- Revenue of $511 million,
increased 8.8%, including 7.4% contribution from organic
growth
- Gross margin of 64.7%, increased 20 bps, and net
income increased to $38
million
- Adjusted EBITDA of $125
million, increased 11.4%, and Adjusted EBITDA margin of
24.4%, increased 60 bps
- Expected to begin trading on November
11th as Primo Brands
(NYSE:PRMB)
TAMPA,
FL, Nov. 7, 2024 /PRNewswire/ - Primo Water
Corporation (NYSE: PRMW) (TSX: PRMW) (the "Company" or "Primo
Water"), a leading provider of sustainable drinking water
solutions in North America, today
announced its results for the third quarter ended September 28, 2024.
"Once again, we had a fantastic quarter, exceeding revenue and
volume expectations across our core water channels. Revenue
growth was driven by both volume and pricing, leading to earnings
growth and margin expansion across our business. Our focus on the
'must-wins' of delivering exceptional customer service, being the
water solutions partner of choice, and providing operational
excellence continues to drive growth and creates value for our
stakeholders," said Robbert Rietbroek, Chief Executive Officer.
"Turning to our planned business combination the Transaction
with BlueTriton, earlier this week we were granted a final order
approving the Transaction from the Ontario Superior Court of
Justice, and our shareowners also overwhelmingly approved the
Transaction. Subject to certain customary closing conditions, we
anticipate the closing will occur on or about November 8, 2024, and as part of the rollout of
the new company, we announced earlier this week the new combined
company's name, Primo Brands, and
new ticker symbol of 'PRMB', which we expect will begin trading on
the NYSE as early as Monday, November 11,
2024. The closing of the transaction will mark an exciting
new chapter as we bring together the strengths of both legacy
companies. I am pleased with the tremendous progress we've made in
shaping the future of Primo Brands.
Our teams have been intensely focused on ensuring we 'hit the
ground running' post-close. We have established integration
planning working groups across both organizations to identify
opportunities, build an optimized structure, and unlock synergies
throughout the combined business," continued Mr. Rietbroek.
(Unless stated otherwise, all third quarter 2024
comparisons are relative to the third quarter of 2023; all
information is in U.S. dollars. Non-GAAP reconciliations presented
on the exhibits to this press release)
THIRD QUARTER HIGHLIGHTS - CONTINUING OPERATIONS
- Revenue increased 8.8% to $511
million compared to $470
million driven by revenue growth with 5.0% of the growth
attributable to volume and 3.8% attributable to pricing.
Contribution from organic growth was 7.4% for the quarter. Revenue
growth by channel includes 8.0% in Water Direct / Water Exchange,
7.1% in Water Refill / Water Filtration and 102.2% in Other Water,
which is primarily Mountain Valley Spring water sold at retail and
on-premise.
- Gross profit increased 9.1% to $331
million compared to $303
million. Gross margin increased 20 bps to 64.7% compared to
64.5%, driven by pricing, increased volume and operating
efficiencies.
- SG&A expenses increased 7.1% to $262
million compared to $245
million. The increase was driven by higher selling and
operating costs that supported volume and revenue growth.
- Reported net income and net income per diluted share were
$38 million and $0.24, respectively, compared to reported net
income and net income per diluted share of $34 million and $0.21, respectively. Adjusted net income and
adjusted net income per diluted share were $56 million and $0.35, respectively, compared to $39 million and $0.24, respectively.
- Adjusted EBITDA increased 11.4% to $125
million compared to $112
million, driven by pricing initiatives, customer demand and
effective expense management. Adjusted EBITDA margin was 24.4%,
compared to 23.8%.
- Net cash provided by operating activities of $91 million, less $36
million of capital expenditures and additions to intangible
assets, resulted in $55 million of
free cash flow, or $60 million of
adjusted free cash flow (adjusting for the items set forth on
Exhibit 6), compared to net cash provided by operating activities
of $127 million and adjusted free
cash flow of $93 million in the prior
year.
|
For the Three Months
Ended
|
|
(USD $M except % or
unless as otherwise noted)
|
September 28,
2024
|
|
September 30,
2023
|
|
Y/Y
Change
|
|
Revenue, net
|
$
511.4
|
|
$
470.0
|
|
8.8 %
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
$
4.5
|
|
Net income from
continuing operations per diluted share
|
$
0.24
|
|
$
0.21
|
|
$
0.03
|
|
Adjusted net income
from continuing operations
|
$
56.4
|
|
$
38.8
|
|
$
17.6
|
|
Adjusted net income
from continuing operations per diluted share
|
$
0.35
|
|
$
0.24
|
|
$
0.11
|
|
Adjusted
EBITDA
|
$
124.7
|
|
$
111.9
|
|
11.4 %
|
|
Adjusted EBITDA margin
%
|
24.4 %
|
|
23.8 %
|
|
60 bps
|
THIRD QUARTER 2024 RESULTS CONFERENCE CALL
Primo Water will host a
conference call, to be simultaneously webcast, on Thursday, November 7, 2024, at 10:00 a.m. Eastern Time. A question-and-answer
session will follow management's presentation. To participate,
please call the following numbers:
Details for the Earnings Conference Call:
Date: November 7, 2024
Time: 10:00 a.m. Eastern Time
North America: (888) 510-2154
International: (437) 900-0527
Conference ID: 66986
Webcast Link: https://app.webinar.net/aerzBkLmwnN
A slide presentation and live audio
webcast will be available through Primo Water's website at
https://www.primowatercorp.com.
