The following is a discussion of the results of operations for the 13 and 39 weeks ended September 27, 2008 compared with the 13 and 39 weeks ended September 29, 2007 and changes in financial condition during the 39 weeks ended September 27, 2008.

The Company's primary means of distributing its product is through independent sales organizations and individuals, who are also its customers in many cases. The majority of the Company's products are in turn sold to end customers who are not members of the sales forces. The Company is largely dependent upon these independent sales organizations and individuals to reach end consumers and any significant disruption of this distribution network would have a negative financial impact on the Company and its ability to generate sales, earnings and operating cash flows. The Company's primary business drivers are the size, activity and productivity of its independent sales organizations.

Overview



                                                                                                       Change
                                                                                                     excluding
                                                          13 weeks ended                             the impact      Foreign
                                                 September 27,       September 29,                   of foreign     exchange
Dollars in millions, except per share amounts        2008                2007           Change        exchange       impact
Net sales                                       $         513.1     $         454.7         13 %              8 %   $    19.8
Gross margin                                               63.7 %              64.6 %     (0.9 )pp           na            na
DS&A as percent of sales                                   55.5 %              57.4 %     (1.9 )pp           na            na
Operating income                                $          43.2     $          24.2         78 %             66 %   $     1.7
Net income                                                 27.5                 6.9          +                +           1.5
Net income per diluted share                               0.44                0.11          +                +          0.02

                                                                                                       Change
                                                                                                     excluding
                                                          39 weeks ended                             the impact      Foreign
                                                 September 27,       September 29,                   of foreign     exchange
Dollars in millions, except per share amounts        2008                2007           Change        exchange       impact
Net sales                                       $       1,640.1     $       1,404.5         17 %              9 %   $    96.4
Gross margin                                               64.6 %              65.1 %     (0.5 )pp           na            na
DS&A as percent of sales                                   54.8 %              56.3 %     (1.5 )pp           na            na
Operating income                                $         147.4     $         116.4         27 %             15 %   $    12.0
Net income                                                 95.6                62.0         54 %             34 %         9.6
Net income per diluted share                               1.51                0.99         53 %             32 %        0.15

+ increase greater than 100 percent

Local currency sales increased 8 percent in the third quarter of 2008 compared to the same period of 2007. The increase in net local currency sales reflected increases in all of the Company's segments, with the exception of Beauty North America. The increase in operating and net income primarily reflected substantial improvements in all of the Tupperware segments, partially offset by declines in the two beauty segments. In addition to the improved overall results, the Company was positively impacted by lower net interest expense this quarter, resulting from a non-cash write off of previously deferred debt costs and costs associated with the termination of certain floating-to-fixed interest rate swaps related to the credit agreement signed in September 2007, and an $11.3 million impairment charge of goodwill and intangible assets which did not recur. Also contributing to the increase in net income this quarter was lower unallocated costs due to the impact of a decline in the Company's stock price on a long term management incentive plan. These improvements were partially offset by lower gains recognized on the disposal of assets and a provision for income tax expense this year versus a benefit last year.

For the year-to-date period of 2008, local currency sales increased 9 percent compared to 2007, due to improvements in all of the Company's segments. On a local currency basis, the segments' increases ranged from 4 to 16 percent, led by strong improvements in Europe, Asia Pacific and Beauty Other and modest growth in both the Tupperware and Beauty businesses in North America. Operating and net income also increased for the year-to-date period compared with last year due to improvements in all of the Company's segments and lower interest expense, partially offset by lower gains recognized on the disposal of assets and slightly higher unallocated corporate expenses.

The Company's balance sheet shows an increase of $27.8 million in working capital as compared with the end of 2007, after an increase of $104.2 million in short term borrowings. The Company closed the third quarter of 2008 with a debt to total capital ratio of 55 percent as compared with 53 percent at the end of 2007 and 58 percent at the end of 2007's third quarter. Total capital is defined as total debt plus shareholders' equity. Net cash flow from operating activities was $7.3 million for the year-to-date period of 2008 compared with $50.2 for the same period of 2007. The most significant differences between years were the payment in 2008 of $19.0 million of non-income tax payables accrued in Mexico at the end of 2007, together with approximately $10.5 million of such amounts paid this year; $24.8 million in payments made this year to settle foreign currency hedge contracts versus a small outflow last year; and a larger increase in inventory this year. These items more than offset a $33.6 million increase in net income.

