PRIMO WATER ANNOUNCES STRONG SECOND QUARTER 2023 RESULTS AND INCREASES ANNUAL GUIDANCE
Aug 10, 2023
- Delivered high end of Q2 Revenue and high end of Adjusted EBITDA guidance
- Increased Revenue 4% to
$593.3 million - Declares quarterly dividend of
$0.08 per common share, a 14% increase over last year’s dividend - Authorizes new
$50 million share repurchase program - Increases full-year 2023 Revenue, Adjusted EBITDA and Adjusted Free Cash Flow Guidance
(Unless stated otherwise, all second quarter 2023 comparisons are relative to the second quarter of 2022; all information is in
SECOND QUARTER HIGHLIGHTS
- Revenue increased 4% to
$593 million compared to$571 million driven by revenue growth of 7% in Water Direct / Water Exchange and 18% in Water Refill / Water Filtration, partially offset by the exit from ourNorth America single use bottled water retail business and the exit from our business inRussia . - Reported net income and net income per diluted share were
$21 million and$0.13 , respectively, compared to reported net loss and net loss per diluted share of$23 million and$0.14 , respectively. Adjusted net income and adjusted net income per diluted share were$39 million and$0.24 , respectively, compared to$33 million and$0.21 , respectively. Gross margin increased 390 bps to 62.1% compared to 58.2%. - Adjusted EBITDA increased 13% to
$122 million and Adjusted EBITDA margin increased 160 bps to 20.5%. - The Company increases its full year 2023 revenue target to between
$2.32 billion and$2.36 billion and increases its full year 2023 Adjusted EBITDA to between$460 million and$480 million . Adjusted Free Cash Flow is forecasted to be approximately$150 million , an increase of$10 million . - The Company reaffirms its 2024 outlook for high single-digit organic revenue growth and 2024 Adjusted EBITDA approaching
$530 million .
For the Three Months Ended | |||||
(in millions of | Y/Y Change | ||||
Revenue, net (1) | $ 593.3 | $ 571.4 | 4 % | ||
Net income (loss) | $ 21.3 | $ (22.5) | $ 43.8 | ||
Net income (loss) per diluted share | $ 0.13 | $ (0.14) | $ 0.27 | ||
Adjusted net income | $ 38.8 | $ 33.3 | $ 5.5 | ||
Adjusted net income per diluted share | $ 0.24 | $ 0.21 | $ 0.03 | ||
Adjusted EBITDA | $ 121.6 | $ 108.0 | 13 % | ||
Adjusted EBITDA margin % | 20.5 % | 18.9 % | 160 bps |
1Reported revenue in Q2 2022 includes |
“We once again delivered strong revenue and earnings growth, driven by improved route density, network efficiencies and optimization, the benefits of our investments and pricing. I am proud of the efforts of our team and their focus on improving the customer experience,” said
“Our second quarter performance gives us confidence to increase our 2023 outlook to between
OUTLOOK
Q3 2023 Range | FY 2023 Range | |||
($ in millions) | Low | High | Low | High |
Revenue | ||||
Adjusted EBITDA | ||||
Cash Taxes | ~ | |||
Interest | ||||
Cap-Ex | ~ | |||
Adj. Free Cash Flow | ~ |
SECOND QUARTER 2023 RESULTS CONFERENCE CALL
International: (416) 764-8659
Conference ID: 73605034
This is a live, listen-only dial-in telephone line.
