Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 1-May-15 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Primo Water Corp | |
Entity Central Index Key | 1365101 | |
Current Fiscal Year End Date | -19 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 24,901,740 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash | $787 | $495 |
Accounts receivable, net | 10,717 | 9,010 |
Inventories | 5,844 | 6,826 |
Prepaid expenses and other current assets | 1,560 | 1,279 |
Total current assets | 18,908 | 17,610 |
Bottles, net | 3,681 | 3,574 |
Property and equipment, net | 33,747 | 34,235 |
Intangible assets, net | 8,966 | 9,452 |
Other assets | 840 | 877 |
Total assets | 66,142 | 65,748 |
Current liabilities: | ||
Accounts payable | 12,557 | 12,499 |
Accrued expenses and other current liabilities | 4,205 | 4,343 |
Current portion of capital leases and notes payable | 105 | 106 |
Total current liabilities | 16,867 | 16,948 |
Long-term debt, capital leases and notes payable, net of current portion | 24,883 | 24,210 |
Liabilities of disposal group, net of current portion, and other long-term liabilities | 2,305 | 2,316 |
Total liabilities | 44,055 | 43,474 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value - 10,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value - 70,000 shares authorized, 24,825 and 24,642 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively | 25 | 25 |
Additional paid-in capital | 278,260 | 277,708 |
Common stock warrants | 8,475 | 8,659 |
Accumulated deficit | -263,541 | -263,304 |
Accumulated other comprehensive loss | -1,132 | -814 |
Total stockholders' equity | 22,087 | 22,274 |
Total liabilities and stockholders' equity | $66,142 | $65,748 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, except Per Share data, unless otherwise specified | ||
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized (in shares) | 10,000 | 10,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized (in shares) | 70,000 | 70,000 |
Common stock, shares issued (in shares) | 24,825 | 24,642 |
Common stock, shares outstanding (in shares) | 24,825 | 24,642 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||
Net sales | $29,213 | $23,528 |
Operating costs and expenses: | ||
Cost of sales | 21,557 | 17,342 |
Selling, general and administrative expenses | 4,665 | 3,841 |
Non-recurring costs | 22 | 1,825 |
Depreciation and amortization | 2,585 | 2,744 |
Loss on disposal and impairment of property and equipment | 64 | 134 |
Total operating costs and expenses | 28,893 | 25,886 |
Income (loss) from operations | 320 | -2,358 |
Interest expense | 519 | 1,276 |
Loss from continuing operations | -199 | -3,634 |
Loss from discontinued operations | -38 | -119 |
Net loss | ($237) | ($3,753) |
Basic and diluted loss per common share: | ||
Loss from continuing operations (in dollars per share) | ($0.01) | ($0.15) |
Loss from discontinued operations (in dollars per share) | $0 | ($0.01) |
Net loss (in dollars per share) | ($0.01) | ($0.16) |
Basic and diluted weighted average common shares outstanding (in shares) | 24,683 | 24,076 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) [Abstract] | ||
Net loss | ($237) | ($3,753) |
Other comprehensive loss: | ||
Foreign currency translation adjustments, net | -318 | -167 |
Comprehensive loss | ($555) | ($3,920) |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||
Net loss | ($237) | ($3,753) |
Less: Loss from discontinued operations | -38 | -119 |
Loss from continuing operations | -199 | -3,634 |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 2,585 | 2,744 |
Loss on disposal and impairment of property and equipment | 64 | 134 |
Stock-based compensation expense | 635 | 289 |
Non-cash interest expense | 28 | 306 |
Issuance of common stock warrant | 0 | 589 |
Other | 195 | -50 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -1,861 | -86 |
Inventories | 974 | 321 |
Prepaid expenses and other assets | -284 | -276 |
Accounts payable | 101 | 3,946 |
Accrued expenses and other liabilities | -355 | 164 |
Net cash provided by operating activities | 1,883 | 4,447 |
Cash flows from investing activities: | ||
Purchases of property and equipment | -1,474 | -1,501 |
Purchases of bottles, net of disposals | -706 | -1,202 |
Proceeds from the sale of property and equipment | 5 | 41 |
Additions to and acquisitions of intangible assets | -3 | -7 |
Net cash used in investing activities | -2,178 | -2,669 |
Cash flows from financing activities: | ||
Borrowings under Revolving Credit Facilities | 7,500 | 18,809 |
Payments under Revolving Credit Facilities | -6,800 | -21,955 |
Borrowings under Term loans | 0 | 2,500 |
Note payable and capital lease payments | -27 | -26 |
Stock option and employee stock purchase activity, net | 27 | -14 |
Debt issuance costs and other | -6 | -78 |
Net cash provided by (used in) financing activities | 694 | -764 |
Cash used in operating activities of discontinued operations | -56 | -96 |
Effect of exchange rate changes on cash | -51 | -16 |
Net increase in cash | 292 | 902 |
Cash, beginning of year | 495 | 394 |
Cash, end of period | $787 | $1,296 |
Description_of_Business_and_Si
Description of Business and Significant Accounting Policies | 3 Months Ended | |
Mar. 31, 2015 | ||
Description of Business and Significant Accounting Policies [Abstract] | ||
Description of Business and Significant Accounting Policies | 1 | Description of Business and Significant Accounting Policies |
Business | ||
Primo Water Corporation (together with its consolidated subsidiaries, “Primo,” “we,” “our,” “us”) is a leading provider of multi-gallon purified bottled water, self-service refill water and water dispensers sold through major retailers in the United States and Canada. | ||
Unaudited Interim Financial Information | ||
The accompanying interim condensed consolidated financial statements have been prepared in accordance with our accounting practices described in our audited consolidated financial statements as of and for the year ended December 31, 2014, and are unaudited. In the opinion of management, the unaudited interim condensed consolidated financial statements included herein contain all adjustments necessary to present fairly our financial position, results of operations and cash flows for the periods indicated. Such adjustments, other than nonrecurring adjustments that have been separately disclosed, are of a normal, recurring nature. The operating results for interim periods are not necessarily indicative of results to be expected for a full year or future interim periods. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes as of and for the year ended December 31, 2014. The accompanying interim condensed consolidated financial statements are presented in accordance with the rules and regulations of the Securities and Exchange Commission and, accordingly, do not include all the disclosures required by generally accepted accounting principles in the United States (“U.S. GAAP”) with respect to annual financial statements. Certain significant accounting policies, in addition to those described below, are summarized in our 2014 Form 10-K. Certain 2014 amounts in the accompanying interim condensed consolidated financial statements have been reclassified to conform to the 2015 presentation, with no effect on stockholders’ equity or net loss as previously presented. | ||
