Primo Brands Corporation ( PRMB ) shares are trading lower on Thursday after worse-than-expected fourth-quarter earnings.

The company, which owns brands like Poland Spring and Pure Life, reported:

Fourth-quarter FY24 revenue growth of 28.6% year-on-year to $1.4 billion, missing the analyst consensus estimate of $1.58 billion.

Adj EPS of 13 cents also missed the consensus estimate of 18 cents.

Gross margin was 30.8% primarily driven by increased volumes with a 36.85 increase in gross profit to $430.1 million.

Selling, general and administrative expenses increased 56.3% to $335.9 million.

Primo Brands ( PRMB ) incurred an operating loss of $81 million, compared to an income of $88.6 million last year.

Adjusted EBITDA for the quarter improved 24.1% to $254.8 million and the margin contracted 70 basis points to 18.2%.

Primo held cash, cash equivalents and restricted cash of $614.4 million as of December end.

Operating cash flow for the quarter totaled 493.7 million with a free cash flow of 436.1 million.

Primo’s board declared a dividend of 10 cents per share, payable on March 24, in cash. The dividend applies to holders of record of such common stock of the company at the close of business on March 7, 2025.

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Outlook: For FY25, Primo sees net sales growth of 3% – 5%.The company expects adjusted EBITDA of $1.6 billion – $1.628 billion.

Primo expects adjusted free cash flow of $790 million – $810 million. Capital expenditure is expected to be 4% of net sales.

Price Action: PRMB shares are trading lower by 1.43% at $32.35 in premarket at last check Thursday.

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