Business Editors
ORLANDO, Fla.--(BUSINESS WIRE)--Jan. 28, 2002
Tupperware Corporation (NYSE:TUP) announced today that for the year ended December 29, 2001, net income in local currency, excluding re-engineering costs, increased 2 percent to $94.0 million, or $1.60 per share. Sales rose to $1,114.4 million, an increase of 9 percent from 2000, excluding the negative impact of foreign exchange. Sales included the benefit of owning BeautiControl for all of 2001.
Fourth quarter 2001 net income, excluding re-engineering costs, was down 7 percent to $38.2 million, or $0.65 per share. There was no impact from foreign exchange on net income. Sales rose to $326.7 million. All segments had local currency increases and the total company increase was 12 percent, excluding the negative impact of foreign exchange and including BeautiControl for the entire period.
"We're pleased to have met the analyst consensus for earnings per share, and to have achieved a high single digit increase in local currency sales in 2001. This came in spite of the difficult environment in several of our important markets that included the impact of September 11th. We made a small investment in terms of our operating margin percentage, but believe that this was worthwhile as we are well positioned for the future," said Rick Goings, chairman and chief executive officer. "We entered 2002 with a sales force size advantage in each of our segments. A larger sales force is one of our strategic growth levers, and being up in all segments is a significant achievement. We also made progress with our second strategic growth lever, integrated direct access (IDA) channel initiatives, that include retail access points, Internet selling and television shopping, with solid growth in the United States, and initiation of a full roll-out of this strategy internationally. Our third strategic growth lever is more products and categories and here we launched BeautiControl in Mexico and the Philippines. The international roll out of this brand offers a huge opportunity. We moved forward with developing and implementing several new categories in our Tupperware businesses as well," Goings continued.
Reported net income, including re-engineering costs, was $61.5 million and $28.5 million, or $1.04 and $0.48 per share, for full year and fourth quarter 2001, respectively, versus $74.9 million and $21.9 million, or $1.29 and $0.38 per share, in the 2000 periods. Excluding sales of BeautiControl, which was acquired in October 2000, sales in local currency increased 4 percent for the full year and 10 percent in the fourth quarter of 2001, compared with 2000. Also, including the negative impact of foreign exchange, sales for the full year were down 1 percent compared with 2000, and for the quarter increased 9 percent.
Tupperware will conduct a conference call on Tuesday, January 29, 2002, at 8:30 am Eastern time. The conference call will be simulcast and archived on the Shareholder.com and Tupperware.com web sites.
Segment Highlights
United States
Sales in the quarter rose 20 percent, including 4 percentage points attributable to implementation of a new business model. The 2001 increase was on top of a 9 percent increase in the fourth quarter of 2000, and was attributable to improvement in the core party plan business, where the number of sellers continued to be up sharply over the prior year, along with strength in the IDA channels. IDA accounted for 10 percent of fourth quarter 2001 sales. Operating profit increased by 28 percent due to the higher sales, lower product cost and reduced expenses that in part reflected a lower need for reserves as the business continued to improve.
Latin America
Latin American sales and profit in local currency increased 11 percent and 7 percent, respectively, in the fourth quarter, reflecting sales increases in Mexico and also Canada, which is reported in this segment. Sales in the Southern Cone were down reflecting weak economies. The re-engineering actions announced for Brazil in October 2001, will be fully implemented by the end of the first quarter of 2002, and are expected to result in a significant improvement in profitability this year.
Europe
Local currency sales were up 5 percent in the region, which included the impact of a high level of distributor orders for January 2002 promotional programs. Profit decreased 10 percent, reflecting significant promotional spending and product discounting to maintain sales force momentum in light of sluggish economies and the impact of September 11th.
Asia Pacific
Asia Pacific's local currency sales increased 9 percent, but profit was down significantly. The sales increase came from all markets other than the Philippines. The profit shortfall reflected the absence of last year's use tax abatement, which was $2.7 million in the quarter, and discounting and investment in promotions in Japan and Korea in order to stimulate sales.