Replay Information:
The earnings conference call will be recorded and archived for
playback on the investor relations section of Primo Water's website.
THIRD QUARTER PERFORMANCE - CONTINUING OPERATIONS
Revenue growth by channel is tabulated below:
|
For the Three Months
Ended
|
|
(in millions of U.S.
dollars)
|
September 28,
2024
|
|
September 30,
2023
|
|
$
Change
|
|
%
Change
|
|
Revenue, net
|
|
|
|
|
|
|
|
|
Water Direct/Water
Exchange
|
$
384.8
|
|
$
356.2
|
|
$ 28.6
|
|
8.0 %
|
|
Water Refill/Water
Filtration
|
66.4
|
|
62.0
|
|
4.4
|
|
7.1 %
|
|
Other
Water1
|
27.5
|
|
13.6
|
|
13.9
|
|
102.2 %
|
|
Water
Dispensers
|
18.7
|
|
16.5
|
|
2.2
|
|
13.3 %
|
|
Other
|
14.0
|
|
21.7
|
|
(7.7)
|
|
(35.5 %)
|
|
Revenue, net as
reported
|
$
511.4
|
|
$
470.0
|
|
$ 41.4
|
|
8.8 %
|
|
1. Primarily Mountain
Valley retail and on-premise revenue
|
TRANSACTION RELATED MATTERS
The Ontario Superior Court of Justice (Commercial List) has
granted a final order approving the plan of arrangement for the
proposed business combination between Primo
Water and BlueTriton. All shareholder and regulatory
approvals have been received, and the transaction is expected to
close on or about November 8, 2024,
subject to satisfaction of certain customary closing
conditions.
The combined company, Primo Brands Corporation, is expected to
begin trading on the New York Stock Exchange under the ticker
symbol "PRMB" as early as November 11,
2024.
ABOUT PRIMO WATER CORPORATION
Primo Water is a leading
North America-focused pure-play
water solutions provider that operates largely under a recurring
revenue model in the large format water category (defined as 3
gallons or greater). This business strategy is commonly referred to
as "razor-razorblade" because the initial sale of a product creates
a base of users who frequently purchase complementary consumable
products. The razor in Primo Water's
revenue model is its industry leading line-up of innovative water
dispensers, which are sold through approximately 11,700 retail
locations and online at various price points. The dispensers help
increase household and business penetration which drives recurring
purchases of Primo Water's
razorblade offering or water solutions. Primo Water's razorblade offering is comprised
of Water Direct, Water Exchange, and Water Refill. Through its
Water Direct business, Primo Water
delivers sustainable hydration solutions direct to customers,
whether at home or to businesses. Through its Water Exchange
business, customers visit retail locations and purchase a
pre-filled bottle of water. Once consumed, empty bottles are
exchanged at our recycling center displays, which provide a ticket
that offers a discount toward the purchase of a new bottle. Water
Exchange is available in approximately 18,100 retail locations.
Through its Water Refill business, customers refill empty bottles
at approximately 23,500 self-service refill drinking water
stations. Primo Water also offers
water filtration units across North
America.
Primo Water's water solutions
expand consumer access to purified, spring, and mineral water to
promote a healthier, more sustainable lifestyle while
simultaneously reducing plastic waste and pollution. Primo Water is committed to its water
stewardship standards and is proud to partner with the
International Bottled Water Association (IBWA) in North America which ensures strict adherence
to safety, quality, sanitation and regulatory standards for the
benefit of consumer protection.
Primo Water is headquartered in
Tampa, Florida (USA). For more
information, visit www.primowatercorp.com.
Non-GAAP Measures
To supplement its reporting of financial measures determined in
accordance with generally accepted accounting principles in
the United States ("GAAP"),
Primo Water utilizes certain
non-GAAP financial measures. Primo
Water utilizes organic revenue growth (which excludes the
impact of acquisitions). Primo Water
also utilizes Adjusted net income (loss), Adjusted net income
(loss) per diluted share, Adjusted EBITDA and Adjusted EBITDA
margin to separate the impact of certain items from the underlying
business. Because Primo Water uses these adjusted financial
results in the management of its business, management believes this
supplemental information is useful to investors for their
independent evaluation and understanding of Primo Water's underlying business performance
and the performance of its management. Additionally,
Primo Water supplements its
reporting of net cash provided by (used in) operating activities
from continuing operations determined in accordance with GAAP by
excluding additions to property, plant and equipment and additions
to intangible assets to present free cash flow, and by excluding
the additional items identified on the exhibits hereto to present
adjusted free cash flow, which management believes provides useful
information to investors in assessing our performance, comparing
Primo Water's performance to the
performance of the Company's peer group and assessing the Company's
ability to service debt and finance strategic opportunities, which
include investing in Primo Water's
business, making strategic acquisitions, paying dividends, and
strengthening the balance sheet. The non-GAAP financial
measures described above are in addition to, and not meant to be
considered superior to, or a substitute for, Primo Water's financial statements prepared in
accordance with GAAP. In addition, the non-GAAP financial measures
included in this earnings announcement reflect management's
judgment of particular items, and may be different from, and
therefore may not be comparable to, similarly titled measures
reported by other companies.
Safe Harbor Statements
This press release contains forward-looking statements and
forward-looking information within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 conveying management's expectations as to the
future based on plans, estimates and projections at the time
Primo Water makes the statements.
