Reynolds Q2 2023 Earnings Report
Key Takeaways
Reynolds Consumer Products reported a 3% increase in net revenues to $940 million and a 27% increase in net income to $66 million for Q2 2023. Adjusted EBITDA also increased by 27% to $150 million. The company's performance was driven by successful implementation of Reynolds Cooking & Baking recovery initiatives and effective execution across all businesses.
Net revenues increased by 3% due to higher pricing and stable volume.
Net income and Adjusted EBITDA increased due to pricing actions and lower operational costs.
Reynolds Cooking & Baking recovery plan execution led to outstanding results with a 9% increase in net revenues.
The company is forecasting strong earnings growth for the remainder of the year and has resumed paying down debt.
Reynolds
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Reynolds Revenue by Segment
Forward Guidance
The Company expects a 3% to 5% decline in third quarter net revenues consisting of essentially unchanged pricing and 3% to 5% lower volume. The Company expects full-year net revenues to be in line with prior year net revenues, plus or minus 1%, consisting of 2% higher pricing and 2% lower volume at the mid-point of the guide.
Positive Outlook
- Reynolds Cooking & Baking is performing well and is on track for earnings consistent with historical levels in the second half of 2023.
- Commodity rates have been consistent with Company expectations since reporting first quarter 2023 results and are expected to remain stable over the balance of the year.
- Consolidated retail volume is estimated to be in line with prior year consolidated retail volume.
- Reynolds Cooking & Baking is performing well and is on track for earnings consistent with historical levels in the second half of 2023.
- Consolidated retail volume is estimated to be in line with prior year consolidated retail volume.
Challenges Ahead
- The Company expects a 3% to 5% decline in third quarter net revenues consisting of essentially unchanged pricing and 3% to 5% lower volume.
- Memorial Day and July Fourth holiday promotions resulted in stronger second quarter shipments and higher household inventories at the start of the third quarter.
- Consolidated non-retail sales are estimated to be down $60 million by comparison to $268 million in the prior year.
- The Company expects a 3% to 5% decline in third quarter net revenues consisting of essentially unchanged pricing and 3% to 5% lower volume.
- Consolidated non-retail sales are estimated to be down $60 million by comparison to $268 million in the prior year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income