Primo Brands Corp (PRMB) 2022 Q4 法說會逐字稿

Good morning. My name is Michelle, and I will be your conference operator today. At this time, I would like to welcome everyone to the Primo Water Corporation's Fourth Quarter 2022 Earnings Conference Call. (Operator Instructions) I would now like to turn the call over to Jon Kathol, Vice President of Investor Relations. Please go ahead.

早上好。我叫米歇爾，今天我將擔任你們的會議接線員。此時，我想歡迎大家參加 Primo Water Corporation 的 2022 年第四季度收益電話會議。 （操作員說明）我現在想把電話轉給投資者關係副總裁 Jon Kathol。請繼續。

Welcome to Primo Water Corporation's Fourth Quarter 2022 Earnings Conference Call. All participants are currently in listen-only mode. This call will end no later than 11:00 a.m. Eastern Time. The call is being webcast live on Primo's website at www.primowatercorp.com and will be available for playback there for 2 weeks.

歡迎來到 Primo Water Corporation 2022 年第四季度收益電話會議。所有參與者當前都處於只聽模式。此電話會議將在美國東部時間上午 11:00 之前結束。該電話會議正在 Primo 網站 www.primowatercorp.com 上進行網絡直播，並將在那裡播放 2 週。

This conference call contains forward-looking statements, including statements concerning the company's future financial and operational performance. These statements should be considered in connection with cautionary statements and disclaimers contained in the safe harbor statements in this morning's earnings press release and the company's annual report on Form 10-K and quarterly reports on Form 10-Q and other filings with securities regulators. The company's actual performance could differ materially from these statements, and the company undertakes no duty to update these forward-looking statements, except as expressly required by applicable law.

本次電話會議包含前瞻性陳述，包括有關公司未來財務和運營業績的陳述。這些聲明應與今天上午的收益新聞稿中安全港聲明中包含的警示聲明和免責聲明以及公司 10-K 表格年度報告和 10-Q 表格季度報告以及向證券監管機構提交的其他文件中的警告聲明和免責聲明一起考慮。公司的實際業績可能與這些陳述存在重大差異，除適用法律明確要求外，公司不承擔更新這些前瞻性陳述的義務。

A reconciliation of any non-GAAP financial measures discussed during the call with the most comparable measures in accordance with GAAP when the data is capable of being estimated is included in the company's fourth quarter earnings announcement released earlier this morning or on the Investor Relations section of the company's website at www.primowatercorp.com.

在電話會議期間討論的任何非 GAAP 財務措施與根據 GAAP 的最可比措施的調節，當數據能夠被估計時，包含在公司今天上午早些時候發布的第四季度收益公告或投資者關係部分公司網站 www.primowatercorp.com。

I am accompanied by Tom Harrington, Primo's Chief Executive Officer; and David Hass, Primo's Chief Financial Officer. As a part of this conference call, we have included a deck online at www.primowatercorp.com that was designed to assist you throughout our discussion. Tom will start today's call by providing a high-level review of full year 2022 and the fourth quarter and our progress on Primo's strategic initiatives. Then David will review our segment level performance and will discuss our fourth quarter performance in greater detail and offer our outlook on the first quarter and full year 2023 before handing the call back to Tom to provide a long-term view ahead of Q&A.

陪同我的是 Primo 的首席執行官湯姆·哈林頓 (Tom Harrington)；和 Primo 的首席財務官 David Hass。作為本次電話會議的一部分，我們在 www.primowatercorp.com 上提供了一個在線平台，旨在幫助您完成我們的討論。湯姆將通過提供對 2022 年全年和第四季度的高層回顧以及我們在 Primo 戰略計劃方面的進展來開始今天的電話會議。然後，David 將回顧我們的細分市場表現，並將更詳細地討論我們第四季度的表現，並提供我們對 2023 年第一季度和全年的展望，然後將電話轉回給 Tom，以便在問答之前提供長期觀點。

With that, I will now turn the call over to Tom.

有了這個，我現在將把電話轉給湯姆。

Thank you, Jon, and good morning, everyone. In 2022, we delivered normalized FX-neutral revenue growth of 16%; adjusted EBITDA growth of 11%, increased adjusted EBITDA margin by 70 basis points to 19%, and Sales of approximately 1 million water dispenser, the razor in our razor-razorblade model and increased return of funds to shareholders through the higher dividend and the opportunistic share repurchase program, partially funded by the sale of 2 properties in California. I am pleased with the performance during the fourth quarter and for full year 2022 and want to thank all the Primo associates for their contributions to the company's ongoing success. We remain confident in our ability to deliver our 2023 and 2024 outlook.

謝謝你，喬恩，大家早上好。 2022 年，我們實現了 16% 的標準化外匯中性收入增長；調整後 EBITDA 增長 11%，將調整後 EBITDA 利潤率提高 70 個基點至 19%，銷售約 100 萬台飲水機，我們的剃須刀刀片模型中的剃須刀，並通過更高的股息和機會主義的方式增加對股東的資金回報股票回購計劃，部分資金來自出售加利福尼亞州的 2 處房產。我對第四季度和 2022 年全年的表現感到滿意，並感謝所有 Primo 員工為公司的持續成功所做的貢獻。我們對實現 2023 年和 2024 年展望的能力充滿信心。

I welcome David Hass to his first earnings call as our recently appointed Chief Financial Officer. David has been a key member of the Primo team for several years, most recently as Chief Strategy Officer. As the key architect of our corporate strategy, David has a deep understanding of our business segments. He has hit the ground running with our team of seasoned accounting, treasury and finance professionals that are assisting him in the transition. As part of this transition, our outgoing CFO, Jay Wells, will work with David to ensure a seamless transition.

歡迎 David Hass 作為我們最近任命的首席財務官參加他的第一次財報電話會議。大衛多年來一直是 Primo 團隊的重要成員，最近擔任首席戰略官。作為我們公司戰略的主要架構師，David 對我們的業務部門有著深刻的理解。他與我們經驗豐富的會計、財務和金融專業人士團隊一起開始了工作，這些專業人士正在協助他完成過渡。作為此過渡的一部分，我們即將離任的首席財務官 Jay Wells 將與 David 合作以確保無縫過渡。

As I mentioned last quarter, I'd like to once again thank Jay for his dedicated service to Primo Water, and we wish him the best as he approaches his retirement. Our growth outlook is on track with a portfolio of leading water solutions across multiple channels and geographies, strong consumer tailwinds in the aging global water infrastructure as well as a compelling financial profile. [Break] continued investment in our digital platforms and increased connectivity of water dispensers to our water solutions provides a solid foundation to achieve our growth targets. For the full year 2022, excluding the impact of foreign exchange, normalized revenue increased 16%.

正如我在上個季度提到的，我想再次感謝 Jay 對 Primo Water 的熱忱服務，我們祝愿他在退休前一切順利。我們的增長前景步入正軌，包括跨多個渠道和地區的領先水資源解決方案組合、老化的全球水資源基礎設施中強勁的消費者順風以及令人信服的財務狀況。 [中斷] 對我們的數字平台的持續投資以及飲水機與我們的水解決方案的更多連接為實現我們的增長目標提供了堅實的基礎。排除外匯影響，2022 年全年正常化收入增長 16%。

Normalized revenue excludes the exited North American single-use bottle water retail business and our exited business in Russia. Adjusted EBITDA increased [$40] million to $420 million, an increase of 11%. Moving to the fourth quarter. We delivered the trifactor of strong revenue, adjusted EBITDA growth and adjusted EBITDA margin expansion in the quarter. Consolidated revenue increased 3% to $533 million, which included FX headwinds. Normalized revenue, excluding the impact of foreign exchange, grew by a healthy 14%, driven by resilient consumer demand, increased dispenser sell-through, solid volume growth in Water Direct and Exchange, strong revenue growth in water refill and filtration, consistent growth of our premium water brand Mountain Valley, execution of our M&A tuck-in acquisition strategy and consistent customer retention.

標準化收入不包括退出的北美一次性瓶裝水零售業務和我們在俄羅斯退出的業務。調整後的 EBITDA 增加 [40] 億美元至 4.2 億美元，增幅為 11%。移動到第四季度。我們在本季度實現了強勁的收入、調整後的 EBITDA 增長和調整後的 EBITDA 利潤率擴張這三個因素。合併收入增長 3% 至 5.33 億美元，其中包括外匯逆風。不計外匯影響的正常化收入健康增長 14%，這得益於消費者需求的彈性、飲水機銷售量的增加、Water Direct 和 Exchange 的穩定銷量增長、補水和過濾的強勁收入增長、持續增長的我們的優質水品牌 Mountain Valley，執行我們的併購收購戰略和持續的客戶保留。

Adjusted EBITDA in the fourth quarter increased 9% to $107 million, supported by higher volume, increased pricing and effective expense management that offset the impact of inflation. Adjusted EBITDA margin for the quarter was up 110 basis points to 20.1%. Although there is seasonality in our quarterly results, this was the second quarter in a row with an adjusted EBITDA margin equal to or greater than 20%. We are especially pleased with the adjusted EBITDA margin expansion in the face of record inflation. We successfully offset the impact of labor, fuel and freight and expanded the margin percentage. A job well done by the Primo team that positions us for continued success in 2023 and beyond.

