Reynolds Consumer Products Reports Fourth Quarter and Full Year 2024 Financial Results; Provides 2025 Outlook
Net Income Grew
Retail Volumes Accelerated in Q4
Investing Strong Cash Flow in Future Revenue Growth and Additional Margin Expansion
Fiscal Year 2024 Highlights
-
Net Revenues of
vs.$3,695 million in 2023$3,756 million -
Retail Net Revenues of
vs.$3,518 million in 2023$3,559 million -
Non-Retail Net Revenues, which comprises aluminum sales to food service and industrial customers, of
vs.$177 million in 2023$197 million
-
Retail Net Revenues of
-
Net Income and Adjusted Net Income of
vs.$352 million in 2023$298 million -
EBITDA and Adjusted EBITDA of
vs.$678 million in 2023$636 million -
Earnings Per Share and Adjusted Earnings Per Share of
vs.$1.67 in 2023$1.42 -
Operating Cash Flow of
;$489 million 72% conversion of Adjusted EBITDA
Retail volume decreased
Net Income increased
The Company reduced Net Debt Leverage1 from 2.7x on December 31, 2023 to 2.3x on December 31, 2024, within the stated target leverage range of 2.0 to 2.5x.
“Our retail volume accelerated in the fourth quarter, and we have the team, business model and resources to drive strong growth, further margin expansion and consistently attractive shareholder returns,” said Scott Huckins, President and Chief Executive Officer. “Reynolds and Hefty are very strong brands, and we enter 2025 committed to executing new and existing programs to realize even more of RCP’s potential.”
1Net Debt is defined as current portion of long-term debt plus long-term debt less cash and cash equivalents. Net Debt Leverage is defined as Net Debt divided by Trailing Twelve Months Adjusted EBITDA. See “Use of Non-GAAP Financial Measures” for additional information. |
Fourth Quarter 2024 Highlights
-
Net Revenues of
vs.$1,021 million in Q4 2023$1,007 million -
Retail Net Revenues of
vs.$975 million in Q4 2023$972 million -
Non-Retail Net Revenues of
vs.$46 million in Q4 2023$35 million
-
Retail Net Revenues of
-
Net Income and Adjusted Net Income of
vs.$121 million in Q4 2023$137 million -
EBITDA and Adjusted EBITDA of
vs.$213 million in Q4 2023$238 million -
Earnings Per Share and Adjusted Earnings Per Share of
vs.$0.58 in Q4 2023$0.65
Retail volume grew
Net Income decreased
Reynolds Cooking & Baking
-
Net Revenues increased
to$17 million reflecting retail and non-retail growth$374 million -
Adjusted EBITDA decreased
to$7 million $82 million
Retail volume increased
The Adjusted EBITDA decrease was driven by higher operational costs and lower pricing, partially offset by the benefit of higher volume.
Hefty Waste & Storage
-
Net Revenues increased
to$8 million $245 million -
Adjusted EBITDA decreased
to$5 million $68 million
Retail volume increased
The Adjusted EBITDA decrease was driven by higher operational costs, partially offset by the benefit of higher volume.
Hefty Tableware
-
Net Revenues decreased
to$8 million $251 million -
Adjusted EBITDA decreased
to$6 million $52 million
Retail volume decreased
The Adjusted EBITDA decrease was driven by lower net revenues and higher operational costs.
Presto Products
-
Net revenues were unchanged at
$153 million -
Adjusted EBITDA decreased
to$4 million $30 million
Retail volume was unchanged, which included a one-point headwind from product portfolio optimization.
The Adjusted EBITDA decrease was driven by higher operational costs.
Balance Sheet and Cash Flow Highlights
Cash and cash equivalents were
Operating cash flow of
Capital expenditures were
Subsequent to quarter end, the Company made a voluntary principal payment of
“The strength of our balance sheet, cash flows and capital allocation discipline position us very well for increased investment, growth and profitability,” said Nathan Lowe, Chief Financial Officer. “We are applying our returns-based framework to a robust pipeline of product innovation and cost savings programs, and we look forward to unlocking even more of RCP’s potential in 2025 and over the long-term.”