Forward-looking statements involve inherent risks and uncertainties
and Primo Water cautions you that
several important factors could cause actual results to differ
materially from those contained in any such forward-looking
statement. You can identify forward-looking statements by words
such as "may," "will," "would," "should," "could," "expect," "aim,"
"anticipate," "believe," "estimate," "intend," "plan," "predict,"
"project," "seek," "potential," "opportunities," and other similar
expressions and the negatives of such expressions. However,
not all forward-looking statements contain these words. The
forward-looking statements contained in this press release include,
but are not limited to, statements regarding future financial and
operating trends and results (including Primo Water's outlook on full-year 2024
revenue, Adjusted EBITDA and Adjusted Free Cash Flow on a
standalone basis), the Transaction (including the anticipated
timing of the completion of the Transaction), the anticipated
benefits of the Transaction, including estimated synergies, and
related matters. The forward-looking statements are based on
assumptions regarding management's current plans and estimates.
Management believes these assumptions to be reasonable, but there
is no assurance that they will prove to be accurate.
Factors that could cause actual results to differ materially
from those described in this press release include, among others:
Primo Water's and BlueTriton's
ability to complete the Transaction on the anticipated terms and
schedule; the risk that disruptions from the Transaction will harm
Primo Water's or the combined
company's business; Primo Water's
ability to compete successfully in the markets in which it
operates; Primo Water's ability to
manage supply chain disruptions and cost increases related to
inflation; fluctuations in commodity prices and Primo Water's ability to pass on increased costs
to its customers or hedge against such rising costs, and the impact
of those increased prices on its volumes; Primo Water's ability to maintain favorable
arrangements and relationships with its suppliers; Primo Water's ability to manage its operations
successfully; currency fluctuations that adversely affect the
exchange between currencies including the U.S. dollar and the
Canadian dollar; the impact on Primo
Water's financial results from uncertainty in the financial
markets and other adverse changes in general economic conditions,
including inflation and interest rates; any disruption to
production at Primo Water's manufacturing facilities; Primo Water's ability to maintain access to its
water sources; the impact of climate change on Primo Water's business; Primo Water's ability to protect its
intellectual property; the seasonal nature of Primo Water's business and the effect of adverse
weather conditions; the impact of national, regional and global
events, including those of a political, economic, business and
competitive nature, such as the Russia/Ukraine war or the Israel/Hamas war; the impact of a pandemic,
such as COVID-19, related government actions and Primo Water's strategy in response thereto on
our business; Primo Water's ability
to fully realize the potential benefit of transactions or other
strategic opportunities that it pursues; Primo Water's ability to realize cost synergies
of its acquisitions due to integration difficulties and other
challenges; Primo Water's exposure
to intangible asset risk; Primo
Water's ability to meet its obligations under its debt
agreements, and risks of further increases to its indebtedness;
Primo Water's ability to maintain
compliance with the covenants and conditions under its debt
agreements; fluctuations in interest rates, which could increase
Primo Water's borrowing costs;
Primo Water's ability to recruit,
retain and integrate new management; the impact of increased labor
costs on Primo Water's business;
Primo Water's ability to renew its
collective bargaining agreements from time to time on satisfactory
terms; disruptions in Primo Water's
information systems; Primo Water's
ability to securely maintain its customers' confidential or credit
card information, or other private data relating to Primo Water's employees or the Company;
compliance with product health and safety standards; liability for
injury or illness caused by the consumption of contaminated
products; liability and damage to Primo
Water's reputation as a result of litigation or legal
proceedings; changes in the legal and regulatory environment in
which Primo Water operates;
Primo Water's ability to adequately
address the challenges and risks associated with its operations and
address difficulties in complying with laws and regulations
including the U.S. Foreign Corrupt Practices Act and the U.K.
Bribery Act of 2010; the impact on Primo
Water's tax obligations and effective tax rate arising from
changes in local tax laws or countries adopting more aggressive
interpretations of tax laws; Primo
Water's ability to maintain its quarterly dividend; and
credit rating changes.
The foregoing list of factors is not exhaustive. Readers are
cautioned not to place undue reliance on any forward-looking
statements, which speak only as of the date hereof. Readers are
urged to carefully review and consider the various disclosures,
including but not limited to risk factors contained in Primo Water's Annual Report on Form 10-K and its
quarterly reports on Form 10-Q, as well as other filings with the
securities commissions. Primo Water
does not undertake to update or revise any of these statements
considering new information or future events, except as expressly
required by applicable law.
Website: www.primowatercorp.com
|
PRIMO WATER
CORPORATION
|
|
|
|
|
|
|
EXHIBIT
1
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
(in millions of U.S.