第四季度調整後的 EBITDA 增長 9% 至 1.07 億美元，這得益於更高的銷量、更高的定價和有效的費用管理，抵消了通貨膨脹的影響。本季度調整後的 EBITDA 利潤率上升 110 個基點至 20.1%。儘管我們的季度業績存在季節性，但這是連續第二個季度調整後的 EBITDA 利潤率等於或大於 20%。面對創紀錄的通貨膨脹，我們對調整後的 EBITDA 利潤率擴張感到特別滿意。我們成功抵消了勞動力、燃料和運費的影響，擴大了利潤率。 Primo 團隊的出色工作使我們能夠在 2023 年及以後繼續取得成功。

We execute a razor and razor blade business strategy where the rental or sale of dispensers helps create high-margin recurring revenue generated from our water solutions. We saw an increase in the level of sell-through in our water dispenser business to approximately 280,000 units in the quarter and approximately 1 million units in 2022. These dispenser sales drove connectivity to our water solutions. Water Dispenser sell-through represents the units sold by brick-and-mortar and e-commerce retailers to the end consumer. Sell-through volume in the quarter was 50% higher than Q4 of 2021.

我們執行剃須刀和剃須刀刀片業務戰略，其中分配器的租賃或銷售有助於從我們的水解決方案中創造高利潤的經常性收入。我們看到飲水機業務的銷售水平在本季度增加到約 280,000 台，到 2022 年增加到約 100 萬台。這些飲水機銷售推動了與我們的水解決方案的連接。飲水機銷售率代表實體店和電子商務零售商向最終消費者銷售的單位。本季度的銷售量比 2021 年第四季度高出 50%。

Our Black Friday promotions exceeded our and our retail partners' expectations. Although higher retail prices reflected the impact of the tariff, consumers continued to purchase dispensers as part of their health and wellness journey. The sell-through units are a leading indicator of the future organic growth of our water solutions. The sell-in or what we sold directly to retailers for Q4 was negatively impacted by retailers' efforts to rightsize their inventories that were increased during 2022 supply chain challenges. We expect the rightsizing of retail inventory to extend into 2023 and result in lower dispenser revenue for Primo as it did in Q4. However, it has little to no impact on our water dispenser sell-through, recurring revenue in our water businesses nor our adjusted EBITDA.

我們的黑色星期五促銷活動超出了我們和我們的零售合作夥伴的預期。儘管更高的零售價格反映了關稅的影響，但消費者繼續購買分配器作為他們健康之旅的一部分。銷售單位是我們水解決方案未來有機增長的領先指標。零售商在 2022 年供應鏈挑戰期間調整庫存規模的努力對第四季度的銷售或我們直接銷售給零售商的產品產生了負面影響。我們預計零售庫存的調整將延續到 2023 年，並導致 Primo 的分配器收入與第四季度一樣下降。然而，它對我們的飲水機銷售率、水業務的經常性收入或我們調整後的 EBITDA 幾乎沒有影響。

Our Water Direct and Exchange business continued to experience strong top line momentum during the quarter with 13% revenue growth through pricing actions, volume growth and improved customer satisfaction enabled by increased delivery frequencies. Customer retention importantly, remained consistent with prior quarters. We were awarded a 5-year contract to be Costco's exclusive service provider for large-format bottled water delivery services direct to Costco consumer and business members. In 2023, we will increase the number and frequency of in-store activities at Costco stores.

我們的 Water Direct 和 Exchange 業務在本季度繼續保持強勁的收入增長勢頭，通過定價行動、銷量增長和交付頻率提高帶來的客戶滿意度提高，收入增長了 13%。客戶保留很重要，與前幾個季度保持一致。我們獲得了一份為期 5 年的合同，成為 Costco 的獨家服務提供商，直接向 Costco 消費者和企業會員提供大型瓶裝水配送服務。 2023 年，我們將增加 Costco 門店的店內活動數量和頻率。

Increased customer growth from these events will ramp up through the year as we build out the program across more and more of the U.S. Our Water Refill and Filtration business continues to accelerate its growth with an increase in revenue of 14% in the quarter as a result of price increases on outdoor machines, improved machine uptime and improved service levels in water filtration. Our water refill business is one of our water platforms where consumers, who purchased a water dispenser connects to one of our water services.

隨著我們在美國越來越多的地區開展該計劃，這些活動帶來的客戶增長將在全年加速。我們的水補充和過濾業務繼續加速增長，因此本季度收入增長了 14%戶外機器的價格上漲、機器正常運行時間的增加以及水過濾服務水平的提高。我們的水補充業務是我們的水平台之一，購買飲水機的消費者可以連接到我們的一項水服務。

Regarding price elasticity, customer trends remain consistent with prior quarters. Customer feedback related to the higher pricing has been minimal as we track this through a combination of metrics, including call center activity, customer retention and customer growth. From a digital perspective, we continue to see positive responses from the update of our mobile app, MyWater+ and its ease of use for our customers. Our digital focus in 2023 is centered on new water customer acquisitions through costcowater.com as one example, water dispenser sales and connectivity to our water solutions. We continue to invest in best-in-class digital solutions for our customers.

關於價格彈性，客戶趨勢與前幾個季度保持一致。由於我們通過呼叫中心活動、客戶保留和客戶增長等指標組合跟踪這一點，因此與更高定價相關的客戶反饋很少。從數字角度來看，我們繼續看到我們的移動應用程序 MyWater+ 的更新及其對客戶的易用性的積極響應。我們在 2023 年的數字重點是通過 costcowater.com 獲取新的水客戶，例如飲水機銷售和與我們水解決方案的連接。我們繼續為我們的客戶投資一流的數字解決方案。

We are redesigning our website water.com, through a combination of internal and external resources to further enhance the effectiveness of this site. These marketing investments are helping us build a larger base of long-term high-value customers. During 2022, we faced significant cost inflation across labor, fuel and freight as well as other input costs, which totaled approximately $74 million. As I mentioned earlier, we fully offset these headwinds through our pricing and efficiency actions during the year and increased our adjusted EBITDA margin percentage.

我們正在重新設計我們的網站 water.com，通過結合內部和外部資源進一步提高該網站的有效性。這些營銷投資正在幫助我們建立更大的長期高價值客戶群。 2022 年期間，我們面臨勞動力、燃料和貨運以及其他投入成本的顯著成本膨脹，總計約 7400 萬美元。正如我之前提到的，我們通過年內的定價和效率行動完全抵消了這些不利因素，並提高了調整後的 EBITDA 利潤率。

The Primo team has done an outstanding job offsetting these increases while continuing to improve the customer experience. The Automated Route Optimization tool, ARO in North America continues to yield efficiencies. The tool sequences routes for the most efficient path possible, which maximizes the time route sales representatives spend with customers, unlocks route capacity to handle future organic growth, and minimizes fuel consumption. As volumes increased through the year, we added routes at a more efficient level, a 13% improvement in productivity when comparing 2022 to pre-pandemic 2019 and a record all-time high efficiency. ARO remains a key operating initiative.

Primo 團隊出色地抵消了這些增長，同時繼續改善客戶體驗。北美的自動路線優化工具 ARO 繼續提高效率。該工具對路線進行排序以獲得最有效的路徑，從而最大限度地延長路線銷售代表與客戶相處的時間，釋放路線容量以應對未來的有機增長，並最大限度地減少燃料消耗。隨著全年運量的增加，我們增加了效率更高的航線，與 2022 年相比，與 2019 年大流行前相比，生產率提高了 13%，效率創歷史新高。 ARO 仍然是一項關鍵的運營計劃。

Our 2022 revenue per stop in North America increased nearly 24% compared to last year. Our ARO tool has helped us offset cost increases while improving the customer experience and enabling us to increase delivery frequency in support of our efforts to grow our water exchange business.

我們在北美的 2022 年單站收入與去年相比增長了近 24%。我們的 ARO 工具幫助我們抵消了成本增加，同時改善了客戶體驗，並使我們能夠提高交付頻率以支持我們發展換水業務的努力。

During 2022, we made meaningful improvements in our ESG story. We're implementing the reporting systems that provide investment-grade reporting, detailing our progress on our journey to ESG leadership. We will be updating our sustainability reports for 2021 and 2022 by midyear. Our upcoming report will highlight improvements in data reporting and our reduction efforts, which have resulted in carbon emissions reductions of nearly 20%. We source our water from a combination of municipal on-site well and spring sources across our footprint.