Discontinued Operations | ||
As described in Note 2, during 2012, we committed to a plan to sell the assets of the sparkling beverage appliances, flavorings, CO2 cylinders and accessories business sold under the Flavorstation brand (the “Disposal Group”). We determined that the Disposal Group meets the criteria for classification as discontinued operations. As a result, the results of operations and financial position of the Disposal Group for the current and prior periods are reflected as discontinued operations. | ||
Revenue Recognition | ||
Revenue is recognized for the sale of multi-gallon purified bottled water upon either the delivery of inventory to the retail store or the purchase by the consumer. Revenue is either recognized as an exchange transaction (where a discount is provided on the purchase of a multi-gallon bottle of purified water for the return of an empty multi-gallon bottle) or a non-exchange transaction. Revenues on exchange transactions are recognized net of the exchange discount. Self-service refill water revenue is recognized as the water is filtered, which is measured by the water dispensing equipment meter. | ||
Revenue is recognized for the sale of our water dispenser products when title is transferred to our retail customers. We have no contractual obligation to accept returns nor do we guarantee sales. However, we will at times accept returns or issue credits for manufacturer defects or for units that were damaged in transit. Revenues are recognized net of an estimated allowance for returns using an average return rate based upon historical experience. | ||
In addition, we offer certain incentives such as coupons and rebates that are netted against and reduce net sales in the condensed consolidated statements of operations. With the purchase of certain of our water dispensers we include a coupon for a free multi-gallon bottle of purified water. No revenue is recognized with respect to the redemption of the coupon for a free multi-gallon bottle of water and the estimated cost of the multi-gallon bottle of purified water is included in cost of sales. | ||
Accounts Receivable | ||
All trade accounts receivable are due from customers located within the United States and Canada. We maintain an allowance for sales discounts, rebates and promotions based on our arrangements with customers. Accounts receivable, net included allowances for sales discounts, rebates and promotions of $1,784 and $1,212 at March 31, 2015 and December 31, 2014, respectively. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. Accounts receivable, net included allowances for doubtful accounts of $154 and $107 at March 31, 2015 and December 31, 2014, respectively. The allowance for doubtful accounts is based on a review of specifically identified accounts in addition to an overall aging analysis. Judgments are made with respect to the collectability of accounts receivable based on historical experience and current economic trends. Actual losses could differ from those estimates. | ||
Intangible Assets | ||
We classify intangible assets into two categories: (1) intangible assets with definite lives subject to amortization and (2) intangible assets with indefinite lives not subject to amortization. We determine the useful lives of our identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors we consider when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, our long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset, and other economic factors, including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their useful lives. Intangible assets that are deemed to have indefinite lives are tested for impairment annually, as of December 31, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. | ||
Concentrations of Risk | ||
Our principal financial instruments subject to potential concentration of credit risk are cash, trade receivables and accounts payable. We invest our funds in a highly rated institution and believe the financial risk associated with cash in excess of federally insured amounts is minimal. We perform ongoing credit evaluations of our customers’ financial condition and maintain allowances for doubtful accounts that we believe are sufficient to provide for losses that may be sustained on realization of accounts receivable. | ||
Basic and Diluted Loss Per Share | ||
Net loss per share has been computed using the weighted average number of shares of common stock outstanding during each period. Diluted amounts per share include the dilutive impact, if any, of our outstanding potential common shares, such as stock options, restricted stock units and warrants. Potential common shares that are anti-dilutive are excluded from the calculation of diluted net loss per common share. | ||
For the three months ended March 31, 2015 and 2014, stock options, unvested shares of restricted stock, restricted stock units and warrants with respect to an aggregate of 3,082 and 3,252 shares, respectively, have been excluded from the computation of the number of shares used in the diluted earnings per share. These shares have been excluded because we incurred a net loss for each of these periods and their inclusion would be anti-dilutive. | ||
Cumulative Translation Adjustment and Foreign Currency Transactions | ||
The local currency of our operations in Canada is considered to be the functional currency. Assets and liabilities of the Canada subsidiary are translated into U. S. dollars using the exchange rates in effect at the balance sheet date. Results of operations are translated using the average exchange rate prevailing throughout the period. The effects of unrealized exchange rate fluctuations on translating foreign currency assets and liabilities into U. S. dollars are accumulated as the cumulative translation adjustment included in accumulated other comprehensive loss in the condensed consolidated statements of comprehensive loss. With the exception of transaction gains and losses on certain intercompany balances which we have determined are of a long-term investment nature, realized gains and losses on foreign currency transactions are included in the condensed consolidated statements of operations. At March 31, 2015 and December 31, 2014, accumulated other comprehensive loss balances of $1,132 and $814, respectively, were related to unrealized foreign currency translation adjustments and transaction gains and losses on certain intercompany balances. | ||
Non-recurring costs | ||
Transactions that are unusual in nature or which occur infrequently, but not both, are reported as non-recurring costs on our condensed consolidated statements of operations. Non-recurring costs consist primarily of transition and other expenses associated with the strategic alliance agreement (the “DS Services Agreement”) with DS Services of America, Inc. (“DS Services”) as well as other legal and severance expenses. | ||
