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Reynolds Consumer Products(REYN) - 2025 Q1 - Earnings Call Presentation
2025-04-30 11:12
Q1 2025 Earnings Call April 30, 2025 This presentation contains statements reflecting our views about our future performance that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including our second quarter and fiscal year 2025 guidance. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expects," "intends," "outlook," "forecast", "position", "committed," "plans," "anticipate ...
Reynolds Consumer Products(REYN) - 2025 Q1 - Quarterly Results
2025-04-30 10:59
Financial Performance - Net Income decreased to $31 million in Q1 2025 from $49 million in Q1 2024, impacted by $10 million in refinancing costs and $8 million in CEO transition costs[4] - Net Revenues were $818 million in Q1 2025, down 1.8% from $833 million in Q1 2024, with Retail Net Revenues decreasing 3% to $767 million[7] - Adjusted EBITDA decreased to $117 million in Q1 2025 from $122 million in Q1 2024, reflecting lower volume and higher operational costs[4] - Net income for the three months ended March 31, 2025, was $31 million, down from $49 million in the same period of 2024, representing a decrease of 36.7%[35] - Total revenues for the three months ended March 31, 2025, were $818 million, a decrease of 1.8% compared to $833 million in the same period of 2024[37] - Adjusted EBITDA for the three months ended March 31, 2025, was $117 million, down from $122 million in the same period of 2024, reflecting a decrease of 4.1%[47] - The company reported a net cash provided by operating activities of $56 million for the three months ended March 31, 2025, compared to $99 million in the same period of 2024, a decline of 43.4%[35] Future Guidance - The Company expects 2025 Net Revenues to decline low single digits compared to 2024, with Adjusted EBITDA projected between $650 million and $670 million[20] - Second quarter 2025 Net Revenues are anticipated to decrease by 2% to 5% compared to Q2 2024, with Adjusted EBITDA expected to be between $155 million and $165 million[21] - Adjusted EPS for 2025 is expected to be between $1.54 and $1.61, with two to four points of positive pricing anticipated to offset cost increases[20] - Future guidance for fiscal year 2025 indicates expected adjustments for Adjusted EBITDA and Adjusted EPS, but specific reconciliations cannot be provided at this time due to uncertainties[44] Debt and Cash Management - Cash and cash equivalents were $58 million as of March 31, 2025, with total debt at $1,637 million, resulting in Net Debt of $1,579 million[17] - The Company refinanced $1.645 billion of its term loan, extending maturity to 2032 and enhancing financial flexibility[5] - The company executed a debt refinancing in March 2025, incurring a debt refinancing expense of $13 million[47] - Net debt as of March 31, 2025, was $1,579 million, with a Net Debt to Trailing Twelve Months Adjusted EBITDA ratio of 2.3x[54] Segment Performance - The Reynolds Cooking & Baking segment generated revenues of $259 million, a slight increase of 1.2% from $256 million in the same period of 2024[37] - The Hefty Waste & Storage segment saw a revenue increase of 2.6% to $240 million from $234 million in the same period of 2024[37] - The Hefty Tableware segment experienced a revenue decline of 13.5%, with revenues of $179 million compared to $208 million in the same period of 2024[37] Dividends - The Company declared a quarterly dividend of $0.23 per common share, payable on May 30, 2025[23]
Reynolds: Attractively Valued And About To Grab More Opportunities
Seeking Alpha· 2025-04-23 06:06
Core Viewpoint - Reynolds Consumer Products (NASDAQ: REYN) is a manufacturer of waste and storage, cooking, and tableware products, which has been trading at high multiples since its listing. The company has recently released guidance that is below market expectations, leading to a focus on investment ideas that involve companies paying healthy dividends while awaiting capital appreciation [1]. Group 1 - The company is identified as a potential investment opportunity due to its ability to reward shareholders through dividends and capital appreciation [1]. - The current market turmoil has resulted in the company's shares being temporarily undervalued compared to its fundamentals, peers, and historical levels [1]. - There is an emphasis on finding businesses with high odds for capital appreciation, preferably driven by foreseeable catalysts [1].