A slide presentation and live audio webcast will be available through
SECOND QUARTER GLOBAL PERFORMANCE
- Revenue increased 4% to
$593 million compared to$571 million . The increase was driven by revenue growth of 7% in Water Direct / Water Exchange and 18% in Water Refill / Water Filtration, due primarily to pricing initiatives and increased demand for products and services from residential and business customers, partially offset by the exits from ourNorth America single use bottled water retail business and our business inRussia in the prior year. Revenue growth by channel is tabulated below:
For the Three Months Ended | |||||||
(in millions of | Change | % Change | |||||
Revenue, net (2) | |||||||
Water Direct/Water Exchange | $ 414.1 | $ 386.5 | $ 27.6 | 7 % | |||
Water Refill/Water Filtration | 66.1 | 56.2 | $ 9.9 | 18 % | |||
Other Water | 31.9 | 44.1 | $ (12.2) | (28) % | |||
Water Dispensers | 17.1 | 18.5 | $ (1.4) | (8) % | |||
Other | 64.1 | 66.1 | $ (2.0) | (3) % | |||
Revenue, net as reported | $ 593.3 | $ 571.4 | $ 21.9 | 4 % | |||
Foreign exchange impact | 2.4 | — | $ 2.4 | n/a | |||
Revenue excluding foreign exchange impact | $ 595.7 | $ 571.4 | $ 24.3 | 4 % |
2Reported revenue in Q2 2022 includes |
- Gross profit increased 11% to
$368 million compared to$332 million . Gross margin increased 390 bps to 62.1% compared to 58.2%, driven by pricing initiatives, increased demand, and the exit from the single-use retail bottled water business inNorth America . - SG&A expenses increased 9% to
$318 million compared to$292 million . The increase was driven by higher selling and operating costs that supported volume and revenue growth related primarily to labor costs increases and an increase in professional fees. - Reported net income and net income per diluted share were
$21 million and$0.13 , respectively, compared to reported net loss and net loss per diluted share of$23 million and$0.14 , respectively. Adjusted net income and adjusted net income per diluted share were$39 million and$0.24 , respectively, compared to$33 million and$0.21 in the prior year. - Adjusted EBITDA increased 13% to
$122 million compared to$108 million , driven primarily by pricing initiatives, customer demand and effective expense management. Adjusted EBITDA margin was 20.5% for the quarter, compared to 18.9%. - Net cash provided by operating activities of
$77 million , less$39 million of capital expenditures and additions to intangible assets, resulted in$38 million of free cash flow, or$41 million of adjusted free cash flow (adjusting for the items set forth on Exhibit 7), compared to adjusted free cash flow of$21 million in the prior year.
SECOND QUARTER REPORTING SEGMENT PERFORMANCE
- Revenue increased 3% to
$451 million driven by revenue growth of 7% in Water Direct / Water Exchange, and 17% in Water Refill / Water Filtration driven by pricing initiatives, partially offset by the exit from our single use bottled water retail business.
For the Three Months Ended | |||||||
(in millions of | Change | % Change | |||||
Revenue, net (3) | |||||||
Water Direct/Water Exchange | $ 342.9 | $ 321.1 | $ 21.8 | 7 % | |||
Water Refill/Water Filtration | 55.4 | 47.3 | $ 8.1 | 17 % | |||
Other Water | 11.9 | 22.2 | $ (10.3) | (46) % | |||
Water Dispensers | 16.7 | 18.5 | $ (1.8) | (10) % | |||
Other | 23.6 | 27.6 | $ (4.0) | (14) % | |||
Revenue, net as reported | $ 450.5 | $ 436.7 | $ 13.8 | 3 % | |||
Foreign exchange impact | 0.9 | — | $ 0.9 | n/a | |||
Revenue excluding foreign exchange impact | $ 451.4 | $ 436.7 | $ 14.7 | 3 % |
3Reported revenue in Q2 2022 includes |
- Revenue increased 12% to
$78 million (increased 9% excluding the impact of foreign exchange) driven by pricing initiatives, increased demand for products and services from residential and business customers, and favorable impact of foreign exchange rates, partially offset by the exit from our business inRussia .