Net Sales

Local currency sales in the third quarter of 2008 grew 8 percent compared to the same period of 2007. The improvement this quarter was led by substantial growth in the Beauty Other segment, driven by the Company's Central and South American businesses, most notably Venezuela, Brazil, and Argentina, partially offset by lower sales in some of the other businesses in that segment. Asia Pacific showed strong growth in local currency sales in the third quarter of 2008 compared with last year, led primarily by the emerging markets of China, Indonesia and Malaysia/Singapore, as well as modest growth in the established market of Australia, partially offset by double digit declines in the two Japanese businesses. Europe also showed a good improvement in sales in the third quarter, led mainly by the emerging markets of Russia, Turkey and Tupperware South Africa. Certain established markets in Europe also contributed to the improvement this quarter with strong growth in France and a significant improvement Greece. Local currency sales in Tupperware North America showed a strong increase in the third quarter mainly due to sales growth in the core business of Tupperware Mexico and an increase in business-to-business sales. The improvements noted in the above segments were partially offset by a slight decline in local currency sales in Beauty North America this quarter due primarily to a double digit decrease in sales in BeautiControl as a result of lower recruiting and a less productive sales force partially offset by a small increase in sales in Fuller Mexico resulting from a larger sales force.

As previously noted, emerging markets had a significant impact on the third quarter results as compared with 2007. Emerging markets, those with a "low" or "medium" GDP per capita as reported by the World Bank, accounted for 56 percent and 50 percent of the Company sales in the third quarters of 2008 and 2007, respectively. Total sales for the emerging markets increased $59.0 million, or 26 percent in the third quarter of 2008, compared with the same period of 2007. Of this increase, $9.3 million was from the impact of changes in foreign currency exchange rates. Excluding the impact of foreign currency on the increase in sales, the growth in sales for these markets was 21 percent compared with prior year. Businesses in established market economies had 2008 sales even with 2007, although sales were down 5 percent excluding the benefit of stronger foreign currencies on the comparison.

The year-to-date fluctuations largely followed the same pattern as those of the quarter with sales growth in all the segments, led by the emerging markets. On a year-to-date basis, emerging markets accounted for 51 percent and 48 percent of the total Company sales for 2008 and 2007, respectively. Total sales in the emerging markets increased $171.3 million, or 26 percent for the year-to-date period of 2008 compared with 2007. Of this increase, $33.1 million was from the impact of changes in foreign currency exchange rates. Excluding the impact of foreign currency on the increase in sales, the growth in sales for these markets was 20 percent. Although third quarter 2008 sales in Beauty North America were down in local currency compared with the same period of 2007, on a year-to-date basis, sales were up in the segment resulting from strong improvements generated in Fuller Mexico in the first half of the year.

A more detailed discussion of the sales results for the Company's reporting segments is included in the segment results section following.

As discussed in Note 3 to the Consolidated Financial Statements, the Company includes promotional costs in delivery, sales and administrative expense. As a result, the Company's net sales may not be comparable with other companies that treat these costs as a reduction of revenue.

Re-engineering and Impairment Expenses

Refer to Note 7 to the Consolidated Financial Statements for a discussion of re-engineering activities and related accruals.

The Company recorded $1.2 million and $6.9 million in re-engineering charges during the third quarter and year-to-date period of 2008, respectively, primarily related to severance costs incurred to reduce headcount in the Company's BeautiControl, France, Germany, Netherlands, Italy, Mexico, Malaysia and Philippines operations. The bulk of the remaining cost was an impairment charge related to software the Company no longer expects to utilize in the South African beauty business. In addition, the Company recorded $1.8 million to write off inventory of the South America region of the Beauty Other segment in connection with a decision to streamline the product line offered. This charge is included in the cost of products sold line item in the Consolidated Statement of Income.