Reynolds Consumer Products: Expected To Continue Facing Ongoing Headwinds
Seeking Alpha· 2025-02-13 14:28
Group 1 - The core viewpoint is that Reynolds Consumer Products (NASDAQ: REYN) is expected to face demand headwinds in the near term, which will pressure its FY25 performance, leading to a hold rating recommendation [1] - The investment approach emphasizes a fundamentals-based strategy, focusing on companies with long-term durability, steady growth, and strong balance sheets, rather than merely low multiple stocks [1] - There is an acknowledgment of the risks involved in investing in successful companies, particularly the potential to overpay, highlighting the importance of valuation [1] Group 2 - The article does not contain any disclosures related to stock positions or business relationships with the companies mentioned [2] - It is noted that past performance does not guarantee future results, and no specific investment recommendations are provided [3]
Reynolds Consumer Products(REYN) - 2024 Q4 - Earnings Call Presentation
2025-02-05 23:01
This presentation contains statements reflecting our views about our future performance that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including our first quarter and fiscal year 2025 guidance. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expects," "intends," "outlook," "forecast", "position", "committed," "plans," "anticipates," "believes," "estimates," "predicts ...
Reynolds Consumer Products(REYN) - 2024 Q4 - Earnings Call Transcript
2025-02-05 22:59
Financial Data and Key Metrics Changes - Net revenues for 2024 reached $3.695 billion, exceeding initial guidance, with a 1% increase in retail volume [33][34] - Adjusted EBITDA for 2024 was $678 million, a $42 million or 7% increase from 2023, with a margin expansion of 140 basis points [34] - Free cash flow for the year was $369 million, contributing to a reduction in leverage to 2.3 times trailing 12 months adjusted EBITDA [34][35] - Adjusted earnings per share increased to $1.67, up 18% from $1.42 in 2023 [35] Business Line Data and Key Metrics Changes - All four business segments showed accelerating volume growth in Q4, with Hefty Waste & Storage and Reynolds Cooking & Baking each delivering 3 points of volume growth [36] - The tableware segment showed improving volume and share trends, while the Presto business unit remained flat [36] Market Data and Key Metrics Changes - Consolidated retail volume increased by 1% in Q4, with each business unit contributing to this growth [9] - The foam plate business, representing less than 10% of revenue, is facing secular headwinds, contributing to inconsistent earnings growth [17] Company Strategy and Development Direction - The company aims to expand its brands into new categories and enhance its portfolio of affordable, sustainable solutions [14] - A comprehensive program of action is being implemented to drive growth, expand margins, and improve shareholder value [18] - The focus is on increasing automation, enhancing production capabilities, and investing in productivity improvements [23][29] Management's Comments on Operating Environment and Future Outlook - Management anticipates a challenging consumer environment, with no significant catalysts for change in consumer behavior [123] - The company expects retail volume to perform at or better than category expectations, driven by increased investment in growth programs [42] - For 2025, net revenues are expected to decline low-single digits, primarily due to a projected double-digit decline in the foam category [40][41] Other Important Information - The company plans to invest in strategic initiatives in 2025, with expected annualized returns starting to benefit results late in the year [39] - The anticipated CEO transition costs and investments in strategic initiatives are estimated to be between $25 million to $35 million [39][130] Q&A Session Summary Question: What are the biggest changes required by the new program? - The company is focusing on a more targeted approach across the retail landscape and prioritizing innovation [53][54] Question: What are the input cost expectations for this year? - Commodities are expected to be a significant headwind, but the company has tools to offset these costs [58] Question: Can you comment on the competitive environment in the trash category? - The promotional environment has increased, but pricing in Waste & Storage remained flat [60][61] Question: What changes prompted the new management approach? - The company is focusing on strategic investments to drive growth in light of category forecasts [68] Question: How does the company plan to manage pricing in light of potential tariffs? - Pricing actions are designed to stay within key thresholds, with productivity also being a tool to offset costs [76][128] Question: Can you clarify the breakdown of the CEO transition costs? - Approximately half of the estimated costs are for CEO transition, with the other half for targeted investments [130]
Reynolds Consumer Products (REYN) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates
ZACKS· 2025-02-05 15:36
For the quarter ended December 2024, Reynolds Consumer Products (REYN) reported revenue of $1.02 billion, up 1.4% over the same period last year. EPS came in at $0.58, compared to $0.65 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $974.33 million, representing a surprise of +4.79%. The company has not delivered EPS surprise, with the consensus EPS estimate being $0.58.While investors scrutinize revenue and earnings changes year-over-year and how they compare with ...
