Reynolds Consumer Products Inc. (NASDAQ: REYN) reported Q2 EPS of $0.55, $0.04 better than the analyst estimate of $0.51. Revenue for the quarter came in at $822 million versus the consensus estimate of $848.78 million.

Second Quarter 2020 Financial Highlights:

• Net Revenues of $822 million
• Earnings Per Share of $0.53; Adjusted earnings per share of $0.551
• Net Income of $112 million; Adjusted Net Income of $115 million1
• Adjusted EBITDA of $193 million1

“The second quarter of 2020 continued to present unprecedented challenges for people everywhere and often in different ways,” said Lance Mitchell, President and Chief Executive Officer of Reynolds Consumer Products. “We recognize and thank essential front line workers, especially healthcare professionals who are aiding patients while learning the most effective treatments. Employees at our retail partners have also stepped up as front-line workers to continue to supply people with essential products on an ongoing basis. We are pleased to be able to support them and I am incredibly proud of how the entire team at Reynolds has come together as we emerged from this quarter a stronger and more agile company.”

“Our second quarter results were strong given that we were able to safely meet much of the sharp increase in demand resulting from the pandemic. We moved to rapidly expand capacity for those products that continue to be in higher-than-planned demand, but fully staffing the existing and new capacity continues to be a challenge contributing to out of stocks across certain product categories. We implemented creative solutions and changed our priorities while leveraging the strong retail customer partnerships we have built over the years. By implementing rigorous safety protocols according to CDC guidelines for prevention, we were able to keep our operations running although not at full utilization rates. We are fortunate that the products produced at our facilities are considered essential in supporting people eating in their homes and keeping their homes sanitary.”

“As we continue to manage the crisis and look towards creating our new future, we are learning and adapting the way we operate our business. We are adjusting to changes in technology, customer needs and habits, supply chains, and e-commerce while re-examining nearly every aspect of what we do. We believe we are well positioned for continued growth in 2020 and beyond in the categories in which we participate. We will continue to serve as category advisors to our customers, drive growth through new and innovative products, and drive shareholder returns through balanced capital allocation.”

GUIDANCE:

Reynolds Consumer Products Inc. sees FY2020 EPS of $1.85-$1.92, versus the consensus of $1.90.

The Company acknowledges that the magnitude and duration of increased demand remains uncertain and that the greatest challenge it faces as a result of the pandemic is its ability to maintain the level of supply needed to keep up with the increased demand. The Company is taking steps to add capacity to address the increased demand, which it assumes will continue through the end of 2020, through both staffing and capital investments.

While the Company has benefited from the increased demand driven by the pandemic, it is facing staffing challenges as it adds capacity throughout its facilities and headwinds from commodity prices that have begun increasing in recent months. The Company is expecting the current consumer behavior to continue which will likely result in fewer social gatherings around holidays. In addition, the outlook assumes that there are no significant disruptions to its operations, supply chain or retail partners for the remainder of fiscal 2020.

Based on the Company's financial results for the second quarter of 2020 and its outlook for the remainder of the year, it now expects full year 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 million3
• Adjusted Net Income to be in the range of $388 million to $403 million3
• Adjusted Earnings Per Share to be in the range of $1.85 to $1.92 per share3
• Net Debt to be in the range of $1.9 billion to $2.1 billion3

For earnings history and earnings-related data on Reynolds Consumer Products Inc. (REYN) click here.