Board Urges Shareowners to Vote on the BLUE
Proxy Card FOR Primo Water's Ten Exceptional Directors
TAMPA,
Fla., April 12, 2023 /CNW/ - Primo Water
Corporation (NYSE: PRMW) (TSX: PRMW) (the "Company" or "Primo
Water"), a leading provider of sustainable drinking water solutions
in North America and Europe, today released an investor
presentation describing the Company's transformation into a
high-performing pure-play water business that is well positioned to
drive further profitable growth.
The presentation outlines why the Board of Directors of Primo
Water (the "Board") encourages all shareowners to vote "FOR"
the Company's ten highly qualified director candidates using the
BLUE universal proxy card at the upcoming 2023 annual and
special meeting of shareowners, scheduled to be held on
May 3, 2023 (the "Annual
Meeting").
The presentation (available at
https://primowatercorp.com/app/uploads/2023/04/Final-Primo-Water-Investor-Presentation-April-11-2023_compressed_compressed.pdf)
and other important information relating to the Annual
Meeting can be found at
https://primowatercorp.com/investors/.
Key highlights from the presentation include:
- Primo Water's transformation into an environmentally
responsible, international pure-play water company. Prior to
2018, the Company operated a disparate collection of businesses,
primarily concentrated in the low margin private label soft drink
sector with high customer concentration. Under the stewardship of
the Board, the Company rationalized its product portfolio, acquired
several higher-margin water businesses (including "Legacy Primo"),
invested in high-ROI operational and customer-facing initiatives,
restructured management, and reconstituted the Board.
- Primo Water has focused on its long-term strategy optimized
for profitable growth. The Company's successful growth strategy
involves selling a full range of water solutions to a recurring
customer base. The Company is driving growth and improved
profitability through better operating efficiencies while building
customer loyalty and retention.
- Primo Water is making great progress despite numerous and
complex challenges. The Company's strategy is clearly working
and producing results, including double-digit top-line growth (on a
foreign-exchange neutral basis) in 2022 and the expansion of
Adjusted EBITDA margin from 13% to 19% over the last five years,
despite challenges from the pandemic and exiting its Russian
business due to the war in Ukraine
among other factors, such as, high inflation, fluctuating foreign
currencies, tight labor markets, tariffs on imported water
dispensers and global supply chain constraints.
- Primo Water has the right leadership team and a
substantially refreshed, diverse Board. The Company has added
seven new directors since the business transformation began five
years ago, while reducing the overall size of the Board during that
period. This was achieved through a proactive and deliberate
process, to ensure that the Board has the right complement of
skills, experience, and gender balance.
- Legion launched a proxy contest without first having a
meaningful conversation with us. Legion began buying stock in
October 2022, has had very little
engagement with management, and has never asked to speak with our
independent directors to voice its concerns privately.
Nevertheless, we have made several good faith attempts at a
resolution; all have been rejected by Legion.
- Legion's candidates will not add value to Primo Water's
Board and may displace directors with unique skills and industry
knowledge. The Board does not believe Legion's nominees would
bring any differentiated perspectives to the Board, and the
election of Legion's candidates could be detrimental to our
progress.
The Board strongly encourages shareowners to vote the
BLUE universal proxy card FOR Primo Water's ten
director nominees.
Shareowners who have any questions or need assistance voting
their shares may contact the Company's proxy solicitor MacKenzie
Partners at 1-800-322-2885 or prmw@mackenziepartners.com
ABOUT PRIMO WATER
CORPORATION
Primo Water is a leading pure-play water solutions provider in
North America and Europe and generates approximately
$2.2 billion in annual revenue. Primo
Water 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
10,000 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 across its 21-country footprint 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 17,500 retail locations.
Through its Water Refill business, customers refill empty bottles
at approximately 23,500 self-service refill drinking water
machines. Primo Water also offers water filtration units across its
21-country footprint.
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 as well as with Watercoolers Europe (WE), which
ensure 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 Measure
To supplement its reporting of financial measures determined in
accordance with U.S. GAAP (Generally Accepted Accounting
Principles), Primo Water utilizes certain non-GAAP financial
measures, including and not limited to 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. 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 press release
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 within
the meaning of Section 27A of the Securities Act of 1933, Section
21E of the Securities Exchange Act of 1934, as amended, and
applicable Canadian securities laws conveying management's
expectations as to the future based on plans, estimates and
projections at the time the Company makes the statements.
Forward-looking statements involve inherent risks and uncertainties
and the Company cautions you that a number of important factors
could cause actual results to differ materially from those
contained in any such forward-looking statements. The
forward-looking statements in this press release include but are
not limited to statements regarding the effectiveness of the
Company's strategy and the ability of the Company's leadership to
execute on such strategy. The forward-looking statements are based
on assumptions regarding management's current plans and estimates.