Fiscal Year 2025 and First Quarter 2025 Outlook2
Full-year 2025 Net Revenues are expected to be down low single digits versus 2024 Net Revenues of
First quarter 2025 Net Revenues are expected to be down low single digits versus first quarter 2024 Net Revenues of
Full-year 2025 Adjusted EBITDA and Adjusted EPS reflect the following estimated adjustments from Net Income: depreciation and amortization of approximately
Quarterly Dividend
The Company’s Board of Directors has approved a quarterly dividend of
Earnings Webcast
The Company will host a live webcast this morning at 7:00 a.m. CT (8:00 a.m. ET). A link to the webcast and all related earnings materials will be available on the Company’s Investor Relations website at https://investors.reynoldsconsumerproducts.com.
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
2The Company is not able to quantify certain other items that will be excluded from forward-looking Adjusted EBITDA and Adjusted EPS without reasonable efforts due to uncertainties and potential variability of those items. Such unavailable information is not expected to have a significant impact on the Company’s future GAAP financial results. |
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 2025 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
Reynolds Consumer Products Inc. Consolidated Statements of Income (amounts in millions, except for per share data) |
|||||||||||||||
|
For the Three Months Ended |
|
For the Years Ended |
||||||||||||
|
December 31, |
|
December 31, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net revenues |
$ |
1,000 |
|
|
$ |
985 |
|
|
$ |
3,618 |
|
|
$ |
3,673 |
|
Related party net revenues |
|
21 |
|
|
|
22 |
|
|
|
77 |
|
|
|
83 |
|
Total net revenues |
|
1,021 |
|
|
|
1,007 |
|
|
|
3,695 |
|
|
|
3,756 |
|
Cost of sales |
|
(741 |
) |
|
|
(698 |
) |
|
|
(2,717 |
) |
|
|
(2,814 |
) |
Gross profit |
|
280 |
|
|
|
309 |
|
|
|
978 |
|
|
|
942 |
|
Selling, general and administrative expenses |
|
(100 |
) |
|
|
(103 |
) |
|
|
(429 |
) |
|
|
(430 |
) |
Other expense, net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Income from operations |
|
180 |
|
|
|
206 |
|
|
|
549 |
|
|
|
512 |
|
Interest expense, net |
|
(22 |
) |
|
|
(28 |
) |
|
|
(98 |
) |
|
|
(119 |
) |
Income before income taxes |
|
158 |
|
|
|
178 |
|
|
|
451 |
|
|
|
393 |
|
Income tax expense |
|
(37 |
) |
|
|
(41 |
) |
|
|
(99 |
) |
|
|
(95 |
) |
Net income |
$ |
121 |
|
|
$ |
137 |
|
|
$ |
352 |
|
|
$ |
298 |
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.58 |
|
|
$ |
0.65 |
|
|
$ |
1.68 |
|
|
$ |
1.42 |
|
Diluted |
$ |
0.58 |
|
|
$ |
0.65 |
|
|
$ |
1.67 |
|
|
$ |
1.42 |
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
||||||||
Basic |
|
210.2 |
|
|
|
210.0 |
|
|
|
210.1 |
|
|
|
210.0 |
|
Diluted |
|
210.9 |
|
|
|
210.0 |
|
|
|
210.4 |
|
|
|
210.0 |
|
Reynolds Consumer Products Inc. Consolidated Balance Sheets As of December 31 (amounts in millions, except for per share data) |
|||||||
|
2024 |
2023 |
|||||
Assets |
|
|
|||||
Cash and cash equivalents |
$ |
137 |
$ |
115 |
|||
Accounts receivable, net |
|
337 |
|
347 |
|||
Other receivables |
|
7 |
|
7 |
|||
Related party receivables |
|
6 |
|
7 |
|||
Inventories |
|
567 |
|
524 |
|||
Other current assets |
|
47 |
|
41 |
|||
Total current assets |
