Reynolds Consumer Products Inc (NASDAQ:REYN) reported second-quarter FY23 sales growth of 3% year-on-year to $940 million, beating the analyst consensus of $937.58 million.

Net revenues from Reynolds Cooking & Baking rose 9%, Hefty Waste & Storage declined 4%, Hefty Tableware rose 5%, and Presto Products declined 3%.

Adjusted EPS of $0.32 beat the analyst consensus of $0.28.

Gross profit increased 23.9% to $228 million. The operating income increased 39.5% to $120 million, with an operating margin of 12.7%.

Adjusted EBITDA increased 27% Y/Y to $150 million.

The company held $83 million in cash and equivalents as of June 30, 2023. Operating cash flow of $207 million in the six months represents a $106 million increase over the same period in the prior year, primarily driven by reductions in working capital.

The company's Board of Directors has approved a quarterly dividend of $0.23 per share, payable on August 31, 2023, to shareholders of record as of August 17, 2023.

CEO Lance Mitchell said, "We are forecasting strong earnings growth for the remainder of the year and have resumed paying down debt enabled by improved earnings, strong working capital management and continued capital investment discipline."

Outlook: REYN sees Q3 revenue to decline 3% - 5% and EPS of $0.34 - $0.38 versus the $0.37 consensus.

REYN revised the FY23 EPS outlook from $1.30 - $1.41 to $1.34 - $1.41 (consensus $1.35).

The company continues to expect flat +/- 1% growth in net revenues for 2023.

Price Action: REYN shares are trading higher by 4.23% at $28.97 on the last check Wednesday.

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