Tupperware Brands Corp (NYSE: TUP) shares are trading lower Wednesday morning after the company reported worse-than-expected financial results and warned that it likely won't be able to maintain compliance with the covenants in its credit agreement.
Tupperware Brands reported third-quarter revenue of $302.8 million, which missed average analyst estimates of $336.8 million, according to Benzinga Pro. The company reported quarterly adjusted earnings of 14 cents per share, which missed average estimates of 46 cents per share.
"While we are excited to expand the Tupperware ecosystem to have some of our products available at a major US retailer early in the fourth quarter, we faced internal and external challenges in the third quarter that eroded our business economics," said Miguel Fernandez, president and CEO of Tupperware Brands.
Tupperware Brands said it experienced decelerating top-line trends in Asia Pacific and North America, as well as continuing declines in Europe as a result of ongoing geopolitical tensions and the difficult macroeconomic environment.
"Given the revenue trends year to date, we expect to take additional restructuring actions in the fourth quarter, as well as implementing stringent inventory reduction programs," said Mariela Matute, CFO of Tupperware Brands.
Tupperware Brands also warned that it's probable that the company will not be able to maintain compliance with the covenants in its credit agreement, "which raises substantial doubt about the company's ability to continue as a going concern."
Tupperware Brands is currently in negotiations with its lenders to amend the credit agreement.
TUP Price Action: Tupperware Brands is making new 52-week lows on Wednesday.
The stock was down 35.6% at $4.96 at time of publication.
Photo: Phillip Pessar from Flickr.
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