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Sep 30, 2023
Reynolds Q3 2023 Earnings Report
Reported third quarter financial results with accelerating margins, updated earnings estimates, strong cash flow generation, and improved leverage.
Key Takeaways
Reynolds Consumer Products reported a 3% decrease in net revenues to $935 million, but net income increased by 63% to $78 million. Adjusted EBITDA rose by 42% to $165 million. The company's performance was driven by pricing actions and lower operational costs.
Net revenues decreased by 3% to $935 million compared to Q3 2022.
Net income increased by 63% to $78 million compared to Q3 2022.
Adjusted EBITDA increased by 42% to $165 million compared to Q3 2022.
Earnings per share increased by 61% to $0.37 compared to Q3 2022.
Reynolds
Reynolds
Reynolds Revenue by Segment
Revenue by Segment
Reynolds Cooking & Baking Revenue
CapyFin.comHefty Waste & Storage Revenue
CapyFin.comHefty Tableware Revenue
CapyFin.comPresto Products Revenue
CapyFin.comUnallocated Revenue
CapyFin.com Forward Guidance
The Company expects fourth quarter net revenues to be approximately 7% to 9% lower than prior year net revenues of $1,089 million, consisting of 2% lower pricing and 5% to 7% lower volume. The Company expects full-year net revenues to be approximately 2% lower than prior year net revenues of $3,817 million, consisting of 2% higher pricing and 4% lower volume.
Positive Outlook
- Consolidated retail volume is estimated to be down 2% to 4%, consisting of stable to growing volume in the Company’s three largest categories (aluminum foil, waste bags and food bags) and lower disposable tableware volume driven by category elasticity.
- Hefty is holding share in relevant disposable tableware segments and is stimulating consumer demand through a series of measures including increases in planned advertising, adjustments to planned promotions and smaller pack sizes.
- Reynolds Cooking & Baking recovery and lower operational costs
- Hefty gained additional share of waste bags in the quarter driven by strong innovation.
- Presto continued to increase share of store brand press-to-close food bags in the quarter.
Challenges Ahead
- Fourth quarter net revenues to be approximately 7% to 9% lower than prior year
- Consolidated retail volume is estimated to be down 2% to 4%
- Consolidated non-retail sales are estimated to be down $40 million by comparison to $75 million in the prior year.
- The Company expects full-year net revenues to be approximately 2% lower than prior year
- Consolidated non-retail sales are estimated to be down $70 million by comparison to $268 million in the prior year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income