dollars, except share and per share amounts)
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
September 28,
2024
|
|
September 30,
2023
|
|
September 28,
2024
|
|
September 30,
2023
|
|
Revenue,
net
|
$
511.4
|
|
$
470.0
|
|
$
1,448.4
|
|
$
1,333.1
|
|
Cost of
sales
|
180.6
|
|
166.7
|
|
508.3
|
|
480.0
|
|
Gross
profit
|
330.8
|
|
303.3
|
|
940.1
|
|
853.1
|
|
Selling, general and
administrative expenses
|
262.3
|
|
244.8
|
|
776.1
|
|
726.0
|
|
Loss on disposal of
property, plant and equipment, net
|
1.3
|
|
1.6
|
|
4.1
|
|
3.8
|
|
Acquisition and
integration expenses
|
8.2
|
|
2.4
|
|
26.6
|
|
6.0
|
|
Gain on sale of
property
|
—
|
|
(5.3)
|
|
(0.5)
|
|
(5.3)
|
|
Operating
income
|
59.0
|
|
59.8
|
|
133.8
|
|
122.6
|
|
Other expense (income),
net
|
1.1
|
|
(4.0)
|
|
1.2
|
|
(3.7)
|
|
Interest expense,
net
|
5.8
|
|
17.8
|
|
25.0
|
|
54.8
|
|
Income from
continuing operations before income taxes
|
52.1
|
|
46.0
|
|
107.6
|
|
71.5
|
|
Income tax
expense
|
13.9
|
|
12.3
|
|
37.4
|
|
21.0
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
$
70.2
|
|
$
50.5
|
|
Net income (loss) from
discontinued operations, net of income taxes
|
0.4
|
|
(0.3)
|
|
9.4
|
|
10.0
|
|
Net
income
|
$
38.6
|
|
$
33.4
|
|
$
79.6
|
|
$
60.5
|
|
|
|
|
|
|
|
|
|
Net income per
common share
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
Continuing
operations
|
$
0.24
|
|
$
0.21
|
|
$
0.44
|
|
$
0.32
|
|
Discontinued
operations
|
$
—
|
|
$
—
|
|
$
0.06
|
|
$
0.06
|
|
Net income
|
$
0.24
|
|
$
0.21
|
|
$
0.50
|
|
$
0.38
|
|
Diluted:
|
|
|
|
|
|
|
|
|
Continuing
operations
|
$
0.24
|
|
$
0.21
|
|
$
0.43
|
|
$
0.32
|
|
Discontinued
operations
|
$
—
|
|
$
—
|
|
$
0.06
|
|
$
0.06
|
|
Net income
|
$
0.24
|
|
$
0.21
|
|
$
0.49
|
|
$
0.38
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding (in thousands)
|
|
|
|
|
|
|
|
|
Basic
|
160,363
|
|
159,407
|
|
160,016
|
|
159,446
|
|
Diluted
|
162,062
|
|
160,042
|
|
161,577
|
|
160,236
|
|
|
|
|
|
|
|
|
|
PRIMO WATER
CORPORATION
|
|
|
EXHIBIT
2
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
(in millions of U.S.
dollars, except share amounts)
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
September 28,
2024
|
|
December 30,
2023
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
667.3
|
|
$
507.9
|
|
Accounts receivable,
net of allowance of $12.5 ($12.7 as of December 30,
2023)
|
185.8
|
|
156.0
|
|
Inventories
|
48.6
|
|
47.3
|
|
Prepaid expenses and
other current assets
|
18.8
|
|
26.0
|
|
Current assets of
discontinued operations
|
77.8
|
|
128.7
|
|
Total current
assets
|
998.3
|
|
865.9
|
|
Property, plant and
equipment, net
|
544.1
|
|
556.5
|
|
Operating lease
right-of-use-assets
|
143.1
|
|
136.0
|
|
Goodwill
|
1,009.4
|
|
1,004.6
|
|
Intangible assets,
net
|
709.3
|
|
714.2
|
|
Other long-term assets,
net
|
20.6
|
|
20.2
|
|
Long-term assets of
discontinued operations
|
138.3
|
|
225.6
|
|
Total
assets
|
$
3,563.1
|
|
$
3,523.0
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Current maturities of
long-term debt
|
$
14.9
|
|
$
14.2
|
|
Accounts payable and
accrued liabilities
|
294.1
|
|
276.4
|
|
Current operating lease
obligations
|
26.2
|
|
25.6
|
|
Current liabilities of
discontinued operations
|
90.9
|
|
109.9
|
|
Total current
liabilities
|
426.1
|
|
426.1
|
|
Long-term
debt
|
1,268.8
|
|
1,270.8
|
|
Operating lease
obligations
|
129.4
|
|
124.0
|
|
Deferred tax
liabilities
|
142.0
|
|
144.2
|
|
Other long-term
liabilities
|
79.4
|
|
64.4
|
|
Long-term liabilities
of discontinued operations
|
34.5
|
|
52.2
|
|
Total
liabilities
|
2,080.2
|
|
2,081.7
|
|
Equity
|
|
|
|
|
Common shares, no par
value - 160,341,329 (December 30, 2023 - 159,480,638) shares
issued
|
1,311.1
|
|
1,288.6
|
|
Additional paid-in
capital
|
91.2
|
|
90.6
|
|
Retained
earnings
|
194.5
|
|
167.2
|
|
Accumulated other
comprehensive loss
|
(113.9)
|
|
(105.1)
|
|
Total Primo Water
Corporation equity
|
1,482.9
|
|
1,441.3
|
|
Total liabilities
and equity
|
$
3,563.1
|
|
$
3,523.0
|
|
PRIMO WATER
CORPORATION
|
|
|
|
|
|
|
EXHIBIT
3
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
(in millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
September 28,
2024
|
|
September 30,
2023
|
|
September 28,
2024
|
|
September 30,
2023
