Exhibit 99.1
TUPPERWARE ANNOUNCES THIRD QUARTER EPS AHEAD OF PREVIOUS GUIDANCE
ORLANDO, Fla., Oct. 24 /PRNewswire-FirstCall/ -- Tupperware Corporation
(NYSE: TUP) announced today third quarter earnings per share of 4 cents versus
its previous outlook of about breakeven.
Summary:
* Sales up 4% as reported and 3% in local currency
* Sales force size up 5%; average active sales force up 2%
* EPS decreased 18 cents versus 2004
* 12 cents of the 18-cent decrease relates to land sales and
re-engineering and financing costs
* Excluding land sales and re-engineering and financing costs, EPS was 7
cents versus previous guidance of 1-3 cents (See Non-GAAP Financial
Measures reconciliation schedule)
"We were pleased to see positive movement in both sales force size and
average active sales force this quarter, which led to third quarter pro forma
earnings ahead of our expectations. Worth noting, Germany, our largest market,
had improved sales force trends. Additionally, we continued to have strong sales
growth in our emerging markets of Russia and China," said Rick Goings, Chairman
and Chief Executive Officer. "The steps necessary to close the Sara Lee Direct
Selling acquisition, including the related financing, are being completed as
expected, and we anticipate a closing date in the fourth quarter," Goings
continued.
"Tupperware will conduct a conference call tomorrow, Tuesday, October 25th,
at 10:00 am Eastern time. The conference call will be simulcast and archived,
along with a copy of the news release, at www.tupperware.com.
Third Quarter Segment Highlights
Europe
Sales increased 2% as reported and in local currency. European profit was
down $6.1 million as reported and $6.2 million in local currency, but modestly
ahead of the Company's expectation. The decrease versus 2004, was primarily due
to promotional investments and manufacturing-related costs. Europe's return
on sales for full year 2005 is still expected to be over 20%.
Asia Pacific
Sales were up 6% as reported and 4% in local currency. Asia Pacific profit
was in line with sales at up $0.4 million as reported and $0.1 million in local
currency.
Latin America
Sales increased 11% as reported and 5% in local currency driven by a sales
force size advantage of 8% and an increase in the average active sales force of
4%. All markets contributed sales and profit improvements during the quarter,
although the trend in Mexico has softened.
North America
Sales were down 8% and included a $3 million benefit due to a shift in the
promotional calendar that moved sales forward into the third quarter. The loss
was reduced by 56% or $4.2 million due to value chain improvements and a $1.4
million positive impact from reduction of LIFO inventory reserve requirements.
Sales force acceptance of the new compensation plan is going well and is in
line with Company expectations.
BeautiControl North America
Sales were up 22%, in line with average active sales force growth. Profit
was about flat with last year due to fulfillment and capacity costs associated
with recent record growth and a less advantageous mix of sales.
Year to Date Actual Results
* Sales up 6% as reported and 4% in local currency
* EPS up 3 cents including 5 cents favorable foreign exchange
* Excluding land sales and re-engineering and financing costs, EPS up 18
cents to 95 cents (see Non-GAAP Financial Measures reconciliation
schedule)
Full-Year Outlook
* Sales up 2-3% as reported and in local currency
* EPS at $1.08-$1.13; no impact from foreign exchange
-- Includes 28 cents of costs associated with financing items related to
Sara Lee direct selling acquisition
-- Outlook does not include operating results or incremental interest
expense related to the acquisition of Sara Lee's direct selling
businesses
* 3 cents of gains for land sales; 5 cents included in previous 2005
guidance deferred to 2006
* 12 cents of re-engineering costs; up from 4 cents in previous guidance
-- Primarily for additional improvements to Tupperware United States
value chain
* Effective tax rate of 12%; down from previous guidance of 19-20% mainly
due to impact of acquisition-related financing costs
* Excluding land sales and re-engineering and financing costs, EPS is
expected to be $1.45-$1.50 vs. $1.41 in 2004 (See Non-GAAP Financial
Measures outlook reconciliation schedule.)
-- Previous guidance was $1.42 -$1.52
-- Pro-forma tax rate remains at 18%
Tupperware Corporation, a $1.3 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 www.tupperware.com and 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 sales, 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 to assist investors in
evaluating performance and analyzing trends across periods. The non-GAAP
financial measures exclude gains on land sales and re-engineering costs
primarily associated with shifting capacity from its South Carolina
manufacturing facility to other facilities. While the Company is engaged in a
multi-year program to sell land, 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 other
amounts related to rationalizing manufacturing and other re-engineering
activities, and believes these amounts are similarly volatile and impact the
comparability of earnings across quarters. Therefore, they are also excluded
from indicated financial information to provide what the Company believes
represents a more useful measure for analysis and predictive purposes.
