SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended May 2, 1999
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-724
PHILLIPS-VAN HEUSEN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 13-1166910
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
200 Madison Avenue New York, New York 10016
(Address of principal executive offices) (Zip Code)
Registrant's telephone number (212) 381-3500
Indicate by check mark whether registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that registrant was required to file such reports), and (2) has
been subject to such filing requirement for the past 90 days.
Yes X No
The number of outstanding shares of common stock, par value $1.00 per
share, of Phillips-Van Heusen Corporation as of May 14, 1999: 27,287,985
shares.
PHILLIPS-VAN HEUSEN CORPORATION
INDEX
PART I -- FINANCIAL INFORMATION
Independent Accountants Review Report................................. 1
Condensed Consolidated Balance Sheets as of May 2, 1999 and
January 31, 1999...................................................... 2
Condensed Consolidated Statements of Operations for the thirteen weeks
ended May 2, 1999 and May 3, 1998..................................... 3
Condensed Consolidated Statements of Cash Flows for the thirteen
weeks ended May 2, 1999 and May 3, 1998............................... 4
Notes to Condensed Consolidated Financial Statements.................. 5-6
Management's Discussion and Analysis of Results of Operations
and Financial Condition............................................... 7-10
PART II -- OTHER INFORMATION
ITEM 6 - Exhibits and Reports on Form 8-K............................. 11-14
Signatures............................................................ 15
Exhibit--Acknowledgment of Independent Accountants.................... 16
Exhibit--Financial Data Schedule...................................... 17
Independent Accountants Review Report
Stockholders and Board of Directors
Phillips-Van Heusen Corporation
We have reviewed the accompanying condensed consolidated balance sheet of
Phillips-Van Heusen Corporation as of May 2, 1999, and the related condensed
consolidated statements of operations and cash flows for the thirteen week
periods ended May 2, 1999 and May 3, 1998. These financial statements are the
responsibility of the Company's management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which will
be performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying condensed consolidated financial statements
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Phillips-Van Heusen Corporation
as of January 31, 1999, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the year then ended (not presented
herein) and in our report dated March 9, 1999, we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated balance sheet
as of January 31, 1999, is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.
ERNST & YOUNG LLP
New York, New York
May 19, 1999
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Phillips-Van Heusen Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share data)
UNAUDITED AUDITED
May 2, January 31,
1999 1999
ASSETS
Current Assets:
Cash, including cash equivalents of $10,911 and $4,399 $ 19,447 $ 10,957
Trade receivables, less allowances of $1,489 and $1,367 97,413 88,038
Inventories 253,750 232,695
Other, including deferred taxes of $10,611 28,094 36,327
Total Current Assets 398,704 368,017
Property, Plant and Equipment 91,671 108,846
Goodwill 85,304 113,344
Other Assets, including deferred taxes of $50,297 and
$52,167 83,425 84,106
$659,104 $674,313
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 20,000
Accounts payable $ 28,994 44,851
Accrued expenses 92,899 67,835
Total Current Liabilities 121,893 132,686
Long-Term Debt 248,738 248,723
Other Liabilities 66,255 64,016
Stockholders' Equity:
Preferred Stock, par value $100 per share; 150,000
shares authorized; no shares outstanding
Common Stock, par value $1 per share; 100,000,000
shares authorized; 27,287,985 shares issued 27,288 27,288
Additional Capital 117,683 117,683
Retained Earnings 77,247 83,917
Total Stockholders' Equity 222,218 228,888
$659,104 $674,313
See accompanying notes.
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Phillips-Van Heusen Corporation
Condensed Consolidated Statements of Operations
Unaudited
(In thousands, except per share data)
Thirteen Weeks Ended
May 2, May 3,
1999 1998
Net sales $289,699 $295,765
Cost of goods sold 188,891 193,257
Gross profit 100,808 102,508
Selling, general and administrative expenses 99,384 101,954
Year 2000 computer conversion costs 1,450 2,000
Loss before interest, taxes and extraordinary item (26) (1,446)
Interest expense, net 6,143 5,466
Loss before taxes and extraordinary item (6,169) (6,912)
Income tax benefit 1,544 2,427
Loss before extraordinary item (4,625) (4,485)
Extraordinary loss on debt retirement, net of tax benefit (1,060)
Net loss $ (4,625) $ (5,545)
Basic and diluted net loss per share:
Loss before extraordinary item $ (0.17) $ (0.16)
Extraordinary loss (0.04)
Net loss per share $ (0.17) $ (0.20)
See accompanying notes.