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities of continuing operations:
|
|
|
|
|
|
|
|
|
Net income
|
$
38.6
|
|
$
33.4
|
|
$
79.6
|
|
$
60.5
|
|
Net income (loss) from
discontinued operations, net of income taxes
|
0.4
|
|
$
(0.3)
|
|
9.4
|
|
10.0
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
70.2
|
|
50.5
|
|
Adjustments to
reconcile net income from continuing operations to
cash flows from operating activities of continuing
operations:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
51.0
|
|
49.3
|
|
148.9
|
|
143.6
|
|
Amortization of
financing fees
|
0.7
|
|
0.8
|
|
2.4
|
|
2.5
|
|
Share-based
compensation expense
|
4.6
|
|
1.4
|
|
17.1
|
|
6.1
|
|
Provision (benefit) for
deferred income taxes
|
1.6
|
|
(0.4)
|
|
(1.4)
|
|
6.1
|
|
Loss on disposal of
property, plant and equipment, net
|
1.3
|
|
1.6
|
|
4.1
|
|
3.8
|
|
Gain on sale of
property
|
—
|
|
(5.3)
|
|
(0.5)
|
|
(5.3)
|
|
Other non-cash
items
|
1.4
|
|
(1.4)
|
|
(1.2)
|
|
(4.6)
|
|
Change in operating
assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
(25.3)
|
|
14.6
|
|
(28.0)
|
|
(4.2)
|
|
Inventories
|
(1.8)
|
|
(0.1)
|
|
(3.6)
|
|
4.6
|
|
Prepaid expenses and
other current assets
|
4.4
|
|
3.8
|
|
4.9
|
|
5.7
|
|
Other
assets
|
(4.4)
|
|
(0.4)
|
|
(0.6)
|
|
(0.9)
|
|
Accounts payable and
accrued liabilities and other liabilities
|
19.3
|
|
29.1
|
|
43.4
|
|
14.3
|
|
Net cash provided by
operating activities of continuing operations
|
91.0
|
|
126.7
|
|
255.7
|
|
222.2
|
|
Cash flows from
investing activities of continuing operations:
|
|
|
|
|
|
|
|
|
Acquisitions, net of
cash received
|
(0.3)
|
|
(1.6)
|
|
(24.5)
|
|
(24.6)
|
|
Additions to property,
plant and equipment
|
(33.8)
|
|
(34.3)
|
|
(108.7)
|
|
(103.5)
|
|
Additions to
intangible assets
|
(2.6)
|
|
(2.5)
|
|
(7.9)
|
|
(6.5)
|
|
Proceeds from sale of
property, plant and equipment
|
—
|
|
0.2
|
|
0.2
|
|
0.4
|
|
Proceeds from sale of
property
|
—
|
|
8.7
|
|
1.0
|
|
8.7
|
|
Other investing
activities
|
—
|
|
0.9
|
|
2.7
|
|
2.8
|
|
Net cash used in
investing activities of continuing operations
|
(36.7)
|
|
(28.6)
|
|
(137.2)
|
|
(122.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities of continuing operations:
|
|
|
|
|
|
|
|
|
Payments of long-term
debt
|
(3.4)
|
|
(2.7)
|
|
(10.0)
|
|
(8.7)
|
|
Proceeds from
short-term borrowings
|
—
|
|
12.0
|
|
—
|
|
116.0
|
|
Payments on short-term
borrowings
|
—
|
|
(88.0)
|
|
—
|
|
(181.0)
|
|
Issuance of common
shares
|
0.8
|
|
1.0
|
|
17.5
|
|
5.7
|
|
Common shares
repurchased and canceled
|
(0.1)
|
|
(0.6)
|
|
(20.3)
|
|
(22.4)
|
|
Financing
fees
|
(0.9)
|
|
—
|
|
(0.9)
|
|
—
|
|
Dividends paid to
common shareholders
|
(14.6)
|
|
(12.7)
|
|
(43.8)
|
|
(38.6)
|
|
Payment of contingent
consideration for acquisitions
|
(0.2)
|
|
(0.3)
|
|
(2.0)
|
|
(1.3)
|
|
Other financing
activities
|
—
|
|
(2.6)
|
|
—
|
|
(7.6)
|
|
Net cash used in
financing activities of continuing operations
|
(18.4)
|
|
(93.9)
|
|
(59.5)
|
|
(137.9)
|
|
Cash flows from
discontinued operations:
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities from discontinued operations
|
4.6
|
|
21.4
|
|
6.8
|
|
37.0
|
|
Net cash provided by
(used in) investing activities from discontinued
operations
|
16.8
|
|
(12.6)
|
|
75.9
|
|
(32.4)
|
|
Net cash (used in)
provided by financing activities from discontinued
operations
|
(2.0)
|
|
(0.5)
|
|
(1.0)
|
|
9.1
|
|
Net cash provided by
discontinued operations
|
19.4
|
|
8.3
|
|
81.7
|
|
13.7
|
|
Effect of exchange
rate changes on cash
|
0.3
|
|
(1.5)
|
|
(0.1)
|
|
(0.1)
|
|
Net increase
(decrease) in cash, cash equivalents and restricted
cash
|
55.6
|
|
11.0
|
|
140.6
|
|
(24.8)
|
|
Cash and cash
equivalents and restricted cash, beginning of period
|
615.5
|
|
86.8
|
|
530.5
|
|
122.6
|
|
Cash and cash
equivalents and restricted cash, end of period
|
$
671.1
|
|
$
97.8
|
|
$
671.1
|
|
$
97.8
|
|
Cash and cash
equivalents and restricted cash from discontinued operations, end
of period
|
3.8
|
|
36.9
|
|
3.8
|
|
36.9
|
|
Cash and cash
equivalents and restricted cash of continuing operations, end of
period
|
$
667.3
|
|
$
60.9
|
|
$
667.3
|
|
$
60.9
|
|
PRIMO WATER
CORPORATION
|
|
|
|
|
|
EXHIBIT
4
|
|
SEGMENT
INFORMATION
|
|
|
|
|
|
|
|
(in millions of U.S.