|
1,101 |
|
1,041 |
|||
Property, plant and equipment, net |
|
758 |
|
732 |
|||
Operating lease right-of-use assets, net |
|
90 |
|
56 |
|||
Goodwill |
|
1,895 |
|
1,895 |
|||
Intangible assets, net |
|
972 |
|
1,001 |
|||
Other assets |
|
57 |
|
55 |
|||
Total assets |
$ |
4,873 |
$ |
4,780 |
|||
Liabilities |
|
|
|||||
Accounts payable |
$ |
319 |
$ |
219 |
|||
Related party payables |
|
34 |
|
34 |
|||
Current operating lease liabilities |
|
20 |
|
16 |
|||
Income taxes payable |
|
5 |
|
22 |
|||
Accrued and other current liabilities |
|
161 |
|
187 |
|||
Total current liabilities |
|
539 |
|
478 |
|||
Long-term debt |
|
1,686 |
|
1,832 |
|||
Long-term operating lease liabilities |
|
73 |
|
42 |
|||
Deferred income taxes |
|
342 |
|
357 |
|||
Long-term postretirement benefit obligation |
|
14 |
|
16 |
|||
Other liabilities |
|
77 |
|
72 |
|||
Total liabilities |
$ |
2,731 |
$ |
2,797 |
|||
Stockholders’ equity |
|
|
|||||
Common stock, |
|
— |
|
— |
|||
Additional paid-in capital |
|
1,413 |
|
1,396 |
|||
Accumulated other comprehensive income |
|
35 |
|
50 |
|||
Retained earnings |
|
694 |
|
537 |
|||
Total stockholders’ equity |
|
2,142 |
|
1,983 |
|||
Total liabilities and stockholders’ equity |
$ |
4,873 |
$ |
4,780 |
Reynolds Consumer Products Inc. Consolidated Statements of Cash Flows For the Years Ended December 31 (amounts in millions) |
|||||||
|
2024 |
|
2023 |
||||
Cash provided by operating activities |
|
|
|
|
|||
Net income |
$ |
352 |
|
|
$ |
298 |
|
Adjustments to reconcile net income to operating cash flows: |
|
|
|
|
|||
Depreciation and amortization |
|
129 |
|
|
|
124 |
|
Deferred income taxes |
|
(11 |
) |
|
|
(5 |
) |
Stock compensation expense |
|
19 |
|
|
|
14 |
|
Change in assets and liabilities: |
|
|
|
||||
Accounts receivable, net |
|
11 |
|
|
|
— |
|
Other receivables |
|
1 |
|
|
|
7 |
|
Related party receivables |
|
1 |
|
|
|
— |
|
Inventories |
|
(42 |
) |
|
|
198 |
|
Accounts payable |
|
95 |
|
|
|
(31 |
) |
Related party payables |
|
— |
|
|
|
(12 |
) |
Income taxes payable / receivable |
|
(17 |
) |
|
|
9 |
|
Accrued and other current liabilities |
|
(26 |
) |
|
|
42 |
|
Other assets and liabilities |
|
(23 |
) |
|
|
— |
|
Net cash provided by operating activities |
|
489 |
|
|
|
644 |
|
Cash used in investing activities |
|
|
|
|
|||
Acquisition of property, plant and equipment |
|
(120 |
) |
|
|
(104 |
) |
Acquisition of business |
|
— |
|
|
|
(6 |
) |
Net cash used in investing activities |
|
(120 |
) |
|
|
(110 |
) |
Cash used in financing activities |
|
|
|
|
|||
Repayment of long-term debt |
|
(150 |
) |
|
|
(262 |
) |
Dividends paid |
|
(192 |
) |
|
|
(192 |
) |
Other financing activities |
|
(4 |
) |
|
|
(3 |
) |
Net cash used in financing activities |
|
(346 |
) |
|
|
(457 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
(1 |
) |
|
|
— |
|
Cash and cash equivalents: |
|
|
|
|
|||
Increase (decrease) in cash and cash equivalents |
|
22 |
|
|
|
77 |
|
Balance as of beginning of the year |
|
115 |
|
|
|
38 |
|
Balance as of end of the year |
$ |
137 |
|
|
$ |
115 |
|
|
|
|
|
|
|||
Cash paid: |
|
|
|
|
|||
Interest – long-term debt, net of interest rate swaps |
|
98 |
|
|
|
114 |
|
Income taxes |
|
125 |
|
|
|
90 |
|
Reynolds Consumer Products Inc. Segment Results (amounts in millions) |
