Primo Water Posts Fourth Quarter, Fiscal Year Results

Primo Water Corporation, a provider of multi-gallon purified bottled water, self-service refill water and water dispensers, has announced financial results for the fourth quarter and fiscal year ended December 31, 2013.

In the fourth quarter, water segment net sales increased to $15.1 million and dispenser segment net sales decreased 25.2% to $4.4 million. Dispenser unit sell-thru to end consumers increased 12.5% to 103,350 units for the fourth quarter of 2013 compared to the same period in the prior year. Overall, net sales for the fourth quarter of 2013 were $19.5 million compared to $20.9 million for the fourth quarter of 2012.

Adjusted EBITDA increased 69.7% to $1.9 million from $1.1 million for the fourth quarter of 2012. The U.S. GAAP net loss from continuing operations for the fourth quarter was $2.8 million compared to $74 million for the fourth quarter of the prior year. The fourth quarter of the prior year was significantly impacted by non-cash goodwill and other impairments charges of $70.5 million.

For the fiscal year, water segment net sales increased 1.9% to $63.8 million while dispenser segment net sales decreased 5% to $27.4 million. Despite the 6.2% decrease in water dispenser unit sell-in to retailers, dispenser unit sell-thru to consumers increased 11.1% for 2013 compared to 2012. Overall, net sales for fiscal year 2013 were $91.2 million compared to $91.5 million for the prior year.

Fiscal year 2013 adjusted EBITDA increased 66.3% to $9.1 million from $5.5 million for 2012. The U.S. GAAP net loss from continuing operations for 2013 was $8.8 million compared to $93.3 million for the prior year. The prior year was significantly impacted by non-cash goodwill and other impairments of $82 million.

As announced in November, Primo has entered into a strategic alliance agreement with DS Waters of America, Inc., an operator in the home and office beverage delivery market. The responsibility for DS Waters’ current five-gallon retail exchange customers will transition to Primo. Over time, DS Waters will become the primary bottling and distribution partner in the U.S. for Primo’s exchange services. The transition of bottling and distribution responsibilities to DS Waters began in January for certain regions and is currently progressing on plan, noted Primo. The company expects to convert DS Waters’ retail customers to Primo over the next two years.


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