dollars, except percentage amounts)
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
For the Three Months
Ended September 28, 2024
|
|
|
North
America
|
|
Other
|
|
Total
|
|
Revenue,
net
|
|
|
|
|
|
|
|
Water Direct/Water
Exchange
|
|
$
384.8
|
|
$
—
|
|
$
384.8
|
|
Water Refill/Water
Filtration
|
|
66.4
|
|
—
|
|
66.4
|
|
Other
Water1
|
|
27.5
|
|
—
|
|
27.5
|
|
Water
Dispensers
|
|
18.7
|
|
—
|
|
18.7
|
|
Other
|
|
13.8
|
|
0.2
|
|
14.0
|
|
Total
|
|
$
511.2
|
|
$
0.2
|
|
$
511.4
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$
330.6
|
|
$
0.2
|
|
$
330.8
|
|
Gross margin
%
|
|
64.7 %
|
|
100.0 %
|
|
64.7 %
|
|
Selling, general and
administrative expenses
|
|
$
251.6
|
|
$
10.7
|
|
$
262.3
|
|
SG&A % of
revenue2
|
|
49.2 %
|
|
NM
|
|
51.3 %
|
|
Operating income
(loss)
|
|
$
76.7
|
|
$
(17.7)
|
|
$
59.0
|
|
Depreciation and
amortization
|
|
$
50.5
|
|
$
0.5
|
|
$
51.0
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended September 30, 2023
|
|
|
North
America
|
|
Other
|
|
Total
|
|
Revenue,
net
|
|
|
|
|
|
|
|
Water Direct/Water
Exchange
|
|
$
356.2
|
|
$
—
|
|
$
356.2
|
|
Water Refill/Water
Filtration
|
|
62.0
|
|
—
|
|
62.0
|
|
Other
Water1
|
|
13.6
|
|
—
|
|
13.6
|
|
Water
Dispensers
|
|
16.5
|
|
—
|
|
16.5
|
|
Other
|
|
21.5
|
|
0.2
|
|
21.7
|
|
Total
|
|
$
469.8
|
|
$
0.2
|
|
$
470.0
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$
303.1
|
|
$
0.2
|
|
$
303.3
|
|
Gross margin
%
|
|
64.5 %
|
|
100.0 %
|
|
64.5 %
|
|
Selling, general and
administrative expenses
|
|
$
235.1
|
|
$
9.7
|
|
$
244.8
|
|
SG&A % of
revenue2
|
|
50.0 %
|
|
NM
|
|
52.1 %
|
|
Operating income
(loss)
|
|
$
70.3
|
|
$
(10.5)
|
|
$
59.8
|
|
Depreciation and
amortization
|
|
$
48.9
|
|
$
0.4
|
|
$
49.3
|
|
____________________________
|
|
|
|
|
|
|
|
1 Primarily
Mountain Valley retail and on-premise revenue
|
|
2 "NM"
defined as not meaningful
|
|
|
For the Nine Months
Ended September 28, 2024
|
|
|
North
America
|
|
Other
|
|
Total
|
|
Revenue,
net
|
|
|
|
|
|
|
|
Water Direct/Water
Exchange
|
|
$
1,092.4
|
|
$
—
|
|
$
1,092.4
|
|
Water Refill/Water
Filtration
|
|
186.2
|
|
—
|
|
186.2
|
|
Other
Water1
|
|
67.4
|
|
—
|
|
67.4
|
|
Water
Dispensers
|
|
48.7
|
|
—
|
|
48.7
|
|
Other
|
|
52.9
|
|
0.8
|
|
53.7
|
|
Total
|
|
$
1,447.6
|
|
$
0.8
|
|
$
1,448.4
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$
939.5
|
|
$
0.6
|
|
$
940.1
|
|
Gross Margin
%
|
|
64.9 %
|
|
75.0 %
|
|
64.9 %
|
|
Selling, general and
administrative expenses
|
|
$
733.0
|
|
$
43.1
|
|
$
776.1
|
|
SG&A % of
revenue2
|
|
50.6 %
|
|
NM
|
|
53.6 %
|
|
Operating income
(loss)
|
|
$
201.0
|
|
$
(67.2)
|
|
$
133.8
|
|
Depreciation and
amortization
|
|
$
147.5
|
|
$
1.4
|
|
$
148.9
|
|
|
|
|
|
|
|
|
|
For the Nine Months
Ended September 30, 2023
|
|
|
North
America
|
|
Other
|
|
Total
|
|
Revenue,
net
|
|
|
|
|
|
|
|
Water Direct/Water
Exchange
|
|
$
1,011.5
|
|
$
—
|
|
$
1,011.5
|
|
Water Refill/Water
Filtration
|
|
169.6
|
|
—
|
|
169.6
|
|
Other
Water1
|
|
36.8
|
|
—
|
|
36.8
|
|
Water
Dispensers
|
|
45.9
|
|
—
|
|
45.9
|
|
Other
|
|
68.8
|
|
0.5
|
|
69.3
|
|
Total
|
|
$
1,332.6
|
|
$
0.5
|
|
$
1,333.1
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$
852.6
|
|
$
0.5
|
|
$
853.1
|
|
Gross margin
%
|
|
64.0 %
|
|
100.0 %
|
|
64.0 %
|
|
Selling, general and
administrative expenses
|
|
$
687.2
|
|
$
38.8
|
|
$
726.0
|
|
SG&A % of
revenue2
|
|
51.6 %
|
|
NM
|
|
54.5 %
|
|
Operating income
(loss)
|
|
$
162.3
|
|
$
(39.7)
|
|
$
122.6
|
|
Depreciation and
amortization
|
|
$
142.5
|
|
$
1.1
|
|
$
143.6
|
|
____________________________
|
|
|
|
|
|
|
|
1 Primarily
Mountain Valley retail and on-premise revenue
|
|
2 "NM"
defined as not meaningful
|
|
PRIMO WATER
CORPORATION
|
|
|
|
|
|
|
EXHIBIT
5
|
|
SUPPLEMENTARY
INFORMATION - NON-GAAP - EARNINGS BEFORE INTEREST, TAXES,
DEPRECIATION & AMORTIZATION
|
|
|
|
|
|
(EBITDA)
|
|
|
|
|
|
|
|
|
(in millions of U.S.