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Phillips-Van Heusen Corporation
Condensed Consolidated Statements of Cash Flows
Unaudited
(In thousands)
Thirteen Weeks Ended
May 2, May 3,
1999 1998
OPERATING ACTIVITIES:
Loss before extraordinary item $ (4,625) $ (4,485)
Adjustments to reconcile to net cash
used by operating activities:
Depreciation and amortization 4,800 6,785
Equity income (270) (260)
Deferred income taxes (1,544) 6
Changes in operating assets and liabilities:
Receivables (9,375) (13,245)
Inventories (3,843) (12,205)
Accounts payable and accrued expenses (2,934) (11,557)
Other-net 999 (1,264)
Net Cash Used By Operating Activities (16,792) (36,225)
INVESTING ACTIVITIES:
Sale of Gant trademark, net of related costs 67,000
Acquisition of inventory associated with new
license agreement (17,212)
Property, plant and equipment acquired (2,461) (3,553)
Net Cash Provided (Used) By Investing Activities 47,327 (3,553)
FINANCING ACTIVITIES:
Net proceeds from issuance of 9.5% senior
subordinated notes 145,104
Repayment of 7.75% senior notes (49,286)
Extraordinary loss on debt retirement (1,631)
Proceeds from revolving lines of credit 41,600 117,000
Payments on revolving lines of credit (61,600) (168,500)
Exercise of stock options 75
Cash dividends (2,045) (2,038)
Net Cash Provided (Used) By Financing Activities (22,045) 40,724
Increase In Cash 8,490 946
Cash at beginning of period 10,957 11,748
Cash at end of period $ 19,447 $ 12,694
See accompanying notes.
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PHILLIPS-VAN HEUSEN CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands)
GENERAL
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information. Accordingly, they do not contain all
disclosures required by generally accepted accounting principles for complete
financial statements. Reference should be made to the annual financial
statements, including the footnotes thereto, included in the Company's Annual
Report to Stockholders for the year ended January 31, 1999.
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from the estimates.
The results of operations for the thirteen weeks ended May 2, 1999 and May 3,
1998 are not necessarily indicative of those for a full fiscal year due, in
part, to seasonal factors. The data contained in these financial statements
are unaudited and are subject to year-end adjustments; however, in the opinion
of management, all known adjustments (which consist only of normal recurring
accruals) have been made to present fairly the consolidated operating results
for the unaudited periods.
Certain reclassifications have been made to the condensed consolidated
financial statements for the thirteen weeks ended May 3, 1998 to present them
on a basis consistent with the thirteen weeks ended May 2, 1999.
INVENTORIES
Inventories are summarized as follows:
May 2, January 31,
1999 1999
Raw materials $ 8,270 $ 8,529
Work in process 11,848 12,834
Finished goods 233,632 211,332
Total $253,750 $232,695
Inventories are stated at the lower of cost or market. Cost for apparel
inventories, excluding certain sportswear inventories, is determined using the
last-in, first-out method (LIFO). Cost for footwear and certain sportswear
inventories is determined using the first-in, first-out method (FIFO).
Inventories would have been approximately $8,400 higher than reported at May
2, 1999 and January 31, 1999, if the FIFO method of inventory accounting had
been used for all apparel.
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The final determination of cost of sales and inventories under the LIFO method
can only be made at the end of each fiscal year based on inventory cost and
quantities on hand. Interim LIFO determinations are based on management's
estimates of expected year-end inventory levels and costs. Such estimates are
subject to revision at the end of each quarter. Since estimates of future
inventory levels and costs are subject to external factors, interim financial
results are subject to year-end LIFO inventory adjustments.
