Swiss Water Decaffeinated Coffee Income Fund declares June cash distribution, amount reduced due to market conditions


    TRADING SYMBOL: The Toronto Stock Exchange - SWS.UN

    BURNABY, BC, June 9 /CNW/ - Swiss Water Decaffeinated Coffee Income Fund
(the "Fund") today declared a monthly cash distribution of $0.030 per unit
($0.36 per annum) for the period from June 1 to June 30, 2009. The
distribution will be payable to unitholders of record at the close of business
on June 30, 2009, and will be paid on July 15, 2009. The Fund holds all the
outstanding securities of Swiss Water Decaffeinated Coffee Company, Inc.
("SWDCC") and makes monthly cash distributions to unitholders based on SWDCC's
financial performance.
    The June 2009 distribution amount is a 60% reduction from the previous
monthly level of $0.075 per unit ($0.90 per annum), which the Fund has
maintained since March 2007. The Fund intends to continue distributions at the
reduced level until its distributable cash generation improves as a result of
anticipated increases in sales volumes.
    "The new distribution level reflects today's very challenging economic
environment. The decline in consumer spending has had a particularly negative
impact on the significant portion of our customer base that targets
out-of-home coffee consumption. In addition, a market-wide shortage of coffee
from Colombia and other Central American countries has caused delays in
receiving coffees from some of our toll customers, and reduced orders from all
customers as they work to manage their costs, inventories and coffee blends in
light of dramatic price increases for coffees from these regions. The net
effect has been a larger than expected decrease in our sales volumes and
distributable cash. These circumstances necessitated the difficult decision to
reduce distributions to our unitholders to a more sustainable level," said
Frank Dennis, Chief Executive Officer of SWDCC and a Trustee of the Fund.
    "We continue to aggressively pursue initiatives to increase our sales
volumes. In March 2009, we launched a marketing campaign in strategic
geographic regions, aimed at increasing consumer awareness of the SWISS
WATER(R) Process and their ability to choose chemical free decaffeinated
coffee. We are optimistic that our investment in building consumer awareness
will generate increased sales volumes in 2010 and beyond, which in turn will
increase the Fund's distributable cash," Dennis concluded.
    "We believe the reduced distribution level is sustainable for 2009, given
the current economic environment and the level of capacity utilization that we
can confidently expect," added Sherry Tryssenaar, Chief Financial Officer of
SWDCC. "The new distribution level will enable the Fund to maintain a
conservative capital structure and the financial flexibility to manage the
business effectively."

    Company Profile

    The Fund owns Swiss Water Decaffeinated Coffee Company Inc. (SWDCC), a
premium green coffee decaffeinator located in Burnaby, British Columbia,
Canada. SWDCC uses the patented 100% chemical free SWISS WATER(R) Process to
decaffeinate green coffee beans for premium roasters and discerning health
conscious customers in the United States, Canada and other international
markets. As a result, it offers a better-for-you alternative to approximately
80% of other decaffeinated coffees which have been exposed to methylene
chloride or ethyl acetate during the decaffeination process. The SWISS
WATER(R) Process is the world's only consumer branded decaffeination process
and the company supports the brand through ongoing consumer research and
focused consumer advertising.

    Forward-Looking Statements

    Certain statements in this news release may constitute "forward-looking"
statements which involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements of
SWDCC and the Fund to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. When used in this press release, such statements may include such
words as "may", "will", "expect", "believe", "plan" and other similar
terminology. These statements reflect management's current expectations
regarding future events and operating performance and speak only as of the
date of this press release. The Fund's ability to pay cash distributions is
entirely dependent upon the earnings and cash flow generated from SWDCC's
operations. This may fluctuate with the performance of the business, which can
be susceptible to a number of risks. These risks may include, but are not
limited to, our ability to renew and expand services agreements with key
customers and obtain service agreements with new customers, competition from
existing chemical and other natural or chemical free coffee decaffeinators,
competition from new entrants with alternate processing methods or
agricultural technologies, environmental and regulatory risks, energy costs,
foreign exchange fluctuations, labour relations, intellectual property
infringement, ability to maintain organic certification, coffee prices
(notwithstanding hedging programs, as exact hedging correlation is not
attainable), the availability of coffee, adequacy of insurance, dependence on
key personnel, product liability, and terms of credit agreements. In addition,
there are certain risks associated with a trust, including the nature of trust
units, dependence on SWDCC, restrictions on potential growth, capital
investment, unitholder limited liability, income tax matters and government

    %SEDAR: 00017658E

For further information:

For further information: Sherry Tryssenaar, Chief Financial Officer,
Swiss Water Decaffeinated Coffee Company Inc., Phone: (604) 444-8780, Fax:
(604) 420-8711, Email:, Website:

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