Recent Accounting Pronouncements | ||
In May 2014, the FASB issued updated guidance which supersedes existing revenue recognition requirements in U.S. GAAP. The updated guidance requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the guidance establishes a five-step approach for the recognition of revenue. The update is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. We are currently evaluating the impact of adopting this guidance on our consolidated financial statements. | ||
In April 2015, the FASB issued updated guidance requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with the presentation of debt discounts. The update is effective for fiscal years beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. We do not expect the adoption of this updated guidance to have a significant impact on our consolidated financial statements. |
Discontinued_Operations
Discontinued Operations | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Discontinued Operations [Abstract] | |||||||||
Discontinued Operations | 2 | Discontinued Operations | |||||||
During 2012, we committed to a plan to sell the assets of the Disposal Group, which includes sparkling beverage appliances, flavorings, CO2 cylinders and accessories sold under the Flavorstation brand as well as the Omnifrio Single-Serve Business and initiated an active program to execute this plan. In addition, we determined that the Disposal Group met all of the criteria for classification as discontinued operations. As a result, current and prior year amounts and disclosures reflect these operations as discontinued operations. For 2015, the primary activities of our discontinued operations relate to the resolution of contingencies and other matters that arise from and that are directly related to the operations of the Disposal Group before its disposal. | |||||||||
Accrued expenses and other current liabilities of the disposal group of $17 and $23 at March 31, 2015 and December 31, 2014, respectively, are presented within accrued expenses and other current liabilities on the condensed consolidated balances. Other long-term liabilities of the disposal group of $1,976 and $1,987 at March 31, 2015 and December 31, 2014, respectively, are presented within liabilities of disposal group, net of current portion, and other long-term liabilities on the condensed consolidated balance sheets. | |||||||||
The net sales and operating results classified as discontinued operations were as follows: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Net sales | $ | – | $ | 142 | |||||
Operating costs and expenses: | |||||||||
Cost of sales | 5 | 110 | |||||||
Selling, general and administrative expenses | 33 | 151 | |||||||
Total operating costs and expenses | 38 | 261 | |||||||
Loss from discontinued operations | $ | (38 | ) | $ | (119 | ) |
Debt_Capital_Leases_and_Notes_
Debt, Capital Leases and Notes Payable | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Debt, Capital Leases and Notes Payable [Abstract] | |||||||||
Debt, Capital Leases and Notes Payable | 3 | Debt, Capital Leases and Notes Payable | |||||||
Long-term debt, capital leases and notes payable are summarized as follows: | |||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
Revolving Credit Facility | $ | 4,700 | $ | 4,000 | |||||
Term Notes | 20,000 | 20,000 | |||||||
Capital leases | 280 | 304 | |||||||
Notes payable | 8 | 12 | |||||||
24,988 | 24,316 | ||||||||
Less current portion | (105 | ) | (106 | ) | |||||
Long-term debt, notes payable and capital leases, net of current portion | $ | 24,883 | $ | 24,210 | |||||
Revolving Credit Facility and Term Notes | |||||||||
On June 20, 2014, we entered into a note purchase agreement (the “Credit Agreement”) that provides up to $35,000 in secured indebtedness and consists of a $15,000 revolving credit facility (the “Revolving Credit Facility”) and $20,000 in term notes (the “Term Notes”). The Revolving Credit Facility matures on June 20, 2019 with all outstanding borrowings and accrued interest to be repaid on such date and the Term Notes mature on June 20, 2021 with all outstanding indebtedness and accrued interest to be repaid on such date. The Revolving Credit Facility and Term Notes are secured on a first priority basis by substantially all of our assets. | |||||||||
Interest on outstanding amounts owed under the Term Notes is payable quarterly at the rate of 7.8%. Principal payments under the Term Notes are payable in five annual $4,000 installments beginning on June 20, 2017. Total costs associated with the Term Notes were $339, which have been capitalized as deferred loan costs and are being amortized as part of interest expense over the term of the Term Notes. At March 31, 2015 and December 31, 2014, accumulated amortization related to Term Notes deferred loan costs was $51 and $34, respectively. | |||||||||
Interest on outstanding borrowings under the Revolving Credit Facility is payable at our option at either (i) the Base Rate, defined as the greater of the Prime Rate, the Federal Funds Effective Rate plus 0.50% or the LIBOR for a three-month interest period plus 1.0%, plus in each such case a margin of 3.25% or (ii) a one-, two-, three- or six-month LIBOR rate, plus a margin of 4.25%. We are required to pay a commitment fee of 0.50% on the unused amount of the commitment under the Revolving Credit Facility. Total costs associated with the Revolving Credit Facility were $214, which have been capitalized and are being amortized as part of interest expense over the term of the Revolving Credit Facility. At March 31, 2015 and December 31, 2014, accumulated amortization related to Revolving Credit Facility deferred loan costs was $32 and $21, respectively. As of March 31, 2015, we had $4,700 in outstanding borrowings at a weighted-average interest rate of 4.51% and our remaining availability was $10,300 under the Revolving Credit Facility. | |||||||||
The Credit Agreement contains a number of affirmative and restrictive financial covenants (including limitations on dissolutions, sales of assets, investments, and indebtedness and liens) that use adjusted EBITDA (“Adjusted EBITDA”). Adjusted EBITDA is a non-U.S. GAAP financial measure that is calculated as loss from continuing operations before depreciation and amortization; interest expense; non-cash, stock-based compensation expense; non-recurring costs; and loss on disposal and impairment of property and equipment and other. | |||||||||
The covenants included in the Revolving Credit Facility are as follows: (i) a ratio of consolidated total indebtedness to Adjusted EBITDA of no more than 3.00 to 1.00 as of the last day of each month (measured on a trailing four-quarter basis), declining to 2.75 on October 31, 2015 and thereafter, (ii) a consolidated tangible net worth requirement measured at the end of each month of no less than $11,000 plus 50% of consolidated net income on a cumulative basis for each fiscal quarter beginning with the quarter ended June 30, 2014 (net losses are disregarded), and (iii) a ratio of Adjusted EBITDA to consolidated fixed charges of no less than 1.00 to 1.00 as of the last day of each quarter (measured on a trailing four-quarter basis). At March 31, 2015 we were in compliance with all covenants with: (i) a consolidated total indebtedness to Adjusted EBITDA ratio of 1.79 to 1.00, (ii) consolidated tangible net worth of $13,121 compared to the minimum of $11,109 and (iii) an Adjusted EBITDA to consolidated fixed charges ratio of 1.23. | |||||||||
