Primo Water Corp.

Overview Key strengths Key risks Leading drinking water solutions provider in North American and European home and office water delivery services. Seasonality in the business, as water delivery sales generally tend to increase in warmer months. High consumer retention rates. Execution and integration risks associated with acquisitive strategy. Effective pricing pass-through to offset cost inflation and variable cost structure helps maintain profitability. Aggressive financial policy to fund acquisitions through debt could elevate leverage measures. Primo aims to leverage its leading position in home and office water delivery services globally by expanding its scale through acquisitions and further strengthen its recurring razor/razorblade revenue model. In fourth-quarter 2021, the company spent about US$90 million for the acquisition of Clear Mountain Refreshment Services

...We expect Primo Water Corp.'s acquisitive strategy will gradually improve the company's geographic footprint to support operating performance. Primo aims to leverage its leading position in home and office water delivery services globally by expanding its scale through acquisitions and further strengthen its recurring razor/razorblade revenue model. In fourth-quarter 2021, the company spent about US$90 million for the acquisition of Clear Mountain Refreshment Services and Water Event in the U.S. and SipWell in Belgium. The SipWell acquisition made Primo the leading provider of sustainable drinking water solutions in Belgium and further expanded its geographic footprint. As consumers and workers extend their mobility and work and recreation activities return to...

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