EXTRAORDINARY LOSS
On April 22, 1998, PVH issued $150,000 of 9.5% senior subordinated notes due
May 1, 2008 and used the net proceeds to retire its intermediate term 7.75%
senior notes and to repay a portion of the borrowings under its prior
revolving credit facility. On the same day, PVH refinanced its revolving
credit facility by entering into a new $325,000 senior secured credit
facility. In connection therewith, the Company paid a yield maintenance
premium of $1,446 and wrote off certain debt issue costs of $185. These items
have been classified as an extraordinary loss, net of tax benefit of $571, in
the first quarter of 1998.
ACQUISITION AND DISPOSITION OF BUSINESSES
On March 12, 1999, PVH entered into a license agreement to market dress shirts
under the John Henry and Manhattan brands. In connection therewith, the
Company acquired $17,212 of inventory from the licensor.
On February 26, 1999, PVH sold the Gant trademark and certain related assets
associated with the Company's Gant operations for $71,000 in cash to Pyramid
Sportswear AB ("Pyramid"), which was the brand's international licensee.
Pyramid is a wholly-owned subsidiary of Pyramid Partners AB, in which PVH has
a minority interest. PVH has realized no gain or loss in connection with this
transaction, after writing off certain assets associated with its Gant
operations, including goodwill.
SEGMENT DATA
PVH manages and analyzes its operating results by its two vertically
integrated business segments: (i) Apparel and (ii) Footwear and Related
Products. In identifying its reportable segments, PVH evaluated its operating
divisions and product offerings. PVH aggregated the results of its apparel
divisions into the Apparel segment. This segment derives revenues from
marketing dresswear, sportswear and accessories, principally under the brand
names Van Heusen, Izod, Izod Club and Geoffrey Beene, John Henry, Manhattan,
and, until February 26, 1999, Gant. PVH's footwear business has been
identified as the Footwear and Related Products segment. This segment derives
revenues from marketing casual and weekend footwear, apparel and accessories
under the Bass brand name.
Sales for both segments occur principally in the United States. See
"Management's Discussion and Analysis of Results of Operations and Financial
Condition" for additional segment data.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION
The following adjusted statements of operations and segment data segregate
Year 2000 computer conversion costs (Y2K costs) from the Company's ongoing
operations:
Statements of Operations
(In thousands) Thirteen Weeks Ended
May 2, May 3,
1999 1998
Net sales $289,699 $295,765
Cost of goods sold 188,891 193,257
Gross profit 100,808 102,508
Selling, general and administrative expenses 99,384 101,954
Income before interest, taxes and Y2K costs 1,424 554
Interest expense, net 6,143 5,466
Loss before taxes and Y2K costs (4,719) (4,912)
Income tax benefit 1,182 1,718
Loss before Y2K costs and extraordinary item (3,537) (3,194)
Y2K costs, net of tax benefit 1,088 1,291
Extraordinary loss on debt retirement, net
of tax benefit 1,060
Net loss $ (4,625) $ (4,485)
Segment Data
Thirteen Weeks Ended
May 2, May 3,
1999 1998
Net sales-apparel $202,058 $205,389
Net sales-footwear and related products 87,641 90,376
Total net sales $289,699 $295,765
Operating income - apparel $ 3,763 $ 3,226
Operating income-footwear and
related products 1,191 581
Total operating income 4,954 3,807
Corporate expenses 3,530 3,253
Income before interest, taxes and Y2K costs $ 1,424 $ 554
Excluding Y2K costs (net of tax benefit), net loss per share before
extraordinary item for the thirteen weeks ended May 2, 1999 and May 3, 1998,
was $0.13 and $0.12, respectively.
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RESULTS OF OPERATIONS
Thirteen Weeks Ended May 2, 1999 Compared with Thirteen Weeks Ended
May 3, 1998
APPAREL
Net sales of the Apparel segment in the first quarter were $202.1 million in
1999 and $205.4 million last year, a decrease of 1.6%.
Gross profit on apparel sales in the first quarter was 33.4% in 1999 compared
with 33.6% in the prior year. This decrease is due principally to lower gross
margins related to winding down the Company's Gant operations in connection
with the sale of Gant in February 1999.
