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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): June 16, 1999
FRUIT OF THE LOOM, INC.
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(Exact Name of Registrant as Specified in Charter)
DELAWARE 1-8941 36-3361804
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(State or Other Jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5000 SEARS TOWER, 233 SOUTH WACKER DRIVE, CHICAGO, ILLINOIS 60606
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (312) 876-1724
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ITEM 5. OTHER EVENTS.
On June 16, 1999, the Registrant's parent company, Fruit of the Loom,
Ltd., issued a press release announcing that its earnings results for the
second quarter are expected to be significantly below analysts' expectations.
The press release is attached hereto as Exhibit 99.1. The information
contained in this press release is incorporated herein by reference.
On June 22, 1999, the Registrant's parent company, Fruit of the Loom,
Ltd., issued a press release announcing that the release date of its second
quarter earnings results has been changed from Wednesday, July 21, 1999, to
Friday, July 23, 1999, due to the delayed closing of the Registrant's
financial statements as a result of the Fourth of July holiday. The press
release is attached hereto as Exhibit 99.2. The information contained in this
press release is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
99.1 Press Release dated June 16, 1999
99.2 Press Release dated June 22, 1999
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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 hereunto duly authorized.
FRUIT OF THE LOOM, LTD.
Dated: July 8, 1999 By: /s/ BRIAN J. HANIGAN
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Brian J. Hanigan
Vice President and Treasurer
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EXHIBIT 99.1
FRUIT OF THE LOOM COMMENTS ON SECOND QUARTER
OPERATING PERFORMANCE
Chicago, IL, June 16, 1999, Fruit of the Loom, Ltd. (the "Company"), one of
the world's leading marketers and manufacturers of basic family apparel today
announced that primarily due to a shortfall in product availability resulting
from a delay in the return to targeted production levels of textile
manufacturing, earnings results for the second quarter are expected to be
significantly below analysts' expectations.
Despite strong demand in both the Retail and Activewear segments, the Company
anticipates sales revenues for the second quarter ending July 3, 1999 will be
within a range of approximately $570 million to $590 million, as compared to
$628 million in the second quarter of 1998. Activewear is most affected by
the product shortage and is responsible for the majority of the sales
shortfall. The Company also experienced lower sales in the Sports Licensing
division due to weaker industry demand and declines in the European imprint
market. Retail sales revenue is expected to be greater than last year's
second quarter with sales growth in men's and boy's underwear between 7% to
10%. To eliminate the product shortfall, the Company has increased
manufacturing rates through the second quarter. Even with the increase, the
cycle time to manufacture finished product has impacted the ability to
correct the imbalance of demand and supply of Activewear. As a result of
lower sales volume, higher mix of irregular sales, competitive Activewear
pricing and higher manufacturing costs, gross margins for the second quarter
are expected to be in a range between 22.5 and 24.0 percent. Gross margins
for the same period last year were 27.9%. Inventories are expected to be
approximately $80 to $100 million below last year's second quarter level of
$913 million. Despite the lower earnings estimate, the Company projects free
cash flows to be approximately $200 million for the year.
The Company will announce complete second quarter operating results and hold
its regularly scheduled teleconference on Wednesday, July 21, 1999. At that
time the Company will comment on the quarter's results in detail and respond
to questions from the investment community.
Except for historical information contained herein, information set forth in
this news release may contain statements and information which describe or
reflect the Company's beliefs concerning future business conditions and the
outlook for the Company. These forward-looking statements are subject to
risks, uncertainties and other facts, which could cause the Company's actual
results, performance or achievement to differ materially from those expressed
in, or implied by, these statements. These risks, uncertainties and other
factors include, but are not limited to, the following: financial strength of
the retail industry, particularly the mass merchant channel, the level of
consumer spending for apparel, the amount of sales of the Company's
activewear screenprint products, the competitive pricing environment within
the basic apparel segment of the apparel industry, the Company's ability to
develop new products, the Company's successful planning of production
necessary to maintain inventories at levels sufficient to efficiently meet
customer demand, the Company's effective income tax rate, the success of
planned advertising, marketing and promotional campaigns, international
activities, the resolution of legal proceedings and other
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contingent liabilities, and weather conditions in the locations in which the
Company manufactures and sells its products. Please refer to the Company's
documents on file with the Securities and Exchange Commission for other risks
and uncertainties.
Fruit of the Loom, Ltd. is a marketing oriented, international basic apparel
company, emphasizing branded products for consumers ranging from infants to
senior citizens. The Company manufactures and markets men's and boys'
underwear, women's and girls' underwear, printable activewear, outerwear,
casualwear, sportswear and childrenswear. Fruit of the Loom employs 30,000
people in over 60 locations worldwide. Brand names include FRUIT OF THE
LOOM-registered trademark-, BVD-registered trademark-, GITANO-registered
trademark-, BEST-TM-, CUMBERLAND BAY-TM- and SCREEN STARS-registered
trademark-. Licensed brands include MUNSINGWEAR-registered trademark-, and
WILSON-registered trademark-. Licensed apparel bearing the logos or insignia
of the major sports leagues and their teams and certain popular players in
the leagues, and the logos of most major colleges and universities, are
marketed under the PRO PLAYER-registered trademark- and FANS GEAR-registered
trademark- brands.
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EXHIBIT 99.2
FRUIT OF THE LOOM ANNOUNCES EARNINGS RELEASE DATE
Chicago, IL, June 22, 1999, Fruit of the Loom, Ltd. (the "Company"), one of
the world's leading marketers and manufacturers of basic family apparel
announced today that the release date of their second quarter earnings
results has been changed from Wednesday, July 21, 1999 to Friday, July 23,
1999 due to the delayed closing of the Company's financial statements as a
result of the Fourth of July holiday.
Fruit of the Loom, Ltd. is a marketing oriented, international basic apparel
company, emphasizing branded products for consumers ranging from infants to
senior citizens. The Company manufactures and markets men's and boys'
underwear, women's and girls' underwear, printable activewear, outerwear,
casualwear, sportswear and childrenswear. Fruit of the Loom employs 30,000
people in over 60 locations worldwide. Brand names include FRUIT OF THE
LOOM-Registered Trademark-, BVD-Registered Trademark-, GITANO-Registered
Trademark-, BEST-TM-, CUMBERLAND BAY-TM- and SCREEN STARS-Registered
Trademark-. Licensed brands include MUNSINGWEAR-Registered Trademark-, and
WILSON-Registered Trademark-. Licensed apparel bearing the logos or insignia
of the major sports leagues and their teams and certain popular players in
the leagues, and the logos of most major colleges and universities, are
marketed under the PRO PLAYER-Registered Trademark- and FANS GEAR-Registered
Trademark- brands.