Reynolds Consumer Products (REYN) Q4 Earnings Meet Estimates
ZACKS· 2025-02-05 14:26
Reynolds Consumer Products (REYN) came out with quarterly earnings of $0.58 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.65 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this company would post earnings of $0.42 per share when it actually produced earnings of $0.41, delivering a surprise of -2.38%.Over the last four quarters, the company has surpassed consensus EPS estimates two times.Reynolds Consumer Pr ...
Reynolds Consumer Products(REYN) - 2024 Q4 - Annual Report
2025-02-05 14:15
Customer Concentration and Sales - In 2024, sales to the top ten customers accounted for 72% of total revenue, with Walmart and Sam's Club contributing 31% and 17% respectively[68]. - The company relies on a relatively small number of customers, and the loss of any significant customer could materially impact financial condition and results[68]. Cost and Pricing Pressures - The company experienced significant increases in raw material costs in 2022, particularly in resin and aluminum prices, negatively impacting results[72]. - Labor costs in the United States continue to rise, and labor shortages could adversely affect operating expenses and growth[77]. - The company implemented multiple rounds of price increases in 2022, but these typically lagged behind material cost increases[74]. - Economic downturns could lead to decreased demand for products, impacting sales and profitability[80]. - Global supply chain issues have resulted in an inflationary environment, impacting gross margin and operating results[82]. Competition and Market Dynamics - The company faces competition from major players like The Clorox Company and S.C. Johnson, which increases pricing pressure and necessitates continuous innovation[70]. - Future regulatory changes regarding environmental concerns could affect product demand and operational costs[79]. Financial Performance and Projections - Total net revenues for the year ended December 31, 2024, were $3,695 million, a decrease of 1.6% from $3,756 million in 2023[304]. - Gross profit increased to $978 million in 2024, up from $942 million in 2023, reflecting a gross margin improvement[304]. - Net income for 2024 was $352 million, representing a 17.9% increase compared to $298 million in 2023[304]. - Earnings per share (EPS) for 2024 were $1.68, up from $1.42 in 2023, indicating a 18.3% growth[304]. Debt and Interest Rate Risks - The company had $1,695 million in outstanding indebtedness under its senior secured term loan facility maturing in 2027 and $694 million of borrowing capacity under its senior secured revolving credit facility maturing in 2029[106]. - As of December 31, 2024, the unhedged portion of the company's Term Loan Facility was approximately $545 million, exposing it to interest rate risk[110]. - Higher interest rates during the year ended December 31, 2023, increased the company's debt service obligations on unhedged variable rate indebtedness, leading to a decrease in net income and cash flows[111]. - A 100-basis point increase in interest rates would result in a $5 million increase in annual interest expense on unhedged borrowings[284]. - Interest expense, net for 2024 was $98 million, a decrease from $119 million in 2023, attributed to lower interest rates and effective hedging[382]. Operational and Compliance Risks - Approximately 20% of the company's employees are covered by collective bargaining agreements, which could impact operations if work stoppages occur[102]. - The company is subject to various environmental, health, and safety laws, which could lead to significant liabilities and compliance costs[113]. - Increased regulatory requirements related to ESG matters may result in higher compliance and operational costs, impacting profitability[117]. - Stakeholders are increasingly focused on ESG issues, which could affect the company's access to capital and consumer demand for its products[115]. Asset Management and Financial Health - Total assets increased to $4,873 million in 2024 from $4,780 million in 2023, representing a growth of 1.95%[310]. - Cash and cash equivalents rose to $137 million in 2024, up from $115 million in 2023, marking an increase of 19.13%[310]. - Total stockholders' equity increased to $2,142 million in 2024 from $1,983 million in 2023, a rise