Selling, general and administrative expenses as a percentage of apparel sales
in the first quarter decreased to 31.5% this year from 32.0% last year. The
improved expense level is due principally to reduced goodwill amortization and
operating expenses relating to the sale of Gant.
FOOTWEAR AND RELATED PRODUCTS
Net sales of the Footwear and Related Products segment in the first quarter
were $87.6 million in 1999 and $90.4 million last year, a decrease of 3.1%.
This decrease was expected as the prior year's first quarter included higher
levels of promotional selling at Bass resulting from the liquidation of excess
inventory.
Gross profit on footwear and related products sales in the first quarter was
37.4% in 1999 compared with 36.8% in the prior year. The improvement is
principally because last year's higher levels of promotional selling did not
recur.
Selling, general and administrative expenses as a percentage of footwear and
related products sales in the first quarter were 36.0% this year compared with
36.1% last year.
INTEREST EXPENSE
Interest expense in the first quarter was $6.1 million in 1999 compared with
$5.5 million last year. This increase resulted from the effects of the
refinancings the Company completed late in the first quarter of 1998 which, in
addition to extending the maturities of long-term debt, also increased overall
borrowing costs.
INCOME TAXES
Income taxes were estimated at a rate of 25.0% for the current year compared
with 35.1% last year. The actual full year tax rate for 1998 was 25.8% The
Company believes the current quarter's rate better estimates its expected full
year rate.
-8-
CORPORATE EXPENSES
Corporate expenses in the first quarter were $3.5 million in 1999 compared
with $3.3 million last year.
YEAR 2000
The Year 2000 (Y2K) issue is the result of computer programs using two digits
rather than four to define the applicable year. Such computer systems will be
unable to interpret dates beyond the year 1999, which could cause a system
failure or other computer errors, leading to disruptions in operations. PVH
has initiated a comprehensive Y2K Project to address this issue and is
utilizing both internal and external resources to complete it.
The Company completed an assessment of Y2K requirements for the systems
supported by its Information Technology Department which included contacting
its software suppliers. The impacted systems, including those that are part
of the Company's data processing infrastructure, are now Y2K compliant as a
result of modification or replacement. The systems have been tested and are
in use. They have been fully implemented in all areas, except the Company
still needs to implement certain Y2K compliant retail systems for a number of
its retail outlet stores. In addition, the Company is addressing the Y2K
issue as it relates to its end user computing area. These are expected to be
compliant by June 30, 1999.
The Company has communicated with suppliers, equipment vendors, service
providers and customers to determine the extent to which it is vulnerable to
the failure of these parties to remedy any Y2K issues. Most of these parties
have stated that they intend to be Y2K compliant by 2000. In conjunction with
this, the Company has developed contingency plans for its major suppliers and
merchandise carriers, where feasible, to mitigate Y2K risks. The Company's
electronic commerce systems, used by many of its major customers, are Y2K
compliant and are being installed in accordance with each customer's schedule.
The total cost of the Y2K Project is estimated to be $22 million and is being
funded through operating cash flows. Of the total Project cost, approximately
$3 million is attributable to the purchase of new software, which will be
capitalized, with the remaining cost expensed as incurred. Expenses incurred
through May 2, 1999 were $10 million. Future expenses for the Y2K project
include testing with customers and suppliers, as well as additional
contingency planning and testing, and includes consulting fees and other
administrative costs.
PVH presently believes that the Y2K issue will not pose significant
operational problems for its computer systems. However, no assurance can be
given that this issue, as it relates to PVH's internal systems or those of
other companies on which it relies, will not have a material adverse impact on
PVH's operations.
SEASONALITY
PVH's business is seasonal, with higher sales and income during its third and
fourth quarters, which coincide with PVH's two peak retail selling seasons:
the first running from the start of the back to school and fall selling
seasons beginning in August and continuing through September, and the second
being the Christmas selling season beginning with the weekend following
Thanksgiving and continuing through the week after Christmas.
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Also contributing to the strength of the third quarter is the high volume of
fall shipments to wholesale customers which are generally more profitable than
spring shipments. The slower spring selling season at wholesale combines with
retail seasonality to make the first quarter particularly weak.
