Primo Water Corp. (NYSE: PRMW) CEO Tom Harrington has announced his retirement, effective Dec. 31, from the Tampa-based provider of bottled water and hydration stations in North America and Europe.
According to a news release, the company’s board has hired an executive search firm to find and evaluate candidates to succeed Harrington, whose retirement comes after a long and public dispute with Los Angeles-based Legion Partners Asset Management LLC, an investment firm that owns about 1.5% of Primo’s outstanding shares but has been highly critical of the company’s performance.
Via brands such as AquaTerra, PureFlo and Mountain Valley Spring Water, Primo sells more than 1 billion gallons of water every year. It reported gross revenue of $2.07 billion in 2022, up from $1.95 billion in 2021 — an increase of more than 6%, though it posted a loss of $3.2 million.
In a March 6 letter sent to Primo’s board of directors, Legion expressed its displeasure with the company’s financial outlook and called for shareholders to elect its four hand-picked nominees to the board.
“Legion Partners believes its case for meaningful change is validated by Primo’s perpetual underperformance — over several time periods — relative to its various peer groups, the Russell 2000 Index and the S&P 500 Index,” the letter reads.
"On behalf of the board, I want to thank Tom for his significant contributions and dedicated years of service to Primo Water," states Jerry Fowden, Primo Water Corp. board chair, in the release. "Since his appointment as CEO in 2019, Tom has played an instrumental role in transforming Primo Water into a leading pure-play water company, leading our response to the COVID-19 pandemic and meaningfully engaging with our stakeholders, shareowners, customers, communities and associates. It has been a privilege to work with Tom and we wish him nothing but the best in his retirement."
Primo operates in 21 countries and its water exchange program is available at about 17,500 retail locations. Its water refill business allows customers to refill empty bottles at some 23,500 self-service refill drinking water machines.
"It has been an honor to lead Primo Water's talented team through a critical and transformative period during my tenure as CEO," Harrington states in the release. "Our strategy is clearly working; we're pleased with our past accomplishments; and we're even more excited about our future. With our strategy in place and exciting prospects for the future, now is the right time to begin the transition to Primo Water's next phase of leadership. Together, we have built a powerful pure-play water platform that benefits from a large and growing revenue base. I am confident in our team's ability to build on our momentum to drive long-term growth and value creation."