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 October 27, 1996
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.)
1290 Avenue of the Americas New York, New York 10104
(Address of principal executive offices) (Zip Code)
Registrant's telephone number (212) 541-5200
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 December 2, 1996: 27,034,037
shares.<PAGE>
PHILLIPS-VAN HEUSEN CORPORATION
INDEX
PART I -- FINANCIAL INFORMATION
Independent Accountants Review Report.................................. 1
Condensed Consolidated Balance Sheets as of October 27, 1996 and
January 28, 1996...................................................... 2
Condensed Consolidated Statements of Operations for the thirteen
weeks and thirty-nine weeks ended October 27, 1996 and
October 29, 1995...................................................... 3
Condensed Consolidated Statements of Cash Flows for the thirty-nine
weeks ended October 27, 1996 and October 29, 1995..................... 4
Notes to Condensed Consolidated Financial Statements.................. 5-7
Management's Discussion and Analysis of Results of Operations
and Financial Condition............................................... 8-11
PART II -- OTHER INFORMATION
ITEM 6 - Exhibits and Reports on Form 8-K............................. 12-15
Signatures............................................................ 16
Exhibit--Acknowledgment of Independent Accountants.................... 17
Exhibit--Financial Data Schedule...................................... 18
<PAGE>
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 October 27, 1996, and the related
condensed consolidated statements of operations for the thirteen and thirty-
nine week periods ended October 27, 1996 and October 29, 1995, and the related
condensed consolidated statements of cash flows for the thirty-nine week
periods ended October 27, 1996 and October 29, 1995. 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 28, 1996, and the related consolidated statements of income,
stockholders' equity, and cash flows for the year then ended (not presented
herein) and in our report dated March 12, 1996, 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 28, 1996, 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
November 19, 1996
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<PAGE>
Phillips-Van Heusen Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share data)
<TABLE>
<CAPTION>
UNAUDITED AUDITED
October 27, January 28,
1996 1996
<S> <C> <C>
ASSETS
Current Assets:
Cash, including cash equivalents of $12,352 and $8,474 $ 23,204 $ 17,533
Trade receivables, less allowances of $4,918 and $5,514 128,774 109,866
Income tax refund receivable - 16,987
Inventories 299,121 276,773
Other, including deferred taxes of $9,801 24,039 23,505
Total Current Assets 475,138 444,664
Property, Plant and Equipment 138,605 143,398
Goodwill 117,546 119,914
Other Assets, including deferred taxes of $22,113 39,503 41,079
$770,792 $749,055
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 74,000 $ 61,590
Accounts payable 43,719 38,796
Accrued expenses 74,792 72,603
Current portion of long-term debt 10,157 10,137
Total Current Liabilities 202,668 183,126
Long-Term Debt, less current portion 229,253 229,548
Other Liabilities 56,740 61,089
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; shares issued 27,030,720 and 26,979,352 27,031 26,979
Additional Capital 116,207 115,977
Retained Earnings 138,893 132,336
Total Stockholders' Equity 282,131 275,292
$770,792 $749,055
</TABLE>
See accompanying notes.
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<PAGE>
Phillips-Van Heusen Corporation
Condensed Consolidated Statements of Operations
Unaudited
(In thousands, except per share data)
<TABLE>
<CAPTION>
Thirteen Weeks Ended Thirty-Nine Weeks Ended
October 27, October 29, October 27, October 29,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Net sales $391,245 $448,007 $978,712 $1,080,487
Cost of goods sold 261,536 308,952 650,581 724,431
Gross profit 129,709 139,055 328,131 356,056
Selling, general and administrative expenses 102,817 116,749 295,538 322,209
Plant, store closing and restructuring
expenses - 25,000 - 25,000
Income (loss) before interest and taxes 26,892 (2,694) 32,593 8,847
Interest expense, net 5,958 6,559 18,029 17,281
Income (loss) before taxes 20,934 (9,253) 14,564 (8,434)
Income tax expense (benefit) 5,899 (4,879) 3,957 (4,594)
Net income (loss) $ 15,035 $ (4,374) $ 10,607 $ (3,840)
Average shares outstanding 27,005 26,762 26,994 26,693
Net income (loss) per share $ 0.56 $ (0.16) $ 0.39 $ (0.14)
Cash dividends per share $ 0.0375 $ 0.0375 $ 0.1125 $ 0.1125
See accompanying notes.
