Reynolds Consumer Products Inc.

Greetings and welcome to the Reynolds Consumer Products Incorporated third quarter 2024 earnings call. At this time, all participants are in listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mark Schwartzberg, Vice President of Investor Relations. Thank you, sir. You may begin.

Thank you, operator. Good morning, and thank you for joining us for Reynolds Consumer Products' third quarter earnings conference call. Please note that this call is being webcast on the investor relations section of our corporate site at ReynoldsConsumerProducts.com. Our earnings press release and presentation slides are also available. With me on the call today are Lance Mitchell, our President and Chief Executive Officer, Scott Huckins, our Chief Financial Officer, and Nathan Lowe, Senior Vice President and Head of Financial Planning and Analysis. Following prepared remarks, we will open the call for a brief question and answer session. Before we begin, I would like to remind you that this morning's discussion will contain forward-looking statements which 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 the risk factors section in our SEC filing. The company does not intend to update or alter these forward-looking statements to reflect events or circumstances arising after the call. 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, which can be found on the investor relations section of our site. Now I'd like to turn the call over to Lance.

Thank you, Mark, and good morning, everyone. Our business is performing well, and we are investing in new products, new business wins, and new cost savings opportunities to drive sustained long-term profitable growth. Turning to the quarter, demand in our categories improved modestly by comparison to first-half performance. Our retail volume was unchanged and in line with our categories, after adjusting for product portfolio optimization and shipment timing as we covered on the Q2 call. We commercialized innovation across our categories, expanded our innovation pipeline, and drove increased awareness among younger consumers. We identified and delivered further revolution cost savings, and we demonstrated the value of our diversified business and product portfolio delivering revenue and earnings in line with our expectations while continuing the work to drive improved revenues and profitability in our tableware business. Before reviewing each of our businesses, I want to remind you of some of the factors positioning RCP for sustained and attractive long-term growth. Our products are well-known, affordable, and convenient. We are effectively leveraging our business model to drive our categories and develop new business in partnership with our retail customers. We are successfully introducing new products to drive share. And as I mentioned, our pipeline is only getting stronger, including an expanding range of affordable, sustainable solutions. We're commercializing scientific advances and consumer insights acquired through sustained investment in R&D, including last year's purchase of Otakama Manufacturing. And we're reducing operational costs and identifying significant additional revolution cost savings, providing additional resources for earnings growth. Our tableware business unit is a focus for many of you, as it is for us, so I'll speak to that first. The tableware business unit reported a volume and earnings decline primarily driven by lower phone plate volume and increased promotional These decreases were largely driven by recent legislative changes in several states, consumer shifting towards more sustainable offerings, and a reduction of retailers' phone plate inventories. Volume for the rest of our tableware business was up modestly and continued to outperform its categories, further demonstrating the effectiveness of the price-packed architecture and promotional strategies that we initiated at the beginning of the year. We expect phone trends to remain a headwind over the near term and have a record of successfully responding to volume declines within our tableware business. As we reviewed earlier this year at our investor day, we fully offset a double-digit phone volume decline between 2019 and 2023 with growth of other disposable tableware products over that period. A number of factors underlie our confidence and our ability to continue building upon our success repositioning our tableware business for growth. We offer a wide range of branded and store brand sustainable solutions, not only in place, but across disposable tableware. And we've been expanding our new product pipeline, emphasizing not only sustainability, including the leveraging of technology acquired in the Atacama acquisition, but also other drivers, including function, fun, and affordability. And we're commercializing scientific advancements and consumer insights through investments in R&D. Our third quarter results highlight pressure on a portion of our tableware portfolio, but this business has excellent potential as we've demonstrated by effectively managing product life cycles, and our new product pipeline and capabilities are strong. The Reynolds cooking and baking business delivered another solid quarter, and Outlook remained strong. Reynolds Wrapped gained additional share in household oil. Reynolds Kitchen's parchment continued to grow, reflecting strong innovation and significant distribution gain. We recently received new findings on several years of increased and targeted work to build brand equity with younger consumers. And I'm pleased to report that unaided awareness of Reynolds Oil and Reynolds Kitchen's parchment among millennials and Gen Z has grown strong double digits since 2021, our baseline period of measure. And in the area of operations, we are building on operational reliability and consistency and implementing new programs to achieve increased production efficiencies. Turning to Hefty Waste and Storage and Presto, our waste and storage businesses continue to perform well in the quarter, and the outlook for these businesses is strong. Recent waste bag share trends can be difficult to interpret due to a competitor's cyber incident last year, but the data is clear. Hefty share of waste bags is above 2022 levels and the Hefty Waste and Storage Business Unit delivered record quarterly revenue in the third quarter. In food bags, where we have built a majority share position in store brand food bags, the volume of store brands grew 2% in the quarter. And in the area of product innovation, Hefty Fabuloso Waste Bags achieved $200 million in annual sales in the quarter, setting the stage for a rollout of Hefty Fabuloso Watermelon, which is tested well with younger consumers and is launching nationally early next year. Hefty press to close food bags continue to build awareness and loyalty as a more affordable branded food bag and is also rolling out nationally in partnership with major retailers next year. And waste and food bag categories continue to benefit from our expanding range of sustainable solutions. Before turning to Caller to Scott, I want to note the devastation that so many in the southeast are experiencing from Hurricanes Milton and Elaine. Reynolds Consumer Products continues to support relief efforts by donating hefty trash bags and tableware products to the American Red Cross, who distributes these products to families recovering from these hurricanes and other disasters. Please join us in supporting the American Red Cross online at redcross.org. As I said in my opening remarks, our business is performing well overall, and we're investing in our categories, product innovation, new business lens, and significant incremental revolution cost savings to drive sustained and attractive long-term growth. Scott, over to you.