2022 年，我們對 ESG 故事做出了有意義的改進。我們正在實施提供投資級報告的報告系統，詳細說明我們在 ESG 領導地位之旅中取得的進展。我們將在年中之前更新 2021 年和 2022 年的可持續發展報告。我們即將發布的報告將重點介紹數據報告方面的改進和我們的減排工作，這些工作已將碳排放量減少了近 20%。我們的水源來自我們足跡內的市政現場水井和泉水。

Of the 81 sources we use, 37% are company-owned. Our approach to sourcing enables us to ensure adequate supply and to meet varying consumer water preferences. From a governance perspective, in identifying new candidates, our Board will consider the mix of director characteristics and diverse experiences, perspectives and skills appropriate for the company. Over the course of the past 5 years, we've refreshed our board with 5 new directors.

在我們使用的 81 個資源中，37% 為公司所有。我們的採購方法使我們能夠確保充足的供應並滿足不同的消費者用水偏好。從治理的角度來看，在確定新候選人時，我們的董事會將考慮適合公司的董事特徵和多樣化經驗、觀點和技能的組合。在過去 5 年的過程中，我們更新了 5 名新董事的董事會。

As we shared last month at the ICR conference, for the full year 2023, we expect revenue to increase to between $2.3 billion and $2.35 billion with normalized revenue growth in the range of 6% to 8%. We expect full year 2023 adjusted EBITDA to be between $450 million and $470 million. Both of these financial guidance items exclude any material tuck-ins we might complete throughout 2023. For the first quarter of 2023, we expect revenue between $520 million and $540 million and adjusted EBITDA of between $90 million and $95 million.

正如我們上個月在 ICR 會議上分享的那樣，對於 2023 年全年，我們預計收入將增加到 23 億美元至 23.5 億美元，正常收入增長率在 6% 至 8% 之間。我們預計 2023 年全年調整後的 EBITDA 將在 4.5 億美元至 4.7 億美元之間。這兩項財務指導項目均不包括我們可能在整個 2023 年完成的任何重大調整。對於 2023 年第一季度，我們預計收入在 5.2 億美元至 5.4 億美元之間，調整後的 EBITDA 在 9000 萬至 9500 萬美元之間。

Finally, I will reiterate that our strategy is working. We are confident in our ability to deliver our 2023 guidance as well as our longer-term outlook. I will now turn the call over to our CFO, David Haas, to review our fourth quarter financial results in greater detail. David?

最後，我要重申我們的戰略正在奏效。我們對我們提供 2023 年指導以及長期展望的能力充滿信心。我現在將電話轉給我們的首席財務官大衛哈斯，以更詳細地審查我們第四季度的財務業績。大衛？

Thank you, Tom, and good morning, everyone. Before reflecting on the results of the quarter, I wanted to begin by expressing my excitement to lead great teams across accounting, treasury, finance and strategy. I've been involved in the Primo business since 2009, preparing for legacy Primo's initial public offering and have worked with Tom since 2013 when we began to work on a production and distribution agreement.

謝謝你，湯姆，大家早上好。在回顧本季度的業績之前，我想首先表達我對領導會計、財務、財務和戰略方面的優秀團隊的興奮之情。自 2009 年以來，我一直參與 Primo 業務，為傳統 Primo 的首次公開募股做準備，並自 2013 年開始與 Tom 合作，當時我們開始製定生產和分銷協議。

Over the past decade plus, the execution of our strategy grew dispenser sell-through from approximately 240,000 units to approximately 1 million units in 2022. The increase in household and small business penetration with our dispensers has created a business with forecasted highly recurring revenue in excess of $2.3 billion, supplying close to 1 billion gallons annually for consumers. Even with this impressive growth, we believe we have just begun to realize the vision and potential of the Primo business.

在過去十年多的時間裡，我們戰略的執行使分配器的銷量從大約 240,000 台增加到 2022 年的大約 100 萬台。我們的分配器在家庭和小型企業中的滲透率增加，創造了一個業務，預計經常性收入超額23 億美元，每年為消費者供應近 10 億加侖。即使有了這種令人印象深刻的增長，我們相信我們才剛剛開始意識到 Primo 業務的願景和潛力。

Starting with our fourth quarter results. Consolidated revenue increased 3% to $533 million compared to $518 million. Excluding the impact of foreign exchange, normalized revenue increased 14% for the quarter. As Tom mentioned earlier, normalized revenue excludes the revenue of the exited North America single-use bottled water retail business and the exit of our business in Russia. Reported revenue for the year 2021 includes $142.1 million of revenue associated with our single-use business and $13.6 million of revenue associated with our Russia business.

從我們的第四季度業績開始。綜合收入從 5.18 億美元增長 3% 至 5.33 億美元。排除外彙的影響，本季度標準化收入增長了 14%。正如湯姆之前提到的，標準化收入不包括退出的北美一次性瓶裝水零售業務和我們在俄羅斯的業務退出的收入。 2021 年報告的收入包括與我們的一次性業務相關的 1.421 億美元收入和與我們的俄羅斯業務相關的 1360 萬美元收入。

Reported revenue for the year 2022 includes $41 million of revenue associated with our single-use business and $7.4 million of revenue associated with our Russia business. Adjusted EBITDA grew 9% to $107 million, which represents a 110 basis point of margin expansion. Excluding the impact of foreign exchange, adjusted EBITDA grew 12%. The effect of price increases, volume growth and strong demand increased profitability. During the quarter, we maintained targeted staffing levels and have more than 98% of route delivery physicians bill. We are confident that the incremental investments in our people and the use of predictive staffing models will enable us to deliver our 2023 targets and beyond. Turning to our segment level performance for the quarter.

2022 年的報告收入包括與我們的一次性業務相關的 4100 萬美元收入和與我們的俄羅斯業務相關的 740 萬美元收入。調整後的 EBITDA 增長 9% 至 1.07 億美元，這意味著利潤率增長了 110 個基點。排除外彙的影響，調整後的 EBITDA 增長了 12%。價格上漲、銷量增長和強勁需求的影響提高了盈利能力。在本季度，我們保持了目標人員配置水平，並有超過 98% 的路線分娩醫生收費。我們相信，對員工的增量投資和預測性人員配備模型的使用將使我們能夠實現 2023 年及以後的目標。轉向我們本季度的細分市場表現。

North America revenue increased 5% to $405 million compared to $387 million. Excluding the impact of foreign exchange, normalized revenue increased 14%. The Organic revenue grew by 16% in Water Direct and Water Exchange, which included 11% price or mix and 5% volume growth, continuing a pattern of consistent price and volume growth throughout the year. Adjusted EBITDA in North America increased 13% to $96 million. In our Europe segment, revenue decreased by 1% to $60 million. Excluding the impact of foreign exchange, normalized revenue increased 20%, with growth in our residential customer base and B2B volume as Europeans returned to the office. Adjusted EBITDA in the Europe segment increased 33% to $10 million. Excluding the impact of foreign exchange, adjusted EBITDA increased 53%. Our 2022 results of $2.215 billion in revenue, $420 million of adjusted EBITDA and 70 basis points of adjusted EBITDA margin enhancement confirm our strategy is working, and we are on track to deliver our 2023 and long-term outlook.

北美收入從 3.87 億美元增長 5% 至 4.05 億美元。排除外匯影響，正常化收入增長 14%。 Water Direct 和 Water Exchange 的有機收入增長了 16%，其中包括 11% 的價格或混合增長以及 5% 的銷量增長，延續了全年價格和銷量持續增長的模式。北美調整後的 EBITDA 增長 13% 至 9600 萬美元。在我們的歐洲分部，收入下降 1% 至 6000 萬美元。排除外彙的影響，隨著歐洲人重返辦公室，我們的住宅客戶群和 B2B 交易量有所增長，正常化收入增長了 20%。歐洲業務的調整後 EBITDA 增長 33% 至 1000 萬美元。排除外彙的影響，調整後的 EBITDA 增長了 53%。我們 2022 年 22.15 億美元的收入、4.2 億美元的調整後 EBITDA 和 70 個基點的調整後 EBITDA 利潤率提升證實了我們的戰略正在發揮作用，我們有望實現 2023 年和長期展望。

Turning to our Q1 and full year outlook. We expect consolidated revenue from continuing operations for the first quarter to be between $520 million and $540 million and that our first quarter adjusted EBITDA will be in the range of $90 million to $95 million. As a reminder, our Q1 is typically seasonally softer with lower volumes and adjusted EBITDA margins as part of the shoulder seasons in water demand. For the full year 2023, revenue is projected to be between $2.3 billion and $2.35 billion with normalized revenue growth in the range of 6% to 8%.

