Reynolds Consumer Products Inc (REYN) 2023 Q3 法說會逐字稿

Greetings, and welcome to the Reynolds Consumer Products Third Quarter 2023 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加雷諾消費品 2023 年第三季財報電話會議。 （操作員指示）謹此提醒，本次會議正在錄製中。

It is now my pleasure to introduce your host, Mark Swartzberg, Vice President of Investor Relations. Thank you, sir. You may begin.

現在我很高興向您介紹主持人，投資者關係副總裁馬克‧斯瓦茨伯格(Mark Swartzberg)。謝謝你，先生。你可以開始了。

Thank you, operator. Good morning, everyone, and thank you for joining us on Reynolds Consumer Products' Third Quarter 2023 Earnings Conference Call. Please note that this call is being recorded and webcast on the Investor Relations section of our corporate website at reynoldsconsumerproducts.com. Our earnings press release and accompanying presentation slides are also available.

謝謝你，接線生。大家早安，感謝您參加雷諾消費品公司 2023 年第三季財報電話會議。請注意，本次電話會議將在我們公司網站 reynoldsconsumerproducts.com 的投資者關係部分進行錄音和網路直播。我們的收益新聞稿和隨附的簡報幻燈片也可供使用。

With me on the call today are Lance Mitchell, our President and Chief Executive Officer; Michael Graham, our Chief Financial Officer; and Scott Huckins, who recently joined RCP and becomes Chief Financial Officer on November 13. For our call, Lance will discuss our results, the macroeconomic environment and our category performance. Mike will provide additional detail on the third quarter, our guide and capital allocation. Following prepared remarks, we will open the call for questions.

今天與我一起參加電話會議的是我們的總裁兼執行長蘭斯米切爾 (Lance Mitchell)；麥可‧格雷厄姆，我們的財務長； Scott Huckins 最近加入了 RCP，並於 11 月 13 日成為財務長。在我們的電話會議中，Lance 將討論我們的業績、宏觀經濟環境和我們的類別表現。麥克將提供有關第三季、我們的指南和資本配置的更多詳細資訊。在準備好發言後，我們將開始提問。

Before we begin, I would like to provide a couple of reminders. First, this morning's discussion may contain forward-looking statements based on current expectations and beliefs. These statements are subject to risks, uncertainties and changes in circumstances that could cause actual results and outcomes to differ materially from those described today. Please refer to our Risk Factors section in our SEC filings, including in our annual report on Form 10-K and our quarterly report on Form 10-Q. Please note that the company does not intend to update or alter these forward-looking statements to reflect events or circumstances arising after the call.

在我們開始之前，我想提幾點提醒。首先，今天上午的討論可能包含基於當前期望和信念的前瞻性陳述。這些陳述受到風險、不確定性和情況變化的影響，可能導致實際結果和結果與今天描述的結果有重大差異。請參閱我們向 SEC 提交的文件中的風險因素部分，包括我們的 10-K 表年度報告和 10-Q 表季度報告。請注意，本公司無意更新或更改這些前瞻性陳述以反映電話會議後發生的事件或情況。

Second, during today's call, we will refer to certain non-GAAP or adjusted financial measures. Reconciliations of these GAAP to non-GAAP financial measures are available in our earnings press release, investor presentation deck and Form 10-Q. Copies of which can be found on the Investor Relations section of our site.

其次，在今天的電話會議中，我們將提及某些非公認會計原則或調整後的財務指標。這些 GAAP 與非 GAAP 財務指標的調整可在我們的收益新聞稿、投資者簡報和 10-Q 表格中找到。其副本可以在我們網站的投資者關係部分找到。

Now I'd like to turn the call over to Lance.

現在我想把電話轉給蘭斯。

Thank you, Mark, and good morning, everyone. Please join me in welcoming Scott Huckins. Scott comes to RCP at a great moment in our history of our company when our brands, our market position and financial profile are strong and getting stronger. He is with us on the call today as part of the transition plan. I'll begin by discussing our results, then I will turn to the macroeconomic environment, our performance in our largest categories and what we're doing to improve the volume trends in disposable tableware. After that, I'll turn the call over to Michael to provide more detail on the quarter and our guide.

謝謝你，馬克，大家早安。請和我一起歡迎斯科特·哈金斯。 Scott 加入 RCP 正值我們公司歷史上的一個偉大時刻，當時我們的品牌、市場地位和財務狀況都很強大，而且還在不斷增強。作為過渡計劃的一部分，他今天與我們一起參加了電話會議。我將首先討論我們的結果，然後我將轉向宏觀經濟環境、我們在最大類別中的表現以及我們正在採取哪些措施來改善一次性餐具的銷售趨勢。之後，我會將電話轉給邁克爾，以提供有關該季度和我們指南的更多詳細資訊。

The RCP team continues to perform very effectively in a dynamic challenging economic environment, and I'm extremely proud of all that we've accomplished. We've delivered net revenues and earnings at the upper end of our expectations for the quarter. We expanded EBITDA margin more than 500 basis points in each of our businesses, reflecting effective execution of our plans to increase share across RCP, continued disciplined investments in our business and additional successful implementation of the Reynolds Cooking & Baking recovery plan. We converted higher earnings into significant cash flow resulting in our deleveraging more quickly than previously anticipated.

RCP 團隊在充滿挑戰的動態經濟環境中繼續高效運作，我對我們所取得的一切成就感到非常自豪。我們本季的淨收入和收益達到了預期的上限。我們每項業務的 EBITDA 利潤率均提高了 500 個基點以上，這反映出我們有效執行了增加 RCP 份額的計劃、對業務的持續嚴格投資以及雷諾烹飪和烘焙復甦計劃的成功實施。我們將更高的收益轉化為大量現金流，使我們的去槓桿化速度比先前預期的更快。

We introduced the Hefty brand in press-to-close food bag category and increased loyalty with Gen Z and millennials. And following quarter end, we acquired a company that is a research-driven business, which will allow us to accelerate production and commercialization of affordable high-quality sustainable products and material blends.