</TABLE>
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<PAGE>
Phillips-Van Heusen Corporation
Condensed Consolidated Statements of Cash Flows
Unaudited
(In thousands)
<TABLE>
<CAPTION>
Thirty-Nine Weeks Ended
October 27, October 29,
1996 1995
<S> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $ 10,607 $ (3,840)
Adjustments to reconcile net income (loss) to net
cash provided (used) by operating activities:
Depreciation and amortization 22,395 25,043
Amortization of contributions from landlords (4,711) (5,602)
Write-off of fixed assets - 11,000
Deferred income taxes - 9,651
Other-net - 2,223
Changes in operating assets and liabilities:
Receivables (16,614) (50,618)
Income tax refund 16,987 -
Inventories (22,348) (65,688)
Accounts payable and accrued expenses 6,945 (23,072)
Other-net (2,694) (150)
Net Cash Provided (Used) By Operating Activities 10,567 (101,053)
INVESTING ACTIVITIES:
Acquisition of the Apparel Group of Crystal
Brands, Inc. - (114,503)
Property, plant and equipment acquired (16,302) (25,029)
Contributions from landlords 1,780 6,930
Other-net 1,264 (9,886)
Net Cash Used By Investing Activities (13,258) (142,488)
FINANCING ACTIVITIES:
Proceeds from revolving line of credit
and long-term borrowings 26,411 205,017
Payments on revolving line of credit
and long-term borrowings (14,280) (16,860)
Exercise of stock options 282 1,227
Cash dividends (4,051) (4,005)
Net Cash Provided By Financing Activities 8,362 185,379
Increase (Decrease) In Cash 5,671 (58,162)
Cash at beginning of period 17,533 80,473
Cash at end of period $ 23,204 $ 22,311
See accompanying notes.
</TABLE>
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<PAGE>
PHILLIPS-VAN HEUSEN CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
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 28, 1996.
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 and thirty-nine weeks ended October
27, 1996 and October 29, 1995 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 and thirty-nine weeks ended October 29,
1995 to present that information on a basis consistent with the thirteen and
thirty-nine weeks ended October 27, 1996.
INVENTORIES
Inventories are summarized as follows:
October 27, January 28,
1996 1996
Raw materials $ 13,784 $ 14,194
Work in process 16,474 13,145
Finished goods 268,863 249,434
Total $299,121 $276,773
Inventories are stated at the lower of cost or market. Cost for the apparel
segment is determined principally using the last-in, first-out method (LIFO),
except for certain sportswear inventories which are determined using the
first-in, first-out method (FIFO). Cost for the footwear segment is
determined using FIFO. Inventories would have been $14,027 and $12,923 higher
than reported at October 27, 1996 and January 28, 1996, respectively, if the
FIFO method of inventory accounting had been used for the entire apparel
business.
-5-
<PAGE>
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.
SEGMENT DATA
The Company operates in two industry segments: (i) apparel - the manufacture,
procurement for sale and marketing of a broad range of men's, women's and
children's apparel to traditional wholesale accounts as well as through
Company-owned retail stores, and (ii) footwear - the manufacture, procurement
for sale and marketing of a broad range of men's, women's and children's shoes
to traditional wholesale accounts as well as through Company-owned retail
stores.
Operating income represents net sales less operating expenses. Excluded from
operating results of the segments are interest expense, net, corporate
expenses and income taxes.
<TABLE>
<CAPTION>
Thirteen Weeks Ended Thirty-Nine Weeks Ended
October 27, October 29, October 27, October 29,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Net sales-apparel $291,222 $343,625 $714,647 $ 804,560
Net sales-footwear 100,023 104,382 264,065 275,927
Total net sales $391,245 $448,007 $978,712 $1,080,487
Operating income (loss)-apparel* $ 20,333 $ (2,624) $ 21,518 $ 2,379
Operating income-footwear* 10,780 4,704 21,110 16,496
Total operating income* 31,113 2,080 42,628 18,875
Corporate expenses (4,221) (4,774) (10,035) (10,028)
Interest expense, net (5,958) (6,559) (18,029) (17,281)
Income (loss) before taxes $ 20,934 $ (9,253) $ 14,564 $ (8,434)
* Operating income for the thirteen and thirty-nine weeks ended October 29, 1995,
includes a $25,000 pre-tax charge, of which $23,000 and $2,000 relate to the
Company's apparel and footwear businesses, respectively. These charges relate
to plant, store closing and restructuring expenses as described in the
accompanying footnote.
