Reynolds Consumer Products(US:REYN)2025-10-29 13:02Financial Data and Key Metrics Changes - Third quarter net revenues were $931 million, an increase of more than 2% from $910 million in the year-ago period [16] - Adjusted EPS was $0.42 compared to $0.41 in the year-ago period, reflecting lower interest costs and tax initiatives [17] - Consolidated adjusted EBITDA was $168 million compared to $171 million in the year-ago period [17] Business Line Data and Key Metrics Changes - Retail revenue of $864 million increased 1% compared to the third quarter of 2023, with retail volume growing 1% excluding foam products [16] - Reynolds Wrap retail sales were up 7%, with volumes outperforming the category [9] - Hefty Waste Bags saw retail takeaways increase by 9%, outperforming the category by 10 points [31] Market Data and Key Metrics Changes - The operating environment remains challenging, particularly for low and middle-income consumers facing cost inflation [8] - The company noted that inflation remains around 3%, above the Fed's target of 2% [33] - Consumer sentiment has declined, with double-digit decreases year to date heading into the holidays [33] Company Strategy and Development Direction - The company is focusing on innovation and revenue growth management to drive share gains and profitability [39] - A new Chief Commercial Officer is leading growth programs to enhance market share across major customers [9] - The company is investing in high-return projects to support growth and drive margin improvements [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in retail trends and the effectiveness of implemented programs to drive near and long-term results [19] - The company anticipates net revenues to be flat to down 1% for the full year compared to 2024 [19] - Management highlighted the importance of maintaining cost discipline in all areas, including SG&A [19] Other Important Information - The company is making progress in managing manufacturing, supply chain, and SG&A costs while driving market share [7] - New product innovations, such as Reynolds Kitchens Air Fryer liners, have been recognized for their growth potential [10] - The company is positioned well within its target leverage range of 2x-2.5x EBITDA, allowing for continued investment in growth opportunities [21] Q&A Session Summary Question: How do you see the setup for the important holiday season in terms of promotional intensity and consumer behavior? - Management noted increased promotional activity in waste and food bags but feels confident in navigating the promotional environment [31][32] - Consumer sentiment remains under pressure, with inflation and cooling labor markets impacting lower-income demographics [33][34] Question: Can you elaborate on the risk of retailers shifting store brands to other suppliers? - Management flagged this risk due to economic challenges and uncertainty in supply chains, but expects to win more than lose as a US-centric manufacturer [34] Question: What is the grand plan related to operational capabilities and long-term growth? - The company is focused on driving growth through innovation, revenue growth management, and share gains at the customer level [39] Question: What is the outlook for the tableware business and foam products? - The tableware business is down primarily due to foam headwinds, but profitability has increased despite volume declines [42][43] Question: How is the Hefty Waste and Storage segment performing in terms of profitability and distribution? - The segment continues to perform well, with significant volume growth and effective management of promotional activities [46][47] Question: What is the current state of consumer behavior regarding dining out versus cooking at home? - There are modest tailwinds from increased cooking at home, but rising prices in the marketplace are also a factor [64]