我們在壓合食品袋類別中引入了 Hefty 品牌，並提高了 Z 世代和千禧世代的忠誠度。在季度末，我們收購了一家研究驅動型企業，這將使我們能夠加速經濟實惠的高品質永續產品和材料混合物的生產和商業化。

As you know, U.S. households are facing significant economic challenges, including inflation and rising interest rates and other headwinds, which have impacted sales volume across consumer staples. We continue to respond to these challenges by adapting and innovating to meet consumers' needs, leveraging our unique business model, including brands and store brands, executing planned increases in promotion and advertising and continuing strong management of cost and manufacturing productivity.

如你所知，美國家庭面臨重大的經濟挑戰，包括通貨膨脹和利率上升以及其他不利因素，這些因素影響了必需消費品的銷售。我們繼續應對這些挑戰，透過適應和創新來滿足消費者的需求，利用我們獨特的商業模式，包括品牌和商店品牌，執行有計劃的促銷和廣告增加，並繼續對成本和製造生產力進行強有力的管理。

As a result, our retail sales volume is stably growing in our 3 largest categories, and we are implementing actions to improve disposable tableware trends. We are also benefiting from continued consumer shifts to untracked channels. As a reminder, a large portion of our business is not tracked.

因此，我們三大品類的零售量穩定成長，我們正在採取行動改善一次性餐具的趨勢。我們也受益於消費者持續轉向未追蹤管道。提醒一下，我們的大部分業務都沒有被追蹤。

I will now review our performance by business segment. The Reynolds Cooking & Baking team has done an outstanding job executing the Reynolds Recovery Plan, while also increasing market share. Volume, operational and gross profit objectives set at the start of the year were met for the third quarter in a row. Our primary foil production facility located in Louisville, has stabilized at historical production rates and extensive work continues to further increase efficiencies to expand margins.

我現在將以業務部門回顧我們的業績。雷諾茲烹飪和烘焙團隊在執行雷諾茲恢復計劃方面表現出色，同時也增加了市場份額。年初設定的銷售、營運和毛利目標連續第三季實現。我們位於路易斯維爾的主要鋁箔生產設施已穩定在歷史生產力，並且廣泛的工作繼續進一步提高效率以擴大利潤。

Reynolds Wrap continued to drive the household foil category, our second largest category, retaining the first half significant share gains and increasing share of nearly 300 basis points in the quarter. We increased household penetration for Reynolds Wrap among all major demographics while also raising aided and unaided awareness for Reynolds foil and parchment among millennials. And we expanded distribution of Reynolds Kitchens air fryer liners in the U.S. and Canada, while increasing distribution of Reynolds Kitchen stay flat parchment paper with Smart Grid nationally. Reynolds now surpasses $1 billion in annual retail sales, and we have the capabilities, share strength and plans to grow Reynolds Cooking & Baking volume and margins.

Reynolds Wrap 繼續推動家用鋁箔類別（我們的第二大類別）的發展，保持了上半年的顯著份額增長，並在本季度增加了近 300 個基點的份額。我們提高了 Reynolds Wrap 在所有主要人群中的家庭滲透率，同時也提高了千禧世代對 Reynolds 鋁箔和羊皮紙的輔助和非輔助意識。我們擴大了 Reynolds Kitchens 氣炸鍋內襯在美國和加拿大的分銷，同時在全國範圍內增加了 Reynolds Kitchen 帶有智慧電網的扁平羊皮紙的分銷。雷諾茲的年零售額現已超過 10 億美元，我們有能力、分享實力併計劃增加雷諾茲烹飪和烘焙的銷售和利潤。

Our waste and food bag businesses are also performing well, driven by the Hefty brand and our integrated brand and store brand model. Hefty retail sales are growing and continue to climb towards $2 billion, led by sales of waste bags, our largest category. Hefty acquired additional waste bag share in the quarter driven by innovation. Our largest innovation over the last 3 years, Hefty Fabuloso was recently recognized by Circana previously known as IRI as the #3 pacesetter brand for 2023 and ACV for both Fabuloso scents, Lavender and Lemon continue to increase.

在 Hefty 品牌以及我們的綜合品牌和商店品牌模式的推動下，我們的垃圾和食品袋業務也表現良好。零售額大幅成長，並繼續攀升至 20 億美元，其中垃圾袋（我們最大的類別）的銷售額帶動了這一增長。在創新的推動下，Hefty 在本季度獲得了額外的垃圾袋份額。 Hefty Fabuloso 是我們過去 3 年來最大的創新，最近被 Circana（之前稱為 IRI）認可為 2023 年第三大標竿品牌，Fabuloso 香水、薰衣草和檸檬的 ACV 繼續增加。

Our Presto business gained additional share of store brand food bags, our third largest category, and Hefty introduced Hefty-branded press-to-close food bags during the quarter. Hefty press-to-close food bags come in multiple sizes and offer consumers the features and reliability of the Hefty brand. Hefty Renew, Our community-based program to aid curbside recycling and harder recycled plastics, expanded to the Greater Cincinnati's market in October. And we broke a major pickup in social media impressions with Hefty Cinema and Pumpkin Spice waste bags available for a limited time this fall and the reintroduction of Hefty Zoo Pals disposable plates in August. Zoo Pals online-only launch drove more than 3 billion social media impressions for the Hefty brand, and we plan to extend the relaunch to other major channels in 2024.

我們的 Presto 業務在商店品牌食品袋（我們的第三大類別）中獲得了額外份額，Hefty 在本季度推出了 Hefty 品牌的按壓閉合食品袋。 Hefty 按壓閉合食品袋有多種尺寸，為消費者提供 Hefty 品牌的功能和可靠性。 Hefty Renew 是我們以社區為基礎的計劃，旨在幫助路邊回收和較硬的再生塑料，已於 10 月擴展到大辛辛那提市場。今年秋季限時推出的 Hefty Cinema 和 Pumpkin Spice 垃圾袋，以及 8 月重新推出的 Hefty Zoo Pals 一次性盤子，打破了社交媒體印象的大幅回升。 Zoo Pals 僅在網路上推出，為 Hefty 品牌帶來了超過 30 億次社群媒體印象，我們計劃在 2024 年將重新推出擴展到其他主要管道。

Turning now to our disposable tableware segment. The Hefty Tableware team has done an exceptional job recovering profitability and the Hefty brand is holding share in the category. In recent months, the team has also done extensive research to identify opportunities to improve tableware volume trends in response to elasticity pressures, which are impacting the entire category. As a result, we have begun implementing comprehensive plans to improve tableware's top line performance, drawing on proprietary consumer insights and extensive experience aligning with our retail partners on pack sizes and promotions that hit key retail price points.

