Reynolds Consumer Products Inc. (Nasdaq: REYN) (the “Company” or
“RCP”) today provided its third quarter 2020 net revenues and
Adjusted EBITDA margin estimates and reiterated its previously
provided guidance for the full fiscal year 2020.
President and Chief Executive Officer, Lance Mitchell, and Chief
Financial Officer, Michael Graham, will be participating in the
Barclays Global Consumer Staples Conference on September 9 and 10,
2020, including a webcasted virtual fireside chat at 12:40 p.m. ET
on Wednesday, September 9, 2020, where they will discuss today’s
update.
Based on preliminary results to date in the third quarter, net
revenues for the third quarter of 2020 are estimated to increase at
a high single-digit rate compared to net revenues of $741.3 million
in the prior year period. Adjusted EBITDA margin for the third
quarter of 2020 is estimated at approximately 23%.
The Company continues to expect fiscal year 2020 results to be
at the upper end of the previously provided ranges for the
following financial metrics: Net Income, Earnings Per Share,
Adjusted EBITDA, Adjusted Net Income, and Adjusted Earnings Per
Share. The Company is also confirming its previous guidance for Net
Debt.
The following guidance was previously provided for the fiscal
year ending December 31, 2020:
- Net Income to be in the range of $335 million to $355
million
- Earnings Per Share to be in the range of $1.60 to $1.69
per share
- Adjusted EBITDA to be in the range of $695 million to
$715 million1
- Adjusted Net Income to be in the range of $388 million
to $403 million1
- Adjusted Earnings Per Share to be in the range of $1.85
to $1.92 per share1
- Net Debt to be in the range of $1.9 billion to $2.1
billion1
Mr. Mitchell remarked, “I am pleased we are on track for another
strong quarter, are reiterating our outlook for 2020, and continue
to expect better 2021 performance than at the time of our IPO. Our
outlook is based on our business model, our team, and changes in
consumer behavior that favor more cooking, baking, organizing, and
waste due to the coronavirus pandemic. Going forward, we plan to
provide an estimate of net revenues growth for the current quarter
with release of results for the prior quarter.”
1 1 Adjusted Net Income, Adjusted Earnings Per Share, Adjusted
EBITDA and Net Debt are non-GAAP measures. Refer to the discussion
on non-GAAP financial measures and reconciliations included in this
release. In addition, as further described in Note 1 to the
non-GAAP reconciliation included within this release, the share
count utilized for Adjusted Earnings Per Share has been adjusted to
reflect the additional shares issued as a result of the IPO as
though they were outstanding for the entire period.
Related information can be found in a presentation on the
Investor Relations section of the Company’s website under the
“Events & Presentations” page.
Barclays Global Consumer Staples Conference Webcast
The Company will participate in a virtual fireside chat at the
Barclays Global Consumer Staples Conference on Wednesday, September
9, 2020 at 12:40 p.m. ET.
The fireside chat will be webcast live and can be accessed via
the Investor Relations section of the Company’s website at
www.reynoldsconsumerproducts.com. The webcast will be archived for
30 days.
About Reynolds Consumer Products Inc.
RCP’s mission is to simplify daily life so consumers can enjoy
what matters most. RCP is a market-leading consumer products
company with a presence in 95% of households across the United
States. RCP produces and sells products across three broad
categories: cooking products, waste & storage products and
tableware that are sold under iconic brands such as Reynolds and
Hefty, as well as under store brands that are strategically
important to RCP’s customers. Overall, across both branded and
store brand offerings, RCP holds the #1 or #2 U.S. market share
position in the majority of product categories in which it
participates.
Note to Investors Regarding 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 third quarter 2020 estimates and
our fiscal year 2020 guidance. In some cases, you can identify
these statements by forward-looking words such as “may,” “might,”
“will,” “should,” “expects,” “plans,” “anticipates,” “believes,”
“estimates,” “predicts,” “potential,” “continue,” “outlook,” “on
track” or 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 strategies and anticipated trends in our business. 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. Our estimates and outlook
for the third quarter and full year of fiscal 2020 also assume the
increased demand related to the coronavirus pandemic will continue
through the end of fiscal 2020, and further assume that there are
no significant disruptions to our operations, supply chain or
retail partners for the remainder of fiscal 2020.