For the Three Months Ended | |||||||
(in millions of | Change | % Change | |||||
Revenue, net (4) | |||||||
Water Direct/Water Exchange | $ 60.2 | $ 53.7 | $ 6.5 | 12 % | |||
Water Refill/Water Filtration | 9.9 | 8.2 | $ 1.7 | 21 % | |||
Other Water | 0.3 | 0.4 | $ (0.1) | (25) % | |||
Water Dispensers | 0.4 | — | $ 0.4 | 100 % | |||
Other | 7.2 | 7.6 | $ (0.4) | (5) % | |||
Revenue, net as reported | $ 78.0 | $ 69.9 | $ 8.1 | 12 % | |||
Foreign exchange impact | (1.9) | — | $ (1.9) | n/a | |||
Revenue excluding foreign exchange impact | $ 76.1 | $ 69.9 | $ 6.2 | 9 % |
4Reported revenue in the three months ended Q2 2022 includes |
QUARTERLY DIVIDEND
SHARE REPURCHASE PROGRAM
The actual timing, manner, number, and value of shares repurchased under the program will be determined by management at its discretion and will depend on a number of factors, including the market price of
ABOUT
Non-GAAP Measures
To supplement its reporting of financial measures determined in accordance with
Safe Harbor Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 conveying management’s expectations as to the future based on plans, estimates and projections at the time
Factors that could cause actual results to differ materially from those described in this press release include, among others: financial condition and results of operations;
The foregoing list of factors is not exhaustive. Readers are cautioned not to place undue reliance on any 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
Website: www.primowatercorp.com
EXHIBIT 1 | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(in millions of | |||||||
Unaudited | |||||||
For the Three Months Ended | For the Six Months Ended | ||||||
Revenue, net | $ 593.3 | $ 571.4 | $ 1,139.8 | $ 1,097.5 | |||
Cost of sales | 225.0 | 239.1 | 443.2 | 465.6 | |||
Gross profit | 368.3 | 332.3 | 696.6 | 631.9 | |||
Selling, general and administrative expenses | 317.7 | 291.6 | 621.2 | 569.9 | |||
Loss on disposal of property, plant and equipment, net | 1.2 | 0.1 | 2.5 | 1.8 | |||
Acquisition and integration expenses | 1.8 | 4.9 | 3.8 | 9.2 | |||
Impairment charges | — | 29.1 | — | 29.1 | |||
Operating income | 47.6 | 6.6 | 69.1 | 21.9 | |||
Other (income) expense, net | (4.5) | 10.7 | (10.8) | 13.4 | |||
Interest expense, net | 19.8 | 17.0 | 38.6 | 33.9 | |||
Income (loss) before income taxes | 32.3 | (21.1) | 41.3 | (25.4) | |||
Income tax expense | 11.0 | 1.4 | 14.2 | 3.8 | |||
Net income (loss) | $ 21.3 | $ (22.5) | $ 27.1 | $ (29.2) | |||
Net income (loss) per common share | |||||||
Basic | $ 0.13 | $ (0.14) | $ 0.17 | $ (0.18) | |||
Diluted | $ 0.13 | $ (0.14) | $ 0.17 | $ (0.18) | |||
Weighted average common shares outstanding (in thousands) | |||||||
Basic | 159,196 | 161,149 | 159,465 | 161,038 | |||
Diluted | 159,900 | 161,149 | 160,332 | 161,038 | |||
EXHIBIT 2 | |||
CONSOLIDATED BALANCE SHEETS | |||
(in millions of | |||
Unaudited | |||
ASSETS | |||
Current assets | |||
Cash and cash equivalents | $ 86.8 | $ 122.6 | |
Accounts receivable, net of allowance of | 293.2 | 258.6 | |
Inventories | 105.7 | 112.1 | |