dollars, except percentage amounts)
|
|
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
September 28,
2024
|
|
September 30,
2023
|
|
September 28,
2024
|
|
September 30,
2023
|
|
|
|
|
|
|
|
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
$
70.2
|
|
$
50.5
|
|
Interest expense,
net
|
5.8
|
|
17.8
|
|
25.0
|
|
54.8
|
|
Income tax
expense
|
13.9
|
|
12.3
|
|
37.4
|
|
21.0
|
|
Depreciation and
amortization
|
51.0
|
|
49.3
|
|
148.9
|
|
143.6
|
|
EBITDA
|
$
108.9
|
|
$
113.1
|
|
$
281.5
|
|
$
269.9
|
|
|
|
|
|
|
|
|
|
Acquisition and
integration costs (a)
|
8.2
|
|
2.4
|
|
26.6
|
|
6.0
|
|
Share-based
compensation costs (b)
|
4.6
|
|
1.4
|
|
17.1
|
|
6.1
|
|
Foreign exchange and
other losses (gains), net (c)
|
1.2
|
|
(0.2)
|
|
2.0
|
|
(0.1)
|
|
Loss on disposal of
property, plant and equipment, net (d)
|
1.3
|
|
1.6
|
|
4.1
|
|
3.8
|
|
Gain on sale of
property (e)
|
—
|
|
(5.3)
|
|
(0.5)
|
|
(5.3)
|
|
Other adjustments, net
(f)
|
0.5
|
|
(1.1)
|
|
0.7
|
|
5.4
|
|
Adjusted
EBITDA
|
$
124.7
|
|
$
111.9
|
|
$
331.5
|
|
$
285.8
|
|
|
|
|
|
|
|
|
|
Revenue,
net
|
$
511.4
|
|
$
470.0
|
|
$
1,448.4
|
|
$
1,333.1
|
|
Adjusted EBITDA
margin %
|
24.4 %
|
|
23.8 %
|
|
22.9 %
|
|
21.4 %
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
Location in
Consolidated
Statements of Operations
|
|
September 28,
2024
|
|
September 30,
2023
|
|
September 28,
2024
|
|
September 30,
2023
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(a) Acquisition and
integration costs
|
Acquisition and
integration
expenses
|
|
$
8.2
|
|
$
2.4
|
|
$
26.6
|
|
$
6.0
|
|
(b) Share-based
compensation costs
|
Selling, general
and
administrative expenses
|
|
4.6
|
|
1.4
|
|
17.1
|
|
6.1
|
|
(c) Foreign exchange
and
other losses (gains), net
|
Other expense (income),
net
|
|
1.2
|
|
(0.2)
|
|
2.0
|
|
(0.1)
|
|
(d) Loss on disposal
of
property, plant and
equipment, net
|
Loss on disposal of
property, plant and
equipment, net
|
|
1.3
|
|
1.6
|
|
4.1
|
|
3.8
|
|
(e) Gain on sale of
property
|
Gain on sale of
property
|
|
—
|
|
(5.3)
|
|
(0.5)
|
|
(5.3)
|
|
(f) Other adjustments,
net
|
Other expense (income),
net
|
|
—
|
|
(0.8)
|
|
(0.7)
|
|
(1.4)
|
|
Selling, general
and
administrative expenses
|
|
0.5
|
|
(0.3)
|
|
1.4
|
|
6.8
|
|
PRIMO WATER
CORPORATION
|
|
|
|
EXHIBIT
6
|
|
SUPPLEMENTARY
INFORMATION - NON-GAAP - FREE CASH FLOW AND ADJUSTED FREE CASH
FLOW
|
|
(in millions of U.S.