LIQUIDITY AND CAPITAL RESOURCES
The seasonal nature of PVH's business typically requires the use of cash to
fund a build-up in the Company's inventory in the first half of each year.
During the third and fourth quarters, the Company's higher level of sales
tends to reduce its inventory and generate cash from operations.
Net cash used by operations in the first quarter totalled $16.8 million in
1999 and $36.2 million last year. This decrease is due to a smaller build-up
of inventory in the current year and reduced spending for restructuring
initiatives as compared to the prior year's first quarter.
The Company has a $325 million credit agreement which includes a revolving
credit facility under which the Company may, at its option, borrow and repay
amounts within certain limits. The agreement also includes a letter of credit
facility with a sub-limit of $250 million, provided, however, that the
aggregate maximum amount outstanding under both the revolving credit facility
and the letter of credit facility is $325 million. The Company believes that
its borrowing capacity under these facilities is adequate for its 1999 peak
seasonal needs.
* * *
******************************************************************************
* Safe Harbor Statement Under the Private Securities Litigation Reform Act *
* of 1995 *
* *
* Forward-looking statements in this Form 10-Q report including, *
* without limitation, statements relating to PVH's plans, strategies, *
* objectives, expectations and intentions, are made pursuant to *
* the safe harbor provisions of the Private Securities Litigation Reform *
* Act of 1995. Investors are cautioned that such forward-looking *
* statements are inherently subject to risks and uncertainties, many of *
* which cannot be predicted with accuracy, and some of which might not be *
* anticipated, including, without limitation, the following: (i) PVH's *
* plans, strategies, objectives, expectations and intentions are subject *
* to change at any time at the discretion of the Company; (ii) the levels *
* of sales of PVH's apparel and footwear products, both to its wholesale *
* customers and in its retail stores, and the extent of discounts and *
* promotional pricing in which the Company is required to engage; *
* (iii) PVH's plans and results of operations will be affected by the *
* Company's ability to manage its growth and inventory; (iv) the timing *
* and effectiveness of programs dealing with the Year 2000 issue; and *
* (v) other risks and uncertainties indicated from time to time in PVH's *
* filings with the Securities and Exchange Commission. *
******************************************************************************
* * *
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Part II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are included herein:
3.1 Certificate of Incorporation (incorporated by reference to Exhibit
5 to the Company's Annual Report on Form 10-K for the fiscal year
ended January 29, 1977).
3.2 Amendment to Certificate of Incorporation, filed June 27, 1984
(incorporated by reference to Exhibit 3B to the Company's Annual
Report on Form 10-K for the fiscal year ended February 3, 1985).
3.3 Certificate of Designation of Series A Cumulative Participating
Preferred Stock, filed June 10, 1986 (incorporated by reference to
Exhibit A of the document filed as Exhibit 3 to the Company's
Quarterly Report as filed on Form 10-Q for the period ended May 4,
1986).
3.4 Amendment to Certificate of Incorporation, filed June 2, 1987
(incorporated by reference to Exhibit 3(c) to the Company's Annual
Report on Form 10-K for the fiscal year ended January 31, 1988).
3.5 Amendment to Certificate of Incorporation, filed June 1, 1993
(incorporated by reference to Exhibit 3.5 to the Company's Annual
Report on Form 10-K for the fiscal year ended January 30, 1994).
3.6 Amendment to Certificate of Incorporation, filed June 20, 1996
(incorporated by reference to Exhibit 3.1 to the Company's Report
on Form 10-Q for the period ended July 28, 1996).
3.7 By-Laws of Phillips-Van Heusen Corporation, as amended through
June 18, 1996 (incorporated by reference to Exhibit 3.2 to the
Company's Report on Form 10-Q for the period ended July 28, 1996).
4.1 Specimen of Common Stock certificate (incorporated by reference to
Exhibit 4 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 31, 1981).
4.2 Preferred Stock Purchase Rights Agreement (the "Rights Agreement"),
dated June 10, 1986 between PVH and The Chase Manhattan Bank, N.A.
(incorporated by reference to Exhibit 3 to the Company's Quarterly
Report as filed on Form 10-Q for the period ended May 4, 1986).