Prepaid expenses and other current assets | 51.5 | 44.7 | |
Total current assets | 537.2 | 538.0 | |
Property, plant and equipment, net | 712.8 | 714.4 | |
Operating lease right-of-use-assets | 197.3 | 198.6 | |
1,300.2 | 1,293.0 | ||
Intangible assets, net | 886.2 | 894.7 | |
Other long-term assets, net | 25.4 | 28.3 | |
Total assets | $ 3,659.1 | $ 3,667.0 | |
LIABILITIES AND EQUITY | |||
Current liabilities | |||
Short-term borrowings | $ 231.0 | $ 212.3 | |
Current maturities of long-term debt | 16.5 | 17.5 | |
Accounts payable and accrued liabilities | 407.0 | 425.1 | |
Current operating lease obligations | 36.2 | 35.7 | |
Total current liabilities | 690.7 | 690.6 | |
Long-term debt | 1,289.9 | 1,283.8 | |
Operating lease obligations | 172.1 | 174.5 | |
Deferred tax liabilities | 177.4 | 170.0 | |
Other long-term liabilities | 63.2 | 65.2 | |
Total liabilities | 2,393.3 | 2,384.1 | |
Equity | |||
Common shares, no par value 159,240,481- ( | 1,283.1 | 1,283.2 | |
Additional paid-in-capital | 88.4 | 91.3 | |
Accumulated deficit | (16.9) | (9.4) | |
Accumulated other comprehensive loss | (88.8) | (82.2) | |
1,265.8 | 1,282.9 | ||
Total liabilities and equity | $ 3,659.1 | $ 3,667.0 |
EXHIBIT 3 | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(in millions of | |||||||
Unaudited | |||||||
For the Three Months Ended | For the Six Months Ended | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ 21.3 | $ (22.5) | $ 27.1 | $ (29.2) | |||
Adjustments to reconcile net income (loss) to cash flows from operating activities: | |||||||
Depreciation and amortization | 62.9 | 60.2 | 125.3 | 121.4 | |||
Amortization of financing fees | 0.9 | 0.8 | 1.7 | 1.7 | |||
Share-based compensation expense | 3.0 | 4.2 | 5.3 | 7.5 | |||
Provision (benefit) for deferred income taxes | 5.6 | (0.1) | 6.4 | 1.5 | |||
Impairment charges | — | 29.1 | — | 29.1 | |||
Loss on disposal of property, plant and equipment, net | 1.2 | 0.1 | 2.5 | 1.8 | |||
Other non-cash items | (5.3) | 11.0 | (12.0) | 12.7 | |||
Change in operating assets and liabilities, net of acquisitions: | |||||||
Accounts receivable | (30.6) | (21.3) | (33.5) | (33.2) | |||
Inventories | (2.6) | (8.0) | (0.5) | (19.1) | |||
Prepaid expenses and other current assets | 4.1 | 1.0 | (0.8) | (5.2) | |||
Other assets | (0.2) | 0.7 | (0.3) | — | |||
Accounts payable and accrued liabilities and other liabilities | 16.5 | 11.5 | (10.1) | 1.3 | |||
Net cash provided by operating activities | 76.8 | 66.7 | 111.1 | 90.3 | |||
Cash flows from investing activities: | |||||||
Acquisitions, net of cash received | (15.6) | (7.1) | (23.1) | (7.4) | |||
Additions to property, plant and equipment | (36.0) | (46.6) | (89.7) | (85.2) | |||
Additions to intangible assets | (2.7) | (2.4) | (5.4) | (4.9) | |||
Proceeds from sale of property, plant and equipment | 0.3 | 0.6 | 0.5 | 1.0 | |||
Proceeds from sale of business, net of cash sold | 0.5 | — | 0.5 | — | |||
Other investing activities | 1.1 | (0.1) | 3.3 | 0.4 | |||
Net cash used in investing activities | (52.4) | (55.6) | (113.9) | (96.1) | |||
Cash flows from financing activities: | |||||||