轉向我們的第一季度和全年展望。我們預計第一季度來自持續經營業務的綜合收入在 5.2 億美元至 5.4 億美元之間，我們第一季度調整後的 EBITDA 將在 9000 萬至 9500 萬美元之間。提醒一下，我們的第一季度通常季節性疲軟，產量較低，調整後的 EBITDA 利潤率是水需求淡季的一部分。 2023 年全年收入預計在 23 億美元至 23.5 億美元之間，正常收入增長率在 6% 至 8% 之間。

We expect full year 2023 adjusted EBITDA to be between $450 million and $470 million. We expect $20 million to $25 million of cash taxes, which is higher than historical run rates due to the utilization of net operating losses or NOLs related to the tax impact of the property sales in California and the increased earnings power of our Water Your Way platform. In addition, we are limited to the amount of NOLs we can use each year, but we have substantial NOLs available in 2023 and 2024 before the amounts start to significantly decline in 2025. If we were to sell a similar amount of properties in 2023 as compared to 2022, we could see an additional tax impact of approximately $10 million. We expect approximately $70 million to $75 million of interest expense.

我們預計 2023 年全年調整後的 EBITDA 將在 4.5 億美元至 4.7 億美元之間。我們預計將產生 2000 萬至 2500 萬美元的現金稅，這高於歷史運行率，這是由於使用了與加利福尼亞房地產銷售的稅收影響相關的淨運營虧損或 NOL，以及我們的 Water Your Way 平台的盈利能力增強.此外，我們每年可以使用的 NOL 數量有限，但在 2025 年數量開始大幅下降之前，我們在 2023 年和 2024 年有大量可用的 NOL。如果我們在 2023 年出售類似數量的房產與 2022 年相比，我們可以看到大約 1000 萬美元的額外稅收影響。我們預計利息支出約為 7000 萬至 7500 萬美元。

The amount of interest expense paid could be lower depending on our capital allocation and potential reduction in our revolver. Our 2023 CapEx guidance consists of 7% of revenue, plus an incremental $30 million for a total of approximately $200 million. As a reminder, we decided that during 2023 and 2024, we will invest approximately $30 million per year as opposed to the $50 million noted in our November 2021 Investor Day. This decision is based upon our confidence and run rate performance that enables us to reduce the investment dollars and deliver the 2023 and 2024 outlook. Key initiatives to be funded from our CapEx plan include driving digital growth, leading dispenser innovation, building a more environmentally friendly fleet, installing more efficient water production lines, which will reduce water usage and increase productivity and driving growth in refill and filtration with our on-the-go units and new filtration innovations.

支付的利息費用可能會更低，這取決於我們的資本配置和我們循環貸款的潛在減少。我們的 2023 年資本支出指導包括收入的 7%，加上增量的 3000 萬美元，總計約 2 億美元。提醒一下，我們決定在 2023 年和 2024 年期間每年投資約 3000 萬美元，而不是我們在 2021 年 11 月投資者日提到的 5000 萬美元。該決定基於我們的信心和運行率表現，這使我們能夠減少投資並實現 2023 年和 2024 年的展望。我們的資本支出計劃資助的主要舉措包括推動數字增長、引領飲水機創新、建立更環保的車隊、安裝更高效的水生產線，這將減少用水量並提高生產率，並通過我們的 on -移動裝置和新的過濾創新。

We expect to return to our normalized total CapEx spend of approximately 7% of revenue in 2025. Our 2022 performance reinforces our confidence in our ability to deliver sustained organic revenue growth. Supporting the organic growth outlook are recent gains in new points of distribution in our exchange business, geographic expansion of Costco in-store events, resulting in an increase in the number of events in North America in our Water Direct business as well as the improved performance of our refill business. These gains are a result of our commitment to improve the customer experience through increased service levels as well as continuing investments in the digital experience, customer satisfaction and operating efficiencies.

我們預計到 2025 年，我們的正常資本支出總額將恢復到約佔收入的 7%。我們 2022 年的業績增強了我們對實現持續有機收入增長能力的信心。支持有機增長前景的是最近我們交換業務新分銷點的收益，Costco 店內活動的地域擴張，導致我們 Water Direct 業務在北美的活動數量增加以及業績改善我們的筆芯業務。這些收益是我們致力於通過提高服務水平以及對數字體驗、客戶滿意度和運營效率的持續投資來改善客戶體驗的結果。

As we mentioned in Q3, we continue to explore opportunities to monetize properties that have seen significant appreciation in value, and we are in the process of marketing additional properties this year. We were able to close on 2 properties during the fourth quarter for an aggregate total of approximately $50 million. We plan to use the net proceeds of these property sales to fund components of our capital allocation plan, including, among other things, debt reduction and our opportunistic share repurchase program. As part of the opportunistic share repurchase program, during 2022, we repurchased approximately $24 million and as of February 20, approximately $6 million year-to-date.

正如我們在第三季度提到的那樣，我們繼續探索將價值顯著升值的物業貨幣化的機會，並且我們今年正在營銷更多物業。我們能夠在第四季度關閉 2 個物業，總計約 5000 萬美元。我們計劃使用這些物業銷售的淨收益為我們的資本配置計劃的組成部分提供資金，其中包括減債和我們的機會性股票回購計劃。作為機會性股票回購計劃的一部分，我們在 2022 年回購了約 2400 萬美元，截至 2 月 20 日，回購了約 600 萬美元。

The repurchase program reflects the Board's confidence in our future performance and our continued long-term cash flow generation and demonstrates our ongoing commitment to providing value for our shareholders. We remain focused on reducing our net leverage ratio to below 3x by the end of 2023 and to less than 2.5x by the end of 2024. As a reminder, our current debt maturities are in 2028 and 2029, and we, therefore, have no reason or benefit to refinance any of our debt at this time and are pleased with our current debt structure.

回購計劃反映了董事會對我們未來業績和持續長期現金流產生的信心，並表明我們對為股東提供價值的持續承諾。我們仍然專注於到 2023 年底將淨槓桿率降至 3 倍以下，到 2024 年底降至 2.5 倍以下。提醒一下，我們目前的債務到期時間是 2028 年和 2029 年，因此我們沒有目前為我們的任何債務再融資的理由或利益，並對我們目前的債務結構感到滿意。

Our 2024 outlook supports our planned multiyear dividend step-up that we will return an incremental $36 million to shareholders through 2024. This is on top of our previously announced plans for incremental investment to fuel top line and bottom line growth. Regarding our tuck-in M&A. For 2023, we expect to invest $20 million to $30 million as we focus on our organic growth as well as take a patient approach due to macroeconomic factors that might weigh more on smaller operators. In recognition of our 2022 results, strong financial position and confidence in the future of Primo, yesterday, our Board of Directors authorized a quarterly dividend of $0.08 per common share, which represents a 14% increase over previous quarterly dividend and marks the second consecutive year the Board has increased the quarterly dividend. I'm excited for the opportunities that we have in front of us. I believe we have the right plan and the right team to win. Our customers, associates and shareholders can all share in our success as consumers migrate to our healthy hydration solutions. I will now turn the call back to Tom.

我們的 2024 年展望支持我們計劃的多年期股息增加計劃，即到 2024 年我們將向股東增加返還 3600 萬美元。這是我們之前宣布的增量投資計劃的基礎，以推動頂線和底線增長。關於我們的併購。到 2023 年，我們預計將投資 2000 萬至 3000 萬美元，因為我們專注於我們的有機增長，並由於宏觀經濟因素可能對較小的運營商產生更大的影響而採取耐心的方法。鑑於我們 2022 年的業績、強勁的財務狀況和對 Primo 未來的信心，昨天，我們的董事會批准了每股普通股 0.08 美元的季度股息，比上一季度股息增加 14%，這是連續第二年董事會增加了季度股息。我為擺在我們面前的機會感到興奮。我相信我們有正確的計劃和正確的團隊來取勝。隨著消費者轉向我們的健康水化解決方案，我們的客戶、員工和股東都可以分享我們的成功。我現在將電話轉回給湯姆。

Thanks, David. We are pleased with last year's results and are excited about our future. We are one of the only pure-play water platforms that benefit from a predictable and resilient revenue base, well balanced with the residential and B2B customer base. Our high single-digit long-term growth targets are driven by the connectivity of water dispensers to our water solutions with supporting consumer tailwinds to include focus on health and wellness and concerns with aging global water infrastructure. We have a healthy balance sheet, a compelling long-term growth outlook and an attractive margin profile that has risen to more than 20% in the last 2 quarters.

謝謝，大衛。我們對去年的成績感到滿意，並對我們的未來感到興奮。我們是唯一受益於可預測和彈性收入基礎的純水務平台之一，與住宅和 B2B 客戶群保持平衡。我們的高個位數長期增長目標是由飲水機與我們的水解決方案的連接性以及支持消費者的順風推動的，包括對健康和保健的關注以及對全球水基礎設施老化的擔憂。我們擁有健康的資產負債表、令人信服的長期增長前景和極具吸引力的利潤率，在過去兩個季度中已上升至 20% 以上。

Once again, I'd like to thank the Primo Water associates across the business for their tireless efforts to serve our customers. With that, I will turn the call back over to Jon for Q&A.