dollars)
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
|
September 28,
2024
|
|
September 30,
2023
|
|
|
|
|
|
|
Net cash provided by
operating activities of continuing operations
|
|
$
91.0
|
|
$
126.7
|
|
Less: Additions
to property, plant, and equipment
|
|
(33.8)
|
|
(34.3)
|
|
Less: Additions
to intangible assets
|
|
(2.6)
|
|
(2.5)
|
|
Free Cash
Flow
|
|
$
54.6
|
|
$
89.9
|
|
|
|
|
|
|
Acquisition and
integration cash costs
|
|
5.4
|
|
1.8
|
|
Cash costs related to
additions to property, plant and equipment for integration of
acquired entities
|
|
0.4
|
|
—
|
|
Tariffs refunds related
to property, plant, and equipment
|
|
—
|
|
1.0
|
|
Adjusted Free Cash
Flow
|
|
$
60.4
|
|
$
92.7
|
|
|
|
|
|
|
|
For the Nine Months
Ended
|
|
|
September 28,
2024
|
|
September 30,
2023
|
|
|
|
|
|
|
Net cash provided by
operating activities of continuing operations
|
|
$
255.7
|
|
$
222.2
|
|
Less: Additions
to property, plant, and equipment
|
|
(108.7)
|
|
(103.5)
|
|
Less: Additions
to intangible assets
|
|
(7.9)
|
|
(6.5)
|
|
Free Cash
Flow
|
|
$
139.1
|
|
$
112.2
|
|
|
|
|
|
|
Acquisition and
integration cash costs
|
|
19.3
|
|
5.6
|
|
Cash costs related to
additions to property, plant and equipment for integration of
acquired entities
|
|
1.1
|
|
0.1
|
|
COVID-19 related
refunds
|
|
(0.8)
|
|
—
|
|
Cash taxes paid for
property sales
|
|
1.3
|
|
0.8
|
|
Tariffs refunds related
to property, plant, and equipment
|
|
2.1
|
|
2.4
|
|
Adjusted Free Cash
Flow
|
|
$
162.1
|
|
$
121.1
|
|
|
|
|
|
|
PRIMO WATER
CORPORATION
|
|
|
|
|
|
|
EXHIBIT
7
|
|
SUPPLEMENTARY
INFORMATION-NON-GAAP-ADJUSTED NET INCOME AND ADJUSTED
EPS
|
|
|
|
(in millions of U.S.
dollars, except share amounts)
|
|
|
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
For the Nine Months
Ended
|
|
September 28,
2024
|
|
September 30,
2023
|
|
September 28,
2024
|
|
September 30,
2023
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
$
70.2
|
|
$
50.5
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Amortization expense of
customer lists
|
7.8
|
|
7.7
|
|
22.0
|
|
22.4
|
|
Acquisition and
integration costs
|
8.2
|
|
2.4
|
|
26.6
|
|
6.0
|
|
Share-based
compensation costs
|
4.6
|
|
1.4
|
|
17.1
|
|
6.1
|
|
Foreign exchange and
other losses (gains), net
|
1.2
|
|
(0.2)
|
|
2.0
|
|
(0.1)
|
|
Gain on sale of
property
|
—
|
|
(5.3)
|
|
(0.5)
|
|
(5.3)
|
|
Other adjustments,
net
|
0.5
|
|
(1.1)
|
|
0.7
|
|
5.4
|
|
Tax impact of
adjustments1
|
(4.1)
|
|
0.2
|
|
(9.4)
|
|
(3.8)
|
|
Adjusted net
income
|
$
56.4
|
|
$
38.8
|
|
$
128.7
|
|
$
81.2
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(as reported)
|
|
|
|
|
|
|
|
|
Net income from
continuing operations
|
$
38.2
|
|
$
33.7
|
|
$
70.2
|
|
$
50.5
|
|
|
|
|
|
|
|
|
|
Basic EPS
|
$
0.24
|
|
$
0.21
|
|
$
0.44
|
|
$
0.32
|
|
Diluted EPS
|
$
0.24
|
|
$
0.21
|
|
$
0.43
|
|
$
0.32
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding (in thousands)
|
|
|
|
|
|
|
|
|
Basic
|
160,363
|
|
159,407
|
|
160,016
|
|
159,446
|
|
Diluted
|
162,062
|
|
160,042
|
|
161,577
|
|
160,236
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings
Per Share (Non-GAAP)
|
|
|
|
|
|
|
|
|
Adjusted net income
from continuing operations (Non-GAAP)
|
$
56.4
|
|
$
38.8
|
|
$
128.7
|
|
$
81.2
|
|
Adjusted diluted EPS
(Non-GAAP)
|
$
0.35
|
|
$
0.24
|
|
$
0.80
|
|
$
0.51
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding (in thousands)
|
|
|
|
|
|
|
|
|
Basic
|
160,363
|
|
159,407
|
|
160,016
|
|
159,446
|
|
Diluted weighted
average common shares outstanding (in thousands)
(Non-GAAP)2
|
162,062
|
|
160,042
|
|
161,577
|
|
160,236
|
|
|
|
|
|
|
|
|
|
1 The tax
effect for adjusted net income is based upon an analysis of the
statutory tax treatment and the applicable tax rate for the
jurisdiction in which the pre-tax adjusting items incurred and for
which realization of the resulting tax benefit (if any) is
expected. A reduced or 0% tax rate is applied to jurisdictions
where we do not expect to realize a tax benefit due to a history of
operating losses or other factors resulting in a valuation
allowance related to deferred tax assets.
|
|
2 For the
periods presented, the non-GAAP diluted weighted average common
shares outstanding equaled the reported diluted weighted average
common shares outstanding.
|
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SOURCE Primo Water Corporation