of 8.02%[310]. - Long-term debt decreased to $1,686 million in 2024 from $1,832 million in 2023, a reduction of 7.99%[310]. Corporate Governance and Ownership Structure - PFL controls approximately 74% of the company's outstanding shares, allowing it to determine the outcome of corporate actions requiring stockholder approval[135]. - The company is classified as a "controlled company" under Nasdaq rules, which allows it to rely on exemptions from certain corporate governance requirements[144]. - Potential conflicts of interest may arise due to directors holding positions with PEI Group entities, affecting decision-making processes[149]. Product and Quality Risks - The company may incur liabilities and experience harm to its reputation due to product quality issues, which could lead to recalls and loss of market share[88]. - The company relies on intellectual property rights to protect its business, but there is a risk of infringement claims that could adversely affect operations[100]. Research and Development - Research and development expenses for the year ended December 31, 2024, were $45 million, up from $44 million in 2023 and $38 million in 2022[346]. Miscellaneous Financial Information - The company paid dividends of $192 million in both 2024 and 2023, maintaining a consistent dividend policy[316]. - The company recorded a depreciation and amortization expense of $129 million in 2024, compared to $124 million in 2023, an increase of 4.03%[316].
Reynolds Consumer Products(REYN) - 2024 Q4 - Annual Results
2025-02-05 11:59
Financial Performance - Net income increased by 18% to $352 million for the fiscal year 2024, driven by improved margins and lower interest expenses [4] - Adjusted EBITDA for the fiscal year 2024 rose to $678 million, a 7% increase from $636 million in 2023, despite lower net revenues [6] - Net income for 2024 was $352 million, up from $298 million in 2023, reflecting a year-over-year increase of 17.9% [35] - Adjusted EBITDA for the year ended December 31, 2024, was $678 million, compared to $636 million in 2023, an increase of 6.6% [47] - Total revenues for the year ended December 31, 2024, were $3,695 million, slightly down from $3,756 million in 2023, a decrease of 1.6% [37] Retail Performance - Retail net revenues decreased to $3,518 million in 2024 from $3,559 million in 2023, reflecting a 1% decline in retail volume [6] - Retail volume in the fourth quarter grew by 1%, with notable performance in Reynolds Cooking & Baking and Hefty Waste & Storage segments [7] Cash Flow and Liquidity - Operating cash flow for the year ended December 31, 2024, was $489 million, representing a 72% conversion of adjusted EBITDA [6] - Cash provided by operating activities decreased to $489 million in 2024 from $644 million in 2023, a decline of 24.1% [35] - The company reported a decrease in cash used in financing activities to $346 million in 2024 from $457 million in 2023, a reduction of 24.2% [35] - Free cash flow decreased to $369 million in 2024 from $540 million in 2023, reflecting a decrease of about 32% [51] Debt and Leverage - Net debt leverage improved from 2.7x in 2023 to 2.3x in 2024, within the target range of 2.0 to 2.5x [5] - Net debt as of December 31, 2024, was $1,549 million, down from $1,717 million in 2023, a decrease of 9.8% [49] Capital Expenditures - Capital expenditures increased to $120 million in 2024 from $104 million in the prior year, focusing on automation and cost-saving programs [18] - Acquisition of property, plant and equipment increased to $120 million in 2024 compared to $104 million in 2023, indicating a rise of approximately 15% [51] Future Outlook - Full-year 2025 net revenues are expected to decline by low single digits compared to 2024's $3,695 million, with adjusted EBITDA projected between $670 million and $690 million [20] - The company anticipates continued focus on market expansion and product innovation in fiscal year 2025, although specific financial guidance was not provided [44] Dividend - The company declared a quarterly dividend of $0.23 per common share, payable on February 28, 2025 [23] Assets and Liabilities - Total assets increased to $4,873 million in 2024 from $4,780 million in 2023, representing a growth of 1.95% [33] - Total liabilities decreased to $2,731 million in 2024 from $2,797 million in 2023, a reduction of 2.4% [33]