Exhibit 99.1
Tupperware Reports Third Quarter EPS of 22 Cents Including a
79 Percent Improvement in Profit From Segments
ORLANDO, Fla., Oct. 18 /PRNewswire-FirstCall/ -- Tupperware Corporation
(NYSE: TUP) announced today that net income for the third quarter of 2004 was
$12.9 million or 22 cents per diluted share, compared with breakeven last
year.
The 2004 quarter included 11 cents per diluted share of gains from land
development and two cents of re-engineering costs. Excluding these items,
diluted earnings per share were 13 cents compared with breakeven last year.
The improvement from last year was primarily driven by a 79 percent
improvement in profit from the company's segments.
Sales in the third quarter were $255.0 million, a two percent increase
from last year. Excluding the impact of foreign currency compared with prior
year, sales were one percent lower due to declines in Japan and the United
States.
"We were pleased to report profitability improvement in four out of five
of our segments. On the sales side, strength in BeautiControl North America
and Latin America partially offset weakness in our German, Japanese and U.S.
Tupperware markets," said Rick Goings, Chairman and Chief Executive Officer.
"As planned, we launched our new sales force compensation model in the U.S. to
a select group of distributors during September and October, and over time, we
are looking forward to this model having a positive impact on the sales force
size and sales," Goings continued.
Tupperware will conduct a conference call today, October 18, 2004, at
10:00 a.m. Eastern time. The conference call will be simulcast and archived,
along with a copy of this news release, at http://www.Tupperware.com .
Third Quarter Segment Highlights
Europe
Sales were $111.2 million, up nine percent over last year. Excluding the
impact of foreign currency on the comparison, sales were up one percent or
$1.2 million, primarily due to improvements in South Africa, France, Russia
and the Nordics, partially offset by a decline in Germany.
Profit was $16.1 million, a 44 percent increase. Excluding a $0.4 million
positive foreign currency impact on the comparison, profit increased
$4.6 million or 38 percent. Return on sales improved due to a stronger gross
margin, as a result of lower manufacturing costs, and lower operating
expenses.
The full-year expectation is for flattish sales, after excluding a
favorable impact of foreign exchange, with a modest improvement in
profitability.
North America
Sales were $38.8 million, down 13 percent from last year, which was a
slight improvement from the second quarter. The decline was primarily due to
an 11 percent decrease in average active sales force. There was a loss for
the quarter of $7.6 million, which was 17 percent higher than last year.
Despite the improvement in the third quarter comparison of active sellers,
the outlook continues to be for a sales decrease in the fourth quarter and
into 2005. As a result, the expectation is that the full-year 2004 loss in
this segment will exceed that of 2003.
Asia Pacific
Sales were $49.6 million, down eight percent or $4.1 million. Excluding
the impact of foreign currency from the comparison, sales were down 10 percent
from last year. The sales decline was primarily in Japan due to a lower
active sales force. The quarter also included lower sales in
Malaysia/Singapore and Indonesia. Growth in China was strong, and progress
continued in the Philippines and Korea.
Profit improved 24 percent compared with the same quarter last year to
$4.0 million. Excluding the impact of foreign currency, profit improved
22 percent, in spite of the sales decline. The profit improvement was due to
cost structure improvements in Korea, the Philippines and Australia, along
with lower product costs.
For the full year, Asia Pacific is expected to have a moderate sales
decline due to current trends in Japan with a slight improvement in profit
resulting from cost structure improvements discussed above.
Latin America
Latin America sales were $26.9 million, which was a two percent increase
compared with last year. Excluding the impact of foreign currency from the
comparison, sales increased eight percent from gains throughout the region.
BeautiControl continued to make good sales contributions in Mexico with
11 percent local currency sales growth over last year.
Profit increased $1.3 million or over 100 percent from last year due to
the higher sales and value chain improvements in all of the markets.
The expectation for this segment continues to be for positive comparison
in sales for the full year, and an even greater improvement in profit due to
value chain improvements.
BeautiControl North America
Sales were $28.5 million, up 26 percent from last year due to total sales
force growth of 29 percent and average active sales force growth of
23 percent.
Profit increased to $1.7 million from $0.4 million last year due to the
higher sales, more effective promotional spending and cost containment.
For the full year, sales are expected to be up over 20 percent, and profit
is expected to be up significantly in comparison with 2003.
Year To Date
Net income was $51.1 million or 87 cents per diluted share compared with
$20.5 million or 35 cents per diluted share last year, which included one cent
from a gain on land development.