4.3 Amendment to the Rights Agreement, dated March 31, 1987 between PVH
and The Chase Manhattan Bank, N.A. (incorporated by reference to
Exhibit 4(c) to the Company's Annual Report on Form 10-K for the
year ended February 2, 1987).
-11-
4.4 Supplemental Rights Agreement and Second Amendment to the Rights
Agreement, dated as of July 30, 1987, between PVH and The Chase
Manhattan Bank, N.A. (incorporated by reference to Exhibit (c)(4)
to the Company's Schedule 13E-4, Issuer Tender Offer Statement,
dated July 31, 1987).
4.5 Notice of extension of the Rights Agreement, dated June 5, 1996,
from Phillips-Van Heusen Corporation to The Bank of New York
(incorporated by reference to Exhibit 4.13 to the Company's report
on Form 10-Q for the period ended April 28, 1996).
4.6 Credit Agreement, dated as of April 22, 1998, among PVH, the group
of lenders party hereto, The Chase Manhattan Bank, as
Administrative Agent and Collateral Agent, and Citicorp USA, Inc.,
as Documentation Agent (incorporated by reference to Exhibit 4.6 to
the Company's report on Form 10-Q for the period ended May 3,
1998).
4.7 Amendment No. 1, dated as of November 17, 1998, to the Credit
Agreement, dated as of April 22, 1998, among PVH, the group of
lenders party hereto, The Chase Manhattan Bank, as Administrative
Agent and Collateral Agent, and Citicorp USA, Inc., as
Documentation Agent (incorporated by reference to Exhibit 4.7 to
the Company's report on Form 10-K for the period ended January 31,
1999).
4.8 Consent, Waiver and Amendment No. 2, dated as of February 23, 1999,
to the Credit Agreement, dated as of April 22, 1998, among PVH, the
group of lenders party hereto, The Chase Manhattan Bank, as
Administrative Agent and Collateral Agent, and Citicorp USA, Inc.,
as Documentation Agent (incorporated by reference to Exhibit 4.8 to
the Company's report on Form 10-K for the period ended January 31,
1999).
4.9 Indenture, dated as of April 22, 1998, with PVH as issuer and Union
Bank of California, N.A., as Trustee (incorporated by reference to
Exhibit 4.7 to the Company's report on Form 10-Q for the period
ended May 3, 1998).
4.10 Indenture, dated as of November 1, 1993, between PVH and The Bank
of New York, as Trustee (incorporated by reference to Exhibit 4.01
to the Company's Registration Statement on Form S-3 (Reg. No. 33-
50751) filed on October 26, 1993).
*10.1 1987 Stock Option Plan, including all amendments through April 29,
1997 (incorporated by reference to Exhibit 10.1 to the Company's
report on Form 10-Q for the period ended May 4, 1997).
*10.2 Phillips-Van Heusen Corporation Special Severance Benefit Plan, as
amended as of April 16, 1996 (incorporated by reference to Exhibit
10.4 to the Company's Annual Report on Form 10-K for the fiscal
year ended January 28, 1996).
*10.3 Phillips-Van Heusen Corporation Capital Accumulation Plan
(incorporated by reference to the Company's Report on Form 8-K
filed on January 16, 1987).
-12-
*10.4 Phillips-Van Heusen Corporation Amendment to Capital Accumulation
Plan (incorporated by reference to Exhibit 10(n) to the Company's
Annual Report on Form 10-K for the fiscal year ended February 2,
1987).
*10.5 Form of Agreement amending Phillips-Van Heusen Corporation Capital
Accumulation Plan with respect to individual participants
(incorporated by reference to Exhibit 10(1) to the Company's
Annual Report on Form 10-K for the fiscal year ended January 31,
1988).
*10.6 Form of Agreement amending Phillips-Van Heusen Corporation Capital
Accumulation Plan with respect to individual participants
(incorporated by reference to Exhibit 10.8 to the Company's report
on Form 10-Q for the period ending October 29, 1995).
*10.7 Agreement amending Phillips-Van Heusen Corporation Capital
Accumulation Plan with respect to Bruce J. Klatsky (incorporated by
reference to Exhibit 10.13 to the Company's report on Form 10-Q for
the period ended May 4, 1997).
