Executive Summary

Q4 2024 net revenues rose 1.4% year over year to $1.021B, with retail volume up 1% and broad-based acceleration across all four business units; diluted EPS was $0.58 and adjusted EBITDA $213M, down 11% year over year due to higher operational costs and lower pricing .
FY 2025 guidance: net revenues down low single digits vs 2024, adjusted EBITDA $670–$690M, adjusted EPS $1.61–$1.68; Q1 2025 adjusted EBITDA $115–$120M and EPS $0.22–$0.24; recently announced tariffs are not reflected in guidance .
Balance sheet/cash flow: FY 2024 operating cash flow $489M, free cash flow $369M, net debt leverage reduced to 2.3x; subsequent $50M term loan prepayment post quarter-end; quarterly dividend of $0.23 per share approved .
Stock narrative catalyst: management outlined a multi-pillar program (growth, cost, ROI) to support distribution wins, innovation, automation, and margin expansion, with investments expected to begin contributing late 2025; pricing actions to offset aluminum cost inflation are underway and designed to limit elasticity impact .

What Went Well and What Went Wrong

What Went Well

Retail volume accelerated across all segments in Q4 (Reynolds Cooking & Baking +3%, Hefty Waste & Storage +3%, Presto flat, Tableware -2% but ex-foam outperforming categories), while net revenues increased to $1.021B; CEO emphasized brand strength and execution capacity for growth and margins .
Hefty innovation continues to scale: Fabuloso waste bags reached ~$200M annual retail sales; Hefty Press to Close food bags are rolling out nationally in 2025, supporting Waste & Storage segment volume gains .
Cash generation and deleveraging: FY 2024 operating cash flow $489M and FCF $369M enabled net debt leverage reduction to 2.3x and a $50M voluntary term loan repayment after quarter-end .

Selected management quotes:

“We enter 2025 committed to executing new and existing programs to realize even more of RCP’s potential.” – Scott Huckins, CEO .
“We look forward to unlocking even more of RCP’s potential in 2025 and over the long-term.” – Nathan Lowe, CFO .

What Went Wrong

Profitability contracted year over year: adjusted EBITDA $213M (-11% y/y) and diluted EPS $0.58 (-$0.07 y/y) due to higher operational costs and lower pricing; Q4 2023 was an unusually strong comparator .
Hefty Tableware headwinds: net revenues fell $8M to $251M and adjusted EBITDA decreased $6M to $52M, driven by foam plate declines, lower pricing, and higher operational costs despite strength in non-foam products .
Mix and macro headwinds: non-retail revenues were stronger than expected, diluting margins by ~75 bps in Q4; management reiterated consumer pressure and commodity inflation (aluminum, resins) into 2025 .

Financial Results

Metric	Q4 2023	Q3 2024	Q4 2024
Net Revenues ($USD Millions)	$1,007	$910	$1,021
Net Income ($USD Millions)	$137	$86	$121
Diluted EPS ($USD)	$0.65	$0.41	$0.58
Adjusted EBITDA ($USD Millions)	$238	$171	$213
Gross Profit ($USD Millions)	$309	N/A	$280
EBITDA Margin (%)	23.6% (238/1007)	18.8% (171/910)	20.9% (213/1021)
Gross Profit Margin (%)	30.7% (309/1007)	N/A	27.4% (280/1021)

Segment breakdown (revenues and adjusted EBITDA):

Segment	Q4 2023 Revenues ($MM)	Q4 2024 Revenues ($MM)	Q4 2023 Adj. EBITDA ($MM)	Q4 2024 Adj. EBITDA ($MM)
Reynolds Cooking & Baking	$357	$374	$89	$82
Hefty Waste & Storage	$237	$245	$73	$68
Hefty Tableware	$259	$251	$58	$52
Presto Products	$153	$153	$34	$30
Unallocated	$1	($2)	($16)	($19)
Total	$1,007	$1,021	$238	$213

Selected KPIs:

KPI	Q4 2024	Source
Retail volume (Total RCP)	+1%
Retail volume – Reynolds C&B	+3% (incl. 1-pt portfolio optimization headwind)
Retail volume – Hefty Waste & Storage	+3%
Retail volume – Hefty Tableware	-2% (ex-foam outperformed)
Retail volume – Presto	Flat (incl. 1-pt optimization headwind)
Components of net revenue change (Q4 YoY, Total RCP)	Price -1%, Retail vol/mix +1%, Non-retail vol/mix +1%, Total +1%
Net Debt ($MM)	$1,549
Net Debt / TTM Adjusted EBITDA (x)	2.3x
Operating Cash Flow FY 2024 ($MM)	$489
Free Cash Flow FY 2024 ($MM)	$369

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenues	FY 2025	Not previously provided	Down low single digits vs $3,695M FY 2024	New
Adjusted EBITDA ($MM)	FY 2025	Not previously provided	$670–$690	New
Adjusted EPS ($)	FY 2025	Not previously provided	$1.61–$1.68	New
Net Revenues	Q1 2025	Not previously provided	Down low single digits vs $833M Q1 2024 (Easter shift)	New
Adjusted EBITDA ($MM)	Q1 2025	Not previously provided	~$115–$120	New
Adjusted EPS ($)	Q1 2025	Not previously provided	$0.22–$0.24	New
D&A ($MM)	FY 2025 (for adj. metrics calc)	Not previously provided	~ $130	New
CEO transition/strategic initiative costs (pre-tax)	FY 2025	Not previously provided	$25–$35	New
Dividend per share	Q1 2025	$0.23 (declared 1/30)	$0.23 payable 2/28/2025	Maintained
Net Debt target ($MM)	FY 2025 year-end	Not previously provided	~ $1,400	New

Notes: Management stated tariffs announced in recent days are not embedded in guidance; expect to manage raw materials via pricing, longer-term supplier pricing windows, and productivity .