||||||||||||||||||
|
Reynolds Cooking & Baking |
|
Hefty Waste & Storage |
|
Hefty Tableware |
|
Presto Products |
|
Unallocated(1) |
|
Total |
|||||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, 2024 |
$ |
374 |
|
$ |
245 |
|
$ |
251 |
|
$ |
153 |
|
$ |
(2 |
) |
|
$ |
1,021 |
Three Months Ended December 31, 2023 |
|
357 |
|
|
237 |
|
|
259 |
|
|
153 |
|
|
1 |
|
|
|
1,007 |
Year Ended December 31, 2024 |
|
1,247 |
|
|
959 |
|
|
918 |
|
|
596 |
|
|
(25 |
) |
|
|
3,695 |
Year Ended December 31, 2023 |
|
1,273 |
|
|
942 |
|
|
967 |
|
|
593 |
|
|
(19 |
) |
|
|
3,756 |
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, 2024 |
$ |
82 |
|
$ |
68 |
|
$ |
52 |
|
$ |
30 |
|
$ |
(19 |
) |
|
$ |
213 |
Three Months Ended December 31, 2023 |
|
89 |
|
|
73 |
|
|
58 |
|
|
34 |
|
|
(16 |
) |
|
|
238 |
Year Ended December 31, 2024 |
|
222 |
|
|
272 |
|
|
147 |
|
|
130 |
|
|
(93 |
) |
|
|
678 |
Year Ended December 31, 2023 |
|
184 |
|
|
261 |
|
|
174 |
|
|
112 |
|
|
(95 |
) |
|
|
636 |
(1) |
The unallocated net revenues include elimination of inter-segment revenues and other revenue adjustments. The unallocated Adjusted EBITDA represents the combination of corporate expenses which are not allocated to our segments and other unallocated revenue adjustments. |
Components of Change in Net Revenues for the Three Months Ended December 31, 2024 vs. the Three Months Ended December 31, 2023 |
||||||||
|
Price |
|
Volume/Mix |
|
Total |
|
||
|
|
|
Retail |
|
Non-Retail |
|
|
|
Reynolds Cooking & Baking |
(1) |
% |
3 |
% |
3 |
% |
5 |
% |
Hefty Waste & Storage |
— |
% |
3 |
% |
— |
% |
3 |
% |
Hefty Tableware |
(1) |
% |
(2) |
% |
— |
% |
(3) |
% |
Presto Products |
— |
% |
— |
% |
— |
% |
— |
% |
Total RCP |
(1) |
% |
1 |
% |
1 |
% |
1 |
% |
Components of Change in Net Revenues for the Twelve Months Ended December 31, 2024 vs. the Twelve Months Ended December 31, 2023 |
||||||||
|
Price |
|
Volume/Mix |
|
Total |
|
||
|
|
|
Retail |
|
Non-Retail |
|
|
|
Reynolds Cooking & Baking |
— |
% |
(1) |
% |
(1) |
% |
(2) |
% |
Hefty Waste & Storage |
1 |
% |
1 |
% |
— |
% |
2 |
% |
Hefty Tableware |
(2) |
% |
(3) |
% |
— |
% |
(5) |
% |
Presto Products |
1 |
% |
— |
% |
— |
% |
1 |
% |
Total RCP |
(1) |
% |
(1) |
% |
— |
% |
(2) |
% |
Use of Non-GAAP Financial Measures
We use non-GAAP financial measures “Adjusted EBITDA,” “Adjusted Net Income,” “Adjusted Earnings Per Share,” “Net Debt,” “Net Debt to Trailing Twelve Months Adjusted EBITDA,” “Free Cash Flow,” and “Conversion of Adjusted EBITDA” 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 Adjusted Net Income and Adjusted Earnings Per Share (“Adjusted EPS”) as Net Income and Earnings Per Share (“EPS”) calculated in accordance with GAAP, plus 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 define Net Debt to Trailing Twelve Months Adjusted EBITDA as Net Debt (as defined above) as of the end of the period to Adjusted EBITDA (as defined above) for the period. We define Free Cash Flow as net cash provided by operating activities in the period minus the acquisition of property, plant and equipment in the period. We define Conversion of Adjusted EBITDA as the ratio of net cash provided by operating activities in the period to Adjusted EBITDA (as defined above) for the period, expressed as a percentage.