Prior Senior Revolving Credit Facility and Prior Term Loans | |||||||||
We entered into a senior revolving credit facility on April 30, 2012, as amended on February 21, 2013 (the “Prior Senior Revolving Credit Facility”). The Prior Senior Revolving Credit Facility provided for total borrowing availability of up to $20,000. | |||||||||
We entered into a credit and security agreement on April 30, 2012, as amended on November 6, 2012, June 14, 2013, and December 24, 2013, pursuant to which $23,150 in term loans were provided (the “Prior Term Loans”). | |||||||||
We repaid borrowings outstanding on the Prior Senior Revolving Credit Facility and Prior Term Loans upon entering into the Revolving Credit Facility on June 20, 2014. |
Stockholders_Equity_and_StockB
Stockholders' Equity and Stock-Based Compensation | 3 Months Ended | |
Mar. 31, 2015 | ||
Stockholders' Equity and Stock-Based Compensation [Abstract] | ||
Stockholders' Equity and Stock-Based Compensation | 4 | Stockholders’ Equity and Stock-Based Compensation |
Common Stock Warrants | ||
The Prior Term Loans were accompanied by a detachable warrant to purchase 1,731 shares of our common stock (the “Comvest Warrant”), including detachable warrants to purchase 131 shares of our common stock received by five of our current directors or stockholders (the “Insider Participants”). The Comvest Warrant is immediately exercisable at an exercise price of $2.30 per share and expires April 30, 2020. For the non-Insider Participants, the exercise price of their portion of the Comvest Warrant was adjusted to $1.20 on November 6, 2012. No changes were made to the warrants we issued to the five directors and stockholders of Primo. | ||
During the first quarter of 2015, we issued 153 shares of our common stock upon partial cashless exercises of 200 shares of the Comvest Warrant. At March 31, 2015, 1,131 Comvest Warrants remain outstanding. | ||
As part of the DS Services Agreement, on January 1, 2014, we granted DS Services a warrant to purchase 475 shares of our common stock (the “DS Services Warrant”). The DS Services Warrant is immediately exercisable at an exercise price of $3.04 per share and expires January 1, 2021. The warrant’s fair value of $589 was determined using the Black-Scholes pricing model and was recorded in common stock warrants on our condensed consolidated balance sheets and in non-recurring costs on our condensed consolidated statements of operations for the three months ended March 31, 2014. | ||
Compensation expense related to stock-based compensation plans was $635 and $289 for the three months ended March 31, 2015 and 2014, respectively. Stock-based compensation is included in selling, general and administrative expenses in the condensed consolidated statements of operations. Compensation expense related to stock-based compensation plans includes charges of $315 and $0 for the three months ended March 31, 2015 and 2014, respectively, related to awards under the Primo Water Corporation Value Creation Plan (the “VCP”) that are contingent on achieving certain financial targets. As of March 31, 2015, there was $1,249 of unrecognized expense related to the VCP which is expected to be recognized over the remainder of 2015 and the first quarter of 2016, when the first issuance of awards under the VCP is currently expected to occur. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |
Mar. 31, 2015 | ||
Commitments and Contingencies [Abstract] | ||
Commitments and Contingencies | 5 | Commitments and Contingencies |
Florida Concentrates Suit | ||
On October 16, 2012, Primo was served with the Summons and Complaint in a suit filed in the Florida state courts on September 26, 2012. Plaintiffs in the suit are Florida Concentrates International, LLC (a Florida limited liability company), Florida Sparkling DS, LLC (a Florida limited liability company), and Didier Hardy (a Florida resident and apparently the principal of the LLC plaintiffs). Also named as defendants are Susan and Scott Ballantyne (alleged to be Florida residents) and SDS-IC. The suit was filed in the Circuit Court for the Twentieth Judicial District (Collier County, Florida). Plaintiffs' allegations include breach of contract, misappropriation of trade secrets and certain additional claims and plaintiffs seek monetary damages. We filed a motion to dismiss all claims, which was granted in part and denied in part on June 21, 2013. Plaintiffs filed an amended complaint on July 10, 2013 to which we responded on August 28, 2013. We do not believe that the suit has any merit whatsoever, and plan to vigorously contest and defend against it. No accrual has been made for this claim at March 31, 2015, as we do not currently believe that any losses are probable. | ||
Omnifrio Single-Serve Beverage Business | ||
Deferred purchase price payments totaling $1,976 and $1,987 were included within liabilities of disposal group, net of current portion, and other long-term liabilities on the condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014, respectively. These payments were related to the April 11, 2011 acquisition of certain intellectual property and other assets from the seller, Omnifrio Beverage Company LLC (“Omnifrio”). On July 19, 2013, we entered into a conditional settlement and release agreement with Omnifrio and certain other parties pursuant to which we agreed to, among other things, use commercially reasonable efforts to sell the assets purchased from Omnifrio in April 2011 and to provide Omnifrio certain amounts of the proceeds of any such sale in exchange for Omnifrio agreeing to release us from any claims related to the milestone payments included in our original purchase agreement with Omnifrio and, upon the sale of such assets, to release us from any claims related to the deferred purchase price payments included in such agreement. On July 19, 2014, the conditional settlement and release agreement was amended to extend its term through October 17, 2014. On October 18, 2014, the conditional settlement and release agreement was further amended to extend its term through April 17, 2015. On April 18, 2015, the conditional settlement and release agreement was further amended to extend its term through July 16, 2015. | ||
Prism Arbitration | ||
On August 5, 2014, Primo Distribution, LLC (also known as Prism Distribution) initiated an arbitration proceeding against us, claiming less than $1,000 in damages for alleged breach of contract. The arbitration was filed with the American Arbitration Association, and was amended on December 19, 2014 to include additional claims for conversion, unfair and deceptive trade practices, fraud, and unjust enrichment. Damages claimed remain less than $1,000. We do not believe that the claim has any merit and plan to vigorously contest and defend against it. No accrual has been made for this claim at March 31, 2015, as we do not currently believe that any losses are probable. | ||