The 2004 results included 13 cents from gains on land development
partially offset by three cents of re-engineering costs. Excluding these
items, earnings per share were 77 cents compared with 34 cents last year. Of
this 43-cent improvement, 21 cents was from the combination of lower hedging
costs and stronger foreign currencies.
Sales were up three percent to $853.5 million. Excluding foreign
currency, sales were down two percent compared with prior year.
Outlook
The full-year 2004 earnings outlook range is narrowed to $1.30 to $1.35
per diluted share. The high end of the previous range of $1.28 to $1.38 was
reduced by three cents due to a decline in the positive impact of foreign
currency. This outlook includes thirteen cents from gains on land
development, six cents of re-engineering costs, 11 cents positive impact from
foreign currencies and 18 cents from lower hedging costs.
The full-year sales outlook is for a slight increase versus 2003, and
excluding the impact of foreign exchange, sales are still expected to be down
slightly compared with last year.
The Company expects during the fourth quarter an insurance recovery
associated with hurricane damage at its Orlando headquarters; however, nothing
is included in the outlook range for this item.
Revolving Credit Facility
The Company is in the process of negotiating a new $150 million revolving
credit facility. Preliminary commitments in excess of the $150 million target
have been received subject to agreement on documentation. The Company expects
that the covenants and restrictions in the new agreement will allow it similar
borrowing and dividend paying flexibility as under its existing facility.
Tupperware Corporation, a $1.2 billion multinational company, is one of
the world's leading direct sellers, supplying premium food storage,
preparation and serving items to consumers in almost 100 countries through its
Tupperware brand. In partnership with one million independent sales
consultants worldwide, Tupperware reaches consumers through informative and
entertaining home parties; retail access points in malls and other convenient
venues; corporate and sales force Internet web sites; and television shopping.
Additionally, premium beauty and skin care products are brought to customers
through its BeautiControl brand in North America, Latin America and Asia
Pacific. Consumers can access the brands' web sites at
http://www.tupperware.com and http://www.beauticontrol.com .
Tupperware stock is listed on the New York Stock Exchange (NYSE: TUP).
Statements contained in this release which are not historical fact and use
predictive words such as "outlook" or "target" are forward-looking statements.
These statements involve risks and uncertainties which include recruiting and
activity of the Company's independent sales forces, the success of new product
introductions and promotional programs, the ability to obtain all government
approvals on land development, the success of buyers in attracting tenants for
commercial developments, the effects of economic and political conditions
generally and foreign exchange risk in particular and other risks detailed in
the Company's report on Form 8-K dated April 10, 2001, as filed with the
Securities and Exchange Commission.
Non-GAAP Financial Measures
The Company has utilized non-GAAP financial measures in this release,
which are provided to assist in investors' understanding of the Company's
results of operations. The adjustment items materially impact the
comparability of the Company's results of operations. The adjusted information
is intended to be more indicative of Tupperware's primary operations, and is
intended to assist investors in evaluating performance and analyzing trends
across periods. The non-GAAP financial measures exclude gains on land
development. While the Company is engaged in a multi-year program to sell
land for development, this activity is not part of the Company's primary
business operation. Additionally, the gains recognized in any given period
are not necessary indicative of gains which may be recognized in any
particular future period. For this reason, these gains are excluded from
indicated earnings per share amounts. Also, the Company periodically records
exit costs as defined under Statement of Financial Accounting Standards
No. 146, "Accounting for Costs Associated with Exit or Disposal Activities,"
and believes these amounts are similarly volatile and impact the comparability
of earnings across quarters. Therefore, they are also excluded from indicated
earnings per share calculations to provide what the Company believes
represents a more useful measure for analysis and predictive purposes. A
reconciliation of non-GAAP financial measures with the corresponding GAAP-
based measures is attached to this release.