Earnings Call Themes & Trends

Topic	Q2 2024 (Previous Mentions)	Q3 2024 (Previous Mentions)	Q4 2024 (Current Period)	Trend
Macro/consumer	Affordable household essentials; modest improvement; promotions returning to pre-pandemic levels (~20% of sales)	Consumer still challenged; sequential category improvement; holiday optimism	Consumer pressure persists; categories expected ~flat ex-foam; Easter timing affects Q1’25	Steady caution
Tariffs/raw materials	Stable commodity outlook embedded; resin/aluminum moves in guide	Aluminum volatility; use hedges, supplier pricing windows, productivity; Canadian tariffs de minimis	Tariffs not in guide; commodities a headwind; pricing actions in flight; purchases from impacted geographies low single-digit % of cost basket	Elevated monitoring
Pricing elasticity	Pricing flat 1H; FY -1% due to prior-year actions	Pricing actions contemplated vs aluminum, mindful of thresholds	Modest pricing to offset aluminum; designed to stay within key thresholds; elasticity management	Tight control
Innovation/distribution	Hefty, Presto record launches; Chef’s Kiss campaign; sustainable solutions ramp	Hefty Fabuloso ~$200M; Reynolds Kitchens Air Fryer liners; distribution gains	Hefty Press to Close national rollout; sustainable cutlery from Atacama; continued product pipeline	Expanding
Tableware foam headwinds	Sequential improvement; price-pack architecture; ex-foam modest growth	Foam decline from legislation/consumer shifts; ex-foam growth; margin pressure	Foam down double digits expected in 2025; ex-foam products strong	Ongoing headwind
Automation/productivity	Reyvolution cost savings identified beyond 2024	Operational reliability; cost savings pipeline; refinancing flexibility	Increased automation/material processing; ROI-driven capex up $20–$40M vs 2024	Accelerating

Management Commentary

Strategic program: “Growth, cost, and ROI pillars” to drive distribution wins, higher-impact innovation, adjacent category entry, cost savings from commodities to finished goods, and returns-based capital allocation; automation and material processing investments to lower costs and increase capacity .
Category outlook: “Down 2% category expectation… driven exclusively by double-digit decline for foam dishes… balance of categories generally flat” (confidence to perform at/above categories) .
Pricing stance: “Pricing actions… designed… with recognition of thresholds… manage and stay within those key thresholds” .
Capital allocation: FCF conversion ~50% of EBITDA; net debt targeted ~$1.4B by end of 2025; continued investment in productivity/growth, with M&A and adjacencies assessed under ROI framework .

Q&A Highlights

Tariffs exposure limited; U.S.-centric manufacturing (16 of 17 plants in U.S.), purchases from impacted geographies a single-digit % of cost basket; potential competitive benefit from tariffs .
Promotional environment: Promotion levels broadly consistent with pre-pandemic norms; Waste & Storage pricing flat in Q4; brands took share from store brands in waste bags .
Pricing vs elasticity: Modest pricing to cover aluminum with careful attention to thresholds and price gaps; productivity complements pricing to neutralize input cost pressure .
Distribution/innovation pipeline: National rollout of Hefty Press to Close in 2025; Air Fryer liners and parchment distribution wins; sustainable cutlery launch from Atacama; record innovation launches in Presto .
2025 setup: Investments (CEO transition costs + strategic initiatives $25–$35M pre-tax) to accelerate growth and cost programs, with returns expected to appear late 2025; management sets stage for growth/margin expansion into 2026 .

Estimates Context

Attempts to retrieve S&P Global consensus estimates for Q4 2024 EPS, revenue, and EBITDA were unsuccessful due to SPGI daily request limits. As a result, comparisons to Wall Street consensus are not provided in this recap. We default to reported results and management guidance in the 8-K and press release for assessment .

Key Takeaways for Investors

Q4 2024 delivered modest top-line growth and retail volume acceleration, but margins compressed on higher operational costs and lower pricing; non-retail mix modestly diluted margin percentages (~75 bps in Q4) .
FY 2025 outlook is conservative on revenues (down LSD), with adjusted EBITDA roughly flat to slightly down vs 2024; investments in automation and strategic initiatives should underpin medium-term margin expansion and earnings stability .
Tableware foam declines are a structural headwind (legislation, consumer/regulatory shifts), but ex-foam tableware and cross-portfolio innovation support segment resilience .
Hefty and Reynolds brands remain strong with scalable innovation (Fabuloso, Press to Close, Air Fryer liners), positioning RCP for distribution wins and share gains in Waste & Storage and Cooking & Baking .
Pricing actions to offset higher aluminum are in motion and designed to limit elasticity, complemented by supplier pricing window extensions and productivity programs to reduce earnings volatility .
Balance sheet flexibility (net debt leverage 2.3x, FCF $369M) supports enhanced capex ($20–$40M step-up) and potential tuck-in M&A; dividend maintained at $0.23 .
Near-term trading: watch tariff developments and commodity moves (aluminum/resins), retail category demand ex-foam, and progress on distribution/innovation launches; medium-term thesis hinges on execution of growth/cost/ROI program driving margin expansion and steadier earnings .

Reynolds Consumer Products Inc. (REYN)·Q4 2024 Earnings Summary