再次，我要感謝整個公司的 Primo Water 員工為服務我們的客戶所做的不懈努力。有了這個，我會把電話轉回給喬恩進行問答。

Thanks, Tom. During the Q&A, to ensure we can hear from as many of you as possible, we would ask for a limit of one question and one follow-up per person. Thank you. Operator, please open the line for questions.

謝謝，湯姆。在問答環節，為確保我們能聽到盡可能多的人的意見，我們會要求每人限制一個問題和一個跟進。謝謝。接線員，請打開問題線路。

Thank you, sir. Ladies and gentlemen, we will now begin the question-and-answer session. (Operator Instructions) Your first question will come from Derek Lessard at TD Securities.

謝謝你，先生。女士們，先生們，我們現在開始問答環節。 （操作員說明）您的第一個問題將來自道明證券的 Derek Lessard。

Congratulations on a really solid year.

祝賀你度過了非常充實的一年。

Thanks, Derek. Appreciate it.

謝謝，德里克。欣賞它。

Maybe, guys, just coming back to the dispenser sales for a second. I was curious how much visibility you have on that line item in particular? And should we be modeling going forward similar to what we saw in Q4 levels? And then I guess whether there's any -- is there any tie-in between the sell-in and sell-through?

也許，伙計們，只是回到分配器銷售一秒鐘。我很好奇您對該訂單項的可見度有多少？我們是否應該像我們在 Q4 關卡中看到的那樣進行建模？然後我猜是否有任何 - 銷售和銷售之間是否有任何联系？

Yes, I'll take the second part of your question first, Derek, then obviously, this is maybe not obviously, this is Tom. The key performance number we look at is that the dispenser sell-through, and that is how many dispensers are purchased by consumers through our brick-and-mortar and/or e-commerce customers? And this year, in 2022, we sold just about $1 million, which is the second best year that we've ever had, and we had a 50% increase in Q4. What's important is that's a sign of new customers coming to the category that will convert into water users, and it could enjoy the water from either water direct an exchange, they can enjoy from water refill. So, we're quite pleased with that sell-through, and that will continue to feed the ongoing order growth in our Water segment.

是的，我會先回答你問題的第二部分，Derek，然後顯然，這可能不是很明顯，這是 Tom。我們關注的關鍵績效數字是分配器的銷售率，即消費者通過我們的實體店和/或電子商務客戶購買了多少分配器？而今年，也就是 2022 年，我們的銷售額僅為 100 萬美元左右，這是我們有史以來第二好的年份，而且我們在第四季度增長了 50%。重要的是，這是新客戶進入該類別的標誌，他們將轉變為用水者，他們可以直接從水交換中享受水，他們可以通過加水享受水。因此，我們對銷售情況感到非常滿意，這將繼續推動我們水部門的訂單持續增長。

Our challenge in Q4, and as I said in my prepared comments, we expect some inventory challenges through 2023 is really the amount of inventory that retailers purchased during 2022 as a result of all the supply chain issues, whether it's all the delays in the port, the elevated costs and retailers we experienced beginning to bring those inventories down during Q4. The sell-in is interesting, but it has no impact really on our water performance on the connectivity and is really unrelated to the sell-through. So as those inventories normalize through 2023, we would expect that -- it will have soft revenues for us and dispensers. But importantly, we expect to continue to see elevated levels of dispenser sell-through. And that's the key -- one of the key drivers of our growth algorithm. Obviously, we also have a rental business in our water dispenser side. So that business is unimpacted by that inventory, and you see it in the solid growth in our Water Direct business...

我們在第四季度面臨的挑戰，正如我在準備好的評論中所說，我們預計到 2023 年將面臨一些庫存挑戰，實際上是由於所有供應鏈問題導致零售商在 2022 年購買的庫存量，無論是港口的所有延誤，我們經歷的高成本和零售商開始在第四季度降低這些庫存。銷售很有趣，但它對我們在連接方面的水性能沒有真正的影響，並且與銷售無關。因此，隨著這些庫存在 2023 年之前恢復正常，我們預計——我們和配藥商的收入將會疲軟。但重要的是，我們預計飲水機銷售量將繼續上升。這就是關鍵——我們增長算法的關鍵驅動力之一。顯然，我們飲水機端也有租賃業務。因此，該業務不受該庫存的影響，您可以在我們的 Water Direct 業務的穩健增長中看到它......

Okay. That's helpful. And maybe there's a big difference between your North American and European margins. Could you just maybe remind us how much of that is structural? And maybe what's a reasonable expectation for closing that gap? And over what period do you think you could do that?

好的。這很有幫助。也許您的北美和歐洲利潤率之間存在很大差異。您能否提醒我們其中有多少是結構性的？也許什麼是縮小差距的合理期望？您認為您可以在什麼時期內做到這一點？

Yes. We had -- we began to close the gap in 2022, and you saw -- we saw -- we enjoyed good numbers from Europe in '22, particularly in Q4 where we had adjusted for FX, something on the order of 50% increase in adjusted EBITDA with FX, it was 33% and 20% revenue growth. So we're pretty happy where the business is. Here's the good news is we haven't yet gotten back to pre-pandemic levels. So we view it as continued upside in growth on a go forward as Europeans continue to return to work. So, we'd expect in the next, I haven't put out a guide to that, but we'd expect to get back to pre-pandemic level over the course of the next year or 2, all things considered equal at this point. So, we're quite pleased with the progress we made there. And we see it getting back to pre-pandemic levels, which will mirror ultimately the margin construct of the North American business.

是的。我們已經——我們在 2022 年開始縮小差距，你看到了——我們看到了——我們在 22 年獲得了來自歐洲的良好數據，尤其是在第四季度，我們針對外匯進行了調整，大約增長了 50%在調整後的 EBITDA 和 FX 中，收入分別增長了 33% 和 20%。所以我們對業務所在非常滿意。好消息是我們還沒有回到大流行前的水平。因此，隨著歐洲人繼續重返工作崗位，我們認為這是未來增長的持續上行空間。所以，我們預計在接下來，我還沒有為此制定指南，但我們預計在明年或兩年內恢復到大流行前的水平，目前所有條件都被認為是平等的觀點。因此，我們對在那裡取得的進展感到非常滿意。我們看到它回到大流行前的水平，這最終將反映北美業務的利潤結構。

Okay. That's fair. And maybe one for David. Congratulations on the new role. Curious, just maybe about your high-level thoughts and expectations as you begin a new journey.

好的。這還算公平。也許一個給大衛。祝賀你擔任新角色。好奇，也許只是關於您開始新旅程時的高層次想法和期望。

Yes. Thanks, Derek. I think mostly I've been around the business for a while. So, when you look at either my time in banking or actually as an employee of either of the companies now New Primo. It's been about 1/3 of my life, and I've been very dedicated to seeing and overseeing the strategic architecture. So, for me, it's a short learning curve around who we are. Even to that degree, when I was at Legacy Primo, Tom and I had a very close business relationship, and I understood the merits of the Water Direct opportunity. So now having all 3 of those services, plus the attractive nature of filtration and different geographies is even more complementary to the opportunity.

是的。謝謝，德里克。我想主要是我已經在這個行業工作了一段時間。所以，當你看看我在銀行業的時間，或者實際上作為任何一家公司的員工，現在是 New Primo。這已經佔據了我生命的大約 1/3，我一直非常專注於查看和監督戰略架構。所以，對我來說，這是一個關於我們是誰的簡短學習曲線。即使在那個程度上，當我在 Legacy Primo 時，Tom 和我有著非常密切的業務關係，而且我了解 Water Direct 機會的優點。因此，現在擁有所有這 3 種服務，加上過濾的吸引力和不同的地理位置，對這個機會更具互補性。

More importantly, a great team around me, really excited to have worked with a lot of these partners for a bit. And really, the approach we have, and Tom and I will be out there is consistently telling our story. We want people to understand that new Primo does not look like either of its predecessors, and we're here to shape water connectivity to our dispensers and really change the way consumers can hydrate...

更重要的是，我周圍有一個很棒的團隊，很高興能與這些合作夥伴一起工作一段時間。事實上，我們所採用的方法，湯姆和我將一直在講述我們的故事。我們想讓人們明白，新的 Primo 看起來不像它的任何一個前輩，我們在這裡塑造水與我們的飲水機的連接，真正改變消費者補水的方式......

Thanks for that gentlemen.

謝謝那位先生。

Your next question comes from Andrea Teixeira of JPMorgan.

你的下一個問題來自摩根大通的 Andrea Teixeira。

This is Drew Levine on for Andrea. And David, you -- so first, I wanted to kind of follow back on the dispenser discussion. So clearly, a shortfall in the quarter and you're suggesting some more pressure in '23 perhaps but reiterated the top line and EBITDA guidance for '23. So just curious maybe where you're feeling more bullish on the underlying business, the underlying water business? And perhaps if that should lead to faster EBITDA growth in that -- those are obviously EBITDA positive businesses.