Texas Regional Operator Litigation/Arbitration | ||
On August 8, 2014, a lawsuit was commenced against us by our regional operators in the State of Texas, Artesia Springs, LLC, HOD Enterprises, L.P., and BBB Water, Inc. (the “ROs”). DS Services is also named as a defendant in the suit. The suit was filed in the 166th Judicial District Court of Bexar County, Texas, and was served upon us on August 25, 2014. We removed the suit to the United States District Court for the Western District of Texas on September 5, 2014. The claims alleged against us in the suit are breach of contract, conspiracy and fraud, and the ROs seek unspecified monetary damages as well as injunctive relief. We responded to the complaint on September 24, 2014 by filing a motion to dismiss, to compel alternative dispute resolution, and to stay proceedings. On January 13, 2015, the Magistrate Judge to whom the case was assigned issued a decision recommending dismissal of the suit and enforcement of the alternative dispute resolution provisions of the ROs’ contracts. On January 31, 2015, the District Judge entered an Order endorsing the Magistrate Judge’s recommended decision and dismissed the case without prejudice. The District Judge indicated that to pursue their claims, the plaintiffs would have to proceed with alternative dispute resolution in North Carolina as provided in their contracts. On April 10, 2015, the ROs initiated an arbitration proceeding with the American Arbitration Association. The claims asserted are essentially the same as the ones made in their lawsuit described above. We do not believe that the claim has any merit and plan to vigorously contest and defend against it. No accrual has been made for this claim at March 31, 2015 as we do not currently believe that any loss which may result can be reasonably estimated. An estimate of the possible loss or range of losses cannot be made. | ||
Sales Tax | ||
We routinely purchase equipment for use in operations from various vendors. These purchases are subject to sales tax depending on the equipment type and local sales tax regulations; however, we believe certain vendors have not assessed the appropriate sales tax. For purchases that are subject to sales tax in which we believe the vendor did not assess the appropriate amount, we accrue an estimate of the sales tax liability we ultimately expect to pay. | ||
Other Contingencies | ||
From time to time, we are involved in various claims and legal actions that arise in the normal course of business. Management believes that the outcome of such legal actions will not have a significant adverse effect on our financial position, results of operations or cash flows. |
Income_Taxes
Income Taxes | 3 Months Ended | |
Mar. 31, 2015 | ||
Income Taxes [Abstract] | ||
Income Taxes | 6 | Income Taxes |
We have established a full valuation allowance for our deferred tax assets that are not expected to be realized. We have incurred losses since inception and in all reporting periods with the exception of the third quarter of 2014. Therefore, for the three months ended March 31, 2015 and 2014, there was no income tax expense or benefit. | ||
Section 382 of the U.S. Internal Revenue Code imposes an annual limitation on the amount of net operating loss carryforwards that might be used to offset taxable income when a corporation has undergone significant changes in stock ownership. We believe our prior ownership changes have created an annual limit, imposed by Section 382, on the amount of net operating loss we can utilize in a given year, however, we believe the annual limit is such that we will be able to utilize our net operating loss carryforwards during their respective carryforward periods. |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||
Mar. 31, 2015 | |||
Fair Value Measurements [Abstract] | |||
Fair Value Measurements | 7 | Fair Value Measurements | |
Fair value rules currently apply to all financial assets and liabilities and for certain nonfinancial assets and liabilities that are required to be recognized or disclosed at fair value. For this purpose, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. | |||
U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: | |||
• | Level 1 — quoted prices in active markets for identical assets and liabilities. | ||
• | Level 2 — observable inputs other than quoted prices in active markets for identical assets and liabilities. | ||
• | Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions. | ||
The carrying amounts of our financial instruments, which include cash, accounts receivable, net, accounts payable, and accrued expenses and other current liabilities, approximate their fair values due to their short maturities. Liabilities of the Disposal Group classified as held for sale and reported within accrued expenses and other current liabilities and liabilities of disposal group, net of current portion, and other long-term liabilities on our condensed consolidated balance sheets are presented at their carrying value, which approximates their fair value. Based on borrowing rates currently available to us for loans with similar terms and the variable interest rate for borrowings under our Revolving Credit Facility, the carrying value of debt, capital leases and notes payable approximates fair value. |
Segments
Segments | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Segments [Abstract] | |||||||||
Segments | 8 | Segments | |||||||
We have two operating segments and two reportable segments: Primo Water (“Water”) and Primo Dispensers (“Dispensers”). | |||||||||
Our Water segment sales consist of the sale of multi-gallon purified bottled water (exchange services) and our self-service refill water service (refill services) offered through retailers throughout the United States and Canada. Our Water services are offered through point of purchase display racks or self-serve filtered water displays and recycling centers that are prominently located at major retailers in space that is often underutilized. | |||||||||
Our Dispensers segment sells water dispensers that are designed to dispense Primo and other dispenser-compatible bottled water. Our Dispensers sales are primarily generated through major U.S. retailers, where we recognize revenues for the sale of the water dispensers when title is transferred. We support retail sell-through with domestic inventory. We design, market and arrange for certification and inspection of our water dispensers. | |||||||||
We evaluate the financial results of these segments focusing primarily on segment net sales and segment income (loss) from operations before depreciation and amortization (“segment income (loss) from operations”). We utilize segment net sales and segment income (loss) from operations because we believe they provide useful information for effectively allocating our resources between business segments, evaluating the health of our business segments based on metrics that management can actively influence and gauging our investments and our ability to service, incur or pay down debt. | |||||||||
