Iconic Tupperware flags doubts about ability to continue

BENGALURU — Tupperware Brands has warned it is not certain its business can continue as a going concern as it faces a liquidity crunch due to slumping demand for its iconic food storage containers.

Founded in 1946 by chemist Earl Tupper, the company's popularity exploded in the 1950s as women of the post-war generation held "Tupperware parties" at their homes to sell food storage containers as they sought empowerment and independence.

The Covid-19 pandemic provided a boost in sales from families who sheltered at home, cooked more and produced lots of leftovers. But sales declined in recent quarters as the world reopened.

In a United States Securities and Exchange Commission filing on March 29, the company flagged doubts about its ability to continue as a going concern for at least a year and forecast inadequate liquidity to fund operations.

The company has reported ballooning losses and also has been facing higher costs of resins for its products, labour and logistics.

Tupperware first raised substantial doubt about its ability to continue as a going concern nearly a year ago.

Since then, it has appointed consumer goods industry veteran Laurie Ann Goldman as its chief executive officer, hired investment bank Moelis & Co to explore strategic alternatives following the discovery of prior period misstatements in financial reporting, and struck an agreement to restructure its debt.

The company, which had earlier delayed filing its annual report for 2022, also said that it will delay the same for 2023, adding that "there can be no assurance with respect to the timing of completion of the filing".

Tupperware blamed ongoing material weaknesses in internal control over financial reporting, its challenging financial condition, and significant attrition resulting in resource and skill set gaps for multiple delays in its annual report filings.

Earlier in 2024, Tupperware was required to retain KPMG as its new independent auditor after the former auditor declined reappointment. It also entered into a forbearance agreement with its lenders that reduces its weekly minimum US liquidity requirement under credit agreement to US$10 million (S$13.5 million).

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