這是安德里亞的德魯萊文。大衛，你 - 首先，我想跟進關於分配器的討論。很明顯，本季度出現短缺，你可能暗示 23 年會有更多壓力，但重申了 23 年的頂線和 EBITDA 指導。所以只是好奇，也許你對基礎業務、基礎水業務更看好哪裡？也許如果這會導致更快的 EBITDA 增長——這些顯然是 EBITDA 積極的業務。

Yes, if you look -- thanks, Drew. Of course, dispenser sell-through, we expect to continue. -- right? So that is the key component of the Razor. Our razor blades have performed quite nicely. Our Q4 performance in Water Direct 14% in revenue in North America and a 20% growth in Europe. So clearly, there are a good performance, growing the revenue. And in North America, it is a combination of price and volume.

是的，如果你看——謝謝，德魯。當然，我們預計飲水機銷售會繼續下去。 - 正確的？所以這是 Razor 的關鍵組件。我們的剃須刀刀片表現非常出色。我們在 Water Direct 的第四季度業績在北美的收入增長了 14%，在歐洲增長了 20%。很明顯，有一個很好的表現，增加了收入。在北美，它是價格和數量的結合。

So North America volume was up 5% organic volume growth, which is a continuation of both price and the elasticity of our business and the volume growth, which says that more customers consuming more water both from customers we sign up as a result of dispenser sell-through, but also from the benefit of programs like Costco and other tactics we execute on growing the water direct customer base. So, we're confident in our ability to continue to drive revenue and volume growth in that part of our business. And now you've seen also in our Refill and Filtration business, solid performance in Q4. That's a couple of quarters of consecutive growth. So, we think we're in a good place there, and we would expect to continue to see growth in that segment of our business. So, the model works. Our in-market tactics are working, and they're driving the revenue growth that we expect that's embedded in our growth algorithm for 2023, which is in the range of 6% to 8%. And obviously, that would contemplate some softness in dispensers.

因此北美銷量有機增長 5%，這是我們業務的價格和彈性以及銷量增長的延續，這表明由於飲水機銷售，更多的客戶從我們簽約的客戶那裡消耗了更多的水-通過，但也受益於 Costco 等計劃和我們執行的其他策略，以擴大水直接客戶群。因此，我們對繼續推動這部分業務的收入和銷量增長的能力充滿信心。現在你也看到了我們的補充和過濾業務在第四季度的穩健表現。這是連續幾個季度的增長。因此，我們認為我們在那里處於一個很好的位置，並且我們希望繼續看到我們業務的該部分的增長。因此，該模型有效。我們的市場策略正在發揮作用，它們正在推動我們預期的收入增長，這已嵌入我們 2023 年的增長算法中，該增長在 6% 至 8% 的範圍內。顯然，這會考慮分配器的一些柔軟性。

Perfect. And just following up on customer additions. So, it sounds like you're continuing to customers, the retention consistent. I guess following the quarter and any change that you're seeing year-to-date in consumer sign up? Are you having to kind of increase any promotional activity or introductory pricing to gain sign-ups? Or how you see that progressing through the year?

完美的。並且只是跟進客戶的增加。所以，聽起來你在繼續與客戶保持一致。我猜想在本季度之後以及您在消費者註冊方面看到的年初至今的任何變化？您是否必須增加任何促銷活動或介紹性定價才能獲得註冊？或者你如何看待這一年的進展？

Yes. Thanks, Drew. So, as we mentioned before, we signed that 5-year agreement with Costco, which gives us the ability exclusively to market our services to Costco, consumer and business members. We're building that program as we speak. It will accelerate as we go through the year. It's a key component of the water direct growth because it will bring more customers into the Primo family. It will build quarter-over-quarter, right? You don't start everything the first day of January, we build that capability. And we're quite pleased with the where we've started. We're also seeing good performance on our digital activities on our water.com and other sites. So, we're off to a good start within where we expected to be in middle of January -- middle of February, excuse me, in terms of the growth story in terms of revenue and volume from the water direct side, the same with our refill business. So, we're quite pleased with our stock...

是的。謝謝，德魯。因此，正如我們之前提到的，我們與 Costco 簽署了為期 5 年的協議，這使我們能夠獨家向 Costco、消費者和企業成員推銷我們的服務。我們正在構建該程序。隨著我們度過這一年，它會加速。它是水直接增長的關鍵組成部分，因為它將為 Primo 家族帶來更多客戶。它將按季度增長，對嗎？您不會在 1 月的第一天開始一切，我們會構建這種能力。我們對我們的起點非常滿意。我們在 water.com 和其他網站上的數字活動也取得了不錯的成績。因此，我們在 1 月中旬的預期中有一個良好的開端 - 2 月中旬，對不起，就直接供水方面的收入和數量增長故事而言，與我們的筆芯業務。所以，我們對我們的庫存非常滿意......

Your next question will come from Dan Moore at CJS Securities.

你的下一個問題將來自 CJS 證券的 Dan Moore。

It's Pete Lucas for Dan. Just in terms of the resi side, obviously, you had a big spike during the pandemic. Just curious what you're seeing in terms of consumer purchasing power and discretionary spending. Has that softened at all in recent months? And any trends you're seeing there?

丹是皮特·盧卡斯。就 resi 方面而言，顯然，在大流行期間你有一個很大的峰值。只是好奇您在消費者購買力和可自由支配支出方面看到了什麼。近幾個月來，這種情況有所緩和嗎？你在那裡看到了什麼趨勢？

Yes. Pete, and thanks for joining. Our residential performance is greater than pre-pandemic levels. Obviously, you may recall those questions about what was the stickiness of the residential customer base as it grew through the pandemic. I'm happy to report it's sticky. There was not a trade from commercial to residential, and our residential business is higher than it was in 2019 pre-pandemic.

是的。皮特，感謝您的加入。我們的住宅性能高於大流行前的水平。顯然，您可能還記得那些關於住宅客戶群在大流行期間增長的粘性的問題。我很高興地報告它很粘。沒有從商業到住宅的交易，我們的住宅業務高於 2019 年大流行前的水平。

We benefitted from commercial customers for us, B2B in North America and real commercial office space in Europe, still not all the way back to pre-pandemic, but we expect that we'll benefit from that return in our growth algorithm over the course of -- hopefully only 23, but 23% in 2024. So very sticky delivering what we wanted, better than it was pre-pandemic. So we're quite pleased in the mix of the customer base. And on an account basis, think of our business -- I'll use North America, about 50-50 in terms of customer count, 50% residential, 50% B2B or commercial. And on the revenue side, it's roughly 60% residential and 40% commercial, just to give you context. So, we're quite pleased with the current construct.

我們受益於我們的商業客戶，北美的 B2B 和歐洲的實際商業辦公空間，仍然沒有回到大流行前，但我們預計我們將在增長算法中受益於這種回報--希望只有 23 個，但到 2024 年會達到 23%。交付我們想要的東西非常有粘性，比大流行前要好。因此，我們對客戶群的組合感到非常滿意。在帳戶的基礎上，想想我們的業務——我將使用北美，大約 50-50 的客戶數量，50% 的住宅，50% 的 B2B 或商業。在收入方面，它大約是 60% 的住宅和 40% 的商業，只是為了給你提供背景信息。因此，我們對當前的結構非常滿意。

Very helpful. And just one more for me. In terms of margin benefits that you expect to achieve, if raw materials and input costs continue to pull back, just any sense of what we could expect there?

很有幫助。還有一個給我。就您期望實現的利潤率收益而言，如果原材料和投入成本繼續回落，我們可以期待什麼？

We enjoyed not about what was at $74 million of inflationary costs, which on a full year basis, roughly 10% increase. So, a big component of that is labor. So, we don't expect labor to come back, right? So that's one that will continue. Fuel will come back some. We do have an energy surcharge and it offsets the fuel. So, the energy surcharge will go up and down with how fuel may come back down. Hopefully, it continues on its current trend. And freight comes back. Think about freight, though, a large component of freight related to the dispenser business. So the dispenser business park CapEx, we would expect to see some mitigation in those costs over the course of the year. And we -- our current view would incorporate some of that into our current guidance, both in the quarter and for the full year.

我們不喜歡 7400 萬美元的通貨膨脹成本，全年增長約 10%。因此，其中很大一部分是勞動力。所以，我們不希望分娩回來，對嗎？所以這將繼續下去。燃料會回來一些。我們確實有能源附加費，它抵消了燃料。因此，能源附加費將隨著燃料可能回落的方式而上下波動。希望它繼續保持目前的趨勢。運費回來了。不過想想運費，很大一部分運費與分配器業務相關。因此，分配器業務園區資本支出，我們預計在這一年中這些成本會有所緩解。我們——我們目前的觀點會將其中的一些納入我們目前的指導方針中，包括本季度和全年。

Very helpful. I'll jump back in the queue. Appreciate.