Cost of sales for Water consists of costs for distribution, bottles and related packaging materials for our exchange services and servicing and material costs for our refill services. Cost of sales for Dispensers consists of contract manufacturing, freight and duties. | |||||||||
Selling, general and administrative expenses for Water and Dispensers consist primarily of personnel costs for sales, marketing, operations support and customer service, as well as other supporting costs for operating each segment. | |||||||||
Expenses not specifically related to operating segments are shown separately as Corporate. Corporate expenses are comprised mainly of compensation and other related expenses for corporate support, information systems, and human resources and administration. Corporate expenses also include certain professional fees and expenses and compensation of our Board of Directors. | |||||||||
The following table presents segment information for the following periods: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Segment net sales | |||||||||
Water | $ | 20,657 | $ | 15,891 | |||||
Dispensers | 8,556 | 7,637 | |||||||
$ | 29,213 | $ | 23,528 | ||||||
Segment income (loss) from operations | |||||||||
Water | $ | 6,428 | $ | 4,938 | |||||
Dispensers | 331 | 328 | |||||||
Corporate | (3,768 | ) | (2,921 | ) | |||||
Non-recurring costs | (22 | ) | (1,825 | ) | |||||
Depreciation and amortization | (2,585 | ) | (2,744 | ) | |||||
Loss on disposal and impairment of property and equipment | (64 | ) | (134 | ) | |||||
$ | 320 | $ | (2,358 | ) | |||||
Depreciation and amortization expense: | |||||||||
Water | $ | 2,359 | $ | 2,506 | |||||
Dispensers | 95 | 76 | |||||||
Corporate | 131 | 162 | |||||||
$ | 2,585 | $ | 2,744 | ||||||
Capital expenditures: | |||||||||
Water | $ | 2,142 | $ | 2,623 | |||||
Dispensers | – | 63 | |||||||
Corporate | 38 | 17 | |||||||
$ | 2,180 | $ | 2,703 | ||||||
Identifiable assets: | At March 31, | At December 31, | |||||||
2015 | 2014 | ||||||||
Water | $ | 52,532 | $ | 52,758 | |||||
Dispensers | 11,823 | 11,075 | |||||||
Corporate | 1,787 | 1,915 | |||||||
$ | 66,142 | $ | 65,748 |
Description_of_Business_and_Si1
Description of Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Description of Business and Significant Accounting Policies [Abstract] | |
Discontinued Operations | Discontinued Operations |
As described in Note 2, during 2012, we committed to a plan to sell the assets of the sparkling beverage appliances, flavorings, CO2 cylinders and accessories business sold under the Flavorstation brand (the “Disposal Group”). We determined that the Disposal Group meets the criteria for classification as discontinued operations. As a result, the results of operations and financial position of the Disposal Group for the current and prior periods are reflected as discontinued operations. | |
Revenue Recognition | Revenue Recognition |
Revenue is recognized for the sale of multi-gallon purified bottled water upon either the delivery of inventory to the retail store or the purchase by the consumer. Revenue is either recognized as an exchange transaction (where a discount is provided on the purchase of a multi-gallon bottle of purified water for the return of an empty multi-gallon bottle) or a non-exchange transaction. Revenues on exchange transactions are recognized net of the exchange discount. Self-service refill water revenue is recognized as the water is filtered, which is measured by the water dispensing equipment meter. | |
Revenue is recognized for the sale of our water dispenser products when title is transferred to our retail customers. We have no contractual obligation to accept returns nor do we guarantee sales. However, we will at times accept returns or issue credits for manufacturer defects or for units that were damaged in transit. Revenues are recognized net of an estimated allowance for returns using an average return rate based upon historical experience. | |
In addition, we offer certain incentives such as coupons and rebates that are netted against and reduce net sales in the condensed consolidated statements of operations. With the purchase of certain of our water dispensers we include a coupon for a free multi-gallon bottle of purified water. No revenue is recognized with respect to the redemption of the coupon for a free multi-gallon bottle of water and the estimated cost of the multi-gallon bottle of purified water is included in cost of sales. | |
Accounts Receivable | Accounts Receivable |
All trade accounts receivable are due from customers located within the United States and Canada. We maintain an allowance for sales discounts, rebates and promotions based on our arrangements with customers. Accounts receivable, net included allowances for sales discounts, rebates and promotions of $1,784 and $1,212 at March 31, 2015 and December 31, 2014, respectively. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. Accounts receivable, net included allowances for doubtful accounts of $154 and $107 at March 31, 2015 and December 31, 2014, respectively. The allowance for doubtful accounts is based on a review of specifically identified accounts in addition to an overall aging analysis. Judgments are made with respect to the collectability of accounts receivable based on historical experience and current economic trends. Actual losses could differ from those estimates. | |
Intangible Assets | Intangible Assets |
We classify intangible assets into two categories: (1) intangible assets with definite lives subject to amortization and (2) intangible assets with indefinite lives not subject to amortization. We determine the useful lives of our identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors we consider when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, our long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset, and other economic factors, including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their useful lives. Intangible assets that are deemed to have indefinite lives are tested for impairment annually, as of December 31, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. | |
Concentrations of Risk | Concentrations of Risk |
Our principal financial instruments subject to potential concentration of credit risk are cash, trade receivables and accounts payable. We invest our funds in a highly rated institution and believe the financial risk associated with cash in excess of federally insured amounts is minimal. We perform ongoing credit evaluations of our customers’ financial condition and maintain allowances for doubtful accounts that we believe are sufficient to provide for losses that may be sustained on realization of accounts receivable. | |
Basic and Diluted Loss Per Share | Basic and Diluted Loss Per Share |