In the last quarter of 2008, the Company expects to incur approximately $2.6 million of costs mainly related to small scale headcount reductions in several of its operations.

During the second quarter of 2008, the financial results of the Nutrimetics and NaturCare businesses were below expectations and the Company lowered its forecast of future sales and profit below that used to value these tradenames in the Company's 2007 annual impairment analysis performed as of September 2007. As a result of these factors, the Company performed interim impairment tests of these tradenames. The fair values calculated were determined using a discounted cash flow model. The result of the interim impairment tests was to record a $6.5 million impairment to the Nutrimetics tradename and a $2.5 million impairment to the NaturCare tradename in the second quarter of 2008. As of September 29, 2007, the Company completed the annual review of goodwill and indefinite-lived intangible assets of its beauty businesses acquired in 2005. As a result of this review, the Nutrimetics goodwill and tradename were deemed to be impaired, resulting in a non-cash impairment charge of $11.3 million. Refer to Note 8 to the Consolidated Financial Statements for a discussion of the impairment of goodwill and intangible assets.

Gross Margin

Gross margin as a percentage of sales was 63.7 percent in the third quarter of 2008 and 64.6 percent in the same period of 2007. For the year-to-date periods, gross margin as a percentage of sales was 64.6 percent in 2008 compared with 65.1 percent in 2007. The slight decline was primarily the result of higher freight costs and higher provision for inventory obsolescence. As previously noted, in the third quarter of 2008, the Company recorded $1.8 million to write off inventory in connection with a decision to streamline the product line offered in Latin America. Also impacting the quarterly margin was higher business-to-business sales which yielded a lower margin. The year-to-date decline in the gross margin percentage was mainly due to higher freight and provision for inventory obsolescence.

Specific segment impacts are discussed in the segment results section.

As discussed in Note 2 to the Consolidated Financial Statements, the Company includes costs related to the distribution of its products in delivery, sales and administrative expense. As a result, the Company's gross margin may not be comparable with other companies that include these costs in costs of products sold.

Costs and Expenses

Delivery, sales and administrative expense (DS&A) declined as a percentage of sales to 55.5 percent for the third quarter of 2008, compared with 57.4 percent in 2007. For the year-to-date periods, DS&A as a percentage of sales was 54.8 percent for 2008 compared with 56.3 percent in 2007. A component of this decrease was from less amortization expense related to definite-lived intangible assets acquired with the direct selling businesses of Sara Lee Corporation in December 2005. These intangible assets are primarily the value of independent sales forces. The amortization is recorded to reflect the estimated turnover rates of the sales forces and was $2.4 million in the third quarter of 2008 as compared with $3.4 million in the same period of 2007. For the full year of 2008, the amortization is expected to be approximately $9.3 million versus $13.6 million in 2007. In addition to the decrease in amortization expense, the Company also had a decrease in the provision for doubtful accounts compared to the same period last year, improvements in cost management, leverage of fixed costs and lower costs associated with an incentive accrual that is remeasured at each reporting period based on the Company's stock price. These declines were partially offset by higher distribution costs primarily due to higher fuel costs in 2008.

Specific segment impacts are discussed in the segment results section.

Net Interest Expense

Net interest expense was $9.0 million for the third quarter of 2008 compared with $19.0 million for the same period of 2007. For the year-to-date period of 2008 net interest expense was $25.3 million compared with $39.7 million for the same period of 2007. In the third quarter of 2007, the Company entered into a new credit agreement replacing the existing credit agreement, which triggered the non-cash write off of previously deferred debt costs of $6.1 million. Also as a result of terminating the previous credit agreement, the Company settled certain floating-to-fixed interest rate swaps that were hedging these borrowings, resulting in a termination payment of $3.5 million. In addition to this, the Company overall experienced lower interest expense due to the benefit of a lower contractual interest rate spread under the Company's main credit agreement entered into in September 2007 compared with the spread under the Company's prior credit agreement. The margin spread on the 2007 Credit Agreement has been about 50 to 75 basis points lower this year compared with the same period last year. This was offset by an increase in borrowings in the third quarter of 2008.