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 Adjusted Net Income and Adjusted Earnings Per Share as supplemental measures to evaluate our business’ performance in a way that also considers our ability to generate profit without the impact of certain items. We use Net Debt as we believe it is a more representative measure of our liquidity. We use Net Debt to Trailing Twelve Months Adjusted EBITDA because it reflects our ability to service our debt obligations. We use Free Cash Flow because it measures our ability to generate additional cash from our business operations. We present Conversion of Adjusted EBITDA as it measures our management of working capital and profit conversion to cash. 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 2025, where adjusted, is provided on a non-GAAP basis. While the Company is providing estimated amounts for certain of the expected adjustments in this release, the Company cannot provide full reconciliations for its expected first quarter and fiscal year 2025 Adjusted EBITDA and Adjusted EPS to expected Net Income and expected EPS under “Fiscal Year 2025 and First Quarter 2025 Outlook” without unreasonable effort because certain items that impact Net Income and EPS and other reconciling metrics are out of the Company’s control and/or cannot be reasonably predicted at this time, which unavailable information is not expected to 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 first quarter 2025 Adjusted EBITDA and Adjusted EPS outlook, as described above) to the most directly comparable GAAP measures, beginning on the following page.
Reynolds Consumer Products Inc. Reconciliation of Net Income to EBITDA and Adjusted EBITDA (amounts in millions) |
|||||||||||
|
For the Three Months Ended December 31, |
|
For the Years Ended December 31, |
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
(in millions) |
|
(in millions) |
||||||||
Net income – GAAP |
$ |
121 |
|
$ |
137 |
|
$ |
352 |
|
$ |
298 |
Income tax expense |
|
37 |
|
|
41 |
|
|
99 |
|
|
95 |
Interest expense, net |
|
22 |
|
|
28 |
|
|
98 |
|
|
119 |
Depreciation and amortization |
|
33 |
|
|
32 |
|
|
129 |
|
|
124 |
EBITDA and Adjusted EBITDA (Non-GAAP) |
$ |
213 |
|
$ |
238 |
|
$ |
678 |
|
$ |
636 |
Reynolds Consumer Products Inc. Reconciliation of Total Debt to Net Debt and Calculation of Net Debt to Trailing Twelve Months Adjusted EBITDA (amounts in millions, except for Net Debt to Trailing Twelve Months Adjusted EBITDA) |
|||
As of December 31, 2024 |
|
||
Current portion of long-term debt |
$ |
— |
|
Long-term debt |
|
1,686 |
|
Total debt |
|
1,686 |
|
Cash and cash equivalents |
|
(137 |
) |
Net debt (Non-GAAP) |
$ |
1,549 |
|
For the twelve months ended December 31, 2024 |
|
||
Adjusted EBITDA (Non-GAAP) |
$ |
678 |
|
|
|
||
Net Debt to Trailing Twelve Months Adjusted EBITDA |
2.3x |
|
As of December 31, 2023 |
|
||
Current portion of long-term debt |
$ |
— |
|
Long-term debt |
|
1,832 |
|
Total debt |
|
1,832 |
|
Cash and cash equivalents |
|
(115 |
) |
Net debt (Non-GAAP) |
$ |
1,717 |
|
For the twelve months ended December 31, 2023 |
|
|
|
Adjusted EBITDA (Non-GAAP) |
$ |
636 |
|
|
|
|
|
Net Debt to Trailing Twelve Months Adjusted EBITDA |
2.7x |
|
Reynolds Consumer Products Inc. Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (amounts in millions) |
|||||||
|
For the Years Ended December 31 |
||||||
|
2024 |
|
2023 |
||||
Net cash provided by operating activities |
$ |
489 |
|
|
$ |
644 |
|
Acquisition of property, plant and equipment |
|
(120 |
) |
|
|
(104 |
) |
Free cash flow |
$ |
369 |
|
|
$ |
540 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20250205634087/en/
Investor Contact
Mark Swartzberg
Mark.Swartzberg@reynoldsbrands.com
(847) 482-4081
Source: Reynolds Consumer Products Inc.