Payments of long-term debt | (4.8) | (5.2) | (9.8) | (9.7) | |||
Proceeds from short-term borrowings | 43.0 | 10.0 | 104.0 | 10.0 | |||
Payments on short-term borrowings | (59.8) | — | (93.0) | — | |||
Issuance of common shares | 0.4 | 0.4 | 4.7 | 1.6 | |||
Common shares repurchased and canceled | (2.5) | (0.2) | (21.8) | (2.0) | |||
Dividends paid to common shareholders | (13.1) | (11.6) | (25.9) | (22.9) | |||
Payment of deferred consideration for acquisitions | (0.2) | — | (1.0) | (0.1) | |||
Other financing activities | 2.3 | 0.7 | 8.4 | 4.6 | |||
Net cash used in financing activities | (34.7) | (5.9) | (34.4) | (18.5) | |||
Effect of exchange rate changes on cash | 0.6 | (1.0) | 1.4 | (1.9) | |||
Net (decrease) increase in cash, cash equivalents and restricted cash | (9.7) | 4.2 | (35.8) | (26.2) | |||
Cash and cash equivalents and restricted cash, beginning of period | 96.5 | 98.0 | 122.6 | 128.4 | |||
Cash and cash equivalents and restricted cash, end of period | $ 86.8 | $ 102.2 | $ 86.8 | $ 102.2 | |||
Cash and cash equivalents and restricted cash: | |||||||
Cash and cash equivalents | $ 86.8 | $ 98.5 | $ 86.8 | $ 98.5 | |||
Cash included in prepaid expenses and other current assets | — | 3.7 | — | 3.7 | |||
Total | $ 86.8 | $ 102.2 | $ 86.8 | $ 102.2 |
EXHIBIT 4 | ||||||||
SEGMENT INFORMATION | ||||||||
(in millions of | ||||||||
Unaudited | ||||||||
For the Three Months Ended | ||||||||
Other | Total | |||||||
Revenue, net | ||||||||
Water Direct/Water Exchange | $ 342.9 | $ 60.2 | $ 11.0 | $ 414.1 | ||||
Water Refill/Water Filtration | 55.4 | 9.9 | 0.8 | 66.1 | ||||
Other Water | 11.9 | 0.3 | 19.7 | 31.9 | ||||
Water Dispensers | 16.7 | 0.4 | — | 17.1 | ||||
Other | 23.6 | 7.2 | 33.3 | 64.1 | ||||
Total | $ 450.5 | $ 78.0 | $ 64.8 | $ 593.3 | ||||
Gross profit | $ 290.7 | $ 53.4 | $ 24.2 | $ 368.3 | ||||
Gross margin % | 64.5 % | 68.5 % | 37.3 % | 62.1 % | ||||
Selling, general and administrative expenses | $ 231.0 | $ 46.0 | $ 40.7 | $ 317.7 | ||||
SG&A % of revenue | 51.3 % | 59.0 % | 62.8 % | 53.5 % | ||||
Operating income (loss) | $ 57.3 | $ 7.1 | $ (16.8) | $ 47.6 | ||||
Depreciation and amortization | $ 46.8 | $ 10.2 | $ 5.9 | $ 62.9 | ||||
For the Three Months Ended | ||||||||
Other | Total | |||||||
Revenue, net | ||||||||
Water Direct/Water Exchange | $ 321.1 | $ 53.7 | $ 11.7 | $ 386.5 | ||||
Water Refill/Water Filtration | 47.3 | 8.2 | 0.7 | 56.2 | ||||
Other Water | 22.2 | 0.4 | 21.5 | 44.1 | ||||
Water Dispensers | 18.5 | — | — | 18.5 | ||||
Other | 27.6 | 7.6 | 30.9 | 66.1 | ||||
Total | $ 436.7 | $ 69.9 | $ 64.8 | $ 571.4 | ||||
Gross profit | $ 260.4 | $ 46.8 | $ 25.1 | $ 332.3 | ||||
Gross margin % | 59.6 % | 67.0 % | 38.7 % | 58.2 % | ||||
Selling, general and administrative expenses | $ 208.6 | $ 45.9 | $ 37.1 | $ 291.6 | ||||
SG&A % of revenue | 47.8 % | 65.7 % | 57.3 % | 51.0 % | ||||
Operating income (loss) | $ 48.3 | $ (29.1) | $ (12.6) | $ 6.6 | ||||
Depreciation and amortization | $ 44.3 | $ 10.1 | $ 5.8 | $ 60.2 | ||||
For the Six Months Ended | ||||||||
Other | Total | |||||||
Revenue, net | ||||||||
