Reynolds Consumer Products Inc. (NASDAQ:REYN) Q2 2023 Earnings Conference Call August 9, 2023 8:00 AM ET Company Participants Mark Swartzberg - Vice President of Investor Relations Lance Mitchell - President and Chief Executive Officer Michael Graham - Chief Financial Officer Conference Call Participants Robert Ottenstein - Evercore Inc. Lauren Lieberman - Barclays Mark Astrachan - Stifel Financial Corp. Andrea Teixeira - JPMorgan Chase & Co. Peter Grom - UBS Group AG Bill Chappell - Truist Securities Brian ...

WASHINGTON, DC 20549 _______________________________________________________________________________________ _______________________________________________________________________________________ FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION For the quarterly period ended June 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 193 ...

Financial Data and Key Metrics Changes - For Q1 2023, net revenues increased by 3% compared to the prior year, driven by price increases that offset a 2% volume decline [16] - Adjusted EBITDA for Q1 2023 is expected to be in the range of $135 million to $145 million, up from $118 million in the prior year [1] - For the full year 2023, net revenues are expected to be flat, plus or minus 1%, with adjusted EBITDA projected between $605 million and $635 million [3] Business Line Data and Key Metrics Changes - Reynolds Cooking & Baking segment is stabilizing with operational improvements, but still faces headwinds from higher material costs [19] - Hefty Waste & Storage and Hefty Tableware segments are operating at restored levels of profitability, with Hefty Waste Bags gaining market share [56][117] - Foil consumption is up 3% compared to pre-pandemic levels, and Hefty is gaining share across all generational groups, especially millennials [8][16] Market Data and Key Metrics Changes - Higher-income consumers are purchasing larger sizes, while lower-income households are opting for smaller sizes due to price sensitivity [25] - Disposable dish consumption is slightly above pre-pandemic levels, with Hefty dishes gaining share [26] - The competitive environment is described as rational, with some increases in promotional activities across categories [28] Company Strategy and Development Direction - The company is focused on returning Reynolds Cooking & Baking to historical profitability levels through operational efficiencies and cost management [55][58] - Investment in innovation and advertising is expected to drive growth, with plans to increase trade investment and promotional activities [60][61] - The company is developing a long-term strategic plan, with an Investor Day expected to provide more details later in the year [97][107] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving earnings growth for 2023, supported by a recovery plan for Reynolds Cooking & Baking [14][58] - The company is monitoring consumer behavior closely due to inflationary pressures and is prepared to adjust pricing strategies as necessary [62][119] - Management anticipates that the recovery plan is on track and expects to see improvements in margins and profitability in the second half of 2023 [19][90] Other Important Information - The search for a new CFO is progressing well, with an announcement expected before the fourth quarter results [4][11] - Cash conversion has improved compared to the previous year, and the company plans to remain disciplined in capital spending [10][127] Q&A Session Summary Question: What drove the higher unallocated costs in the quarter? - Higher professional fees were part of the costs, which were expected and included in the overall guidance [125] Question: How is the competitive environment affecting pricing and promotions? - The competitive environment is rational, with some increases in promotional activities, but the company has planned for this [28] Question: What are the expectations for volume growth during normal times? - The company expects low single-digit volume growth across most categories during normal conditions [109] Question: How is the company addressing consumer behavior changes? - The company is monitoring consumer behavior closely and adjusting pricing strategies as necessary to maintain market share [62][119]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _______________________________________________________________________________________ _______________________________________________________________________________________ FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 19 ...

Three Months Ended March 31, 2023 Year Ended December 31, 2023 | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-------------------------------|-------|------------|----------|-------|-------|-------------|-------|------------| | Net income (GAAP) | $ | Low \n12 | High \n$ | \n20 | $ | Low \n274 | $ | High \n296 | | Income tax expense | | 4 | | 6 | | 91 | | 99 | | Interest expense, net | | 30 | | 30 | | 120 | | 120 | | Depreciation and amortization | | 29 | | 29 | | 120 | | 120 | | Adjusted EBITDA | ...