*10.8 Phillips-Van Heusen Corporation Supplemental Defined Benefit Plan,
dated January 1, 1991, as amended and restated on June 2, 1992
(incorporated by reference to Exhibit 10.10 to the Company's Annual
Report on Form 10-K for the fiscal year ended January 31, 1993).
*10.9 Phillips-Van Heusen Corporation Supplemental Savings Plan,
effective as of January 1, 1991 and amended and restated as of
April 29, 1997 (incorporated by reference to Exhibit 10.10 to the
Company's report on Form 10-Q for the period ended May 4, 1997).
*10.10 Non-Incentive Stock Option Agreement, dated as of December 3, 1993,
between the Company and Bruce J. Klatsky (incorporated by reference
to Exhibit 10.12 to the Company's Annual Report on Form 10-K for
the fiscal year ended January 29, 1995).
*10.11 Phillips-Van Heusen Corporation 1997 Stock Option Plan, effective
as of April 29, 1997 (incorporated by reference to Exhibit 10.14 to
the Company's report on Form 10-Q for the period ending August 3,
1997).
*10.12 Phillips-Van Heusen Corporation Senior Management Bonus Program for
fiscal year 1998 (incorporated by reference to Exhibit 10.15 to the
Company's report on Form 10-Q for the period ending August 2,
1998).
15. Acknowledgement of Independent Accountants
27. Financial Data Schedule
* Management contract or compensatory plan or arrangement required to be
identified pursuant to Item 14(a) of this report.
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(b) Reports on Form 8-K filed during the quarter ended May 2, 1999:
Report on Form 8-K, dated as of February 26, 1999, describing the
transaction to sell the Gant, Hugger and Rugger trademarks and certain
related assets associated with the Company's Gant operations for $71.0
million cash to Pyramid Sportswear AB.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PHILLIPS-VAN HEUSEN CORPORATION
Registrant
May 20, 1999 /s/ Vincent A. Russo
Vincent A. Russo, Vice President
and Controller
-15-
Exhibit 15
May 21, 1999
Stockholders and Board of Directors
Phillips-Van Heusen Corporation
We are aware of the incorporation by reference in
(i) Post-Effective Amendment No. 2 to the Registration Statement (Form
S-8, No. 2-73803), which relates to the Phillips-Van Heusen Corporation
Employee Savings and Retirement Plan,
(ii) Registration Statement (Form S-8, No. 33-50841) and Registration
Statement (Form S-8, No. 33-59602), each of which relate to the
Phillips-Van Heusen Corporation Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico,
(iii) Registration Statement (Form S-8, No. 33-59101), which relates to
the Voluntary Investment Plan of Phillips-Van Heusen Corporation
(Crystal Brands Division),
(iv) Registration Statement (Form S-8, No. 33-38698), Post-Effective
Amendment No. 1 to Registration Statement (Form S-8, No. 33-24057) and
Registration Statement (Form S-8, No. 33-60793), each of which relate to
the Phillips-Van Heusen Corporation 1987 Stock Option Plan,
(v) Registration Statement (Form S-8, No. 333-29765) which relates to
the Phillips-Van Heusen Corporation 1997 Stock Option Plan.
of our report dated May 19, 1999 relating to the unaudited condensed
consolidated interim financial statements of Phillips-Van Heusen Corporation
which are included in its Form 10-Q for the thirteen week period ended
May 2, 1999.
Pursuant to Rule 436(c) of the Securities Act of 1933, our report is not a
part of the registration statements or post-effective amendments prepared or
certified by accountants within the meaning of Section 7 or 11 of the
Securities Act of 1933.
ERNST & YOUNG LLP
New York, New York
-16-
5
1,000
3-MOS
JAN-30-2000
MAY-02-1999
19,447
0
98,902
1,489
253,750
398,704
91,671
0
659,104
121,893
248,738
0
0
27,288
194,930
659,104
289,699
289,699
188,891
188,891
100,834
0
6,143
(6,169)
1,544
(4,625)
0
0
0
(4,625)
(0.17)
(0.17)
Property, plant and equipment is presented net of accumulated depreciation.
Provision for doubtful accounts is included in other costs and expenses.
