Company: PRMB
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-049952
Chunk: 72

Company: Primo Brands Corp
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 72
---
tlement risk by being permitted to net settle for transactions with the same counterparty. To minimize the concentration of credit risk, the Company may enter into derivative transactions with a portfolio of financial institutions. Based on these factors, the Company considers the risk of counterparty default to be minimal.Fair Value Hedging StrategyIn connection with the Transaction, the Company acquired foreign exchange contracts with a combined notional amount of €450.0 million and a maturity date of October 31, 2025 (the "2024 FX Forwards"). Prior to completion of the Exchange Offers, as described in Note 7 - "Debt", the derivative financial instruments were utilized to hedge the foreign exchange risk associated with the Original 3.875% Senior Notes. Following completion of the Exchange Offers, such derivative financial instruments were utilized to hedge the foreign exchange risk associated with the combined €441.9 million 3.875% Senior Notes and €8.1 million non-tendered Original 3.875% Senior Notes (collectively, the "Euro Notes").On August 6, 2025, the Company net settled the 2024 FX Forwards and simultaneously entered into new foreign exchange contracts with a combined notional amount of €450.0 million ($527.6 million at exchange rates in effect on September 30, 2025) and a maturity date of November 1, 2027 to hedge the foreign exchange risk associated with the Euro Notes.The Company designated the foreign exchange contracts as fair value hedges. The foreign exchange contracts are recognized on the Condensed Consolidated Balance Sheets at fair value and changes in the fair value of the foreign exchange contracts are recorded in the same line as the hedged item, which is Other income, net in the Condensed Consolidated Statements of Operations. The Company excludes forward points from its assessment of hedge effectiveness and amortizes them on a straight-line basis over the life of the hedging instruments in Other income, net in the Condensed Consolidated Statements of 

31

Table of Contents

Operations. The difference between fair value changes of the excluded component and the amount amortized to Other income, net is recorded as a component of AOCI on the Condensed Consolidated Balance Sheets.The following amounts were recorded on the Condensed Consolidated Balance Sheets related to hedged items as of September 30, 2025 and December 31, 2024:($ in millions)September 30, 2025December 31, 2024Line Item in Condensed Consolidated Balance Sheets in