like to -- we will answer as many questions as time permits. Please limit your questions to topics related to today's subject matter. We will limit your questions for 3 minutes to allow other attendees to ask their questions. Your questions will be addressed in the order received.

Mr. Chairman, there appear to be no questions at this time. I will now turn the meeting back to Mr. Wallace for closing remarks. Thank you.

Before we conclude our meeting, let me take this opportunity to congratulate our management and employees for their significant accomplishments over this past year. 2025 was a tumultuous year for the coffee industry, and it took experience, creativity and hard work to successfully navigate the challenges faced. Despite high coffee prices and a volatile global trading environment, your company's management team delivered sales volume growth, reduced debt levels and a solid operational performance. Thanks also to the Board members for their engagement and guidance throughout the year. A special thanks to Don Tringali, who was on the board since 2020, including as Chair during the time our Line 2 construction was being completed. And I'm pleased to welcome Mark Venderman, who joins the Board with over 20 years of investment experience driving operational performance and executing value creation initiatives in a number of companies. And thanks finally to our shareholders for their confidence during these past years very volatile coffee markets. As we look into the remainder of this year, we are seeing encouraging signs of restocking by our customers and extending order visibility. As markets continue to normalize, we look to support our customers by building on the strong foundation which will permit us to continue to reduce debt and pursue growth opportunities as they arise. We remain confident in the strength of our company's ability to serve our customers. With that, we conclude our meeting, and I will now pass it back to the moderator. Thank you very much for attending.

This concludes today's virtual meeting. Thank you for participating, and have a pleasant day. You may disconnect now.