Tax Rate

The provision for income taxes in the third quarter of 2008 was $5.0 million versus a $2.1 million tax benefit in the third quarter of 2007. The effective tax rate for the third quarter was 15.4 percent compared with a 43.8 percent benefit in 2007. The 2007 benefit resulted from changes in estimated federal tax liabilities, a favorable settlement of a state tax liability and tax law changes in various jurisdictions.

The effective rate for the year-to-date period of 2008 was 19.2 percent compared with 17.2 percent for the comparable 2007 period. The increase was primarily due to an increase in income subject to higher tax rates. The effective tax rates are below the U.S. statutory rate reflecting the availability of excess foreign tax credits as well as lower foreign effective tax rates. The effective tax rates are below the U.S. statutory rate reflecting the availability of excess foreign tax credits as well as lower foreign effective tax rates and the discrete items impacting the accrual for uncertain tax positions.

As discussed in Note 15 to the Consolidated Financial Statements, the requirements of FIN 48, which the Company implemented at the beginning of 2007, has clarified guidance surrounding the recognition and derecognition of uncertain tax positions, including the timing of those adjustments. As such, it is reasonably possible that the effective tax rates in any individual quarter will vary from the full year expectation. At this time, the Company is unable to estimate what impact that may have on any individual quarter.

Net Income

The increase in net income for the 2008 third quarter was largely due to a substantial growth in profit in the Asia Pacific, Europe and Tupperware North America segments partially offset by a decline in Beauty Other. Beauty North America's profit was about even with the prior year's quarter. The Company was also impacted this quarter by a decrease in net interest expense due to the $9.6 million in previously deferred debt and interest rate swap costs that were written off in the third quarter of 2007 as well as a positive impact from stronger foreign currencies compared to the same period of 2007. In addition, in the third quarter of 2007, the Company recorded an $11.3 million impairment of goodwill and intangible assets that did not recur in the third quarter of 2008. These improvements were partially offset by lower gains on

the sale of assets recorded in 2008 compared with 2007. In the third quarter of 2007, the Company recognized $5.6 million in gains on the sale of land held for development near the Company's Orlando, Florida headquarters, whereas in the third quarter of 2008 only $2.2 million was recognized. Finally, the Company recorded income tax expense in 2008 compared with a benefit from income taxes in 2007 as previously noted.

Similar to the quarter, the increase in net income for the year-to-date period was the result of strong performance in Asia Pacific, Europe and Tupperware North America, partially offset by a higher loss in Beauty Other, while Beauty North America's profit was about even for the year-to-date period. In addition to the specific items previously noted for the quarter, net income for the 2007 year-to-date period was also impacted by the settlement of an insurance claim related to the Company's former manufacturing facility in Halls, Tennessee, resulting in a $2.5 million increase to net income and a $2.1 million gain the on sale of excess land in Australia

International operations in the third quarter generated 85 percent and 83 percent of sales respectively in 2008 and 2007 and accounted for 93 percent of net segment profit. For the year-to-date periods, international operations generated 86 percent and 84 percent of sales and 94 percent and 91 percent of net segment profit in 2008 and 2007, respectively.

The Company generated 35 percent of its third quarter 2008 sales from the sales of beauty products, as compared with 39 percent in the third quarter 2007. For the year-to-date period of 2008, the Company generated 34 percent of its sales from the sale of beauty products compared with 37 percent for the same period of 2007.

