March 2013 Rick Goings, Chairman & CEO June 2014 Building C O N F I D E N C E Together.
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Transcript of March 2013 Rick Goings, Chairman & CEO June 2014 Building C O N F I D E N C E Together.
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March 2013
Rick Goings, Chairman & CEOJune 2014
BuildingC O N F I D E N C E
Together
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We are making some forward looking statements today that use words like “outlook” or “target” or similar predictive words. Such forward looking statements involve risks and uncertainties detailed in our recent periodic reports as filed in accordance with the Securities and Exchange Act of 1934. These risks and uncertainties may cause actual results to differ materially from our statements today.
www.tupperwarebrands.com
Forward Looking Statements
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Sustain Tupperware Brands position as the premier, relationship-based
global marketer of quality innovative products and brands.
Our Going Forward Objective
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Commonly Asked Questions
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Organizational Structure - how are you organized, by country, by region and globally; and what is your level of visibility into the business
Levers for sustainable growth and to mitigate external forces
Runway left in the business…near term…next decade
Uses of Cash
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How the Business is Organized
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Market:Managing Director
• Head of Sales• Head of Marketing• Head of Finance
3 Global Regions: • Americas • Europe Africa & Middle East • Asia PacificGroup PresidentHeads of major functional areas
Corporate:CEO – Leadership Development & Strategic focusCOO – Day to day operationsHeads of major functional areas
Visibility
Weekly: Reporting & Calls from marketsMonthly: Monthly Performance Review, Formalized calls with markets
Weekly / Daily contact Managing Directors
Daily contactSales Force
Decentralized Structure
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Typical Country Structure Distributor Model
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TUPPERWARE GERMANYEst. 1962
Headquarters in Frankfurt/Main
Logistics center in Eppertshausen
Approx. 270 Team Leaders
130 Distributors Each controls a specific geography
Approx. 4,050 Unit Managers
Approx. 62,000 Demonstrators
Belgium Manufacturing &
Warehouse
Tours Manufacturing
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Germany Distributor Structure
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2 Team Leaders
450 Demonstrators
Average German distributor has
30 Unit Managers
Sales per Distributor varies by market
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Levers For Sustainable Growth
Multi Local SystemFormula Based on 4 Drivers:
Product Innovation
Entertaining & Informative Selling Method
Compelling Sales Force Opportunity & Structure
Solid Business Fundamentals 8
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Selling Method
RELATIONSHIP BASED
VALUE ADDED DEMONSTRATION
ENABLES PENETRATION
Fundamentals
PRIMARY DRIVERS: RECRUIT, TRAIN,
MOTIVATE
REINFORCED BY: CONTACT, COMPETITION,
RECOGNITION
Real OpportunitySALES OR SALES MANAGEMENT
SUPPLEMENTAL INCOME TO SERIOUS MONEY
Brand & ProductTRUSTED, POWERFUL AND. ASPIRATIONAL BRAND
HIGH QUALITY, INNOVATIVE AND DEMONSTRABLE PRODUCTS
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Success Driven by the Model
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Product Innovation
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Food Storage
Kitchen Tools & Gadgets
Table Top & Serving
Kitchen Prep
Cutlery & Cookware
Microwave
Baking & Ovenware
Approximately 25% of Sales each year to come from new products (products introduced in the last 2 years)
On-the-Go & Water
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Entertaining & Informative Selling Method
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Group Presentation = PartyParty every 1.3 seconds
Advertising RetailRent
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Compelling Sales Force Opportunity & Structure
Earning Opportunity Career Opportunity
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Part Time Supplemental
Income
Super Seller
Demonstrator
Unit Manager
Team Leader
Distributor
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Solid Business Fundamentals
• Training• Recognition• Competition• Motivation
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Levers to Mitigate External Forces
Foreign Currency
Raw Material Pricing
Inflation
Compression in consumer spending
Hedge transaction FX exposure/ Manage business in local currency
Global Purchasing Council
We own the shelf / Price with consumer inflation
We are Sellers
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Balanced Global Portfolio
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Europe; 29%
Asia Pacific; 31%TW
North Amer-
ica; 14%
Beauty North Amer-
ica; 12%
South Amer-
ica; 14%
2013 Full Year Segment Sales as % of Total
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Emerging AND Established MarketsEstablished Markets35% OF 2013 SALES14% WORLD POPULATION
Emerging Markets65% OF 2013 SALES86% WORLD POPULATION
WE'RE AN AND
STORY!16
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Tupperware AND Beauty
*Full Year 2013
79%Tupperware BrandedHousewares
21%Beauty & Personal CareProducts
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TWB – Supported by Social Media
TupperwareHostesses and
Fans
Host 2 Parties per Year
− Affiliation− Allegiance− Advocate
Promoters of Brand & Products
− No Rent− No Advertising
Interactive Selling System
2.9M Sales Force
• Party every 1.3 sec
• Driven by Earning Opportunity and Career path
Social Network
Over 5 million fans on Facebook and almost 7 million followers on Twitter and Weibo join us to share photos and stories about experiences with Tupperware Brands.