Reynolds Consumer Products Inc. (NASDAQ:REYN) Q4 2022 Earnings Conference Call February 8, 2023 8:00 AM ET Company Participants Mark Swartzberg - Investor Relations Lance Mitchell - President and Chief Executive Officer Michael Graham - Chief Financial Officer Conference Call Participants Lauren Lieberman - Barclays Jason English - Goldman Sachs Kaumil Gajrawala - Credit Suisse Tristen Chau - Stifel Peter Grom - UBS Rob Ottenstein - Evercore ISI Operator Ladies and gentlemen, thank you for standing by and w ...

Revenue Concentration and Customer Dependence - In 2022, sales to the top ten customers accounted for 74% of total revenue, with Walmart and Sam's Club contributing 30% and 18% respectively[68]. - The company relies on a relatively small number of customers for a significant portion of revenue, making it vulnerable to customer consolidation and loss[67]. Cost Pressures and Economic Factors - The company experienced significant increases in raw material costs in both 2021 and 2022, particularly in resin and aluminum prices, negatively impacting results[72]. - Labor costs in the United States continue to rise, and the company increased prices in 2022 to pass these costs onto customers[77]. - Fluctuations in raw material and energy costs, including tariffs, have introduced greater uncertainty and could adversely affect financial results[73]. - Economic downturns and changes in consumer demand could lead to decreased sales and profitability[80]. - Supply chain disruptions and labor shortages continue to impact operations and could lead to increased costs[81]. Financial Performance and Results - Total net revenues for the year ended December 31, 2022, were $3,817 million, an increase from $3,556 million in 2021, representing a growth of 7.3%[288]. - Gross profit for 2022 was $776 million, down from $811 million in 2021, indicating a decrease of 4.3%[288]. - Net income for 2022 was $258 million, compared to $324 million in 2021, reflecting a decline of 20.4%[288]. - Earnings per share (EPS) for 2022 were $1.23, down from $1.54 in 2021, a decrease of 20.1%[288]. - The company reported interest expense of $76 million in 2022, an increase from $48 million in 2021, representing a rise of 58.3%[288]. Debt and Financing - As of December 31, 2022, the company had $2,107 million in outstanding indebtedness under its Term Loan Facility and $243 million borrowing capacity under its Revolving Facility[101]. - The unhedged portion of the Term Loan Facility was approximately $957 million as of December 31, 2022, exposing the company to interest rate risk[104]. - The company may need additional financing for growth strategies, including acquisitions, which may not be available on favorable terms[103]. Ownership and Governance - PFL controls approximately 74% of the voting power of the company's outstanding common stock, allowing it to determine the outcome of corporate actions requiring stockholder approval[116]. - The company is classified as a "controlled company" under Nasdaq rules, which allows it to rely on exemptions from certain corporate governance requirements[125]. - The concentration of PFL's ownership may discourage other parties from making tender offers, potentially preventing stockholders from receiving a premium for their shares[118]. Risks and Compliance - The company faces risks related to product quality and potential recalls, which could harm reputation and financial performance[85]. - The company may incur material liabilities under existing or future laws and regulations, which could adversely affect its business and financial condition[132]. - The company is subject to various environmental, health, and safety laws, which impose strict liability for costs related to hazardous substances[134]. - The company may face increased compliance costs due to evolving ESG regulations and stakeholder expectations[136]. Seasonal Trends - The company experiences seasonality, with the strongest sales in Q4 and weakest in Q1, influenced by major U.S. holidays[87]. Investments and Assets - Total assets as of December 31, 2022, were $4,929 million, up from $4,812 million in 2021, showing an increase of 2.4%[294]. - Total equity as of December 31, 2022, increased to $1,868 million, up from $1,756 million in 2021, representing a growth of 6.4%[298]. - The company’s inventories decreased by $139 million in 2022, compared to a decrease of $165 million in 2021[301]. - Property, plant, and equipment, net rose to $722 million in 2022 from $677 million in 2021, reflecting a 7% increase[349]. Interest Rate Management - The company has significant variable rate debt commitments outstanding as of December 31, 2022, accruing interest at the LIBO rate plus an applicable margin of 1.75%[266]. - The company entered into interest rate swaps fixing the LIBO rate to an annual rate of 2.70% to 3.44% for an aggregate notional amount of $1,000 million[267]. - A 100-basis point increase in interest rates would result in a $10 million increase in annual interest expense on borrowings[269]. Dividends and Shareholder Returns - The company intends to continue paying quarterly cash dividends, but its ability to do so may be limited by operational results and debt restrictions[114]. - The company declared and paid dividends of $0.92 per share in both 2021 and 2022, totaling $192 million each year[301]. Related Party Transactions - The company has entered into various related party transactions with PEI Group, which may limit its operational flexibility and could involve conflicts of interest[120]. - Conflicts of interest may arise as certain directors hold positions with PEI Group entities, potentially impacting decision-making[128].