TUPPERWARE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
13 Weeks Ended 39 Weeks Ended
Sept. 25, Sept. 27, Sept. 25, Sept. 27,
(In millions, except per
share data) 2004 2003 2004 2003
Net sales $255.0 $249.2 $853.5 $830.7
Cost of products sold 87.5 88.5 287.3 286.4
Gross margin 167.5 160.7 566.2 544.3
Delivery, sales and administrative
expense 157.4 156.4 503.3 500.6
Re-engineering and impairment
charge 1.8 -- 2.5 --
Gains on disposal of assets 10.1 -- 11.6 1.2
Operating income 18.4 4.3 72.0 44.9
Interest income 0.4 0.4 1.4 1.4
Other income (0.3) -- 0.3 0.6
Interest expense 3.7 4.1 10.6 11.6
Other expense 0.8 1.7 1.8 10.0
Income (loss) before income taxes 14.0 (1.1) 61.3 25.3
Provision for (benefit from)
income taxes 1.1 (1.1) 10.2 4.8
Net income 12.9 -- 51.1 20.5
Net income per common share:
Basic $0.23 $-- $0.88 $0.35
Diluted $0.22 $-- $0.87 $0.35
TUPPERWARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(Amounts in millions, except per share)
13 Weeks Ended Reported Restated Foreign
Sept. 26, Sept. 27, % % Exchange
2004 2003 Inc Inc Impact
(Dec) (Dec)
SALES
Europe $111.2 $102.2 9 1 $7.8
Asia Pacific 49.6 53.7 (8) (10) 1.5
Latin America 26.9 26.4 2 8 (1.6)
North America 38.8 44.5 (13) (13) 0.2
BeautiControl
North America 28.5 22.4 26 26 --
$255.0 $249.2 2 (1) $7.9
SEGMENT PROFIT (LOSS)
Europe $16.1 $11.1 44 38 $0.4
Asia Pacific 4.0 3.2 24 22 0.1
Latin America 2.3 1.0 + + (0.1)
North America (7.6) (6.5) (17) (16) --
BeautiControl
North America 1.7 0.4 + + --
16.5 9.2 79 72 0.4
Unallocated expenses (6.7) (4.7) (43)
Hedge costs (0.8) (1.9) 58
Other income 10.1 -- +
Re-engineering and
impairment charges (1.8) -- --
Interest expense, net (3.3) (3.7) 9
Income (loss) before taxes 14.0 (1.1) +
Provision for (benefit from)
income taxes 1.1 (1.1) +
Net income $12.9 $-- +
Net income per common
share (diluted) $0.22 $-- +
Average number of
diluted shares 58.7 58.5
TUPPERWARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(Amounts in millions, except per share)
39 Weeks Ended Reported Restated Foreign
Sept. 26, Sept. 27, % % Exchange
2004 2003 Inc Inc Impact
(Dec) (Dec)
SALES
Europe $409.7 $372.9 10 -- $35.2
Asia Pacific 146.5 152.2 (4) (9) 8.6
Latin America 77.7 77.1 1 6 (4.2)
North America 136.7 161.8 (16) (16) 0.7
BeautiControl
North America 82.9 66.7 24 24 --
$853.5 $830.7 3 (2) $40.3
SEGMENT PROFIT (LOSS)
Europe $83.0 $65.9 26 15 $6.1
Asia Pacific 12.1 10.4 17 7 1.0
Latin America 7.2 1.1 + + (0.6)
North America (25.2) (19.0) (32) (32) --
BeautiControl
North America 4.2 2.0 + + --
81.3 60.4 35 22 6.5
Unallocated expenses (18.2) (17.0) (7)
Hedge costs (1.7) (9.7) 82
Other income 11.6 1.8 +
Re-engineering and
impairment charges (2.5) -- --
Interest expense, net (9.2) (10.2) 9
Income (loss) before
taxes 61.3 25.3 +
Provision for (benefit from)
income taxes 10.2 4.8 +
Net income $51.1 $20.5 +
Net income per common
share (diluted) $0.87 $0.35 +
Average number of
diluted shares 58.8 58.4
TUPPERWARE CORPORATION
RECONCILIATION
13 Weeks Ended 13 Weeks Ended
September 25, 2004 September 27, 2003
Excluding Excluding
Adjust- Adjust- Adjust- Adjust-
Reported ments ments Reported ments ments
Segment profit (loss)
Europe $16.1 $16.1 $11.1 $11.1
Asia Pacific 4.0 4.0 3.2 3.2
Latin America 2.3 2.3 1.0 1.0
North America (7.6) (7.6) (6.5) (6.5)
BeautiControl North
America 1.7 1.7 0.4 0.4
16.5 -- 16.5 9.2 -- 9.2
Unallocated expenses (6.7) (6.7) (4.7) (4.7)
Hedge costs (0.8) (0.8) (1.9) (1.9)
