Reynolds Consumer Products Hosts 2024 Investor Day
- None.
- None.
Insights
Reynolds Consumer Products' Investor Day and the introduction of their 2030 Vision represent a strategic roadmap for the company's future growth and operational efficiency. The emphasis on organic volume growth and margin expansion through the 'Grow the Core' and 'Expand Margins' initiatives underscores a focus on sustainable product innovation and cost management. This is particularly relevant in the consumer products sector, where competition is fierce and margins can be thin. The 'Champion Cash' pillar indicates a prudent approach to capital management, potentially leading to improved liquidity and creditworthiness.
From a market perspective, the 'Explore for More' pillar suggests that Reynolds is seeking to diversify its revenue streams, which could mitigate risks associated with market volatility. Additionally, the reaffirmation of Q1 and full-year 2024 guidance provides a level of predictability and confidence for investors, signaling management's belief in the company's stability and growth prospects. Considering the provided financial outlook, the projected net income and adjusted EBITDA figures suggest a healthy profitability margin, which is a positive indicator for potential investors.
Reynolds Consumer Products' financial algorithm and capital allocation framework, as presented by CFO Scott Huckins, are critical for evaluating the company's financial health and investment potential. The targeted net debt figures indicate a strategic approach to leverage, aiming to balance growth investments with financial stability. A reduction in net debt can lead to lower interest expenses and an improved debt-to-equity ratio, which is often viewed favorably by investors and credit rating agencies.
The provided earnings per share (EPS) guidance for both Q1 and full year 2024 offers insight into the company's expected profitability and earnings growth. An EPS within the projected range would align with industry standards for a company of Reynolds' size and market position. The total shareholder return (TSR) drivers discussed will be of particular interest to investors, as they directly relate to the potential return on investment from both capital gains and dividends.
The introduction of sustainable new products, as part of the 'Grow the Core' initiative, is a response to increasing consumer demand for environmentally friendly options. This move not only caters to market trends but also positions Reynolds Consumer Products as a forward-thinking player in the industry. The focus on digital transformation within the 'Expand Margins' pillar can lead to improved operational efficiencies and reduced environmental impact through more streamlined processes.
Investing in enabling technologies, as mentioned in the 'Explore for More' pillar, could further enhance sustainability efforts and operational efficiency, potentially leading to cost savings and a stronger competitive edge. This strategic focus on sustainability is not only beneficial for the environment but can also result in long-term cost savings and brand loyalty, which are important factors for the company's financial performance and stock valuation.
Introduces 2030 Vision
Reaffirms Q1 2024 and Full Year 2024 Guidance
The Reynolds Consumer Products 2024 Investor Day will feature presentations from key members of the leadership team, providing in-depth discussions on the Company’s strategic priorities, financial objectives and long-term goals.
The presentation will kick-off with an address from Lance Mitchell, President and Chief Executive Officer, who will introduce the Reynolds Consumer Products 2030 Vision along with the four pillars that support it. The four pillars of the 2030 vision are: (1) “Grow the Core”, driving organic volume growth through championing the Reynolds categories, leveraging innovation and sustainable new products; (2) “Expand Margins” through leveraging the Reyvolution program for operating efficiencies, cost management, and digital transformation; (3) “Champion Cash” by investing in the business for revenue and profit growth, extending working capital efficiencies, and increasing financial flexibility through debt reduction; and (4) “Explore for More”, expanding the business scope through innovation in adjacent categories, targeted acquisition opportunities, and investing in and developing enabling technologies.
Each of the Presidents of the four Reynolds Consumer Products business units will then review their business dynamics and strategies. Judi Buckner will review Reynolds Cooking & Baking, Lisa Smith will present Hefty Waste & Storage, Chris Corey will discuss Presto Products, and Rachel Bishop will review Hefty Tableware.
Scott Huckins, CFO, will review the Reynolds Consumer Products financial algorithm, capital allocation framework, and total shareholder return (TSR) drivers. The session will conclude with a question-and-answer session for participants.
