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Primo Water boosts Q3, FY 2023 revenue, earnings mixed

February 22, 2024

Primo Water Corp., a provider of sustainable drinking water solutions in North America and Europe, lifted its Q4 and FY 2023 revenue over the prior year period, while earnings results were mixed, according to an earnings report. Highlights include:

• Net revenue from continuing operations rose 8% from $405.1 million in Q4 2022 to $438.7 million in the quarter ending Dec. 30, 2023, driven by 8% revenue growth in water direct/water exchange and 15% in water refill/water filtration, due mainly to pricing initiatives and increased demand.
• Water direct/water exchange revenue rose 8% from $309.3 million to $333.8 million.
• Water refill/water filtration rose 15% from $49.9 million to $57.3 million.
• "Other water" revenue rose 89% from $8 million to $15 million.
• Net income fell 21.5% from $34.8 million to $13.3 million in the comparative quarters.
• Net income per diluted share fell from 22 cents to 8 cents.
• Adjusted net income per diluted share fell from 13 cents to 12 cents.
• Full-year revenue from continuing operations increased 5% from $1.7 billion in 2022 to $1.8 billion in the year ending Dec. 30, 2023, driven by revenue growth of 8% in water direct/water exchange and 18% in water refill/water filtration, offset primarily by the exit from the single-use retail bottled water business in North America and the exit from the company's Russia business.
• Full-year net income rose from $29.6 million to $238.1 million.
• Full-year net income per common share rose from 18 cents to $1.49 on a basic basis and from 18 cents to $1.48 on a diluted basis.

The company announced a dividend of 9 cents per share on common shares, payable in cash on March 25 to shareholders of record March 8, 2024.

Shares traded at $15.05 today against a 52-week range of $12.27 to $16.19.

The quarterly revenue of $438.7 million missed analyst expectations by $117.45 million and the non-GAAP EPS of 12 cents missed expectations by 5 cents, according to Seeking Alpha.

"Our full-year 2023 results exceeded the midpoint of our guidance for revenue, adjusted EBITDA and adjusted free cash flow for the combined continuing and discontinued operations," CEO Robbert Rietbroek said in the press release.

The company expects 2024 revenue to be between $1.84 billion and $1.88 billion.