很有幫助。我會跳回到隊列中。欣賞。

Your next question will come from John Zamparo at CIBC.

您的下一個問題將來自 CIBC 的 John Zamparo。

Thanks. Good morning, guys, and welcome, David. My question is on free cash flow generation and in particular working capital. And in prepandemic years, this was generally neutral to positive for what Primo was. It's been a meaningful drag from 2020 now through to 2022. So I wonder has something changed structurally here? And do you expect you'll need to keep investing in working capital in 2023?

謝謝。早上好，伙計們，歡迎您，大衛。我的問題是關於自由現金流的產生，尤其是營運資金。在大流行前幾年，對於 Primo 來說，這通常是中性到積極的。從 2020 年到 2022 年，這是一個有意義的拖累。所以我想知道這裡是否發生了結構性變化？您是否預計您需要在 2023 年繼續投資營運資金？

Yes, John, I'll take a high level, and then I'll flip it over to David for perhaps a little bit more granular. I really view working capital as a 2022 phenomenon. -- largely, driven by the supply chain challenges we faced. So, if you said on a high level, we don't -- hopefully, those supply chains anomaly, in my opinion, in 2022, don't repeat themselves. But the biggest change -- biggest changes in our working capital were related to decisions we made on working capital and as a result of that supply chain. But let me flip it to David for some more color.

是的，John，我先講一個高層次的問題，然後我會把它交給 David，也許更詳細一點。我確實將營運資金視為 2022 年的現象。 - 主要是受到我們面臨的供應鏈挑戰的推動。所以，如果你在高層說，我們不會——希望那些供應鏈異常，在我看來，在 2022 年不會重演。但最大的變化——我們營運資金的最大變化與我們對營運資金做出的決定以及供應鏈的結果有關。但是讓我把它轉給大衛以獲得更多顏色。

Yes. So, John, on dispensers, whether imported for use in our rental float or imported to then supply domestically to retailers, both of those would have been impacted negatively by the tariff percentage. So, on a like-for-like basis, a single dispenser would have impacted working capital that much higher due to the tax, if you will, or call it a tariff of the percentage. And so, when we talk about sell-in versus sell-through at least of the retail-oriented dispensers, both we and our retail partners increased inventory to support storages, challenges, et cetera, that most of the supply chain faced. And so that would have been the largest contributor to the working capital change on a year-over-year basis.

是的。因此，約翰，在分配器上，無論是進口用於我們的租賃浮動還是進口然後在國內供應給零售商，這兩者都會受到關稅百分比的負面影響。因此，在類似的基礎上，單個分配器會因稅收而對營運資金產生更高的影響，如果你願意的話，或者稱之為百分比關稅。因此，當我們至少談論面向零售的分配器的銷售與銷售時，我們和我們的零售合作夥伴都增加了庫存以支持大多數供應鏈面臨的存儲、挑戰等。因此，這將是營運資本同比變化的最大貢獻者。

So, it's a combination of the tariff, $0.25 on a dollar higher and the fact that we eyes-wide-open increased the inventory levels to meet growing consumer demand.

因此，這是關稅、每美元上漲 0.25 美元以及我們睜大眼睛增加庫存水平以滿足不斷增長的消費者需求這一事實的結合。

Correct. And so on a like-for-like basis, if we bring in the same quantity of dispensers on any annualized level in '23, they will cost $0.25 on the dollar less.

正確的。因此，在類似的基礎上，如果我們在 23 年的任何年化水平上引入相同數量的分配器，它們的成本將減少 0.25 美元。

Got it. Okay. That's helpful. And then my follow-up is it's twofold, both housekeeping items. There was roughly $10 million worth of SG&A costs added back to EBITDA. Can you say what that consisted of? And secondly, can you confirm the plan for buybacks for 2023 is still roughly $75 million.

知道了。好的。這很有幫助。然後我的後續行動是雙重的，都是家政用品。 EBITDA 中增加了大約 1000 萬美元的 SG&A 成本。你能說出那是由什麼組成的嗎？其次，您能否確認 2023 年的回購計劃仍約為 7500 萬美元。

Yes. So, I'll start with the second one clearly just to clarify something put in the supplemental. That would have been a year-to-date value, and it is not a change in our repurchase program. So, the residual value left of that repurchase program as it meets sort of thresholds and criteria will still be executed. So, the monetary value mentioned would have only been the year-to-date value. It is not a change and prescribe sort of look at the program.

是的。所以，我將從第二個開始，清楚地說明補充中的內容。那將是年初至今的價值，而不是我們回購計劃的變化。因此，該回購計劃的剩餘價值在滿足某種閾值和標準時仍將被執行。因此，提到的貨幣價值只是年初至今的價值。這不是改變和規定那種看程序的。

So, our full year authorization was $100 million. which happens to be part '22 and '23. And through a week or so ago, we've so far repurchased about $30 million. Right? So, it's -- we're still authorized up to an incremental $70 million opportunistically.

所以，我們全年的授權是 1 億美元。這恰好是 '22 和 '23 的部分。大約一周前，我們已經回購了大約 3000 萬美元。正確的？所以，它是 - 我們仍然有機會獲得高達 7000 萬美元的增量授權。

To the first part of your question, that would be a complete noncash related item. As we sold properties, we had some subleases related to that, and that's an accounting charge simply to a mark-to-market accounting. So, they know what our rates are in the market and what our current relationship is with that subtenant. And so, it's just a noncash charge, the majority of that value.

對於你問題的第一部分，那將是一個完整的非現金相關項目。當我們出售房產時，我們有一些與此相關的轉租，這只是按市值計算的會計費用。因此，他們知道我們在市場上的利率以及我們目前與該轉租人的關係。因此，這只是一項非現金費用，佔該價值的大部分。

Understood. That's helpful.

明白了。這很有幫助。

Your next question comes from Derek Dley at Canaccord. Derek.

您的下一個問題來自 Canaccord 的 Derek Dley。德里克。

Okay, just on your guidance for EBITDA for '23 and '24, for '23 at the midpoint, you've got about a 9.5% increase in EBITDA year-over-year. And then to get to your medium-term target for 2024, that implies a 15% increase on top of that midpoint for '23. So, can you just walk us through how you expect to get there and why you expect to see an acceleration in your EBITDA growth in '24 versus '23?

好的，根據你對 23 年和 24 年 EBITDA 的指導，對於 23 年的中點，EBITDA 同比增長約 9.5%。然後要達到 2024 年的中期目標，這意味著在 23 年的中點基礎上增加 15%。那麼，您能否向我們介紹一下您希望如何實現這一目標，以及為什麼您希望在 24 年和 23 年看到 EBITDA 增長加速？

Well, we're doing a couple of things. And we haven't provided all the details obviously in 2024. But I'll just share with you the way I think about it. So, our guide for our guidance for '23 is $450 million to $470 million. We know we have now exited completely the retail business. So, we'll get the flow through full benefit of having exited that business. We -- as we previously articulated we're making incremental capital investments and those capital investments are not all done, and there is future work to be done, which will help us improve operating efficiencies. So as an example, we talked about in the script, ARO.

好吧，我們正在做幾件事。我們顯然沒有在 2024 年提供所有細節。但我將與您分享我的想法。因此，我們對 23 年的指導是 4.5 億至 4.7 億美元。我們知道我們現在已經完全退出零售業務。因此，我們將通過退出該業務的全部好處來獲得流程。我們 - 正如我們之前所闡明的那樣，我們正在進行增量資本投資，而這些資本投資尚未全部完成，未來還有工作要做，這將有助於我們提高運營效率。因此，作為一個例子，我們在腳本中談到了 ARO。

So it's how do we use our Automated Route Optimization to improve route efficiency. We're quite pleased with the first, call it, 5 months of benefit from ARO, but there's more to come as a result of that one program as an example. Today, it's only in North America. It's not in Europe. We would expect over time to introduce that to Europe. Our first production line in that we talked about effectiveness and efficiency on a production line. So, we're -- we've been operating on a new line in L.A. about 10 days now, and it is on the path to produce the kind of benefits that we thought.

所以這就是我們如何使用我們的自動路線優化來提高路線效率。我們對第一次從 ARO 受益 5 個月感到非常滿意，但作為一個例子，作為一個項目的結果還有更多。今天，它只在北美。它不在歐洲。我們希望隨著時間的推移將其引入歐洲。我們在第一條生產線上討論了生產線的有效性和效率。所以，我們——我們已經在洛杉磯的一條新生產線上運營了大約 10 天，它正在產生我們認為的那種好處。

So, as you build to 24, it is runway performance and 2 quarters of improved adjusted EBITDA margin in Q3 and Q4, right, where we got over that short-term manager up 20%. The exit -- full exit of retail, further investments on that incremental CapEx to drive efficiency and that could true things like ARO and production. And of course, incremental revenue and the natural leverage that we get through our income statement as we continue to grow in that 6% to 8% range. So, it's a combination of those things that give us confidence in '23 and frankly, in 2024.

