Reynolds Consumer Products leans on higher pricing to offset volume drop in Q1
MicroStockHub
Reynolds Consumer Products (NASDAQ:REYN) posted solid results for Q1 as it battled through some inflation and consumer headwinds.
Revenue increased 3.4% during the quarter as the effect of price increases implemented last year more than offset a 2% volume decline. The company saw net income and adjusted EBITDA decline as anticipated increases in material and manufacturing costs in the Reynolds Cooking & Baking business, as well as higher personnel costs, professional fees and advertising costs, were partially offset by increased profitability in the rest of the businesses. Net income was noted to be also negatively impacted by higher interest costs due to increased interest rates.
Revenue was up 6% for the cooking and baking business and 2% for the hefty waste and storage business. The hefty tableware business saw a 7% increase in revenue and the Presto products business saw a 2% increase.
Operating cash flow in the quarter was $88M vs. $19M a year ago, largely due to the benefit from working capital initiatives. REYN's cash position at the end of the quarter was $50M and net debt was $2.04B.
"The Reynolds Cooking & Baking recovery is off to a strong start, and our other three segments are also performing well, reflecting our category leadership and the advantage of our integrated brand and store brand model," updated CEO Lance Mitchell.
The consumer products company backed prior guidance for flat to +/-1% revenue growth or a range of $3.78B to $3.86B vs. $3.83B consensus.