現在轉向我們的一次性餐具部分。 Hefty 餐具團隊在恢復獲利能力方面表現出色，而 Hefty 品牌在該類別中佔有份額。近幾個月來，該團隊還進行了廣泛的研究，以確定改善餐具數量趨勢的機會，以應對影響整個類別的彈性壓力。因此，我們已經開始實施全面的計劃，以提高餐具的營收表現，利用專有的消費者洞察和與我們的零售合作夥伴在包裝尺寸和達到關鍵零售價格點的促銷方面保持一致的豐富經驗。

Here are some of the highlights of those plans. We've increased advertising at Hefty Party Cups and disposable plates to bring in lapsed and lost users, reminding them we'll do the dishes in addition to showcasing the party cups used for crafting and other nonfood occasions. We're modifying features and displays based on very encouraging results from a new feature we recently trialed. We are adjusting counts while still providing consumers the value they seek from large pack sizes.

以下是這些計劃的一些亮點。我們在 Hefty Party Cups 和一次性盤子上增加了廣告，以吸引流失和流失的用戶，提醒他們除了展示用於手工製作和其他非食品場合的派對杯子外，我們還會洗碗。我們正在根據最近試用的新功能所取得的非常令人鼓舞的結果來修改功能和顯示。我們正在調整數量，同時仍為消費者提供他們從大包裝中尋求的價值。

Disposable plates, for example, we can make small reductions to pack counts and plate size, allowing for reductions in everyday retail pricing. And we are adjusting key pack sizes, promoted price points. It will take time to realize an improvement in disposable tableware volume trends. We have a high level of confidence in that improvement based on the advantages of our brand and store brand model, our experience managing our categories together with our retail partners and our previous implementation of improvement plans to drive product growth.

例如，對於一次性盤子，我們可以小幅減少包裝數量和盤子尺寸，從而降低日常零售價格。我們正在調整關鍵包裝尺寸，提升價格點。一次性餐具數量趨勢的改善需要時間。基於我們的品牌和商店品牌模式的優勢、我們與零售合作夥伴一起管理品類的經驗以及我們先前為推動產品成長而實施的改進計劃，我們對這項改進充滿信心。

We began in 2023 committed to driving our categories, expanding margins and increasing cash flow in a challenging macroeconomic environment, and we've been very successful doing that. We recovered margins across RCP and anticipate further margin expansion. We're paying down debt faster than initially expected. We are increasing share in the vast majority of our business, and we are implementing improvement plans to improve trends in disposable tableware. All this adds up to being very well positioned for further deleveraging and for sustaining volume and earnings growth beyond 2023.

我們從 2023 年開始致力於在充滿挑戰的宏觀經濟環境中推動我們的品類、擴大利潤並增加現金流，並且我們在這方面非常成功。我們恢復了 RCP 的利潤率，並預計利潤率將進一步擴大。我們償還債務的速度比最初預期的要快。我們正在增加絕大多數業務的份額，並且正在實施改進計劃以改善一次性餐具的趨勢。所有這些加起來，為進一步去槓桿化以及在 2023 年以後維持銷售和獲利成長奠定了良好的基礎。

Now before I hand the call over to Michael, I would like to remind you that Michael will remain in an advisory role to the company after Scott become CFO and until Michael's retirement early next year. I'd also like to stress my gratitude to Michael for his many years of service to the company. We've accomplished a lot together, including the growth of Reynolds Consumer Products, the introduction and expansion of our Reyvolution program of business transformation initiatives, the successful listing as a publicly traded company and steady financial management through a period of unprecedented macroeconomic volatility. Michael, you're a trusted friend. And I know that I speak for all of us at RCP, would I tell you that he will be missed as our business partner. Over to you.

現在，在我將電話轉交給邁克爾之前，我想提醒您，在斯科特成為首席財務官之後，邁克爾將繼續擔任公司的顧問角色，直到邁克爾明年初退休。我也要向麥可多年來為公司提供的服務表示感謝。我們共同取得了許多成就，包括 Reynolds Consumer Products 的發展、業務轉型計畫 Reyvolution 計畫的推出和擴展、上市公司的成功上市以及在前所未有的宏觀經濟波動時期的穩定財務管理。邁克爾，你是一位值得信賴的朋友。我知道我代表 RCP 所有人，我可以告訴您，作為我們的業務合作夥伴，我們將懷念他。交給你了。

Thank you, Lance. I really appreciate the kind words, and good morning, everyone. I'll start by reviewing third quarter results and then turn to our guide.

謝謝你，蘭斯。我真的很感謝大家的善意之言，早安。我將首先回顧第三季的業績，然後轉向我們的指南。

Net revenues were at the upper end of our guide, reflecting a 1% increase in pricing and volume consistent with our expectations. Execution and consistency were strong as each business generated over 500 basis points of EBITDA margin improvement. We demonstrated strong balance sheet discipline, including reductions in working capital, primarily driven by strong inventory management. As a result, we grew operating cash flow by nearly $200 million by comparison to the third quarter of 2022 and improved leverage. The net debt to tolling 12-month adjusted EBITDA decreased from 3.8x at the end of 2022 to 3.1x at the end of September, and we made an additional voluntary debt payment of $100 million subsequent to the quarter end.