Net loss per share has been computed using the weighted average number of shares of common stock outstanding during each period. Diluted amounts per share include the dilutive impact, if any, of our outstanding potential common shares, such as stock options, restricted stock units and warrants. Potential common shares that are anti-dilutive are excluded from the calculation of diluted net loss per common share. | |
For the three months ended March 31, 2015 and 2014, stock options, unvested shares of restricted stock, restricted stock units and warrants with respect to an aggregate of 3,082 and 3,252 shares, respectively, have been excluded from the computation of the number of shares used in the diluted earnings per share. These shares have been excluded because we incurred a net loss for each of these periods and their inclusion would be anti-dilutive. | |
Cumulative Translation Adjustment and Foreign Currency Transactions | Cumulative Translation Adjustment and Foreign Currency Transactions |
The local currency of our operations in Canada is considered to be the functional currency. Assets and liabilities of the Canada subsidiary are translated into U. S. dollars using the exchange rates in effect at the balance sheet date. Results of operations are translated using the average exchange rate prevailing throughout the period. The effects of unrealized exchange rate fluctuations on translating foreign currency assets and liabilities into U. S. dollars are accumulated as the cumulative translation adjustment included in accumulated other comprehensive loss in the condensed consolidated statements of comprehensive loss. With the exception of transaction gains and losses on certain intercompany balances which we have determined are of a long-term investment nature, realized gains and losses on foreign currency transactions are included in the condensed consolidated statements of operations. At March 31, 2015 and December 31, 2014, accumulated other comprehensive loss balances of $1,132 and $814, respectively, were related to unrealized foreign currency translation adjustments and transaction gains and losses on certain intercompany balances. | |
Non-recurring costs | Non-recurring costs |
Transactions that are unusual in nature or which occur infrequently, but not both, are reported as non-recurring costs on our condensed consolidated statements of operations. Non-recurring costs consist primarily of transition and other expenses associated with the strategic alliance agreement (the “DS Services Agreement”) with DS Services of America, Inc. (“DS Services”) as well as other legal and severance expenses. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
In May 2014, the FASB issued updated guidance which supersedes existing revenue recognition requirements in U.S. GAAP. The updated guidance requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the guidance establishes a five-step approach for the recognition of revenue. The update is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. We are currently evaluating the impact of adopting this guidance on our consolidated financial statements. | |
In April 2015, the FASB issued updated guidance requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with the presentation of debt discounts. The update is effective for fiscal years beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. We do not expect the adoption of this updated guidance to have a significant impact on our consolidated financial statements. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Discontinued Operations [Abstract] | |||||||||
Financial Information of Disposal Group | The net sales and operating results classified as discontinued operations were as follows: | ||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Net sales | $ | – | $ | 142 | |||||
Operating costs and expenses: | |||||||||
Cost of sales | 5 | 110 | |||||||
Selling, general and administrative expenses | 33 | 151 | |||||||
Total operating costs and expenses | 38 | 261 | |||||||
Loss from discontinued operations | $ | (38 | ) | $ | (119 | ) |
Debt_Capital_Leases_and_Notes_1
Debt, Capital Leases and Notes Payable (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Debt, Capital Leases and Notes Payable [Abstract] | |||||||||
Debt, Capital Leases and Notes Payable | Long-term debt, capital leases and notes payable are summarized as follows: | ||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
Revolving Credit Facility | $ | 4,700 | $ | 4,000 | |||||
Term Notes | 20,000 | 20,000 | |||||||
Capital leases | 280 | 304 | |||||||
Notes payable | 8 | 12 | |||||||
24,988 | 24,316 | ||||||||
Less current portion | (105 | ) | (106 | ) | |||||
Long-term debt, notes payable and capital leases, net of current portion | $ | 24,883 | $ | 24,210 |
Segments_Tables
Segments (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Segments [Abstract] | |||||||||
Segment Information | The following table presents segment information for the following periods: | ||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Segment net sales | |||||||||
Water | $ | 20,657 | $ | 15,891 | |||||
Dispensers | 8,556 | 7,637 | |||||||
$ | 29,213 | $ | 23,528 | ||||||
Segment income (loss) from operations | |||||||||
Water | $ | 6,428 | $ | 4,938 | |||||
Dispensers | 331 | 328 | |||||||
Corporate | (3,768 | ) | (2,921 | ) | |||||
Non-recurring costs | (22 | ) | (1,825 | ) | |||||
Depreciation and amortization | (2,585 | ) | (2,744 | ) | |||||
Loss on disposal and impairment of property and equipment | (64 | ) | (134 | ) | |||||
$ | 320 | $ | (2,358 | ) | |||||
Depreciation and amortization expense: | |||||||||
Water | $ | 2,359 | $ | 2,506 | |||||
Dispensers | 95 | 76 | |||||||
Corporate | 131 | 162 | |||||||
$ | 2,585 | $ | 2,744 | ||||||
Capital expenditures: | |||||||||
Water | $ | 2,142 | $ | 2,623 | |||||
Dispensers | – | 63 | |||||||
Corporate | 38 | 17 | |||||||
$ | 2,180 | $ | 2,703 | ||||||
Identifiable Assets by Segment | Identifiable assets: | At March 31, | At December 31, | ||||||
2015 | 2014 | ||||||||
Water | $ | 52,532 | $ | 52,758 | |||||
Dispensers | 11,823 | 11,075 | |||||||
Corporate | 1,787 | 1,915 | |||||||
$ | 66,142 | $ | 65,748 |
Description_of_Business_and_Si2
Description of Business and Significant Accounting Policies (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Accounts Receivable [Abstract] | |||
Allowances for sales discounts, rebates and promotions | $1,784 | $1,212 | |
Allowance for doubtful accounts | 154 | 107 | |
Basic and Diluted Net Loss Per Share [Abstract] | |||
Shares excluded from computation of number of shares used in diluted earnings per share (in shares) | 3,082 | 3,252 | |
Cumulative Translation Adjustment and Foreign Currency Transactions [Abstract] | |||
Accumulated other comprehensive loss balances | ($1,132) | ($814) |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Discontinued Operations [Abstract] | |||
Accrued expenses and other current liabilities | $17 | $23 | |
Other long-term liabilities | 1,976 | 1,987 | |
Net sales and operating results classified as discontinued operations [Abstract] | |||
Net sales | 0 | 142 | |
Operating costs and expenses: | |||
Cost of sales | 5 | 110 | |
Selling, general and administrative | 33 | 151 | |
Total operating costs and expenses | 38 | 261 | |