TUPPERWARE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
13 Weeks 13 Weeks 40 Weeks 39 Weeks
Ended Ended Ended Ended
(In millions, except October 1, September 25, October 1, September 25,
per share data) 2005 2004* 2005 2004*
- --------------------------------- ------------- ------------- ------------- -------------
Net sales $ 270.7 $ 259.3 $ 917.5 $ 866.6
Cost of products sold 100.5 90.9 324.7 297.3
Gross margin 170.2 168.4 592.8 569.3
Delivery, sales and
administrative expense 161.1 158.3 511.6 506.4
Re-engineering and
impairment charges 0.6 1.8 7.8 2.5
Gains on disposal of assets - 10.1 3.4 11.6
Operating income 8.5 18.4 76.8 72.0
Interest income 0.7 0.4 2.2 1.4
Other income 0.2 (0.3) 0.5 0.3
Interest expense 7.3 3.7 15.9 10.6
Other expense 0.5 0.8 0.5 1.8
Income before income taxes 1.6 14.0 63.1 61.3
Provision for income taxes (1.0) 1.1 8.9 10.2
Net income $ 2.6 $ 12.9 $ 54.2 $ 51.1
Net income per common share:
Basic $ 0.04 $ 0.23 $ 0.91 $ 0.88
Diluted $ 0.04 $ 0.22 $ 0.90 $ 0.87
* Certain prior year amounts have been reclassified on the consolidated
statements of income to conform with current year presentation.
TUPPERWARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
13 Weeks 13 Weeks
Ended Ended Reported Restated Foreign
October 1, September 25, % % Exchange
(Amounts in millions, except per share) 2005 2004 Inc (Dec) Inc (Dec) Impact
- ------------------------------------------- ----------- ------------- ----------- ----------- -----------
SALES
Europe $ 115.6 $ 113.3 2 2 $ 0.2
Asia Pacific 53.0 50.1 6 4 1.0
Latin America 30.0 26.9 11 5 1.6
North America 36.9 40.2 (8) (9) 0.3
BeautiControl
North America 35.2 28.8 22 22 -
$ 270.7 $ 259.3 4 3 $ 3.1
SEGMENT PROFIT (LOSS)
Europe $ 9.9 $ 16.1 (38) (38) $ 0.1
Asia Pacific 4.4 4.0 9 2 0.3
Latin America 2.4 2.3 2 - -
North America (3.4) (7.6) 56 56 -
BeautiControl North
America 1.6 1.7 (7) (7) -
14.9 16.5 (9) (11) $ 0.4
Unallocated expenses (5.9) (6.7) (11)
Hedge income (costs) (0.2) (0.8) (75)
Other income - 10.1 -
Re-engineering and
impairment charges (0.6) (1.8) (68)
Interest expense, net (6.6) (3.3) 96
Income before taxes 1.6 14.0 (88)
Provision for income
taxes (1.0) 1.1 -
Net income $ 2.6 $ 12.9 (80)
Net income per common
share (diluted) $ 0.04 $ 0.22 (82)
Average number of
diluted shares 60.9 58.7
40 Weeks 39 Weeks
Ended Ended Reported Restated Foreign
October 1, September 25, % % Exchange
2005 2004 Inc (Dec) Inc (Dec) Impact
----------- ------------- ----------- ----------- -----------
SALES
Europe $ 440.3 $ 415.2 6 3 $ 12.5
Asia Pacific 151.5 148.1 2 - 3.6
Latin America 91.4 77.7 18 14 2.1
North America 123.4 141.4 (13) (13) 0.9
BeautiControl
North America 110.9 84.2 32 32 -
$ 917.5 $ 866.6 6 4 $ 19.1
SEGMENT PROFIT (LOSS)
Europe $ 78.8 $ 83.0 (5) (8) 2.7
Asia Pacific 10.3 12.1 (15) (18) 0.5
Latin America 8.8 7.2 22 23 -
North America (6.6) (25.2) 74 74 -
BeautiControl
North America 8.0 4.2 89 88 -
99.3 81.3 22 18 $ 3.2
Unallocated expenses (18.6) (18.2) 2
Hedge income (costs) 0.5 (1.7) -
Other income 3.4 11.6 (70)
Re-engineering and
impairment charges (7.8) (2.5) +
Interest expense, net (13.7) (9.2) 48
Income before taxes 63.1 61.3 3
Provision for income
taxes 8.9 10.2 (12)
Net income $ 54.2 $ 51.1 6
Net income per common
share (diluted) $ 0.90 $ 0.87 3
Average number of
diluted shares 60.4 58.8
* Certain prior year amounts have been reclassified on the condensed
consolidated statements of income to conform with current year presentation.
