Executive Summary

Q1 2022 results materially disappointed: net sales $348.1M (−16% YoY), gross margin 63.8% (−720 bps YoY), diluted EPS from continuing ops $0.05; adjusted diluted EPS $0.12 .
Management withdrew full-year 2022 guidance amid operational uncertainty, inflation, Russia/Ukraine impacts, and China lockdowns; visibility will drive potential re-issuance later in the year .
CEO acknowledged a “delay” in the Turnaround Plan due to execution, technology and service issues alongside macro headwinds, and announced pricing actions; U.S./Canada down 25% with service/system issues and a 10% price increase implemented in early May (first increase in some time) .
Liquidity and capital allocation: executed a $75M accelerated share repurchase (ASR) of 3.4M shares in Q1 and retained $150M authorization; consolidated net leverage ratio 2.88; long-term debt rose to $799.2M .
Leadership change: appointed Mariela Matute as CFO (effective May 24, 2022) to accelerate finance transformation and omnichannel strategy execution .

What Went Well and What Went Wrong

What Went Well

Pricing actions and increased focus on structural changes: management implemented price increases (e.g., 10% in U.S./Canada) and is “refocusing efforts” on core direct selling structural improvements to strengthen the model .
Balance sheet liquidity intact: cash and equivalents $245.6M; revolver activity increased liquidity; net leverage ratio at 2.88 per credit agreement metrics .
Capital allocation continuity: ASR launched and completed initial $75M tranche in Q1; remaining authorization $150M supports flexibility under new credit facility covenants .

What Went Wrong

Broad-based revenue pressure and execution issues: net sales down across all segments, driven by lower recruiting and sales force activity, Russia/Ukraine conflict, China lockdowns, and “execution, technology, and service” challenges .
Margin compression from inflation and inefficiencies: gross margin 63.8% vs 71.0% prior year, impacted by higher resin/logistics, operational inefficiencies at lower volumes, higher inventory reserves, and mix .
Guidance withdrawal and estimate uncertainty: previously guided FY22 adjusted EPS $2.60–$3.20 and operating cash flow net of investing $120–$160M; management withdrew outlook given high operational uncertainty .

Financial Results

Headline Metrics vs Prior Two Quarters and Prior Year

Metric	Q3 2021	Q4 2021	Q1 2022
Revenue ($USD Millions)	$376.9	$394.9	$348.1
Gross Margin (%)	65.8%	61.0%	63.8%
Operating Income ($USD Millions)	$57.1	$44.4	$17.5
Operating Income Margin (%)	15.1%	11.2%	5.0%
Diluted EPS – Continuing Ops ($)	$1.14	$0.37	$0.05
Adjusted Diluted EPS – Continuing Ops ($)	$1.19	$0.38	$0.12
Adjusted EBITDA ($USD Millions)	$68.9	$46.5	$28.7

Vs Prior Year (Q1 2021)

Metric	Q1 2021	Q1 2022
Revenue ($USD Millions)	$413.9	$348.1
Gross Margin (%)	71.0%	63.8%
Operating Income ($USD Millions)	$77.0	$17.5
Diluted EPS – Continuing Ops ($)	$0.82	$0.05
Adjusted Diluted EPS – Continuing Ops ($)	$0.81	$0.12
Adjusted EBITDA ($USD Millions)	$84.8	$28.7

Estimates Comparison (S&P Global)

Metric	Q1 2022 Consensus	Actual Q1 2022
Revenue ($USD Millions)	N/A – S&P Global consensus unavailable	$348.1
Primary EPS ($)	N/A – S&P Global consensus unavailable	$0.05
EBITDA ($USD Millions)	N/A – S&P Global consensus unavailable	$24.6 EBITDA (GAAP) / $28.7 Adjusted

Note: S&P Global consensus estimates were unavailable for TUP due to a mapping issue in the data source.

Segment Breakdown (Q1 2022 vs Q1 2021)

Region	Net Sales Q1 2021 ($M)	Net Sales Q1 2022 ($M)	Segment Profit Q1 2021 ($M)	Segment Profit Q1 2022 ($M)	Segment Profit Margin Q1 2021	Segment Profit Margin Q1 2022
Asia	$116.3	$97.7	$28.9	$12.3	24.8%	12.6%
Europe	$121.8	$90.9	$33.3	$7.4	27.3%	8.1%
North America	$117.7	$101.8	$18.9	$9.9	16.1%	9.7%
South America	$58.1	$57.7	$11.6	$7.6	20.0%	13.2%
Total	$413.9	$348.1	N/A	N/A	N/A	N/A

KPIs (Sales Force Activity)

KPI	Q1 2021	Q1 2022	Change
Active Sales Force – Asia Pacific (count)	83,840	42,107	−50%
Active Sales Force – Europe (count)	105,515	85,415	−19%
Active Sales Force – North America (count)	66,158	72,144	+9%
Active Sales Force – South America (count)	125,776	126,615	+1%
Total Active Sales Force (count)	381,289	326,281	−14%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted Diluted EPS – Continuing Ops	FY 2022	$2.60–$3.20	Withdrawn	Lowered (withdrawn)
Operating Cash Flow net of Investing Cash Flow	FY 2022	$120M–$160M	Withdrawn	Lowered (withdrawn)
Tax Rate Assumption	FY 2022	Mid-to-high 20%	N/A (no current guidance)	N/A