Loss from discontinued operations | ($38) | ($119) |
Debt_Capital_Leases_and_Notes_2
Debt, Capital Leases and Notes Payable (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Installment | ||
Debt Instrument [Line Items] | ||
Long-term debt, notes payable and capital leases | $24,988 | $24,316 |
Less current portion | -105 | -106 |
Long-term debt, notes payable and capital leases, net of current portion | 24,883 | 24,210 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, notes payable and capital leases | 4,700 | 4,000 |
Term Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, notes payable and capital leases | 20,000 | 20,000 |
Interest rate (in hundredths) | 7.80% | |
Maturity date | 20-Jun-21 | |
Number of annual installment | 5 | |
Periodic payment principal | 4,000 | |
Deferred loan costs capitalized | 339 | |
Accumulated amortization of deferred loans costs | 51 | 34 |
Capital Leases [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, notes payable and capital leases | 280 | 304 |
Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, notes payable and capital leases | $8 | $12 |
Debt_Capital_Leases_and_Notes_3
Debt, Capital Leases and Notes Payable, Line of Credit Facility (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Jun. 30, 2014 | Dec. 31, 2014 |
Line of Credit Facility [Line Items] | |||
Total borrowing availability | $35,000 | ||
Debt to EBITDA ratio | 3 | ||
Debt to EBITDA ratio after declining | 2.75 | ||
Consolidated debt to EBITDA ratio | 1.79 | ||
Financial covenants minimum tangible net worth requirement | 11,109 | 11,000 | |
Percentage of consolidated income considered for financial covenant (in hundredths) | 50.00% | ||
EBITDA to fixed charge ratio | 1.23 | ||
EBITDA to fixed charge ratio increase in period one | 1 | ||
Financial covenants tangible net worth requirement | 13,121 | ||
Revolving Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Total borrowing availability | 15,000 | ||
Expiration date | 20-Jun-19 | ||
Commitment fee percentage (in hundredths) | 0.50% | ||
Outstanding borrowings | 4,700 | ||
Weighted-average interest rate (in hundredths) | 4.51% | ||
Remaining borrowing availability | 10,300 | ||
Deferred loan costs capitalized | 214 | ||
Accumulated amortization of deferred loans costs | 32 | 21 | |
Revolving Credit Facility [Member] | Federal Funds [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate (in hundredths) | 0.50% | ||
Revolving Credit Facility [Member] | LIBOR [Member] | |||
Line of Credit Facility [Line Items] | |||
Description of variable rate basis | LIBOR for a three-month | ||
Basis spread on variable rate (in hundredths) | 1.00% | ||
Revolving Credit Facility [Member] | LIBOR [Member] | Maximum [Member] | |||
Line of Credit Facility [Line Items] | |||
Description of variable rate basis | a one-, two-, three- or six-month LIBOR rate | ||
Basis spread on variable rate (in hundredths) | 4.25% | ||
Revolving Credit Facility [Member] | Base Rate [Member] | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate (in hundredths) | 3.25% | ||
Prior Senior Revolving Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Total borrowing availability | 20,000 | ||
Prior Term Loans [Member] | |||
Line of Credit Facility [Line Items] | |||
Total borrowing availability | $23,150 |
Stockholders_Equity_and_StockB1
Stockholders' Equity and Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 1 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Jan. 31, 2014 | Nov. 06, 2012 |
Director | ||||
Class of Warrant or Right [Line Items] | ||||
Number of current directors or stockholders as insider participants | 5 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $635 | $289 | ||
Value Creation Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 315 | 0 | ||
Unrecognized compensation expense related to the VCP | 1,249 | |||
DS Services [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Grant of DS Services Warrant (in shares) | 475 | |||
Warrants exercise price (in dollars per share) | $3.04 | |||
Warrants expiry date | 1-Jan-21 | |||
Initial fair value of warrants issued | $589 | |||
Comvest Warrant [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Grant of DS Services Warrant (in shares) | 1,731 | |||
Warrants exercise price (in dollars per share) | $2.30 | $1.20 | ||
Warrants expiry date | 30-Apr-20 | |||
Issuance of common stock (in shares) | 153 | |||
Partial exercises of Comvest Warrant (in shares) | 200 | |||
Comvest warrants outstanding (in shares) | 1,131 | |||
Comvest Warrant [Member] | Insider Participants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Grant of DS Services Warrant (in shares) | 131 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Aug. 05, 2014 |
In Thousands, unless otherwise specified | |||
Omnifrio Single-Serve Beverage Business [Member] | |||
Omnifrio Single-Serve Beverage Business [Abstract] | |||
Deferred purchase price payments | $1,976 | $1,987 | |
Prism Arbitration [Member] | Maximum [Member] | |||
Omnifrio Single-Serve Beverage Business [Abstract] | |||
Arbitration damaged claim value | $1,000 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Taxes [Abstract] | ||
Income tax expense (benefit) | $0 | $0 |
Segments_Details
Segments (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Segment | |||
Segments [Abstract] | |||
Number of operating segments | 2 | ||
Number of reportable segments | 2 | ||
Segment Reporting Information [Line Items] | |||
Segment net sales | $29,213 | $23,528 | |
Segment income (loss) from operations | 320 | -2,358 | |
Depreciation and amortization | -2,585 | -2,744 | |
Loss on disposal and impairment of property and equipment | -64 | -134 | |
Depreciation and amortization expense | 2,585 | 2,744 | |
Capital expenditures | 2,180 | 2,703 | |
Identifiable assets | 66,142 | 65,748 | |
Reconciling Items [Member] | |||
Segment Reporting Information [Line Items] | |||
Non-recurring costs | -22 | -1,825 | |
Depreciation and amortization | -2,585 | -2,744 | |
Loss on disposal and impairment of property and equipment | -64 | -134 | |
Depreciation and amortization expense | 2,585 | 2,744 | |
Operating Segments [Member] | Water [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment net sales | 20,657 | 15,891 | |
Segment income (loss) from operations | 6,428 | 4,938 | |
Depreciation and amortization | -2,359 | -2,506 | |
Depreciation and amortization expense | 2,359 | 2,506 | |
Capital expenditures | 2,142 | 2,623 | |
Identifiable assets | 52,532 | 52,758 | |
Operating Segments [Member] | Dispensers [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment net sales | 8,556 | 7,637 | |
Segment income (loss) from operations | 331 | 328 | |
Depreciation and amortization | -95 | -76 | |
Depreciation and amortization expense | 95 | 76 | |
Capital expenditures | 0 | 63 | |
Identifiable assets | 11,823 | 11,075 | |
Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment income (loss) from operations | -3,768 | -2,921 | |
Depreciation and amortization | -131 | -162 | |
Depreciation and amortization expense | 131 | 162 | |
Capital expenditures | 38 | 17 | |
Identifiable assets | $1,787 | $1,915 |