Water Direct/Water Exchange | $ 655.3 | $ 113.2 | $ 21.4 | $ 789.9 | ||||
Water Refill/Water Filtration | 107.6 | 18.7 | 1.4 | 127.7 | ||||
Other Water | 23.2 | 0.5 | 35.4 | 59.1 | ||||
Water Dispensers | 29.4 | 0.5 | — | 29.9 | ||||
Other | 47.3 | 14.5 | 71.4 | 133.2 | ||||
Total | $ 862.8 | $ 147.4 | $ 129.6 | $ 1,139.8 | ||||
Gross profit | $ 549.5 | $ 100.9 | $ 46.2 | $ 696.6 | ||||
Gross Margin % | 63.7 % | 68.5 % | 35.6 % | 61.1 % | ||||
Selling, general and administrative expenses | $ 452.1 | $ 90.3 | $ 78.8 | $ 621.2 | ||||
SG&A % of Revenue | 52.4 % | 61.3 % | 60.8 % | 54.5 % | ||||
Operating income (loss) | $ 92.0 | $ 10.0 | $ (32.9) | $ 69.1 | ||||
Depreciation and amortization | $ 93.6 | $ 19.8 | $ 11.9 | $ 125.3 | ||||
For the Six Months Ended | ||||||||
Other | Total | |||||||
Revenue, net | ||||||||
Water Direct/Water Exchange | $ 599.4 | $ 101.9 | $ 22.5 | $ 723.8 | ||||
Water Refill/Water Filtration | 89.5 | 16.4 | 1.2 | 107.1 | ||||
Other Water | 56.2 | 0.8 | 37.5 | 94.5 | ||||
Water Dispensers | 32.7 | — | — | 32.7 | ||||
Other | 56.0 | 15.1 | 68.3 | 139.4 | ||||
Total | $ 833.8 | $ 134.2 | $ 129.5 | $ 1,097.5 | ||||
Gross profit | $ 492.4 | $ 90.6 | $ 48.9 | $ 631.9 | ||||
Gross margin % | 59.1 % | 67.5 % | 37.8 % | 57.6 % | ||||
Selling, general and administrative expenses | $ 408.3 | $ 92.1 | $ 69.5 | $ 569.9 | ||||
SG&A % of revenue | 49.0 % | 68.6 % | 53.7 % | 51.9 % | ||||
Operating income (loss) | $ 76.6 | $ (32.7) | $ (22.0) | $ 21.9 | ||||
Depreciation and amortization | $ 89.6 | $ 19.9 | $ 11.9 | $ 121.4 |
EXHIBIT 5 | |||||||
SUPPLEMENTARY INFORMATION – NON-GAAP – ANALYSIS OF REVENUE AND GROSS PROFIT BY REPORTING SEGMENT | |||||||
(in millions of | |||||||
Unaudited | |||||||
For the Three Months Ended | |||||||
North | Other | Primo | |||||
Change in revenue | $ 13.8 | $ 8.1 | $ — | $ 21.9 | |||
Impact of foreign exchange (a) | 0.9 | (1.9) | 3.4 | 2.4 | |||
Change excluding foreign exchange | $ 14.7 | $ 6.2 | $ 3.4 | $ 24.3 | |||
Percentage change in revenue | 3.2 % | 11.6 % | — % | 3.8 % | |||
Percentage change in revenue excluding foreign exchange | 3.4 % | 8.9 % | 5.2 % | 4.3 % | |||
For the Six Months Ended | |||||||
North | Other | Primo | |||||
Change in revenue | $ 29.0 | $ 13.2 | $ 0.1 | $ 42.3 | |||
Impact of foreign exchange (a) | 2.0 | 2.3 | 10.2 | 14.5 | |||
Change excluding foreign exchange | $ 31.0 | $ 15.5 | $ 10.3 | $ 56.8 | |||
Percentage change in revenue | 3.5 % | 9.8 % | 0.1 % | 3.9 % | |||
Percentage change in revenue excluding foreign exchange | 3.7 % | 11.5 % | 8.0 % | 5.2 % | |||
For the Three Months Ended | |||||||
North | Other | Primo | |||||
Change in gross profit | $ 30.3 | $ 6.6 | $ (0.9) | $ 36.0 | |||
Impact of foreign exchange (a) | 0.5 | (1.4) | 1.8 | 0.9 | |||
Change excluding foreign exchange | $ 30.8 | $ 5.2 | $ 0.9 | $ 36.9 | |||
Percentage change in gross profit | 11.6 % | 14.1 % | (3.6) % | 10.8 % | |||
Percentage change in gross profit excluding foreign exchange | 11.8 % | 11.1 % | 3.6 % | 11.1 % | |||
For the Six Months Ended | |||||||
North | Other | Primo | |||||