</TABLE>
-6-
<PAGE>
ACQUISITION
On February 17, 1995, the Company completed the acquisition of the Apparel
Group of Crystal Brands, Inc. (Gant and Izod) for $114,503 in cash, net of
cash acquired, and subject to certain adjustments. This acquisition was
accounted for as a purchase. The acquired operations are included in the
Company's consolidated financial statements since February 17, 1995.
PLANT, STORE CLOSING AND RESTRUCTURING EXPENSES
In 1995, the Company adopted and began to implement a plan designed to reduce
costs and realign the product distribution mix primarily within the Company's
apparel segment. Significant components of the plan included the closure of
three domestic apparel manufacturing facilities before the end of fiscal year
1995 and the closing of approximately 300 less profitable retail outlet
stores. As a result, the Company recorded a pre-tax charge of $25,000 and
$2,000 in the third and fourth quarters of 1995, respectively, which the
Company expects to utilize fully by the end of its current fiscal year.
As part of its ongoing expense and cost reduction initiatives, the Company
continues to evaluate its operating structure.
OTHER
The Company is a party to certain litigation which, in management's judgement
based in part on the opinion of legal counsel, will not have a material
adverse effect on the Company's financial position.
-7-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION
RESULTS OF OPERATIONS
Thirteen Weeks Ended October 27, 1996 Compared to Thirteen Weeks Ended
October 29, 1995
APPAREL
Net sales of the Company's apparel segment in the third quarter were $291.2
million in 1996 and $343.6 million last year, a decrease of 15.3%. This
decrease was expected, given the absence of clearance sales associated with
the acquisition of the Apparel Group of Crystal Brands Inc., the planned
elimination of the Company's private label retail formats, the planned
reduction of low margin private label sales at the wholesale level and the
closure of factory outlet stores as part of the Company's continuing strategic
initiative to downsize its factory outlet business. The effect of these
changes more than offset sales gains made this year in the Company's branded
product lines at the wholesale level.
Gross profit on apparel sales was 31.7% in the third quarter of 1996 compared
to 30.0% last year. The improvement in gross profit comes largely from the
elimination of certain of the less profitable businesses described above.
Selling, general and administrative expenses as a percentage of apparel sales
in the third quarter was 24.8% in 1996 and 24.0% in 1995. The increased
expense level is attributable principally to current year start-up costs
associated with the new Gant and Izod outlet stores.
FOOTWEAR
Net sales of the Company's footwear segment were $100.0 million in the third
quarter of 1996 and $104.4 million last year, a decrease of 4.2%. The
decrease was due principally to the closure of factory outlet stores described
above.
Gross profit on footwear sales was 37.2% in the third quarter of 1996 compared
to 34.6% last year. The improvement in gross profit results principally from
a significant reduction in promotional selling as footwear enjoyed a strong
back to school season.
Selling, general and administrative expenses as a percentage of footwear sales
in the third quarter was 26.4% in 1996 and 28.2% in 1995. The decrease in
expenses results from the closure of underperforming factory outlet stores
described above.
INTEREST EXPENSE
Net interest expense was $6.0 million in the third quarter of 1996 compared
with $6.6 million last year.
-8-
<PAGE>
INCOME TAXES
Income tax expense was estimated at a rate of 28.2% for the third quarter of
1996 compared to last year's rate of 27.4% (before the effect of the non-
recurring restructuring charge). The tax rates reflect the relationship of
U.S. income taxed at normal rates versus tax exempted income from operations
in Puerto Rico.
CORPORATE EXPENSES
Corporate expenses were $4.2 million in the third quarter of 1996 compared to
$4.8 million in 1995. The decrease is due solely to timing.
Thirty-Nine Weeks Ended October 27, 1996 Compared to Thirty-Nine Weeks Ended
October 29, 1995
APPAREL
Net sales of the Company's apparel segment were $714.7 million in the first
nine months of 1996, a decrease of 11.2% from the prior year's $804.6 million.
This decrease was expected, given the absence of clearance sales associated
with the acquisition of Crystal Brands, the planned elimination of the
Company's private label retail formats, the planned reduction of low margin
private label sales at the wholesale level and the closure of factory outlet
stores as part of the Company's continuing strategic initiative to downsize
its factory outlet business. The effect of these changes more than offset
sales gains made this year in the Company's branded product lines at the
wholesale level.