The estimates related to the third quarter of 2020 are based on
results for only a portion of the third quarter, which have not
been through the Company’s financial reporting processes and
review, and the estimates are subject to change as a result of such
processes and review, as well as the Company’s actual results for
the remainder of the third quarter of 2020.
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.
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.
Use of Non-GAAP Financial Measures
We use non-GAAP financial measures “Adjusted EBITDA,” “Adjusted
Net Income,” “Adjusted Earnings Per Share”, 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
unrealized gains and losses on derivatives, factoring discounts
(pre-IPO), the allocated related party management fee (pre-IPO) and
IPO and separation-related costs. We define Adjusted Net Income and
Adjusted Earnings Per Share as Net Income and Earnings Per Share
calculated in accordance with GAAP, plus the sum of IPO and
separation-related costs, the impact of tax legislation changes
under the CARES Act enacted March 27, 2020 and any unrealized gains
or losses on derivatives. 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 Adjusted Net Income and Adjusted Earnings Per
Share as supplemental metrics 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. Accordingly, we
believe presenting these metrics provides 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 2020, where adjusted, is provided on a
non-GAAP basis, which the Company will continue to identify as it
reports its future financial results. Estimated Adjusted EBITDA
margin, a non-GAAP measure, is also provided for the full third
quarter of 2020. The Company cannot reconcile its expected Adjusted
EBITDA to expected Net Income under “Fiscal Year 2020 Outlook”, or
its estimated Adjusted EBITDA margin to estimated net income
margin, without unreasonable effort because certain items that
impact net income and other reconciling metrics are out of the
Company's control and/or cannot be reasonably predicted at this
time, which unavailable information could have a significant impact
on the Company’s GAAP financial results. In addition, the Company
cannot reconcile its expected Net Debt to expected total debt
without reasonable effort because certain items that impact total
debt and other reconciling metrics are out of the Company’s control
and/or cannot be reasonable predicted at this time, which
unavailable information could have a significant impact on the
Company’s GAAP financial results.
Please see below reconciliations of non-GAAP measures used in
this release (with the exception of our 2020 Adjusted EBITDA
outlook and 2020 Net Debt outlook, as well as our third quarter
2020 Adjusted EBITDA margin estimate, as described above) to the
most directly comparable GAAP measures.
Reynolds Consumer Products Inc. Reconciliation of 2020
Net Income and EPS guidance to Adjusted Net Income and Adjusted EPS
guidance (amounts in millions except per share data)
Net Income Diluted sharesoutstanding (1) Diluted
Earnings Per Share low high low
high Fiscal Year 2020 - Guidance
$
335
$
355
210
$
1.60
$
1.69
Adjustments:
IPO and separation-related costs (2)
30
25
210
0.14
0.12
Impact of tax legislation change from the CARES Act
23
23
210
0.11
0.11
Fiscal Year 2020 - Adjusted Guidance
$
388
$
403
210
$
1.85
$
1.92
- The Company has assumed the actual shares outstanding at June
30, 2020 to be outstanding for the full year period rather than the
weighted average shares outstanding over the course of the period
as it is a more meaningful calculation that provides consistency in
comparability.
- Amounts are after tax calculated using a tax rate of 24%, which
is the Company’s effective tax rate for the three and six months
ended June 30, 2020.
REYN-F
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200908005859/en/
Investors Mark Swartzberg
Mark.Swartzberg@reynoldsbrands.com (847) 482 – 4081
Media Kate Ottavio Kent Kate.OttavioKent@icrinc.com
203-682-8276
Reynolds Consumer Products (NASDAQ:REYN)
Historical Stock Chart
From Sep 2024 to Oct 2024
Reynolds Consumer Products (NASDAQ:REYN)
Historical Stock Chart
From Oct 2023 to Oct 2024