淨收入處於我們指南的上限，反映出價格和銷量成長了 1%，符合我們的預期。執行力和一致性很強，每項業務的 EBITDA 利潤率提高了 500 個基點。我們表現出了嚴格的資產負債表紀律，包括減少營運資本，這主要是由強有力的庫存管理所推動的。因此，與 2022 年第三季相比，我們的營運現金流增加了近 2 億美元，槓桿率也有所提高。淨債務與 12 個月調整後 EBITDA 比率從 2022 年底的 3.8 倍下降到 9 月底的 3.1 倍，並且我們在季度末後額外支付了 1 億美元的自願債務。

As a reminder, our term loan is a floating rate facility we have hedged approximately 55% of the floating rate risk affording us flexibility to delever without penalty while providing protection and predictability in this volatile interest rate environment.

提醒一下，我們的定期貸款是一種浮動利率工具，我們對沖了大約55% 的浮動利率風險，使我們能夠靈活地去槓桿化而不受處罰，同時在這種波動的利率環境中提供保護和可預測性。

Turning to our guide. We've raised our full year earnings expectations to the upper end of our previous range, reflecting better-than-expected third quarter results and unchanged earnings expectations for the fourth quarter. Our net revenue estimate for the year is now 2% lower than prior year net revenues, consisting of 2% higher pricing, which is unchanged at 4% lower volume. Consolidated retail volume for the year is estimated to be 2% below consolidated retail volume in the prior year. .

轉向我們的指南。我們將全年獲利預期上調至先前區間的上限，反映出好於預期的第三季業績和第四季獲利預期不變。目前，我們對今年淨收入的預測比上年淨收入低 2%，其中定價上漲 2%，但銷量下降 4% 不變。今年的綜合零售量預計比去年的綜合零售量低 2%。 。

In the fourth quarter, we expect stable to growing retail volume in aluminum foil, waste bags and food bags and lower disposable tableware volume, resulting in a consolidated retail volume decline of 2% to 4%. Our fourth quarter earnings estimates are unchanged in spite of the lower fourth quarter revenue estimates. This is due to our mix improvement, and we are executing a newly identified revenue and cost savings. Other considerations regarding our annual guide consists of the following: commodity rates remain broadly consistent with our expectations when reporting second quarter results. Reyvolution cost savings are now estimated to be slightly in excess of our prior estimate of 200 basis points of incremental margin. .

第四季度，我們預計鋁箔、垃圾袋和食品袋的零售量將穩定成長，而一次性餐具的零售量將下降，導致綜合零售量下降 2% 至 4%。儘管第四季營收預期較低，但我們第四季獲利預期保持不變。這是由於我們的組合改進，並且我們正在執行新確定的收入和成本節約。關於我們的年度指南的其他考慮因素包括以下內容：大宗商品價格與我們報告第二季業績時的預期基本一致。目前估計 Reyvolution 成本節省略高於我們先前估計的增量利潤 200 個基點。 。

Gross profit is expected to be approximately $935 million at the midpoint of our guide, representing an increase on our previous estimate. There are no significant changes to the annual depreciation and amortization, interest expense, effective tax rate and capital spending estimates that we provided in our last earnings call.

以我們指南的中點計算，毛利預計約為 9.35 億美元，比我們先前的估計增加。我們在上次財報電話會議中提供的年度折舊和攤提、利息支出、有效稅率和資本支出估計沒有重大變動。

Turning to our capital allocation, we are deleveraging faster than anticipated in reporting second quarter results and expect net debt of $1.8 billion at year-end compared to a range of $1.8 billion to $1.9 billion previously shared. This equates to an estimated 2.9x net debt to trailing 12 months adjusted EBITDA ratio representing an [improvement] in end of Q3 and year-end. And our capital allocation priorities are unchanged: invest with discipline in automation, continued margin expansion and growth, returning cash to our shareholders by maintaining our current dividend and further deleveraging to a target of 2 to 2.5x adjusted EBITDA and pursue bolt-on acquisitions consistent with our marketplace position and core competencies.

談到我們的資本配置，我們在報告第二季度業績時去槓桿化的速度快於預期，預計年底淨債務為 18 億美元，而之前的分配範圍為 18 億美元至 19 億美元。這相當於預期淨債務與過去 12 個月調整後 EBITDA 比率的 2.9 倍，代表第三季末和年底的[改善]。我們的資本配置優先事項保持不變：嚴格投資於自動化、持續的利潤率擴張和成長、透過維持當前股息向股東返還現金、進一步去槓桿化至調整後EBITDA 2 至2.5 倍的目標，並追求一致的補強收購憑藉我們的市場地位和核心能力。

Overall, our business is strong and getting stronger. Our volumes stable to growing in our 3 largest categories, and we are implementing plans to improve top line performance in our tableware business. We have additional opportunities to expand margins and our cash flows are strong, giving us the opportunity to accelerate deleverage while investing in the future of our company.

總體而言，我們的業務很強勁，而且還在不斷增強。我們三大類別的銷售量穩定成長，我們正在實施計劃以提高餐具業務的營收績效。我們有更多機會擴大利潤率，而且我們的現金流強勁，使我們有機會在投資公司未來的同時加速去槓桿化。

Now before I turn the call back over to the operator, I would like to acknowledge that this will be my last earnings call with you. It's truly been a pleasure working with the incredible team here at Reynolds Consumer Products and I'm immensely proud of the remarkable progress we've achieved together over the years. In addition, a special thank you to the analysts and investor community for the trust and confidence you have shown to our team. Finally, I'm confident that Scott and the entire RCP team will be very effective guiding Reynolds to the company's next phase of growth. As we turn to our Q&A, we ask that you direct your questions to Lance and me as Scott remains in an advisory role to the company. With that, operator, please open the call for questions.

現在，在我將電話轉回給接線員之前，我想確認這將是我與您的最後一次財報電話會議。與雷諾消費產品公司令人難以置信的團隊合作確實令人愉快，我對多年來我們共同取得的顯著進步感到非常自豪。此外，特別感謝分析師和投資人界對我們團隊的信任和信心。最後，我相信 Scott 和整個 RCP 團隊將非常有效地指導 Reynolds 公司進入下一階段的發展。當我們進行問答時，我們要求您將問題直接向蘭斯和我提出，因為斯科特仍然擔任公司的顧問。那麼，接線員，請打開提問電話。

(Operator Instructions) Our first question comes from Peter Grom with UBS.