Gross profit on apparel sales was 32.1% in the first nine months of 1996
compared to 31.5% last year. The improvement in gross profit comes largely
from the elimination of certain of the less profitable businesses described
above.
Selling, general and administrative expenses as a percentage of apparel sales
in the first nine months was 29.1% in 1996 and 28.4% in 1995. The increased
expense level is attributable principally to current year start-up costs
associated with the new Gant and Izod outlet stores.
FOOTWEAR
Net sales of the Company's footwear segment in the first nine months were
$264.1 million compared to last year's $275.9 million, a decrease of 4.3%.
The decrease was due principally to the closure of factory outlet stores
described above.
Gross profit on footwear sales was 37.2% in the first nine months of 1996 and
1995.
Selling, general and administrative expenses as a percentage of footwear sales
in the first nine months was 29.3% in 1996 and 30.5% in 1995. The decrease in
expenses results from the closure of underperforming factory outlet stores
described above.
-9-<PAGE>
INTEREST EXPENSE
Net interest expense was $18.0 million in the first nine months of 1996
compared with $17.3 million last year. The increase in interest expense is
directly related to the timing of the Gant and Izod acquisition and the
funding of the cash portion of the Company's prior year restructuring
initiatives.
INCOME TAXES
Income tax expense was estimated at a rate of 27.2% for the first nine months
of 1996 compared with last year's rate of 28.3% (before the effect of the non-
recurring restructuring charge). The tax rates reflect the relationship of
U.S. income taxed at normal rates versus tax exempted income from operations
in Puerto Rico.
CORPORATE EXPENSES
Corporate expenses were $10.0 million in the first nine months of 1996 and
1995.
SEASONALITY
The Company's business is seasonal, with higher sales and income during its
third and fourth quarters, which coincide with the Company'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; the
second being the Christmas selling season beginning with the weekend following
Thanksgiving and continuing through the week after Christmas.
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 combined with
retail seasonality make the first quarter particularly weak.
LIQUIDITY AND CAPITAL RESOURCES
The seasonal nature of the Company's business typically requires the use of
cash to fund a build-up in the Company's inventory in the first half of each
fiscal year. During the third and fourth quarters, the Company's higher level
of sales tends to reduce its inventory and generate cash from operations.
Cash provided (used) by operations in the first nine months totalled $10.6
million in 1996 compared with $(101.1) million last year. The improvement
comes principally from the normalization of working capital requirements in
1996 compared to the increased requirements in 1995 due to the acquisition of
the Apparel Group of Crystal Brands, Inc. In addition, there is a reduction
in working capital requirements due to the downsizing of the Company's retail
business.
Capital spending was $16.3 million in the first nine months of 1996 as
compared with $25.0 million last year. The decrease is in line with the
Company's planned capital spending reduction.
-10-
<PAGE>
The Company has a credit agreement which includes a revolving credit facility
under which the Company may, at its option, borrow and repay amounts within
certain limits. The credit agreement also includes a letter of credit
facility. The total amount available to the Company under each of the
revolving credit and the letter of credit facility is $250 million provided,
however, that the aggregate maximum amount outstanding at any time under both
facilities is $400 million. The Company believes that its borrowing capacity
under this facility is adequate for its 1996 peak seasonal needs. At the end
of the current and prior year's third quarters, the Company estimated that $70
million of the outstanding borrowings under this facility were non-current.
The Company's long-term debt (net of invested cash) as a percentage of total
capital is 43.5% at the end of the current quarter compared with 45.9% at the
end of last year's third quarter.
* * *
******************************************************************************
* *
* Safe Harbor Statement Under the Private Securities Litigation Reform Act *
* of 1995: Except for the historical information contained herein, the *
* matters discussed in this Form 10-Q report may be deemed to consist of *
* forward-looking statements that may involve risks to and uncertainties in *
* the Company's business. Such risks and uncertainties primarily relate to *
* the levels of sales of the Company's apparel and footwear products, both *
* to its wholesale customers and in its retail stores, to the extent of *
* discounts and promotional pricing in which the Company is required to *
* engage, and to other risks and uncertainties which may be detailed from *
* time to time in the Company's reports filed with the Securities and *
* Exchange Commission. *
* *
******************************************************************************
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<PAGE>
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).
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).