TUPPERWARE CORPORATION
RECONCILIATION
13 Weeks Ended 13 Weeks Ended
October 1, 2005 September 25, 2004
-------------------------------------- --------------------------------------
(In millions except per share Excl Excl
data) Reported Adj's Adj's Reported Adj's Adj's
- ------------------------------ ---------- ---------- ---------- ---------- ---------- ----------
Segment profit (loss)
Europe $ 9.9 0.2 a $ 10.1 $ 16.1 $ 16.1
Asia Pacific 4.4 0.3 a 4.7 4.0 4.0
Latin America 2.4 0.1 a 2.5 2.3 2.3
North America (3.4) (1.0)b (4.4) (7.6) (7.6)
BeautiControl North
America 1.6 1.6 1.7 1.7
14.9 (0.4) 14.5 16.5 - 16.5
Unallocated expenses (5.9) (5.9) (6.7) (6.7)
Hedge costs (0.2) (0.2) (0.8) (0.8)
Other income - - 10.1 (10.1)d -
Re-eng and impairment chgs (0.6) 0.6 c - (1.8) 1.8 c -
Interest expense, net (6.6) 3.1 e (3.5) (3.3) (3.3)
Income before taxes 1.6 3.3 4.9 14.0 (8.3) 5.7
Provision for income
taxes (1.0) 1.2 f 0.2 1.1 (3.1)f (2.0)
Net income $ 2.6 $ 2.1 $ 4.7 $ 12.9 $ (5.2) $ 7.7
Net income per common
share (diluted) $ 0.04 $ 0.03 $ 0.07 $ 0.22 $ (0.09) $ 0.13
40 Weeks Ended 39 Weeks Ended
October 1, 2005 September 25, 2004
-------------------------------------- --------------------------------------
Excl Excl
Reported Adj's Adj's Reported Adj's Adj's
---------- ---------- ---------- ---------- ---------- ----------
Segment profit (loss)
Europe $ 78.8 0.3 a $ 79.1 $ 83.0 $ 83.0
Asia Pacific 10.3 0.5 a 10.8 12.1 12.1
Latin America 8.8 0.4 a 9.2 7.2 7.2
North America (6.6) (4.0)b (10.6) (25.2) (25.2)
BeautiControl North
America 8.0 8.0 4.2 4.2
99.3 (2.8) 96.5 81.3 - 81.3
Unallocated expenses (18.6) (18.6) (18.2) (18.2)
Hedge costs 0.5 0.5 (1.7) (1.7)
Other income 3.4 (3.4)d - 11.6 (11.6)d -
Re-eng and impairment
chgs (7.8) 7.8 c - (2.5) 2.5 c -
Interest expense, net (13.7) 3.1 e (10.6) (9.2) (9.2)
Income before taxes 63.1 4.7 67.8 61.3 (9.1) 52.2
Provision for income
taxes 8.9 1.6 f 10.5 10.2 (3.5)f 6.7
Net income $ 54.2 $ 3.1 $ 57.3 $ 51.1 $ (5.6) $ 45.5
Net income per common
share (diluted) $ 0.90 $ 0.05 $ 0.95 $ 0.87 $ (0.10) $ 0.77
(a) Primarily machinery relocation costs incurred in connection with shift
of capacity from Hemingway, South Carolina to other manufacturing
facilities.
(b) Reduction of LIFO inventory reserve requirements from shift of capacity
from Hemingway, South Carolina to other manufacturing facilities which
report inventory on the FIFO basis of accounting were $1.4 million in
the third quarter and $5.2 million YTD. Offsetting these amount are
costs of $0.4 million in the third quarter and $1.2 million YTD related
to the transfer of machinery and equipment to the other manufacturing
facilities.
(c) Pretax re-engineering and impairment charges in the third quarter of
2005 of $0.6 million were mainly related to a small restructuring at
the Japan manufacturing facility and the headcount reduction at the US
manufacturing operations. The YTD re-engineering and impairment charges
of $7.8 million were primarily related to severance costs incurred to
reduce headcount in the Company's Hemingway, South Carolina
manufacturing facility. In 2004 re-engineering and impairment
charges of $2.5 million YTD included $1.8 million related to severance
costs incurred to reduce headcount in the company's United States,
Philippines, 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 Philippines manufacturing operation of which $0.4
million was recorded in the third quarter.