（操作員說明）我們的第一個問題來自 UBS 的 Peter Grom。

Michael, I wish you the best of luck moving forward and thank you for all the help over the years. And Scott, congratulations and looking forward to working with you. So I wanted to ask about the 4Q revenue guidance, which was a bit weaker than expected, especially on the retail volume front. I think last quarter, there's always an expectation for non-retail sales to have an impact in the fourth quarter. But I may be mistaken, but I think the expectation was for retail volume to return to growth. Can you maybe just talk about what's changed versus August? And while I wouldn't expect any official commentary on '24 just now, but I do think it would be helpful to understand how you see volume performance evolving kind of given the weaker exit rate?

邁克爾，祝您一切順利，並感謝您多年來的所有幫助。斯科特，祝賀您並期待與您合作。所以我想詢問第四季的營收指引，該指引略弱於預期，尤其是在零售量方面。我認為上個季度，人們總是預期非零售銷售會對第四季產生影響。但我可能錯了，但我認為預期是零售量恢復成長。您能否簡單談談與 8 月相比發生了什麼變化？雖然我不希望對 24 剛出現任何官方評論，但我確實認為，在退出率較弱的情況下，了解您如何看待銷量表現的演變會有所幫助？

I'll start, and I'll let Michael add to my comments. The change in the revenue guide is primarily the tableware business and non-retail. In the retail -- in the tableware business, we are seeing volumes decline. However, it's worth reminding everyone that we're seeing an 800 basis point increase in the EBITDA margins in that business. Tableware is a more discretionary item than our other categories, and we've taken the most pricing up in that category than we have other categories, up over 30% on a 4-year basis versus high teens in our other businesses. And we started and completed those increases later than we did in our other categories. So we've now crossed some key elasticity thresholds knowing that we may have to address the volume impact. And we're going to use the same playbook we've used with Reynolds Wrap, get the right price points, get the promoted activity right and drive the overall category growth. .

我先開始，然後讓邁克爾添加我的評論。收入指引的變化主要是餐具業務和非零售。在零售業——餐具業務中，我們看到銷售量下降。然而，值得提醒大家的是，我們看到該業務的 EBITDA 利潤率成長了 800 個基點。餐具是比我們其他類別更自由的商品，我們在該類別中的定價比其他類別最高，四年來上漲了 30% 以上，而我們其他業務的價格則高達十幾歲。我們開始並完成這些增長的時間比其他類別的增長要晚。因此，我們現在已經跨越了一些關鍵的彈性閾值，因為我們知道我們可能必須解決數量影響的問題。我們將使用與 Reynolds Wrap 相同的策略，獲得正確的價格點，正確進行促銷活動並推動整體類別的成長。 。

Nonetheless, it's going to take some time to see the full benefit of those actions as it did with Reynolds Wrap, and we've gone through that previously. So that's the primary change in the revenue guidance on tableware.

儘管如此，我們還需要一段時間才能看到這些行動的全部好處，就像 Reynolds Wrap 所做的那樣，我們之前已經經歷過這一點。這是餐具收入指引的主要變化。

And Peter, this is Mark. I'll just add to what Lance said to remind you that our non-retail business is a very low-margin business. So while it's impacting the top line, it's not having any really very significant effect on our earnings expectations versus where we were a few months ago.

彼得，這是馬克。我只是補充一下蘭斯所說的話，以提醒您我們的非零售業務是一項利潤率非常低的業務。因此，雖然它影響了營收，但與幾個月前相比，它並沒有對我們的獲利預期產生任何非常顯著的影響。

No, that's really helpful. And then maybe just a follow-up. I wanted to ask about Hefty Waste & Storage. You touched on the innovation and share performance, and it was nice to see. So the volume mix return to growth this quarter, but there's obviously been a lot of disruption in the category with your largest branded competitor. Did this impact your results at all in the quarter? And I am just really curious how do you kind of see this dynamic evolving as you look out to the fourth quarter?

不，這真的很有幫助。然後也許只是後續行動。我想問一下關於大量廢物和儲存的問題。您談到了創新和分享績效，很高興看到。因此，本季銷量組合恢復成長，但與最大的品牌競爭對手相比，該類別顯然出現了許多混亂。這對您本季的業績有影響嗎？我真的很好奇，當您展望第四季時，您如何看待這種動態的演變？

Well, first, I want to start by saying I would never wish a cybersecurity incident on any company and particularly on a competitor. It's very disappointing to hear that happening to any business across our country. Hefty was, as you mentioned, was already driving volume and share in waste bags prior to Clorox's cybersecurity incident. There was some benefit in the latter part of Q3, which is continuing in the Q4 and that, along with a refresh of our category expectations across all of our businesses was factored into our Q4 guide.

好吧，首先，我想說，我永遠不希望任何公司，特別是競爭對手發生網路安全事件。聽到這種情況發生在我們國家的任何企業身上，真是令人失望。正如您所提到的，在高樂氏網路安全事件發生之前，Hefty 就已經在推動垃圾袋的數量和份額。第三季後期出現了一些好處，這種情況在第四季度繼續存在，我們所有業務的類別預期的更新都已納入我們的第四季度指南中。

Our next question comes from Mark Astrachan with Stifel.

我們的下一個問題來自 Stifel 的 Mark Astrachan。

A couple of questions for me. One, just starting on M&A, not trying to make too much out of it, but it's kind of notable considering your history. What are you trying to get out of the acquisition? Is it commercialization technology, R&D know-how, et cetera, any signaling on more willingness for M&A? Or was it just opportunistic and partly because of Michael's comments on the deleveraging faster than anticipated? That's question one.