Earnings Call Themes & Trends

Topic	Q3 2021 Mentions	Q4 2021 Mentions	Q1 2022 Mentions	Trend
Supply chain & logistics	Higher input/logistics costs; disruptions from new sales force solution	Omicron-related disruptions; operational inefficiencies at lower volumes	Ongoing service/technology issues; broader execution challenges	Deteriorated in Q1 vs Q4
Inflation (resin, freight)	Input cost pressure noted	Higher resin costs and inflationary pressures compress margins	Persisting inflation; latency between input cost rises and pricing	Intensified; pricing actions initiated
China lockdowns	COVID impacts across Asia Pacific	Omicron significant impact in Asia Pacific	Heavily impacted; gradual reopening uncertain	Acute headwind in Q1
Russia/Ukraine conflict	Noted as rising geopolitical risk	Impact acknowledged in forward-looking statements	Europe impacted; demand/sales activity hit	New, incremental headwind
Sales force activity	NA decreased on tech implementation issues; SA improved via recruiting	Sales force trends mixed, Asia/Europe challenged	Active sales force down 14% total; execution and service issues cited	Weakened in Q1
Pricing actions	Not highlighted	Not highlighted	10% price increase in U.S./Canada in early May	Initiated to offset inflation
Capital allocation	Share repurchase $25M in Q3	New $880M facility; authorization $225M at YE; flexibility improved	$75M ASR; $150M remaining authorization	Continued execution

Management Commentary

CEO Miguel Fernandez: “With today’s results we acknowledge that this turnaround still requires a lot more work… Sales were negatively impacted by the Russia/Ukraine conflict, as well as strict COVID-related lockdowns in China and internal challenges in execution, technology, and service… Due to the high degree of operational uncertainty we currently face, we have decided to withdraw our previously issued financial guidance for 2022.” .
Pricing and U.S./Canada performance: “The U.S. and Canada were down 25%… experienced significant service issues in demand and sales force systems… we are making fundamental and rapid changes… including 10% price increases effective in early May” .
CFO appointment: “We welcome Mariela to the team as a critical player in our Turnaround Plan… deep financial acumen… accelerate the pace of change as we transform our business model into one that serves all channels where consumers want to shop the Tupperware brand.” .

Q&A Highlights

China reopening timing: Management described gradual, city-by-city easing with no precise timeline; confidence in local team execution but acknowledged dynamic conditions .
North America systems/service issues: Significant demand and sales force system problems contributed to lower buying ahead of price increases and weaker inventory sell-through; pricing actions implemented to offset costs .
Pricing strategy: First price increase in some time (10% in U.S./Canada) to counter inflation; broader structural refocus on core direct selling execution .
Guidance withdrawal clarification: Driven by high operational uncertainty (inflation, macro conflicts, COVID lockdowns) and volatility related to fundamental business changes; potential to re-establish guidance when visibility improves .

Estimates Context

S&P Global Wall Street consensus for Q1 2022 was unavailable due to a data mapping issue; therefore, we cannot quantify beats/misses vs consensus for revenue, EPS, or EBITDA at this time. This limits forward estimate-driven conclusions and implies Street models may need to reduce revenue/EPS trajectories given management’s withdrawal of guidance and cited operating headwinds .

Key Takeaways for Investors

Guidance withdrawn; significant negative revision signal: The removal of FY22 adjusted EPS and cash flow guidance underscores visibility challenges and likely forces sell-side estimate cuts; watch for reissuance once operational execution improves .
Structural execution fix is the core near-term catalyst: Management identified execution, technology, and service challenges—resolution and stabilization of sales force systems should be monitored as a leading indicator of recovery in NA and Europe .
Pricing actions vs inflation trajectory: A 10% U.S./Canada price increase is a first step, but latency vs input cost inflation was cited—expect margin recovery only as price-cost timing normalizes and volumes improve .
Macro headwinds are non-trivial: Russia/Ukraine impacts in Europe and China lockdowns are acute—regional sales/profit declines reflect sensitivity; positioning for normalization is key to H2 recovery .
Balance sheet and capital allocation: ASR and authorization signal continued commitment to shareholder returns, but leverage rose to $799.2M; monitor covenant metrics and cash generation amid lower volumes .
Sales force health: Total active sales force down 14% YoY; rebuilding recruiting and activity should be a focus to restore top-line momentum .
Leadership upgrade: New CFO brings deep transformation and data-driven FP&A experience—could accelerate systems modernization and omnichannel execution .

Bolded surprise: Withdrawal of FY22 guidance and acknowledgment of structural execution/technology issues .

TUPPERWARE BRANDS CORP (TUP)·Q1 2022 Earnings Summary