(d) 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. In
2005, the gain on the sale of land was $3.4 million in the first
quarter of 2005.
(e) The Company entered into an agreement during the first quarter of 2005
to lock in a fixed 10-year treasury rate for an expected October 2006
refinancing of $100 million notes then due. Due to the early
termination of the agreement, which was no longer an effective hedge in
light of the refinancing necessary for the Sara Lee Direct Selling
acquisition, the Company incurred $3.1 million interest expense in the
third quarter.
(f) Provision for income taxes represents the net tax impact of adjusted
amounts.
See note regarding non-GAAP financial measures in the attached press release.
TUPPERWARE CORPORATION
NON-GAAP FINANCIAL MEASURES OUTLOOK RECONCILIATION SCHEDULE
October 24, 2005
Adjusted
before FX
GAAP Adjustments impact Adjusted
----------- ------------------------- ---------- ----------
Land and Exchange
($ in millions, except per share hurricane Re- rate
amounts) insurance engineering impact
Full year ended Dec 25, 2004 gains Costs (a)
- ---------------------------------- ---------- ---------- ----------- ---------- ---------- ----------
Income before
income taxes $ 102.0 $ (13.1) $ 7.0 $ 95.9 $ - $ 95.9
Income tax 15.1 (5.1) 2.6 12.6 12.6
Net income 86.9 (8.0) 4.4 83.3 83.3
Net income per common
share (diluted) $ 1.48 $ (0.14) $ 0.07 $ 1.41 $ - $ 1.41
Average number of
diluted shares
(millions) 58.9
GAAP Adjusted
Range Adjustments Range
----------------------- -------------------------------------- -----------------------
Re-
Full year ended Dec 31, Land engineering Financing
2005 - Outlook Low High gains Costs Costs Low High
- ----------------------------- ---------- ---------- ---------- ------------ ---------- ---------- ----------
Income before income
taxes $ 74.2 $ 77.5 $ (3.1) $ 11.5 $ 27.1 $ 109.7 $ 113.0
% vs prior year -27% -24% 14% 18%
Income tax 8.9 9.3 (1.1) 4.2 9.9 21.86 22.26
Net income 65.3 68.2 (2.0) 7.3 17.2 87.8 90.7
Net income per
common share
(diluted) $ 1.08 $ 1.13 $ (0.03) $ 0.12 $ 0.28 $ 1.45 $ 1.50
Average number of
diluted shares
(millions) 60.6
% vs prior year -27% -24% 3% 6%
TUPPERWARE CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS
(UNAUDITED)
Oct. 1, Dec. 25,
(In millions) 2005 2004
- ------------------------------------------------ ------------ ------------
Cash and cash equivalents $ 73.2 $ 90.9
Accounts receivable 124.6 119.0
Less allowances for doubtful accounts (16.9) (15.0)
107.7 104.0
Inventories 176.7 163.0
Deferred income tax benefits, net 58.6 59.4
Non-trade amounts receivable 28.6 35.8
Prepaid expenses 16.2 12.9
Total current assets 461.0 466.0
Deferred income tax benefits, net 160.1 160.5
Property, plant and equipment 1,106.9 1,131.2
Less accumulated depreciation (904.9) (915.2)
202.0 216.0
Long-term receivables, net of
allowances of
$18.2 million at October 1, 2005
and $25.7 million at December 25, 2004 38.0 42.6
Goodwill 56.2 56.2
Other assets 42.1 41.9
Total assets $ 959.4 $ 983.2
TUPPERWARE CORPORATION
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
(UNAUDITED)
(Dollars in millions, except per Oct. 1, Dec. 25,
share amounts) 2005 2004
- ------------------------------------------------ ------------ ------------
Accounts payable $ 64.3 $ 91.0
Short-term borrowings and current
portion of long-term debt 3.0 2.6
Accrued liabilities 188.0 198.5
Total current liabilities 255.3 292.1
Long-term debt 257.8 246.5
Accrued post-retirement benefit cost 35.1 35.3
Other liabilities 100.1 118.4
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 27.5 25.6
Subscription receivable (13.3) (18.7)
Retained earnings 563.7 560.9
Treasury Stock, 2,372,067 shares
at October 1, 2005 and 3,542,135
shares at December 25, 2004 at cost (63.5) (96.8)