有幾個問題問我。第一，剛開始併購，不想從中賺到太多錢，但考慮到您的歷史，這有點值得注意。您想從這次收購中得到什麼？商業化技術、研發技術等是否顯示併購意願增強？或者這只是機會主義，部分原因是麥可關於去槓桿化速度快於預期的評論？這是問題一。

Mark, thanks. Yes. No, our capital allocation strategy has not changed. We saw a very unique opportunity with this acquisition. This company creates unique and novel raw materials that enhanced performance in postability. They manufacture reusable plant-based products and develop technologies and partnerships in a circular economy, which aligns with our Hefty renewed recycling program and our sustainable product development. So we saw this as a unique opportunity to enhance our research and development opportunities and sustainable products. And as I said, but that doesn't change. Our primary focus is on delevering.

馬克，謝謝。是的。不，我們的資本配置策略沒有改變。我們透過這次收購看到了一個非常獨特的機會。該公司創造了獨特而新穎的原材料，可提高可後處理性能。他們生產可重複使用的植物性產品，並在循環經濟中開發技術和合作夥伴關係，這與我們的 Hefty 更新的回收計劃和永續產品開發相一致。因此，我們認為這是一個增強我們的研發機會和永續產品的獨特機會。正如我所說，但這並沒有改變。我們的首要重點是去槓桿化。

Got it. And maybe just a related question to that and then the second question. So is there any change in your thinking about how to think about that specific avenue, the sustainability of what you're selling? Or is it just part of the core sort of thing? And then the second real question is just how to think about the balance between gross margin expansion, obviously, very good in the quarter. It probably continues to be good, reinvestment, which was increased and just the flow-through to adjusted EBITDA.

知道了。也許只是一個與之相關的問題，然後是第二個問題。那麼，您對所銷售產品的特定途徑、永續性的看法是否有任何改變？或者它只是核心事物的一部分？第二個真正的問題是如何考慮毛利率擴張之間的平衡，顯然，本季非常好。再投資可能會繼續保持良好勢頭，增加，並且只是調整後 EBITDA 的流入。

I'll answer the first part of the question, I'll ask you to repeat the second one. So Michael can answer it. But our focus has always been on -- and if you look at our ESG scorecard on having sustainable product solutions across our product portfolios. We have a goal to ensure that consumers have a choice of a sustainable product across all of our categories by 2025, and we're well on our way to achieving that goal. So this is part of developing those sustainable product options for consumers. And could you repeat the second part of your question for Michael?

我會回答問題的第一部分，我會請你重複第二部分。所以麥可可以回答這個問題。但我們的重點始終是——如果您查看我們的 ESG 記分卡，您會發現我們的產品組合中擁有可持續的產品解決方案。我們的目標是確保到 2025 年消費者可以選擇我們所有類別的永續產品，並且我們正在努力實現這一目標。因此，這是為消費者開發永續產品選擇的一部分。您能否向邁克爾重複問題的第二部分？

Yes. It was basically just about thinking about the balance between gross margin expansion, reinvestment and then -- and adjusted EBITDA growth.

是的。基本上只是考慮毛利率擴張、再投資以及調整後的 EBITDA 成長之間的平衡。

Yes. So when you think about our gross margin expansion, we are expecting continued improvement into the future. We do expect additional gross margin expansion driven by the full year of Cooking & Baking improvements, additional mix and revolution cost savings. So that is our expectation going forward. So you should look to see continuation of our expansion (inaudible) understand. Can you again -- then the second part of that question was related specifically to what again, can you...

是的。因此，當你考慮我們的毛利率擴張時，我們預計未來會持續改善。我們確實預計，全年烹飪和烘焙改進、額外組合和革命成本節約將推動毛利率進一步成長。這就是我們對未來的期望。因此，您應該了解我們的擴充（聽不清楚）的延續。你能再說一次嗎──那麼這個問題的第二部分又具體牽涉到什麼，你能…

Yes. Just what do you do with that incremental gross profit? How do you think about reinvestment? How do you think about flow-through to EBITDA?

是的。您如何處理增量毛利？您如何看待再投資？您如何看待 EBITDA 的流通？

Well, our priority continues to be delever and pay down debt. Anything beyond that would be dealt with on an opportunistic basis, but -- and we'll continue to invest in this business, but our priority is to pay down debt and delever as we indicated previously.

嗯，我們的首要任務仍然是去槓桿化和償還債務。除此之外的任何事情都將在機會主義的基礎上處理，但是——我們將繼續投資這項業務，但我們的首要任務是償還債務和去槓桿化，正如我們之前指出的那樣。

Our next question comes from Lauren Lieberman with Barclays.

我們的下一個問題來自巴克萊銀行的勞倫·利伯曼。

One question I had on tableware. You walked through the plans for kind of resuscitating the business and using that the existing playbook that's worked. But I was wondering if there's an opportunity to reset profitability or business -- product mix within tableware as you're doing this? So there are segments of that business that are more profitable than others. Sort of is there like a broader kind of reset opportunity within that business as well as you're putting in this resuscitation plan?

我有一個關於餐具的問題。您詳細了解了復興業務的計劃，並使用了有效的現有劇本。但我想知道，當你們這樣做時，是否有機會重新調整餐具內的盈利能力或業務產品組合？因此，該業務的某些部分比其他部分利潤更高。在該業務中是否存在更廣泛的重置機會以及您正在製定的復甦計劃？

Yes. Without getting into specific details beyond what I said in the prepared remarks, the answer to that question is yes. We have restored profitability across all of the products, which gives us the flexibility to invest in all those actions I talked about, which is features and displays, adjusting counts and increasing advertising and promotional activity.

是的。除了我在準備好的發言中所說的內容之外，無需深入討論具體細節，這個問題的答案是肯定的。我們已經恢復了所有產品的盈利能力，這使我們能夠靈活地投資於我談到的所有這些行動，即功能和展示、調整數量以及增加廣告和促銷活動。

Okay. And then if I shift to the Hefty food bag launch, and I apologize, I don't know if you covered this to a great extent in the prepared remarks. I'm sorry if you did because I was on another call. But I was just curious about just early reads from retailers on shelf space there, if it's incremental, if this is a replace slider bags with press-to-close, but just how that kind of fits into the product lineup and the decision to add this to the portfolio?

