Reynolds Consumer Products (REYN) Q1 2025 earnings summary

Executive summary

• Q1 2025 net revenues were $818 million, down 2% year-over-year, with retail revenues declining due to retailer destocking, later Easter timing, and foam category declines, partially offset by higher pricing and innovation.

• Net income declined 37% to $31 million, impacted by lower volume, $13 million debt refinancing expense, higher costs, and CEO transition costs.

• Adjusted EBITDA was $117 million, down from $122 million, with margins at 14%; adjusted EPS remained flat at $0.23 year-over-year after excluding one-time items.

• Outperformed categories by two points at retail, gaining share in key segments without increased promotional spend.

• Maintained focus on growth, margin expansion, and building a more stable earnings growth model, supported by innovation and distribution gains.

Financial highlights

• Gross profit was $189 million, down from $201 million; operating income was $76 million, down from $90 million; adjusted EBITDA margin was 14%.

• Adjusted EPS was $0.23, flat year-over-year, after adjusting for $0.05 in term loan refinancing costs and $0.04 in strategic and CEO transition costs.

• Net debt at quarter-end was $1,579 million, with net debt to trailing twelve months adjusted EBITDA at 2.3x.

• Quarterly dividend of $0.23 per share declared for Q2 2025.

• Cash flow from operations was $56 million, down from $99 million in Q1 2024.

Outlook and guidance

• Fiscal 2025 net revenues expected to decline low single digits versus 2024; adjusted EBITDA forecasted at $650–$670 million and adjusted EPS at $1.54–$1.61.

• Q2 2025 net revenues expected to decrease 2–5% year-over-year; adjusted EBITDA projected at $155–$165 million and adjusted EPS at $0.35–$0.39.

• Two to four points of positive pricing expected in 2025 to offset cost increases, including tariffs.

• Full-year adjusted net income excludes $25–$35 million pre-tax CEO transition and strategic investment costs, and $13 million pre-tax refinancing costs.

• Management expects to continue paying quarterly cash dividends.