Reynolds Consumer Products Reports 2% Revenue Decline and 37% Net Income Drop in Q1 2025

Reynolds Consumer Products Inc. reported a decrease in financial performance for the first quarter of 2025, with total net revenues of $818 million, down 2% from $833 million in the same period last year. The decline was primarily attributed to lower sales volume, although this was partially offset by higher pricing. The company's net income also fell significantly, decreasing 37% to $31 million compared to $49 million in the prior year, driven by increased costs related to material, manufacturing, and logistics, as well as a $13 million debt refinancing expense.

In terms of operational metrics, Reynolds' gross profit for the quarter was $189 million, a decrease from $201 million in the previous year, reflecting a gross margin of 23%. Selling, general, and administrative expenses were reduced to $104 million from $111 million, indicating a 6% decrease, which was a positive factor in mitigating the overall decline in profitability. The company reported an Adjusted EBITDA of $117 million, down 4% from $122 million in the first quarter of 2024, highlighting the impact of lower revenues and increased operational costs.

Strategically, Reynolds Consumer Products has made significant changes to its debt structure, amending its senior secured term loan facility to a new $1.645 billion facility maturing in March 2032. This refinancing included a $13 million expense recorded in the current quarter. The company also reported a voluntary principal payment of $50 million on its term loan during the quarter, reflecting a proactive approach to managing its debt obligations. Additionally, Reynolds continues to focus on its core product segments, which include Reynolds Cooking & Baking, Hefty Waste & Storage, Hefty Tableware, and Presto Products, maintaining a strong market presence across various categories.

As of March 31, 2025, Reynolds Consumer Products had 210.3 million shares of common stock outstanding. The company remains committed to its dividend policy, having declared a cash dividend of $0.23 per share for the quarter, consistent with the previous year. Looking ahead, Reynolds anticipates that its strategic initiatives, including cost-saving measures and product innovation, will help stabilize its financial performance despite the current challenges in volume and market conditions. The company continues to monitor economic factors and consumer trends that may impact its operations and profitability in the future.