Other income 10.1 (10.1)a -- -- --
Re-engineering and
impairment charges (1.8) 1.8 b -- -- --
Interest expense, net (3.3) (3.3) (3.7) (3.7)
Income (loss) before
taxes 14.0 (8.3) 5.7 (1.1) -- (1.1)
Provision for (benefit
from) income taxes 1.1 (3.1)c (2.0) (1.1) (1.1)
Net income $12.9 $(5.2) $7.7 $-- $-- $--
Net income per common
share (diluted) $0.22 $0.13 $-- $--
39 Weeks Ended 39 Weeks Ended
September 25, 2004 September 27, 2003
Excluding Excluding
Adjust- Adjust- Adjust- Adjust-
Reported ments ments Reported ments ments
Segment profit (loss)
Europe $83.0 $83.0 $65.9 $65.9
Asia Pacific 12.1 12.1 10.4 10.4
Latin America 7.2 7.2 1.1 1.1
North America (25.2) (25.2) (19.0) (19.0)
BeautiControl North
America 4.2 4.2 2.0 2.0
81.3 -- 81.3 60.4 -- 60.4
Unallocated expenses (18.2) (18.2) (17.0) (17.0)
Hedge costs (1.7) (1.7) (9.7) (9.7)
Other income 11.6 (11.6) a -- 1.8 (1.2) a 0.6
Re-engineering and
impairment charges (2.5) 2.5 b -- -- --
Interest expense, net (9.2) (9.2) (10.2) (10.2)
Income before taxes 61.3 (9.1) 52.2 25.3 (1.2) 24.1
Provision for income
taxes 10.2 (3.5) c 6.7 4.8 (0.5) c 4.3
Net income $51.1 $(5.6) $45.5 $20.5 $(0.7) $19.8
Net income per common
share (diluted) $0.87 $0.77 $0.35 $0.34
Non-GAAP Financial Measures
The Company has utilized non-GAAP financial measures in this release,
which are provided to assist in investors' understanding of the Company's
results of operations. The adjustment items materially impact the
comparability of the Company's results of operations. The adjusted
information is intended to be more indicative of Tupperware's primary
operations, and is intended to assist investors in evaluating performance and
analyzing trends across periods. The non-GAAP financial measures exclude
gains on land development. While the Company is engaged in a multi-year
program to sell land for development, this activity is not part of the
Company's primary business operation. Additionally, the gains recognized in
any given period are not necessarily indicative of gains which may be
recognized in any particular future period. For this reason, these gains are
excluded from indicated earnings per share amounts. Also, the Company
periodically records exit costs as defined under Statement of Financial
Accounting Standards No. 146, "Accounting for Costs Associated with Exit or
Disposal Activities", and believes these amounts are similarly volatile and
impact the comparability of earnings across quarters. Therefore, they are
also excluded from indicated earnings per share calculations to provide what
the Company believes represents a more useful measure for analysis and
predictive purposes.
(a) During the third quarter and September YTD 2004, pretax gains from the
sale of land held for development near the company's Orlando, Florida
headquarters were $10.1 million and $11.6 million, respectively. During
September YTD 2003, pretax gains from these sales were $1.2 million and
recorded in Other income.
(b) Pre-tax re-engineering and impairment charges of approximately $2.5
million YTD includes $1.7 million related to severance costs incurred to
reduce headcount in the Company's United States, Philippine, Japanese and
Korean operations, of which $1.4 million was recorded in the third quarter,
and $0.8 million related to asset impairments in the Philippine Mfg operation,
of which $0.3 million was recorded in the third quarter.
(c) Provision for income taxes represent the net tax impact of adjusted
amounts.