Additionally, Reynolds Consumer Products is reaffirming guidance for the first quarter and full year 2024. This financial guidance was detailed in the Company’s financial results press release dated February 7, 2024. The summary guidance tables are repeated here:
|
Fiscal Year 2024 Outlook |
Net revenues |
|
Net income |
|
Adjusted EBITDA |
|
Earnings per share |
|
Net debt at December 31, 2024 |
|
|
Q1 2024 Outlook |
Net revenues |
|
Net income |
|
Adjusted EBITDA |
|
Earnings per share |
|
About Reynolds Consumer Products Inc.
Reynolds Consumer Products is a leading provider of household products that simplify daily life so consumers can enjoy what matters most. With a presence in
Forward Looking Statements
This press release 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 2024 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,” “model”, “assumes,” “confident,” “look forward,” “potential” “on track”, or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth and recovery of profitability, management of costs and other disruptions and other strategies, and anticipated trends in our business, including expected levels of commodity costs and volume. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including but not limited to the risk factors set forth in our most recent Annual Report on Form 10-K and in our Quarterly Reports on Form 10-Q.
For additional information on these and other factors that could cause our actual results to materially differ from those set forth herein, please see our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and subsequent filings. Investors are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
REYN-F
Use of Non-GAAP Financial Measures
We use non-GAAP financial measures “Adjusted EBITDA” and “Net Debt” in evaluating our past results and future prospects. We define Adjusted EBITDA as net income calculated in accordance with GAAP, plus the sum of income tax expense, net interest expense, depreciation and amortization and further adjusted to exclude IPO and separation-related costs, as well as other non-recurring costs. We define Net Debt as the current portion of long-term debt plus long-term debt less cash and cash equivalents.
We present Adjusted EBITDA because it is a key measure used by our management team to evaluate our operating performance, generate future operating plans and make strategic decisions. In addition, our chief operating decision maker uses Adjusted EBITDA of each reportable segment to evaluate the operating performance of such segments. We use Net Debt as we believe it is a more representative measure of our liquidity. Accordingly, we believe presenting these measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management team and board of directors.
Non-GAAP information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, our non-GAAP financial measures may not be the same as or comparable to similar non-GAAP financial measures presented by other companies.
Guidance for fiscal year and first quarter 2024, where adjusted, is provided on a non-GAAP basis. The Company cannot reconcile its expected Net Debt at December 31, 2024 to expected total debt, or expected ratios involving Net Debt, without reasonable effort because certain items that impact total debt and other reconciling measures are out of the Company’s control and/or cannot be reasonably predicted at this time, to which unavailable information could have a significant impact on the Company’s GAAP financial results.
Please see reconciliations of non-GAAP measures used in this release (with the exception of our December 31, 2024 Net Debt outlook, as described above) to the most directly comparable GAAP measures, beginning on the following page.
Reynolds Consumer Products Inc. |
|||||||||||
Reconciliation of Q1 2024 and FY2024 Net Income Guidance to Adjusted EBITDA Guidance |
|||||||||||
(amounts in millions) |
|||||||||||
|
Three Months Ended March 31, 2024 |
|
Year Ended December 31, 2024 |
||||||||
|
Low |
|
High |
|
Low |
|
High |
||||
Net income (GAAP) |
$ |
44 |
|
$ |
48 |
|
$ |
331 |
|
$ |
347 |
Income tax expense |
|
15 |
|
|
16 |
|
|
108 |
|
|
112 |
Interest expense, net |
|
26 |
|
|
26 |
|
|
100 |
|
|
100 |
Depreciation and amortization |
|
30 |
|
|
30 |
|
|
121 |
|
|
121 |
Adjusted EBITDA |
$ |
115 |
|
$ |
120 |
|
$ |
660 |
|
$ |
680 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240318006075/en/
Investor Contact
Mark Swartzberg
Mark.Swartzberg@reynoldsbrands.com
(847) 482-4081
Source: Reynolds Consumer Products Inc.
FAQ
When will Reynolds Consumer Products host its 2024 Investor Day?
What are the four pillars of Reynolds Consumer Products 2030 Vision?
Who will kick-off the Reynolds Consumer Products 2024 Investor Day presentation?
What financial guidance has Reynolds Consumer Products reaffirmed for Q1 2024 and Full Year 2024?
Where can the live webcast of the Investor Day be found?