Unearned portion of restricted
stock issued for future service (4.1) (2.9)
Accumulated other comprehensive
loss (199.8) (177.8)
Total shareholders' equity 311.1 290.9
Total liabilities and shareholders'
equity $ 959.4 $ 983.2
TUPPERWARE CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
40 weeks 39 weeks
ended ended
October 1, September 25,
(In millions) 2005 2004
- ------------------------------------------------ ------------ ------------
OPERATING ACTIVITIES
Net income $ 54.2 $ 51.1
Adjustments to reconcile net
income to net
cash provided by operating
activities:
Depreciation and
amortization 35.8 37.3
Amortization of deferred
gains, restricted stock
compensation and
other - (0.7)
Net gains on disposal of
assets (2.8) (11.5)
Provision for bad debts 4.1 5.0
Net impact of writedown
of inventories and
change in LIFO reserve (4.6) 4.3
Non-cash impact of
re-engineering and impairment
costs - 0.5
Stock option grants 1.9 1.8
Termination of interest
rate hedge 3.1 -
Changes in assets and liabilities:
(Increase) decrease in
accounts receivable (11.8) 2.8
Increase in inventories (18.1) (30.3)
(Increase) decrease in non-
trade amounts receivable (0.8) 4.0
Increase in prepaid
expenses (6.4) (2.5)
(Increase) decrease in
other assets, net (1.7) 3.0
Decrease in accounts
payable and
accrued liabilities (29.3) (13.2)
Increase (decrease) in
income taxes payable 1.7 (6.0)
Decrease (increase) in net
deferred income taxes 3.6 (16.2)
Increase (decrease) in
other liabilities (2.8) (3.8)
Net cash impact from fair value
hedge activity 3.8 (9.8)
Termination of interest rate
swaps (3.1) -
Other 0.1 0.6
Net cash provided by
operating activities 26.9 16.4
INVESTING ACTIVITIES
Capital expenditures (31.0) (31.8)
Proceeds from disposal of
property, plant & equipment 7.5 15.0
Payment to terminate interest
rate hedge (3.1) -
Net cash used in investing
activities (26.6) (16.8)
FINANCING ACTIVITIES
Dividend payments to
shareholders (39.1) (38.6)
Proceeds from exercise of stock
options 24.2 1.0
Proceeds from payments of
subscriptions receivable 0.5 1.5
Net increase in short-term debt 0.8 15.9
Net cash used in financing
activities (13.6) (20.2)
Effect of exchange rate changes on
cash and cash equivalents (4.4) (0.5)
Net decrease in cash and cash
equivalents (17.7) (21.1)
Cash and cash equivalents at
beginning of period 90.9 45.0
Cash and cash equivalents at end of
period $ 73.2 $ 23.9
Supplemental disclosure:
Loans settled with common stock $ 5.1 $ 0.6
TUPPERWARE CORPORATION
SUPPLEMENTAL INFORMATION
Third Quarter Ended October 1, 2005
Sales Force Statistics (a):
Segment DIST. % CHG. AVG. ACTIVE % CHG. TOTAL % CHG.
- ---------------------- ------------ ------------ ------------ ------------ ------------ ------------
Europe 736 5 59,890 8 262,183 9
Asia Pacific 688 3 36,633 (7) 299,672 (4)
Latin America 186 (1) 60,468 4 250,907 8
North America n/a n/a(b) 22,707(c) (25) 90,254 (4)
Tupperware 1,610 - 179,698 (2) 903,016 3
BeautiControl N.A n/a n/a 37,786 22 119,765 26
Total 1,610 3 217,484 2 1,022,781 5
(a) As collected by the Company and provided by distributors and sales force.
(b) North America distributor counts are no longer applicable due to
implementation of new compensation plan.
(c) Changed methodology to align with monthly business cycle. Prior year
amounts are restated in computation of percentage change
UNAUDITED SELECTED FINANCIAL DATA THIRD QUARTER 2005
($ in millions)
Cash $ 73.2 Net Debt to Capital Ratio (d) 38%
Net Current Receivables 107.7 Equity $ 311.1
Net Inventory 176.7 Capital Expenditures 31.0
Short-Term Debt 3.0 Depreciation and Amortization 35.8
Long-Term Debt 257.8
(d) 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- 10/24/2005
/CONTACT: Jane Garrard, +1-407-826-4522, for Tupperware Corporation /
/Web site: http//www.tupperware.com /
(TUP)