Research Update: Primo Water Corp. Upgraded To 'B+' On Strong Operating Performance And Continued Deleveraging; Outlook Positive

Tampa, Fla.-based pure-play water solutions provider Primo Water Corp.'s reported that its operating performance remained strong through the first half of 2023 and continues to show strength. With mid-single-digit topline growth from increased demand in water direct and water exchange business, S&P Global Ratings expects incremental 2023 EBITDA generation that leads to reduced leverage measures (S&P Global Ratings-adjusted) around the 3.5x area for the next 12 months. Moreover, we expect the company will continue to implement prudent discretionary spending towards acquisitions while generating an annual S&P Global Ratings-adjusted free operating cash flow (FOCF) of US$100 million-US$125 million in the next 12 months. As a result, we raised our issuer credit rating on Primo Water to 'B+' from 'B'. At the

...- Tampa, Fla.-based pure-play water solutions provider Primo Water Corp.'s reported that its operating performance remained strong through the first half of 2023 and continues to show strength. - With mid-single-digit topline growth from increased demand in water direct and water exchange business, S&P Global Ratings expects incremental 2023 EBITDA generation that leads to reduced leverage measures (S&P Global Ratings-adjusted) around the 3.5x area for the next 12 months. - Moreover, we expect the company will continue to implement prudent discretionary spending towards acquisitions while generating an annual S&P Global Ratings-adjusted free operating cash flow (FOCF) of US$100 million-US$125 million in the next 12 months. - As a result, we raised our issuer credit rating on Primo Water to 'B+' from 'B'. At the same time, we raised our issue-level rating on Primo's senior unsecured debt to 'B+' from 'B'. - The positive outlook reflects our expectation that Primo will continue to grow revenue...

Research Update