TUPPERWARE CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS
(UNAUDITED)
Sept. 25, Dec. 27,
(In millions) 2004 2003
Cash and cash equivalents $23.9 $45.0
Accounts receivable 112.1 127.3
Less allowances for doubtful
accounts (15.1) (25.2)
97.0 102.1
Inventories 184.9 160.5
Deferred income tax benefits 62.3 59.2
Non-trade amounts receivable 28.4 28.6
Prepaid expenses 17.8 16.0
Total current assets 414.3 411.4
Deferred income tax benefits 152.4 136.8
Property, plant and equipment 1,062.6 1,059.3
Less accumulated depreciation (853.6) (837.9)
209.0 221.4
Long-term receivables, net of
allowance of $25.2 million at
September 25, 2004 and $26.8 million
at December 27, 2003 41.0 45.4
Goodwill, net of accumulated
amortization of $1.6 million at
September 25, 2004 and
December 27, 2003 56.2 56.2
Other assets 17.8 18.7
Total assets $890.7 $889.9
TUPPERWARE CORPORATION
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
(UNAUDITED)
Sept. 25, Dec. 27,
(Dollars in millions, except per
share amounts) 2004 2003
Accounts payable $65.5 $86.0
Short-term borrowings and current
portion of long-term debt 21.2 5.6
Accrued liabilities 179.0 182.6
Total current liabilities 265.7 274.2
Long-term debt 251.0 263.5
Accrued post-retirement benefit cost 36.7 36.4
Other liabilities 98.8 87.6
Commitments and contingencies
Shareholders' equity:
Preferred stock, $0.01 par value,
200,000,000 shares authorized;
none issued -- --
Common stock, $0.01 par value,
600,000,000 shares authorized;
62,367,289 shares issued 0.6 0.6
Paid-in Capital 25.0 23.1
Subscription receivable (18.7) (20.6)
Retained earnings 540.6 529.0
Treasury Stock, 3,804,629 shares
at September 25, 2004 and 3,850,343
shares at December 27, 2003
at cost (103.9) (105.5)
Unearned portion of restricted
stock issued for future service (1.3) (1.6)
Accumulated other comprehensive
loss (203.8) (196.8)
Total shareholders' equity 238.5 228.2
Total liabilities and
shareholders' equity $890.7 $889.9
TUPPERWARE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
39 weeks ended
Sept. 25, Sept. 27,
(In millions) 2004 2003
OPERATING ACTIVITIES
Net income $51.1 $20.5
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and
amortization 37.3 39.7
Gain on sale of assets (11.5) (0.6)
Non-cash impact of
re-engineering and
impairment charges 0.5 --
Changes in assets and liabilities:
Decrease in accounts
receivable 7.8 5.0
Increase in inventories (26.0) (13.6)
Decrease in accounts
payable and accrued
liabilities (13.2) (3.7)
Decrease in income
taxes payable (6.0) (7.7)
Increase in net
deferred income taxes (16.2) (17.2)
Net cash impact from hedge activity (9.8) 8.7
Other, net 2.4 (8.2)
Net cash provided by
operating activities 16.4 22.9
INVESTING ACTIVITIES
Capital expenditures (31.8) (26.9)
Proceeds from disposal of
property, plant & equipment 15.0 4.3
Net cash used in
investing activities (16.8) (22.6)
FINANCING ACTIVITIES
Dividend payments to shareholders (38.6) (38.5)
Proceeds from exercise of stock
options 1.0 0.9
Proceeds from payments of
subscriptions receivable 1.5 --
Net increase in short-term debt 15.9 33.3
Payment of long-term debt -- (15.0)
Net cash used in
financing activities (20.2) (19.3)
Effect of exchange rate changes on
cash and cash equivalents (0.5) 1.4
Net decrease in cash and cash
equivalents (21.1) (17.6)
Cash and cash equivalents at
beginning of period 45.0 32.6
Cash and cash equivalents at end of period $23.9 $15.0
TUPPERWARE CORPORATION
SUPPLEMENTAL INFORMATION
Third Quarter Ended September 2004
Sales Force Statistics (a):
AVG.
Segment DIST. % CHG. ACTIVE % CHG. TOTAL % CHG.
Europe 704 1 55,389 9 239,500 13
Asia Pacific 667 2 39,379 (7) 311,609 (9)
Latin America 188 (6) 58,016 (2) 232,466 (23)
North America 350 (4) 13,682 (11) 93,769 (17)
Tupperware 1,909 - 166,466 (1) 877,344 (9)
BeautiControl N.A. n/a n/a 30,885 23 94,782 29
Total 1,909 - 197,351 2 972,126 (7)
(a) As collected by the Company and provided by distributors.
UNAUDITED SELECTED FINANCIAL DATA THIRD QUARTER 2004
(In millions)
Cash 23.9 Net Debt to Capital Ratio(b) 51%
Net Current Receivables 97.0 Equity 238.5
Net Inventory 184.9 Capital Expenditures 31.8
Short-Term Debt 21.2 Depreciation and
Long-Term Debt 251.0 Amortization 37.3
(b) Net debt is defined as total debt less cash on hand. Capital is
defined as total debt less cash on hand plus shareholders' equity.
SOURCE Tupperware Corporation
-0- 10/18/2004
/CONTACT: Jane Garrard, Tupperware Corporation, +1-407-826-4522/
/Web site: http://www.tupperware.com
http://www.beauticontrol.com /
(TUP)
CO: Tupperware Corporation
ST: Florida
IN: HOU
SU: ERN CCA MAV ERP