Financial Data and Key Metrics Changes - Net revenues for Q3 2022 were $967 million, a 7% increase from $905 million in Q3 2021, driven by price increases, partially offset by a decline in volume [19] - Adjusted EBITDA for the quarter was $116 million, down 12% from $132 million in the previous year, due to lower volume and higher SG&A costs [19] - Adjusted earnings per share for the quarter was $0.24 [19] Business Line Data and Key Metrics Changes - Pricing increased by 14%, offsetting all material, manufacturing, and logistics cost increases, while volume declined by 7% [20] - Hefty Tableware volume increased by 7%, while Reynolds Cooking and Baking volume declined by 14% [20][22] - Hefty waste and storage volume declined by 9%, and Presto volume decreased by 8% [20][22] Market Data and Key Metrics Changes - The waste bag category grew by 7% compared to 2019, reflecting increased consumer spending time at home [11][56] - Disposable tableware, particularly plastic party cups, saw a 9% increase compared to 2019 levels [56] - The foil category, including Reynolds Wrap, experienced a 4.5% increase in equivalent volume compared to the same period in 2019 [55] Company Strategy and Development Direction - The company aims for margin expansion and profit growth in Q4 2022 and 2023, leveraging pricing actions and operational improvements [16][24] - The integrated brand and store brand model is viewed as a competitive advantage, with a focus on innovation and consumer demand [11][12] - The company is committed to returning to pre-pandemic profitability levels in 2023 [37] Management's Comments on Operating Environment and Future Outlook - The economic environment remains dynamic with inflationary pressures and uncertain price elasticity impacting revenue expectations [10][16] - Management expressed confidence in adapting to market conditions and highlighted the importance of promotional activities in driving consumer demand [10][11] - The company anticipates a return to earnings growth and increased flexibility for future investments [16][28] Other Important Information - The company is implementing operational changes to improve reliability and efficiency in the Cooking and Baking segment due to recent manufacturing challenges [15][23] - Capital spending is projected to be approximately $135 million to $140 million, with a focus on improving balance sheet efficiency [25][27] Q&A Session Summary Question: Follow-up on cooking and baking profitability issues - Management acknowledged that recent operational performance has fallen short of standards due to unplanned equipment downtime, impacting manufacturing costs and production volume [33][34] Question: Return to pre-pandemic profitability levels - Management confirmed that the goal is to return to pre-pandemic profitability within 2023 [36][37] Question: Sales performance and elasticity - Management indicated that September volume met expectations, and promotional strategies are focused on quality and features rather than just price [42][43] Question: Trends in foil category and consumer behavior - Management noted that cooking at home has increased, benefiting the foil category, and younger consumers are cooking more often [49][50] Question: Impact of inflation and price elasticity on margins - Management stated that closing the pricing gap and easing commodity costs will improve margins going into 2023 [59][60] Question: Volume expectations for 2023 - Management is still finalizing plans for 2023 and will have a clearer outlook after the holiday season [72]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR WASHINGTON, DC 20549 REYNOLDS CONSUMER PRODUCTS INC. (Exact name of Registrant as specified in its charter) ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Incorporation or Organization) For the transition period from __________ to __________ Delaware 45-3 ...

Third Quarter 2022 Earnings Presentation November 8, 2022 Disclaimer Forward-Looking Statements and Other Information 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 fourth quarter and fiscal year 2022 guidance. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expects, ...