所以，當你建立到 24 時，它是跑道性能和第三季度和第四季度調整後的 EBITDA 利潤率的兩個季度的改進，正確的，我們超過了那個短期經理 20%。退出——零售業的全面退出，對增量資本支出的進一步投資以提高效率，這可能會像 ARO 和生產那樣成為現實。當然，隨著我們繼續在 6% 到 8% 的範圍內增長，我們通過損益表獲得的增量收入和自然槓桿。因此，正是這些因素的結合讓我們對 23 年和 2024 年充滿信心。

Okay. That's helpful. And then just following up on something you can do that a couple of times here, just your commercial business as it relates to pre-COVID levels. It sounds like you're not fully back, but pretty confident you'll get there in the next year or 2. Is there a major difference between North America and Europe, where you're at versus where you were pre-COVID? And can you give us some color on what that sort of magnitude of difference is?

好的。這很有幫助。然後只是跟進一些你可以在這裡做幾次的事情，只是你的商業業務，因為它與 COVID 之前的水平有關。聽起來您還沒有完全恢復，但很有信心您會在明年或兩年內到達那裡。北美和歐洲之間是否存在重大差異，您現在所在的位置與 COVID 之前的位置相比？你能給我們一些關於這種差異程度的顏色嗎？

Yes. The North America is closer... Right? Part of that is the construct of the differences in that commercial business, Derek. So the North America business is more B2B. So doctor's office, dentist office, Hair salon. In the European business, it's more larger commercial office. And the U.S. -- the North American business is in the early 90% return-ish and the European business would start with an 8, but making good recovery. So we see a clear path where we will absolutely benefit from growth in both of those over the course of the next year or 2. I can't predict if it's going to -- which quarter it's going to happen in, but we see continued improvement on both sides of the Atlantic. And hopefully, that gives you kind of order of magnitude of the difference between the 2 pieces.

是的。北美更近……對吧？部分原因是商業業務差異的構成，Derek。所以北美業務更多的是B2B。所以醫生辦公室，牙醫辦公室，美髮沙龍。在歐洲商業中，它是比較大的商業辦公室。而美國——北美業務處於 90% 的早期回報率，歐洲業務將從 8 開始，但復甦良好。因此，我們看到了一條清晰的道路，我們將在明年或兩年內從這兩個方面的增長中絕對受益。我無法預測它是否會 - 它會在哪個季度發生，但我們看到繼續大西洋兩岸的改善。希望這能為您提供兩件之間差異的數量級。

Your next question comes from Pavel Molchanov at Raymond James.

你的下一個問題來自 Raymond James 的 Pavel Molchanov。

Maybe back on the European aspect. Given the drop in the euro and the pound over the past year, you talked about the currency impact. Is this actually creating a more target-rich environment for you as a potential consolidator of M&A assets in Europe?

也許回到歐洲方面。鑑於過去一年歐元和英鎊的下跌，您談到了貨幣影響。作為歐洲併購資產的潛在整合者，這實際上是否為您創造了一個目標更加豐富的環境？

Yes, Pavel, thanks for the question. Our M&A, what we have articulated, both at ICR and in our prepared comments is we're going to be thoughtful and patient, and part of that is, we think inflation will have an impact on small operators over time. So frankly, we want to let that to have its effect, and we have a thick pipeline of opportunities, and we continue to look for the right ones, but we're not rushing to execute those in today's environment and want to be really patient about the ones that we do execute in 2023.

是的，帕維爾，謝謝你的提問。我們的併購，我們在 ICR 和我們準備好的評論中所表達的是，我們將深思熟慮和耐心，其中一部分是，我們認為通貨膨脹將隨著時間的推移對小型運營商產生影響。所以坦率地說，我們想讓它發揮作用，我們有很多機會，我們會繼續尋找合適的機會，但我們並不急於在今天的環境中執行這些機會，而是要非常耐心關於我們在 2023 年執行的那些。

Okay. Let me turn to the ESG road map. You talked about some of the initiatives you have in place. This is the first year with the commercial electric legal tax credit from the inflation Reduction Act -- are you starting to maybe look with more appetite on electric mobility for your truck fleet, at least in the U.S?

好的。讓我談談 ESG 路線圖。您談到了您已經採取的一些舉措。今年是通貨膨脹減少法案中商業電動合法稅收抵免的第一年——你是否開始對你的卡車車隊的電動汽車更有興趣，至少在美國是這樣？

Yes. The way we think about it is we certainly have a large appetite for it. We will focus on the lighter weight assets first. So, think about that Pavel as we have a large service fleet, which would be more like Vans. And largely, both in the U.S. and in Europe. So, we are looking at how we might begin to shift from gas powered into EV for the smaller assets. And we continue to look at larger assets to handle for the bigger beverage bodies, but we haven't found the right economic solution yet because the cost is still 3x what it would be for a propane-powered diesel for a propane-powered asset. So, we'll continue to look at propane for the bigger assets in the U.S., North America. We'll look to expand our exposure and use of not diesel or gas-powered assets for the smaller fleet. And we stay very diligent looking at other assets as we hope the economics get to a place where we can wisely invest the shareholders' dollar in that equation.

是的。我們考慮它的方式是我們當然對它有很大的胃口。我們將首先關注較輕的資產。所以，考慮一下 Pavel，因為我們擁有龐大的服務車隊，這更像是 Vans。主要是在美國和歐洲。因此，我們正在研究如何開始將小型資產從天然氣動力轉向電動汽車。我們繼續尋找更大的資產來處理更大的飲料機構，但我們還沒有找到合適的經濟解決方案，因為丙烷動力資產的成本仍然是丙烷動力柴油的 3 倍。因此，我們將繼續關注美國、北美更大資產的丙烷。我們將尋求擴大我們對小型機隊的非柴油或天然氣動力資產的敞口和使用。我們仍然非常勤奮地關注其他資產，因為我們希望經濟發展到一個我們可以明智地將股東的錢投資到這個等式中的地方。

Ladies and gentlemen, (Operator Instructions) your next question will come from Derek Lessard at TD Securities.

女士們，先生們，（操作員說明）您的下一個問題將來自道明證券的 Derek Lessard。

Yes. Just one follow-up for me. I was curious if you guys ever see, and I know it's part of the longer-term tailwinds. But I was curious if you ever see bumps in sales on the back of news events like the train derailment and water contamination in Ohio.

是的。對我來說只有一個後續行動。我很好奇你們是否見過，我知道這是長期順風的一部分。但我很好奇，您是否曾在俄亥俄州的火車出軌和水污染等新聞事件的背後看到銷售量的激增。

As I think about the aging water infrastructure and recently, plentas popped up again as an issue. And Jackson, Mississippi has a popped up again as an interest.

當我想到老化的水利基礎設施時，最近，plentas 作為一個問題再次出現。密西西比州的傑克遜再次引起人們的興趣。

We are in the process of getting some water into East Palestine hopefully today or tomorrow to support that community. We see a little bit of a bounce, and we're working hard to redeck some of our efforts to ensure that consumers know that we're a viable both an emergency solution, but a long-term solution as they begin to make choices about their healthy hydration solution. But it happens in small little blips, it's not a big event, right? So we don't see a big burst, but we see it meaningfully in some of these smaller geographies.

我們希望在今天或明天向東巴勒斯坦輸送一些水，以支持該社區。我們看到了一點反彈，我們正在努力重新調整我們的一些努力，以確保消費者知道我們是一個可行的緊急解決方案，但在他們開始做出選擇時，我們是一個長期解決方案他們的健康保濕解決方案。但它發生在很小的點點滴滴，這不是什麼大事，對吧？所以我們沒有看到大爆發，但我們在其中一些較小的地區看到了有意義的爆發。

Thanks. There are no further questions on the phone line. So, I will turn the conference back to Jon Kathol for any closing remarks.

謝謝。電話線上沒有其他問題。因此，我將把會議轉回 Jon Kathol 的閉幕詞。

Thanks, Michelle. We're excited to announce that Tom, David and I will be attending the Raymond James conference in Orlando on March 6 and the Bank of America Consumer and Retail Conference in Miami on March 14. We hope to see many of you there.

謝謝，米歇爾。我們很高興地宣布，湯姆、大衛和我將參加 3 月 6 日在奧蘭多舉行的 Raymond James 會議和 3 月 14 日在邁阿密舉行的美國銀行消費者和零售會議。我們希望能在那裡見到你們中的許多人。

This concludes Primo's fourth quarter results call. Thank you all for attending.

Primo 的第四季度業績電話會議到此結束。謝謝大家的出席。

Ladies and gentlemen, this does conclude the conference call for this morning. Thank you very much for your attendance. And would you please disconnect your lines.

女士們，先生們，今天上午的電話會議到此結束。非常感謝您的出席。請你斷開你的線路。