Change in gross profit | $ 57.1 | $ 10.3 | $ (2.7) | $ 64.7 | |||
Impact of foreign exchange (a) | 1.2 | 1.3 | 4.0 | 6.5 | |||
Change excluding foreign exchange | $ 58.3 | $ 11.6 | $ 1.3 | $ 71.2 | |||
Percentage change in gross profit | 11.6 % | 11.4 % | (5.5) % | 10.2 % | |||
Percentage change in gross profit excluding foreign exchange | 11.8 % | 12.8 % | 2.7 % | 11.3 % | |||
(a) Impact of foreign exchange is the difference between the current period revenue and gross profit translated utilizing the current period average foreign exchange rates less the current period revenue and gross profit translated utilizing the prior period average foreign exchange rates. |
EXHIBIT 6 | |||||||
SUPPLEMENTARY INFORMATION – NON-GAAP – EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION & AMORTIZATION | |||||||
(EBITDA) | |||||||
(in millions of | |||||||
Unaudited | |||||||
For the Three Months Ended | For the Six Months Ended | ||||||
Net income (loss) | $ 21.3 | $ (22.5) | $ 27.1 | $ (29.2) | |||
Interest expense, net | 19.8 | 17.0 | 38.6 | 33.9 | |||
Income tax expense | 11.0 | 1.4 | 14.2 | 3.8 | |||
Depreciation and amortization | 62.9 | 60.2 | 125.3 | 121.4 | |||
EBITDA | $ 115.0 | $ 56.1 | $ 205.2 | $ 129.9 | |||
Acquisition and integration costs (a) | 1.8 | 4.9 | 3.8 | 9.2 | |||
Share-based compensation costs (b) | 3.0 | 4.2 | 5.3 | 7.5 | |||
Impairment charges (c) | — | 29.1 | — | 29.1 | |||
Foreign exchange and other (gains) losses, net (d) | (5.0) | 11.5 | (10.9) | 15.4 | |||
Loss on disposal of property, plant and equipment, net (e) | 1.2 | 0.1 | 2.5 | 1.8 | |||
Other adjustments, net (f) | 5.6 | 2.1 | 10.6 | 3.0 | |||
Adjusted EBITDA | $ 121.6 | $ 108.0 | $ 216.5 | $ 195.9 | |||
Revenue, net | $ 593.3 | $ 571.4 | $ 1,139.8 | $ 1,097.5 | |||
Adjusted EBITDA margin % | 20.5 % | 18.9 % | 19.0 % | 17.8 % |
For the Three Months Ended | For the Six Months Ended | |||||||
Location in | ||||||||
(Unaudited) | (Unaudited) | |||||||
(a) Acquisition and integration costs | Acquisition and integration expenses | $ 1.8 | $ 4.9 | $ 3.8 | $ 9.2 | |||
(b) Share-based compensation costs | Selling, general and administrative expenses | 3.0 | 4.2 | 5.3 | 7.5 | |||
(c) Impairment charges | Impairment charges | — | 29.1 | — | 29.1 | |||
(d) Foreign exchange and other (gains) losses, net | Other (income) expense, net | (5.0) | 11.5 | (10.9) | 15.4 | |||
(e) Loss on disposal of property, plant and equipment, net | Loss on disposal of property, plant and equipment, net | 1.2 | 0.1 | 2.5 | 1.8 | |||
(f) Other adjustments, net | Other (income) expense, net | (0.3) | (0.4) | (0.7) | (1.7) | |||
Selling, general and administrative expenses | 5.9 | 2.5 | 11.3 | 4.7 |
EXHIBIT 7 | |||
SUPPLEMENTARY INFORMATION – NON-GAAP – FREE CASH FLOW AND ADJUSTED FREE CASH FLOW | |||
(in millions of | |||
Unaudited | |||
For the Three Months Ended | |||
Net cash provided by operating activities | $ 76.8 | $ 66.7 | |
Less: Additions to property, plant, and equipment | (36.0) | (46.6) | |
Less: Additions to intangible assets | (2.7) | (2.4) | |
Free Cash Flow | $ 38.1 | $ 17.7 | |