好的。然後，如果我轉向 Hefty 食品袋的發布，我道歉，我不知道您在準備好的演講中是否在很大程度上涵蓋了這一點。如果您這樣做了，我很抱歉，因為我正在接聽另一個電話。但我只是好奇零售商在貨架空間上的早期閱讀，如果它是增量的，如果這是用按下關閉來替換滑塊袋，但這種方式如何適合產品陣容以及添加的決定這到投資組合？

It is to add another brand to the press-to-close category. At this point in time, there's only one brand in the category and much likely we've successfully been in the food bag category with both brands and store brands. There's 3 brands in the slider category. So we saw an opportunity through our category management teams, insights and development to add a brand to the press-to-close category. We just launched it recently, and it's too early to get a read on the revenue success that we project. We'll have that when we put our 2024 plan together.

就是在按下關閉的類別中新增另一個品牌。目前，該類別中只有一個品牌，很可能我們已經成功地進入了食品袋類別，同時擁有品牌和商店品牌。滑桿類別中有 3 個品牌。因此，我們透過我們的品類管理團隊、洞察力和發展看到了一個機會，可以將一個品牌添加到按關閉品類中。我們最近才推出它，現在了解我們預計的收入成功還為時過早。當我們制定 2024 年計畫時，我們就會實現這一點。

Okay. And then final thing, sorry, It was just -- at our conference, you had spoken to 2024 volumes kind of flattish as a good starting point for expectations. Now that we know about the pressure from -- in tableware and I guess, continued on the non-retail side of things. Just curious how much of that's driving that thought process on flattish volumes? Like should we think about Hefty and Reynolds Cooking & Baking is having like a sort of some growth and then they're began offset from tableware and non-retail?

好的。最後一件事，抱歉，在我們的會議上，您曾說過 2024 年的捲數有點平淡，但作為期望的一個良好起點。現在我們知道了來自餐具方面的壓力，我想，這種壓力持續存在於非零售方面。只是好奇這在多大程度上推動了平坦體積的思考過程？就像我們應該考慮一下 Hefty 和 Reynolds 烹飪和烘焙正在經歷某種增長，然後它們開始從餐具和非零售產品中抵消？

Well, we are in the middle of our planning process for next year, and we'll have more share in our volume expectations when that's complete. We are -- certainly, we're operating in a very dynamic macroeconomic environment. And I'm pleased with our performance in our largest categories. As you heard in my prepared remarks, our retail volume is stable and growing in household foil, waste bags, and food bags. And that's better than many CPGs in their largest categories, driven by many factors, including our innovation, our leverage of our brand and store brand business model and successful category management with our retail partners. .

嗯，我們正處於明年的規劃過程中，完成後我們將在銷售預期中獲得更多份額。當然，我們是在一個非常活躍的宏觀經濟環境中運作的。我對我們在最大類別中的表現感到滿意。正如您在我準備好的演講中所聽到的，我們的家用箔、垃圾袋和食品袋的零售量穩定且正在增長。在其最大的品類中，這比許多消費品公司都要好，這是由許多因素推動的，包括我們的創新、我們對品牌和商店品牌業務模式的利用以及與我們的零售合作夥伴的成功品類管理。 。

As commodities have and costs have stabilized, our tableware business has achieved levels of profitability, as I mentioned a moment ago on key items that gives us the flexibility to adjust retail prices and price packs together with our retail partners. And those actions will require time to drive improvement, and I'm confident they will, and that will be factored into our 2024 planning.

隨著商品和成本的穩定，我們的餐具業務已經實現了盈利水平，正如我剛才提到的關鍵項目，這使我們能夠靈活地與零售合作夥伴一起調整零售價格和價格包。這些行動需要時間來推動改進，我相信它們會的，這將納入我們 2024 年的規劃中。

(Operator Instructions) Our next question comes from Jason English with Goldman Sachs.

（操作員說明）我們的下一個問題來自高盛的 Jason English。

I have to apologies in advance like Lauren, I'm stretching multiple directions. So I may ask questions that you've already addressed, if that's the case, well, my apologies. It's great to see the robust margin recovery on Reynolds Cooking & Baking. You, however, still are well below kind of the 20% level -- EBITDA level that you were hovering at plus/minus for quite a few years there. Is that a reasonable number to get back to or just because of the numerator denominator effect of how much price you put in the system, should we be looking to level off at a lower margin than that? And if so, what is that right margin? And when do you think you'd be able to get there?

我必須像勞倫一樣提前道歉，我正在向多個方向延伸。所以我可能會問你已經解決過的問題，如果是這樣的話，那我很抱歉。很高興看到雷諾茲烹飪和烘焙業務的利潤率強勁復甦。然而，您仍然遠低於 20% 的水平——您在正負值上徘徊了好幾年的 EBITDA 水平。這是一個合理的數字嗎？還是僅僅因為您在系統中投入的價格的分子分母效應，我們是否應該尋求比這個更低的利潤保持穩定？如果是這樣，右邊距是多少？你認為你什麼時候能到達那裡？

Yes, Jason, it's a great question. Look, we're still in the midst of working through our plan. I mean, so I think we're going to pause and give you an answer on that in a lot more detail in January.

是的，傑森，這是一個很好的問題。看，我們仍在實施我們的計劃。我的意思是，所以我認為我們將暫停一下，並在一月份為您提供更詳細的答案。

Jason, Mark here. And what I would add to what Michael said is that as you've seen, and really it's been a story all year in 2023, you've seen margin expansion in each of our businesses. And as Lance just mentioned, we're pleased with what we've achieved. As you know, our earnings expectations for the year have come up as we move through the year. So we think we're going into the planning cycle in a very good place to be starting that exercise.