Factors that could cause actual results to differ materially from
those described in this press release include, among others: risks
relating to any unforeseen changes to or effects on liabilities,
future capital expenditures, revenues, expenses, earnings,
synergies, indebtedness, financial condition, losses and future
prospects; the effect of economic, competitive, legal, governmental
and technological factors on Primo Water's business; and the impact
of national, regional and global events on our business, including
the COVID-19 outbreak. The foregoing list of factors is not
exhaustive. Readers are cautioned not to place undue reliance on
these 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 the Company's Annual Report in the Form 10-K and its
quarterly reports on Form 10-Q, as well as other periodic reports
filed with the securities commissions. The Company does not, except
as expressly required by applicable law, undertake to update or
revise any of these statements in light of new information or
future events.
Important Additional
Information
The Company, its directors and certain of its executive officers
are participants in the solicitation of proxies from the Company's
shareowners in connection with the Annual Meeting. The Company
filed its definitive proxy statement and a BLUE proxy card
with the U.S. Securities and Exchange Commission (the "SEC") and
Canadian securities regulators on March 31,
2023 in connection with the solicitation of proxies from the
Company's shareowners. SHAREOWNERS OF THE COMPANY ARE STRONGLY
ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING BLUE PROXY
CARD AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN
THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN
IMPORTANT INFORMATION. The Company's definitive proxy statement
for the Annual Meeting contains information regarding the direct
and indirect interests, by security holdings or otherwise, of the
Company's directors and executive officers in the Company's
securities. Information regarding subsequent changes to their
holdings of the Company's securities can be found in the SEC
filings on Forms 3, 4 and 5, which are available on the Company's
website at https://primowatercorp.com/investors/ or through the
SEC's website at www.sec.gov, and are disclosed on The System for
Electronic Disclosure by Insiders (SEDI) in Canada. Information can also be found in the
Company's other SEC filings, including its Annual Report on Form
10-K for the year ended December 31,
2022, filed on March 1, 2023.
Shareowners will be able to obtain the definitive proxy statement,
any amendments or supplements to the proxy statement and other
documents filed by the Company with the SEC and Canadian securities
regulators at no charge at the SEC's website at www.sec.gov and on
the System for Electronic Document Analysis and Retrieval (SEDAR)
at www.sedar.com. Copies will also be available at no charge on the
Company's website at https://primowatercorp.com/investors/.
Presentation and Reconciliation of Non-GAAP Measures to
GAAP
PRIMO WATER
CORPORATION
|
SUPPLEMENTARY
INFORMATION - NON-GAAP - EARNINGS BEFORE INTEREST, TAXES,
DEPRECIATION & AMORTIZATION
|
(EBITDA)
|
|
|
|
|
|
|
|
|
|
(in millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year
Ended
|
|
2022
|
|
2021
|
|
2020
|
|
2019
|
|
2018
|
|
(December 31,
2022)
|
|
(January 1,
2022)
|
|
(January 2,
2021)
|
|
(December 28,
2019)
|
|
(December 29,
2018)
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
29.6
|
|
$
(3.2)
|
|
$
(156.8)
|
|
$
(10.8)
|
|
$
28.9
|
Interest expense,
net
|
69.8
|
|
68.8
|
|
81.6
|
|
77.6
|
|
77.6
|
Income tax
expense
|
19.7
|
|