Segment Results

Europe




                                                                              Change
                                                                            excluding
                                                                            the impact      Foreign
                                                                            of foreign      exchange        Percent of total
Dollars in millions                      2008        2007       Change       exchange        impact         2008        2007
Third Quarter
Net sales                               $ 159.2     $ 138.8         15 %             8 %   $      8.1           31          31
Segment profit                             13.5        10.2         32              34           (0.1 )         27          24

Segment profit as percentage of sales       8.5 %       7.3 %      1.2 pp           na             na           na          na


                                                                              Change
                                                                            excluding
                                                                            the impact      Foreign
                                                                            of foreign      exchange        Percent of total
Dollars in millions                      2008        2007       Change       exchange        impact         2008        2007
Year-to-Date
Net sales                               $ 582.7     $ 479.3         22 %            10 %   $     50.7           36          34
Segment profit                             81.5        63.8         28              17            5.9           44          43

Segment profit as percentage of sales      14.0 %      13.3 %      0.7 pp           na             na           na          na

Local currency sales in the third quarter of 2008 were 8 percent higher compared with the same period of 2007. The increase was mainly due to the continued success in the emerging markets driven primarily by Russia, Tupperware South Africa and Turkey. Emerging markets, those with a "low" or "medium" GDP per capita as reported by the World Bank, accounted for $67.0 million and $50.7 million or 42 percent and 37 percent of net sales in this segment for the third quarter of 2008 and 2007, respectively. Of the $16.3 million emerging markets increase, $0.7 million was from the impact of changes in foreign currency exchange rates. The overall improvement in sales in these markets was due to continued growth in the sales force, achieved through further geographic expansion, recruiting of new sellers, success in generating productivity by the sales forces and well received promotional programs.

For the third quarter of 2008, established markets showed an increase in sales during the period compared with 2007, however this was mainly due to the impact of foreign currency. On a local currency basis, sales in the Company's established markets decreased compared to the 2007 comparable period, mainly in Germany and the Nordics. The decrease in Germany was mainly due to the timing of shipments in the third quarter, while the sales force size was slightly higher than at the same time last year at the end of the quarter. The decrease in local currency sales in the Nordics this quarter was the result of a lower active sales force due to lower recruiting results. Among the established markets, Greece and France improved from positive promotional and recruiting programs. At the end of the third quarter the sales force size advantage for the whole segment was 15 percent, which was in line with the year-over-year advantage at the end of the second quarter of 2008.

For the year-to-date period, local currency sales in the segment increased 10 percent compared with the same period of 2007. Similar to the quarter, the increase in sales was due to the success of the emerging markets driven primarily by Russia, Tupperware South Africa and Turkey. On a year-to-date basis, sales in the emerging markets accounted for $203.5 million and $150.1 million or 35 and 31 percent of net sales in this segment. For the year-to-date period, local currency sales in the established markets increased slightly compared to the same period of 2007. This increase was mainly from France, where there was a larger sales force and better productivity and Greece due to successful recruiting and promotional programs leading to the sale of more higher price point items, as well as higher business-to-business sales. Sales in Germany were even with the prior year-to-date period in local currency. The Company continues to implement strategies in Germany to increase the size and productivity of its sales force including its new product programs, training programs, specific promotions focused on recruiting and retention and emphasis on the earnings opportunity for its sales force.

Segment profit increased $3.3 million during the third quarter of 2008 compared with the same period of 2007, reflecting a slightly more than one point improvement in profit as a percentage of sales. The higher profit, in addition to reflecting the gross margin associated with improved sales volume, also reflected more efficient promotional spending, lower administrative expenses and a decrease in the provision for bad debts. The items leading to the year-to-date segment profit variances largely mirrored those of the quarter.

The euro was the main currency that led to the positive foreign currency comparison on third quarter sales and the sales and profit comparisons for the year-to-date period.

Asia Pacific




                                                                              Change
                                                                            excluding
                                                                            the impact      Foreign
                                                                            of foreign      exchange      Percent of total
Dollars in millions                      2008        2007       Change       exchange        impact       2008        2007
Third Quarter
Net sales                               $  88.3     $  74.5         18 %            15 %   $      2.2         17          16
Segment profit                             18.0        13.6         32              29            0.3         36          32

Segment profit as percentage of sales      20.4 %      18.3 %      2.1 pp           na             na         na          na


                                                                              Change
                                                                            excluding
                                                                            the impact      Foreign
. . .