傑森，馬克在這裡。我想補充一下邁克爾所說的是，正如您所看到的，實際上這是 2023 年全年的一個故事，您已經看到我們每項業務的利潤率正在擴大。正如蘭斯剛才所提到的，我們對所取得的成就感到滿意。如您所知，隨著時間的推移，我們對今年的獲利預期也隨之提高。因此，我們認為我們正在一個非常適合開始這項工作的計劃週期。

I would absolutely agree with -- from the perspective of an outsider looking in. Turning to the waste and storage business. I think it was Mr. Astrachan earlier who asked the question around Clorox' disruption and the benefit that's accruing to. You mentioned you saw some benefit late in the third quarter. How long should we expect these benefits to continue? And said differently, I imagine some of that disruption is giving you an opportunity to secure some maybe a higher share of promotional merchandising programming than you otherwise would have had. Is that the case? And how far out have you been able to secure the higher share?

我絕對同意——從局外人的角度來看。轉向廢物和存儲業務。我認為阿斯特拉坎先生早些時候提出了有關高樂氏的破壞及其所帶來的好處的問題。您提到您在第三季末看到了一些好處。我們預計這些好處會持續多久？換句話說，我認為其中一些幹擾使您有機會獲得比其他方式更高的促銷商品計劃份額。是這樣嗎？您距離獲得更高份額還有多遠？

I think it would be premature for us to comment on that as we're developing our 2024 plan, how sticky these gains have been on a sustained basis. We'll wait and see, and we'll plan accordingly.

我認為，在我們制定 2024 年計畫時，現在評論這些成果的持續黏性還為時過早。我們將拭目以待，並做出相應的計劃。

Our next question comes from Andrea Teixeira with JPMorgan.

我們的下一個問題來自摩根大通的 Andrea Teixeira。

Michael, I would like to congratulate you in the next steps of your life and thank you for all the patience along the way. And Scott, welcome, and looking forward to working with you. My question is on the balance between your branded and private label offerings. And I understand that you have -- and correct me if I'm wrong, you had alluded to that, I think, in the second quarter that you had a contractual price reduction in trash bags in the Q4 because of just the rising price flowing through.

邁克爾，我謹祝賀你人生的下一步，並感謝你一路以來的耐心。斯科特，歡迎並期待與您合作。我的問題是關於您的品牌產品和自有品牌產品之間的平衡。我知道您已經 - 如果我錯了，請糾正我，我認為您在第二季度提到了第四季度垃圾袋的合約價格下降，因為價格上漲通過。

So I wonder, number one, if that's correct? And number two, if you're looking to do any adjustments to the price of Hefty trash bags given that the price gap will likely widen and what your experience with tableware has been in terms of price elasticity or conversely, because you probably got more velocity given your competitors issues. Is there anything we should be thinking of? And again, thinking of how you've been able to recover your -- it was impressive, 80 basis points improvement in gross margin. If you wanted to reinvest a little bit more in promo or that is the level that you feel is appropriate in terms of price points and price gaps?

所以我想知道，第一，這是否正確？第二，如果您想對 Hefty 垃圾袋的價格進行任何調整，因為價格差距可能會擴大，以及您在餐具方面的經驗在價格彈性方面或相反，因為您可能會獲得更高的速度考慮到您的競爭對手的問題。有什麼值得我們思考的嗎？再一次，想想你是如何恢復毛利率的——令人印象深刻的是，毛利率提高了 80 個基點。如果您想在促銷上再投資一點，或者您認為這個水平在價格點和價格差距方面是合適的？

To your first point about the private label pricing and waste bags, it's been stable and has not changed. We didn't make any changes in private label pricing and waste bags. And resin has stabilized, but we haven't seen and nor do we expect significant decreases there. So our pricing strategy remains as it has been. We've restored the margins to a level that we're satisfied with. We believe that we can continue to grow from this point forward.

關於自有品牌定價和垃圾袋的第一點，它一直穩定且沒有改變。我們沒有對自有品牌定價和垃圾袋進行任何更改。樹脂已經穩定下來，但我們還沒有看到，也不預期會有顯著下降。所以我們的定價策略維持不變。我們已將利潤恢復到我們滿意的水平。我們相信，從現在開始，我們可以繼續成長。

Go ahead.

前進。

I was going to say, I think one of your questions was there about our path to continued gross margin expansion. I did speak on this earlier, but we do expect to see continued gross margin expansion as we get the benefit -- the full year benefits from the Reynolds Cooking & Baking improvements. And in additional, we do see mix being favorable. And obviously, we have Reyvolution cost savings that we're still working through. But we've demonstrated in the past that we managed Reyvolution projects pretty well, and you should expect to see that going forward.

我想說，我認為您的問題之一是關於我們持續毛利率擴張的道路。我之前確實談到過這一點，但我們確實希望看到毛利率持續增長，因為我們受益於雷諾茲烹飪和烘焙改進的全年收益。此外，我們確實認為混合是有利的。顯然，我們仍在努力實現 Reyvolution 成本節約。但我們過去已經證明，我們很好地管理了 Reyvolution 項目，您應該期待看到這一點。

There are no further questions at this time. I would now like to turn the floor back over to Lance Mitchell for closing comments.

目前沒有其他問題。我現在想把發言權交還給蘭斯·米切爾，請他發表結束語。

Thank you, operator, and thank you, everyone, for your questions and your interest in our business. I'd also like to just say thank you again to Michael Graham for his contributions to our company. We're going to miss his business partnership. I also want to really extend a sincere thank you to everyone on the RCP team. They are the reason that we're doing and performing so well. And finally, I'd like you to all mark your calendars for Wednesday, March 20, 2024, we will be in New York City on that day for an Investor Day. I hope to see you all then. Thank you.

謝謝運營商，也謝謝大家提出的問題以及對我們業務的興趣。我也想再次感謝邁克爾·格雷厄姆對我們公司的貢獻。我們會懷念他的商業夥伴關係。我還要向 RCP 團隊的每個人致以誠摯的謝意。他們是我們做得和表現如此出色的原因。最後，我希望大家在日曆上標記 2024 年 3 月 20 日星期三，我們將在這一天在紐約市慶祝投資者日。我希望屆時見到你們大家。謝謝。

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

今天的電話會議到此結束。此時您可以斷開線路。感謝您的參與。