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PREMARK ANNOUNCES CHARGE IN MAJOR RESTRUCTURING OF ITS TUPPERWARE U.S. UNIT

 PREMARK ANNOUNCES CHARGE IN MAJOR
 RESTRUCTURING OF ITS TUPPERWARE U.S. UNIT
 DEERFIELD, Ill., Oct. 9 /PRNewswire/ -- Following a special board of directors meeting today, Premark International, Inc. (NYSE: PMI), announced a major restructuring of its U.S. Tupperware unit and will take a $137 million pretax charge, or $129 million after tax, primarily as a result of this action.
 Approximately $90 million of the restructuring charge includes the closing of Tupperware's Halls, Tenn., manufacturing facility and the write-down of certain other manufacturing capacity. About 800 jobs will be affected by the closing.
 "Downsizing Tupperware U.S. will result in manufacturing capacity more consistent with declining sales," said Premark chairman and chief executive officer, Warren L. Batts. "U.S. sales have dropped sharply in recent months and produced a nine-month segment loss of about $21 million, despite earlier cost reduction measures. This situation has detracted from the improvement in Tupperware's international operations as well as the progress in several other parts of our business."
 The restructuring charge also includes steps to strengthen Tupperware's distribution network in the United States. "Our goal is twofold," said Batts, "to improve both company and distributor profitability and to focus the field sales organization on recruiting, training and sales."
 Starting immediately, Tupperware will begin the introduction of a new "Consultant Pack" program which builds on its Tupperware Express delivery system. A portion of the charge includes costs for a significant enhancement of Tupperware's MIS capabilities to support "Consultant Pack."
 The "Consultant Pack" program is designed to reduce costs for smaller distributors by removing order processing and fulfillment from the distributorship and centralizing these functions at Tupperware. Customer orders will be shipped directly from Tupperware to the sales consultant, who will then deliver the product to the customer. Distributors who would benefit from "Consultant Pack" should be converted to the system over the next two years. At the same time, Tupperware Express will continue to ship orders directly to the customers of distributors on this delivery system.
 In addition, the restructuring charge includes the costs associated with the accelerated turnover of unprofitable distributorships. "Near term, there should be fewer distributorships," said Batts, "but performance should improve for those distributorships and for Tupperware because of these actions."
 Premark expects the restructuring of Tupperware's manufacturing and distribution operations to save about $40 million annually when fully implemented and will enable the company to recover the approximately $30 million cash portion of the charge within about two years.
 "While over the near term we anticipate that sales may continue to decline, the result of restructuring Tupperware U.S. should be a smaller, more focused business with a more effective distribution system and an improved variable cost structure," said Batts.
 For the third quarter ended September 26, Premark anticipates earnings before restructuring and other charges to be comparable with the prior year. The company expects improvement in the Food Equipment Group to be offset primarily by a higher Tupperware U.S. loss and lower profits in Tupperware's Latin American business.
 Premark also announced it will adopt the Statement of Financial Accounting Standards (SFAS) No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions." Adoption of SFAS 106 will result in a one-time pretax charge to 1992 earnings of $140 million and an increase in annual expense of approximately $8 million. Most large companies are required to adopt the new rule by the first quarter of 1993. SFAS 106 is retroactive to the beginning of 1992 and has no effect on cash flows.
 Premark International, Inc. is a $2.8 billion multinational company that markets premium products under leading brand names such as Tupperware, Hobart, Wilsonart, West Bend, Vulcan, Florida Tile, Precor and Hartco. Premark stock is listed on the New York, Pacific and London Stock Exchanges.
 -0- 10/9/92
 /CONTACT: George Shafer of Premark, 708-405-6252/
 (PMI) CO: Premark International, Inc. ST: Illinois IN: HOU SU: RCN


TM -- NY079 -- 8561 10/09/92 17:37 EDT
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Publication:PR Newswire
Date:Oct 9, 1992
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