BeautiControl
Pro forma sales in North America were up 16 percent for the quarter, driven by a larger sales force recruited under a new promotional program introduced in mid 2001. There was a small profit, in line with expectations, reflecting planned investment in the promotional program to grow the sales organization and amortization of goodwill. (more)
Outlook
Based on early trends, the first quarter 2002 outlook is for a slight increase in sales and a low teen percentage decrease in net income in local currency. Using current exchange rates, there is no impact from foreign exchange on the comparison. The outlook reflects sales about flat in Europe in local currency in light of the significant level of December orders. The net income outlook reflects the expectation of continued investment of gross margin and promotional dollars in Europe and possibly Japan and Korea, in order to keep the sales forces engaged and to stimulate sales. The outlook results in earnings per share of about 28 cents.
For full year 2002, sales and profit targets, excluding foreign exchange and re-engineering costs, are:
Segment Sales Profit ------- ----- ------ Europe Up slightly About flat Asia Pacific Mid single digit Mid single digit percent increase percent increase Latin America Up slightly Up about 20 percent United States High single digit Mid single digit percent increase percent increase BeautiControl Mid 20 percent Low single digit million increase dollar Total Mid single digit High single digit percent increase percent increase
The Latin America sales outlook reflects the change to an importing distributor model in Brazil under which sales are made to distributors at a lower price than under the previous model. Excluding this impact the outlook for Latin America sales for full year 2002, would be a high single digit percent increase in local currency. The BeautiControl profit outlook reflects investment in international operations of about $2 million, and including interest expense on the purchase price of the business in October 2000, would result in earnings per share dilution of 3 cents versus 7 cents of dilution in 2001.
For the Company overall, the outlook remains for a mid single digit percentage increase in sales and a high single digit percentage increase in net income in local currency. Based on current exchange rates, the negative impact of foreign exchange on net income would be 3 to 4 cents per share. This results in a full year earnings per share outlook of $1.67 to $1.71.
Tupperware Corporation, a $1.1 billion multinational company, is one of the world's leading direct sellers, supplying premium food storage, preparation and serving items to consumers in more than 100 countries through its Tupperware brand. In partnership with more than 1.3 million independent sales consultants worldwide, Tupperware reaches consumers through informative and entertaining home parties; retail access points in malls and other convenient venues including SuperTarget and Kroger stores; corporate and sales force Internet web sites; and Home Shopping NetworkSM. Additionally, premium beauty and skin care products are brought to customers through its BeautiControl brand in North America, Latin America and the Philippines. 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 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.
