Tupperware Brands Corp (TUP)

Tupperware Brands is a global retailer of premium innovative products in categories as diverse as kitchenware, personal care and beauty products. The company utilizes an independent sales force and has presence in over 100 countries worldwide. The main revenue drivers for the company are new product innovation and increasing sales force. The company uses three major brand names namely Tupperware for its kitchen products, BeautiControl and International Beauty for its skin and beauty products.

The company competes with other retailers and department stores that sell household products, other than that they also compete with local stores. The business of the company is divided into four geographical markets: Europe comprising Europe, Africa and Middle East, Asia Pacific, Latin America and North America. Due to this heavy reliance on foreign markets close to 75% of revenue, earnings are thus exposed to exchange rate risks. Segment wise, Tupperware brand has been contributing close to 80% of the total revenue for the past five fiscal years.

The company’s business in its Latin American and Asia Paicific Market has been growing well over the years partly aided by the growth in consumer spending and partly due to the introduction of new and innovative products. The company has been streamlining its operations and as a result has achieved a 20% cut in its overhead expenses by the end of 2006. This is going to translate into a $6.0 million savings in the expense incurred to sell the goods in the coming years. The company also acquired the direct selling arm of Sara Lee Corporation, which will prove handy in increasing its reach. Industry outlook for 2007 is moderate and is expected to follow the general economic trend. The company is well equipped to handle the situation, which can well translate into a positive stock movement.