Acquisition and integration cash costs | 1.4 | 3.1 | |
Cash costs related to additions to property, plant and equipment for integration of acquired entities | 0.1 | — | |
Cash taxes paid for property sales | 0.8 | — | |
Tariffs refunds related to property, plant, and equipment | 1.0 | — | |
Adjusted Free Cash Flow | $ 41.4 | $ 20.8 | |
For the Six Months Ended | |||
Net cash provided by operating activities | $ 111.1 | $ 90.3 | |
Less: Additions to property, plant, and equipment | (89.7) | (85.2) | |
Less: Additions to intangible assets | (5.4) | (4.9) | |
Free Cash Flow | $ 16.0 | $ 0.2 | |
Acquisition and integration cash costs | 4.0 | 8.1 | |
Cash costs related to additions to property, plant and equipment for integration of acquired entities | 0.2 | — | |
Cash taxes paid for property sales | 0.8 | — | |
Tariffs refunds related to property, plant, and equipment | 1.4 | — | |
Adjusted Free Cash Flow | $ 22.4 | $ 8.3 | |
EXHIBIT 8 | |||||||
SUPPLEMENTARY INFORMATION-NON-GAAP-ADJUSTED NET INCOME AND ADJUSTED EPS | |||||||
(in millions of | |||||||
Unaudited | |||||||
For the Three Months Ended | For the Six Months Ended | ||||||
Net income (loss) (as reported) | $ 21.3 | $ (22.5) | $ 27.1 | $ (29.2) | |||
Adjustments: | |||||||
Amortization expense of customer lists | 11.2 | 12.1 | 22.5 | 25.0 | |||
Acquisition and integration costs | 1.8 | 4.9 | 3.8 | 9.2 | |||
Share-based compensation costs | 3.0 | 4.2 | 5.3 | 7.5 | |||
Impairment charges | — | 29.1 | — | 29.1 | |||
Foreign exchange and other (gains) losses, net | (5.0) | 11.5 | (10.9) | 15.4 | |||
Other adjustments, net | 5.6 | 2.1 | 10.6 | 3.0 | |||
Tax impact of adjustments (a) | 0.9 | (8.1) | (4.7) | (12.8) | |||
Adjusted net income | $ 38.8 | $ 33.3 | $ 53.7 | $ 47.2 | |||
Earnings Per Share (as reported) | |||||||
Net income (loss) | $ 21.3 | $ (22.5) | $ 27.1 | $ (29.2) | |||
Basic EPS | $ 0.13 | $ (0.14) | $ 0.17 | $ (0.18) | |||
Diluted EPS | $ 0.13 | $ (0.14) | $ 0.17 | $ (0.18) | |||
Weighted average common shares outstanding (in thousands) | |||||||
Basic | 159,196 | 161,149 | 159,465 | 161,038 | |||
Diluted | 159,900 | 161,149 | 160,332 | 161,038 | |||
Adjusted Earnings Per Share (Non-GAAP) | |||||||
Adjusted net income (Non-GAAP) | $ 38.8 | $ 33.3 | $ 53.7 | $ 47.2 | |||
Adjusted diluted EPS (Non-GAAP) | $ 0.24 | $ 0.21 | $ 0.33 | $ 0.29 | |||
Diluted weighted average common shares outstanding (in thousands) (Non-GAAP) (b) | 159,900 | 161,894 | 160,332 | 161,934 | |||
(a) The tax effect for adjusted net income is based upon an analysis of the statutory tax treatment and the applicable tax rate for the jurisdiction in which the pre-tax adjusting items incurred and for which realization of the resulting tax benefit (if any) is expected. A reduced or 0% tax rate is applied to jurisdictions where we do not expect to realize a tax benefit due to a history of operating losses or other factors resulting in a valuation allowance related to deferred tax assets. | |||||||
(b) Includes the impact of dilutive securities of 745 and 896 for the three and six months ended |
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