9.5
|
|
4.3
|
|
4.5
|
|
(4.8)
|
Depreciation and
amortization
|
242.8
|
|
219.1
|
|
202.1
|
|
168.6
|
|
194.6
|
EBITDA2
|
$
361.9
|
|
$
294.2
|
|
$
131.2
|
|
$
239.9
|
|
$
296.3
|
|
|
|
|
|
|
|
|
|
|
Acquisition and
integration costs (a)1
|
15.3
|
|
10.8
|
|
33.7
|
|
16.4
|
|
15.3
|
Share-based
compensation costs (b)
|
17.2
|
|
17.5
|
|
22.1
|
|
9.9
|
|
18.4
|
COVID-19 costs
(c)
|
(0.6)
|
|
2.4
|
|
20.8
|
|
—
|
|
—
|
Commodity hedging loss
(gain), net (d)
|
—
|
|
—
|
|
—
|
|
—
|
|
0.3
|
Impairment charges
(e)
|
29.1
|
|
—
|
|
115.2
|
|
—
|
|
—
|
Foreign exchange and
other losses (gains), net (f)
|
15.1
|
|
8.7
|
|
1.5
|
|
0.9
|
|
(10.7)
|
Loss on disposal of
property, plant and equipment, net
(g)
|
8.5
|
|
9.3
|
|
10.6
|
|
7.6
|
|
9.4
|
Loss (gain) on
extinguishment of long-term debt (h)
|
—
|
|
27.2
|
|
19.7
|
|
—
|
|
(7.1)
|
Gain on sale of
business (i)
|
(0.8)
|
|
(3.8)
|
|
(0.6)
|
|
6.0
|
|
(6.0)
|
Gain on sale of
property (j)
|
(38.8)
|
|
—
|
|
—
|
|
—
|
|
—
|
Other adjustments, net
(k)
|
13.2
|
|
13.7
|
|
7.3
|
|
6.4
|
|
(3.9)
|
Adjusted
EBITDA2
|
$
420.1
|
|
$
380.0
|
|
$
361.5
|
|
$
287.1
|
|
$
312.0
|
|
|
|
|
|
|
|
|
|
|
Revenue,
net
|
$
2,215.1
|
|
$
2,073.3
|
|
$
1,953.5
|
|
$
1,795.4
|
|
$
2,372.9
|
Adjusted EBITDA
margin %
|
19.0 %
|
|
18.3 %
|
|
18.5 %
|
|
16.0 %
|
|
13.1 %
|
|
|
|
|
|
|
|
|
|
|
1 Includes
an increase of $1.8 million of share-based compensation costs for
the year ended December 28, 2019 related to awards granted in
connection with the acquisition of our
Eden business and a reduction of $1.1 million of share-based
compensation costs for the year ended December 29, 2018 related to
awards granted in connection with the acquisition
of our S&D and Eden businesses.
|
2 The year
ended January 2, 2021 include $3.9 million of benefit associated
with the 53rd week.
|
|
For the Year
Ended
|
|
|
|
2022
|
|
2021
|
|
2020
|
|
2019
|
|
2018
|
|
Location in
Consolidated
Statements of Operations
|
|
(December
31,
2022)
|
|
(January
1,
2022)
|
|
(January
2,
2021)
|
|
(December
28,
2019)
|
|
(December
29,
2018)
|
|
|
|
(Unaudited)
|
(a) Acquisition and
integration costs
|
Acquisition and
integration
expenses
|
|
$
15.3
|
|
$
10.8
|
|
$
33.7
|
|
$
16.4
|
|
$
15.3
|
(b) Share-based
compensation costs
|
Selling, general
and
administrative expenses
|
|
17.2
|
|
17.5
|
|
22.1
|
|
9.9
|
|
18.4
|
(c) COVID-19
costs
|
Selling, general
and
administrative expenses
|
|
(0.6)
|
|
2.4
|
|
20.8
|
|
—
|
|
—
|
(d) Commodity hedging
loss (gain), net
|
Cost of
Sales
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.3
|
(e) Impairment
charges
|
Impairment
charges
|
|
29.1
|
|
—
|
|
115.2
|
|
—
|
|
—
|
(f) Foreign exchange
and other losses
(gains), net
|
Other (income) expense,
net
|
|
15.1
|
|
8.7
|
|
1.5
|
|
0.9
|
|
(10.7)
|
(g) Loss on disposal of
property, plant
and equipment, net
|
Loss on disposal of
property,
plant and equipment, net
|
|
8.5
|
|
9.3
|
|
10.6
|
|
7.6
|
|
9.4
|
(h) Loss (gain) on
extinguishment of
long-term debt
|
Other (income) expense,
net
|
|
—
|
|
27.2
|
|
19.7
|
|
—
|
|
(7.1)
|
(i) (Gain) loss on sale
of business
|
Other (income) expense,
net
|
|
(0.8)
|
|
(3.8)
|
|
(0.6)
|
|
6.0
|
|
(6.0)
|
(j) Gain on sale of
property
|
Gain on sale of
property
|
|
(38.8)
|
|
—
|
|
—
|
|
—
|
|
—
|
(k) Other adjustments,
net
|
Other (income) expense,
net
|
|
(4.3)
|
|
(2.8)
|
|
(1.7)
|
|
(2.8)
|
|
(14.9)
|
|
Selling, general
and
administrative expenses
|
|
17.5
|
|
15.7
|
|
8.6
|
|
9.4
|
|
8.8
|
|
Cost of
Sales
|
|
—
|
|
0.8
|
|
0.4
|
|
7.0
|
|
2.2
|
|
Revenue, net
|
|
—
|
|
—
|
|
—
|
|
(7.2)
|
|
—
|
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SOURCE Primo Water Corporation