Company: PRMB
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001193125-25-012325
Chunk: 134

Company: Primo Brands Corp
Filing Date: 2025-01-24
Form: S-1
Chunk 134
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 value of the intangible asset or an accelerated amortization of any remaining value and could lead to an impairment of the fixed assets that were used to service that customer. Primo
Water did not record impairment charges for its intangible assets subject to amortization in the fiscal years ended December 30, 2023, December 31, 2022, and January 1, 2022.

Impairment and Disposal of Long-Lived Assets

When adverse events occur, Primo Water compares the carrying amount of long-lived assets to the estimated undiscounted future cash flows at the
lowest level of independent cash flows for the group of long-lived assets and recognize any impairment loss based on discounted cash flows in the consolidated statements of operations, taking into consideration the timing of testing and the
asset’s remaining useful life. The expected life and value of these long-lived assets is based on an evaluation of the competitive environment, history, and future prospects as appropriate. Primo Water did not record impairments of long-lived
assets during the fiscal years ended December 30, 2023, December 31, 2022, and January 1, 2022.

Insurance Reserves

Primo Water maintains insurance retention programs under its general liability, auto liability, and workers’ compensation insurance
programs. Primo Water also carries excess coverage to mitigate catastrophic losses. Primo Water uses an independent third-party actuary to assist in determining its insurance reserves. Insurance reserves are accrued on an undiscounted basis based on
known claims and estimated incurred but not reported claims not otherwise covered by insurance. The estimates are developed utilizing standard actuarial methods and are based on historical claims experience and actuarial assumptions, including loss
development factors and expected ultimate loss selections. The inherent uncertainty of future loss projections could cause actual claims to differ from Primo Water’s estimates. Primo Water recorded insurance reserves of $67.0 million and
$58.7 million as of December 30, 2023 and December 31, 2022, respectively, within Accounts payable and accrued liabilities and Other long-term liabilities in the Consolidated Balance Sheets, of which $8.8 million and
$12.3 million, respectively, was covered by insurance and included as a component of Accounts receivable, net of allowance and Other long-term assets in the Consolidated Balance Sheets.

Income Taxes

Primo Water is
subject to income taxes in Canada as well as in numerous foreign jurisdictions. Significant judgments and estimates are required in determining the income