Our videos, showcasing product demonstrations, have been viewed on YouTube over 6 million times. More than 5 million visitors come to our consumer web sites each month.Our websites provide consumers with the ability to view product information, browse online catalogs, or find a local consultant for hosting parties, buying products, and becoming new recruits in over 60 different countries.
Living Cook Books
iTUP (think Rosetta
Stone)
Sales Force
Webinars
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Asia Pacific• Middle Class expected to grow from 500 million to 1.7 billion
by 2020
Central & South America• Middle Class expected to grow 70M, almost 40%, by 2020
*Source OECD, The Emerging Middle Class in Developing Countries, January 2010
Emerging Market Penetration Global Middle Class expected to grow from
1.8B to 3.2B by 2020*
Runway…
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White space in existing markets• New products and categories• Under served urban centers and populations,
millennials are entrepreneurs
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Dynamic Emerging Market Sales
TW Mexico +6%
Brazil +27%
Turkey +32%
India +12%
China +22%
EMERGING MARKETS65% OF
2013 SALES 20
Argentina +27%
+13% LC FY 2013
Venezuela +35% Malaysia/
Singapore +11%
Indonesia +35%
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Basket of Global Currencies
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Key Sales & Profit Currencies
• Euro• Indonesian Rupiah• Mexican Peso
• Brazilian Real • Malaysian Ringgit
>90% of 2013 sales and profit from outside the U.S.
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Consistently Growing Sales & EPS
2009 2010 2011 2012 2013 2014*$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$0
$1
$2
$3
$4
$5
$6
$7
Sales Diluted EPS Adjusted Diluted EPS
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Sales $million Diluted EPS includesimpact of non-cash purchase accounting assetimpairment charges
EPS $Dollar
*High end of guidance range provided in April 23, 2014 Earnings Release. Impact of changes in foreign currency versus prior year are updated monthly and posted on: http://ir.tupperwarebrands.com/foreign-exchange-impact.cfm
Diluted EPS includesimpact of Venezuelan devaluation from balance sheet items
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Free Cash Flow(as Reported)
2009 2010 2011 2012 2013 2014*$0
$50
$100
$150
$200
$250
$300
Net Cash Flow before Financing Activities (Free Cash Flow) GAAP Net Income
* High end of guidance range provided in April 23, 2014 Earnings Release. Impact of changes in foreign currency versus prior year are updated monthly and posted on: http://ir.tupperwarebrands.com/foreign-exchange-impact.cfm 23
GAAP Net Inc. includesImpact of non-cash
Purchase Accounting Asset impairment
charges
GAAP Net Inc. includes impact from Venezuelan devaluation on balance sheet items
$millions
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Business Use of Cash
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Quarterly Dividends Declared
72% increase
$2.48 per shareannualized
$128M
Open Market Share
Repurchases
$375M in 2013
4.6 Million Shares
Quarterly Dividends Declared
10% increase
$2.72 per shareannualized
$135M
Open Market Share
Repurchases
$185M in 2014
Invest in the Business Invest in the Business
Full Year 2013 Full Year 2014
Cash Returned to Shareholders $9.54* Cash Returned to Shareholders > $6.00*
*Based on full year diluted shares and for 2014 guidance provided on April 23, 2014
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Quarterly Dividends Declared
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1996-2009 2010 2011 2012 2013 2014$0.00
$0.10
$0.20
$0.30
$0.40
$0.50
$0.60
$0.70
$0.80
$0.22$0.25
$0.30
$0.36
$0.62
$0.68
Dividend per Share
+14%
Announce50% Payout
target on trailing EPS