TUPPERWARE CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) (Dollars in millions, except per share) 13 13 Weeks Weeks Ended Ended Reported Restated Foreign Dec.29, Dec.30, % % Exchange 2001 2000 Inc(Dec) Inc(Dec) Impact ------- -------- -------- -------- -------- SALES Europe $ 121.3 $ 112.9 8 % 5 % $ 3.0 Asia Pacific 61.3 61.5 - 9 (5.3) Latin America 52.4 48.5 8 11 (1.3) United States 73.5 61.4 20 20 - BeautiControl 18.2 12.2 49 49 - $ 326.7 $ 296.5 10 12 $ (3.6) OPERATING PROFIT (LOSS) Europe $ 23.6 $ 26.1 (9) (10) $ 0.1 Asia Pacific 9.0 16.7 (46) (40) (1.5) Latin America 4.8 (1.6) + + 1.2 United States 18.5 14.3 28 28 - BeautiControl 0.2 0.1 89 + - 56.1 55.6 1 1 (0.2) Unallocated expenses (7.3) (4.4) 66 66 (0.1) Re-engineering and impairment charge (7.5) (12.5) 40 40 - Interest expense, net (4.4) (6.0) (25) (25) - Income before taxes 36.9 32.7 13 14 (0.3) Provision for income taxes 8.4 10.8 (22) (21) (0.1) Net income $ 28.5 $ 21.9 30 31 $ (0.2) Diluted: Net (loss) income per common share $ 0.48 $ 0.38 26 26 $ - Average number of shares 58.7 58.1 TUPPERWARE CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME EXCLUDING RE-ENGINEERING AND IMPAIRMENT COSTS (UNAUDITED) (Dollars in millions, except per share) 13 13 Weeks Weeks Ended Ended Reported Restated Foreign Dec.29, Dec.30, % % Exchange 2001 2000 Inc(Dec) Inc(Dec) Impact -------- -------- -------- -------- ------- SALES Europe $ 121.3 $ 112.9 8% 5 % $ 3.0 Asia Pacific 61.3 61.5 - 9 (5.3) Latin America 52.4 48.5 8 11 (1.3) United States 73.5 61.4 20 20 - BeautiControl 18.2 12.2 49 49 - $ 326.7 $ 296.5 10 12 $ (3.6) OPERATING PROFIT (LOSS) Europe $ 23.6 $ 26.1 (9) (10) $ 0.1 Asia Pacific 9.0 16.8 (46) (40) (1.5) Latin America 6.3 4.6 35 7 1.2 United States 18.5 14.3 28 28 - BeautiControl 0.2 0.1 89 + - 57.6 61.9 (7) (6) (0.2) Unallocated expenses (6.4) (2.9) (-) (-) (0.1) Interest expense, net (4.4) (6.0) (25) (25) - Income before taxes 46.8 53.0 (12) (6) (0.3) Provision for income taxes 8.6 11.8 (27) (27) (0.1) Net income $ 38.2 $ 41.2 (7) (7) $ (0.2) Diluted: Net income per common share $ 0.65 $ 0.71 (8) (8) $ - Average number of shares 58.7 58.1 TUPPERWARE CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) (Dollars in millions, except per share) 52 52 Weeks Weeks Ended Ended Reported Restated Foreign Dec.29, Dec.30, % % Exchange 2001 2000 Inc(Dec) Inc(Dec) Impact ------- -------- -------- -------- -------- SALES Europe $ 400.4 $ 424.1 (6)% (2)% $ 14.0) Asia Pacific 213.4 242.0 (12) (1) (26.7) Latin America 201.3 193.0 4 9 (8.1) United States 234.6 201.8 16 16 - BeautiControl 64.7 12.2 + + - $1,114.4 $1,073.1 4 9 $(48.8) OPERATING PROFIT Europe $ 74.8 $ 94.1 (20) (16) $ (4.8) Asia Pacific 28.5 44.8 (36) (26) (6.0) Latin America 17.2 8.0 + 67 2.3 United States 31.1 15.6 98 98 - BeautiControl 0.5 0.1 + + - 152.1 162.6 (6) (1) (8.5) Unallocated expenses (23.4) (27.9) (16) (16) 0.1 Re-engineering and impairment charge (24.8) (12.5) 98 98 - Interest expense, net (21.7) (21.1) 3 3 - Income before taxes 82.2 101.1 (16) (8) (8.4) Provision for income taxes 20.7 26.2 (20) (14) (1.9) Net income $ 61.5 $ 74.9 (14) (6) $ (6.5) Diluted: Net income per common share $ 1.04 $ 1.29 (19) (12) $ (0.11) Average number of shares 58.9 58.0 TUPPERWARE CORPORATION CONDENSED CONSOLIDATED STATEMENT OF INCOME EXCLUDING RE-ENGINEERING AND IMPAIRMENT COSTS (UNAUDITED) (Dollars in millions, except per share) 52 52 Weeks Weeks Ended Ended Reported Restated Foreign Dec.29, Dec.30, % % Exchange 2001 2000 Inc(Dec) Inc(Dec) Impact -------- -------- -------- -------- ------- SALES Europe $ 400.4 $ 424.1 (6)% (2) % $ (14.0) Asia Pacific 213.4 242.0 (12) (1) (26.7) Latin America 201.3 193.0 4 9 (8.1) United States 234.6 201.8 16 16 - BeautiControl 64.7 12.2 + + - $1,114.4 $1,073.1 4 9 $ (48.8) OPERATING PROFIT Europe $ 74.8 $ 94.1 (20) (16) $ (4.8) Asia Pacific 28.5 44.8 (36) (26) (6.0) Latin America 24.9 14.3 74 50 2.3 United States 31.1 15.6 98 98 - BeautiControl 0.5 0.1 + + - 159.8 168.9 (5) - (8.5) Unallocated expenses (20.2) (20.0) 2 2 0.1 Interest expense, net (21.7) (21.1) 3 3 - Income before taxes 117.9 127.8 (8) (1) (8.4) Provision for income taxes 23.9 28.7 (17) (11) (1.9) Net income $ 94.0 $ 99.1 (5) 2 $ (6.5) Diluted: Net income per common share $ 1.60 $ 1.71 (7) - $ (0.11) Average number of shares 58.9 58.0
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