ex. items
+20%
+20%
+72%
+10%
Annualized Dividend2011 $1.202012 1.442013 2.482014 2.72
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Local Currency Sales: +5% to 7%• Emerging markets up low double digit• Established markets even with prior year to down low single digit
EPS Excluding Items: $5.66 - $5.81• Up 12-15% LC, 4 - 7% USD, vs. $5.43 in 2013• GAAP $4.97 to $5.12• 38 cents negative FX on EPS excluding items
Pre-Tax ROS, excluding items: 14.4%• GAAP pre-tax ROS 12.9% • Longer range ROS increase target 50 bp 2014 LC Operating Margin Improvement +90 Incremental 2014 interest -31 2014 vs. 2013 translation FX -42 Other +13
High end pretax ROS fcst 30 bp26
2014 Full Year Outlook*
*Guidance range provided in April 23, 2014 Earnings Release. ROS high end. Impact of changes in foreign currency versus prior year are updated monthly and posted on: http://ir.tupperwarebrands.com/foreign-exchange-impact.cfm
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Outlook*Q2 2014 Full-year 2014
USD Sales (1) to 1% 0 to 2%
GAAP EPS $1.24 – $1.29 $4.97 – $5.12
GAAP Pre-tax ROS 12.7 – 12.9% 12.8 – 12.9%
Local Currency Sales +5 to 7% +5 to 7%
EPS, excluding items $1.44 - $1.49 $5.66 - $5.81
Pre-tax ROS, excluding items 14.4 – 14.6% 14.3 – 14.4%
FX Impact on EPS comparison, excluding items
($0.13) ($0.38)
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*Guidance range provided in April 23, 2014 Earnings Release. Impact of changes in foreign currency versus prior year are updated monthly and posted on: http://ir.tupperwarebrands.com/foreign-exchange-impact.cfm-Venezuela first quarter operating activity translated at 6.3 Bs/$. Monetary assets on the balance sheet at the end of March 2014 and operating activity for reminder of 2014 translated at 10.8 Bs/$ .
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Full Year 2014 EPS* Outlook
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2013 FX 2013 at 2014 Rates
Int Exp Tax Unalloc Ops Share Imp. 2014 $4.50
$4.70
$4.90
$5.10
$5.30
$5.50
$5.70
$5.90
$6.10
$5.43 ($0.38)
($0.12) ($0.08) $0.04
$0.68
$0.24 $5.81
*High end of guidance range excluding items, provided in April 23, 2014 earning release.
$5.05
7% Increase
15% Increase
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* As of April 23, 2014.
Double Digit EPS Growth driven by:
• Local Currency Sales: +6% to 8%• Emerging markets about 10%• Established markets low single digit
• Pre-Tax ROS, excluding items: 50 bps improvement per year into the mid- to high-teens
• Some offset from tax rate: going to 27-28% over time
• Share repurchases
Long Range Outlook*
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Non-GAAP Financial Measures Reconciliation
2011 2012 2013 Q1 2014 Q2 2014* 2014*Net Income (GAAP) $218.3 $193.0 $274.2 $52.2 $66.6 $260.7
Adjustments:Gains on disposal of assets including insurance recoveries (3.8) (7.9) (0.7) (1.8) (0.1) (1.9)Re-engineering and other restructuring costs 9.6 22.1 9.3 2.3 4.2 10.2
Impact of Venezuelan bolivar devaluation on balance sheet positions 4.2 15.0 4.5 21.3Swap impairment and debt cost write-off 19.8 Acquired intangible asset amortization 2.9 2.1 4.8 2.9 3.0 11.9Purchase accounting intangibles and goodwill impairment 36.1 76.9Income tax impact of adjustments (9.6) (4.8) (3.5) (3.7) (1.4) (6.7)
Net Income (Adjusted) $273.3 $281.4 $288.3 $66.9 $76.8 $295.5
Adjusted ROS 13.9% 14.1% 14.1% 13.5% 14.6% 14.4%Average number of diluted shares (millions) 61.4 56.4 53.1 51.1 51.1 50.9
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*High end of guidance range provided in April 23, 2014 Earnings Release. Impact of changes in foreign currency versus prior year are updated monthly and posted on: http://ir.tupperwarebrands.com/foreign-exchange-impact.cfm
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March 2013
BuildingC O N F I D E N C E
Together