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<PAGE>
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 December 16, 1993, among PVH, Bankers
Trust Company, The Chase Manhattan Bank, N.A., Citibank, N.A., The
Bank of New York, Chemical Bank and Philadelphia National Bank, and
Bankers Trust Company, as agent (incorporated by reference to
Exhibit 4.5 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 30, 1994).
4.7 First Amendment, dated as of February 13, 1995, to the Credit
Agreement dated as of December 16, 1993 (incorporated by reference
to Exhibit 4.6 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 29, 1995).
4.8 Second Amendment, dated as of July 17, 1995, to the Credit
Agreement dated as of December 16, 1993 (incorporated by reference
to Exhibit 4.7 to the Company's report on Form 10-Q for the period
ending October 29, 1995).
4.9 Third Amendment, dated as of September 27, 1995, to the Credit
Agreement dated as of December 16, 1993 (incorporated by reference
to Exhibit 4.8 to the Company's report on Form 10-Q for the period
ending October 29, 1995).
4.10 Fourth Amendment, dated as of September 28, 1995, to the Credit
Agreement dated as of December 16, 1993 (incorporated by reference
to Exhibit 4.9 to the Company's report on Form 10-Q for the period
ending October 29, 1995).
4.11 Fifth Amendment, dated as of April 1, 1996, to the Credit Agreement
dated as of December 16, 1993 (incorporated by reference to Exhibit
4.10 to the Company's Annual Report on Form 10-K for the fiscal
year ended January 28, 1996).
4.12 Note Agreement, dated October 1, 1992, among PVH, The Equitable
Life Assurance Society of the United States, Equitable Variable
Life Insurance Company, Unum Life Insurance Company of America,
Nationwide Life Insurance Company, Employers Life Insurance Company
of Wausau and Lutheran Brotherhood (incorporated by reference to
Exhibit 4.21 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 31, 1993).
4.13 First Amendment Agreement, dated as of June 24, 1996, to the Note
Agreement, dated as of October 1, 1992 (incorporated by reference
to Exhibit 4.14 to the Company's report on Form 10-Q for the period
ended July 28, 1996).
4.14 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).
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<PAGE>
10.1 1987 Stock Option Plan, including all amendments through June 13,
1995 (incorporated by reference to Exhibit 10.1 to the Company's
report on Form 10-Q for the period ended October 29, 1995).
10.2 1973 Employees' Stock Option Plan (incorporated by reference to
Exhibit 1 to the Company's Registration Statement on Form S-8 (Reg.
No. 2-72959) filed on July 15, 1981).
10.3 Supplement to 1973 Employees' Stock Option Plan (incorporated by
reference to the Company's Prospectus filed pursuant to Rule 424(c)
to the Registration Statement on Form S-8 (Reg. No. 2-72959) filed
on March 31, 1982).
10.4 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).
10.5 Phillips-Van Heusen Corporation Capital Accumulation Plan
(incorporated by reference to the Company's Report on Form 8-K
filed on January 16, 1987).
10.6 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).
10.7 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).
10.8 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).
10.9 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).
10.10 Phillips-Van Heusen Corporation Supplemental Savings Plan, dated as
of January 1, 1991 and amended and restated as of July 1, 1995
(incorporated by reference to Exhibit 10.10 to the Company's Annual
Report on Form 10-K for the fiscal year ended January 28, 1996).
10.11 Performance Restricted Stock Plan, as amended as of April 16, 1996
(incorporated by reference to Exhibit 10.16 to the Company's Annual
Report on Form 10-K for the fiscal year ended January 28, 1996).
-14-
<PAGE>
10.12 Phillips-Van Heusen Corporation (Crystal Brands Division)
Associates Investment Plan, dated as of November 1, 1985, as
amended and restated as of July 1, 1995 (incorporated by reference
to Exhibit 10.17 to the Company's report on Form 10-Q for the
period ended April 28, 1996).
10.13 Agreement, dated as of April 28, 1993, between Bruce J. Klatsky,
Lawrence S. Phillips and the Company (incorporated by reference to
Exhibit 10.11 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 29, 1995).
10.14 Amendment, dated December 6, 1993, to the Agreement, dated April
28, 1993, between Bruce J. Klatsky, Lawrence S. Phillips and the
Company (incorporated by reference to Exhibit 10.13 to the
Company's Annual Report on Form 10-K for the fiscal year ended
January 29, 1995).
10.15 Non-Incentive Stock Option Agreement, dated as of April 28, 1993,
between the Company and Bruce J. Klatsky. Non-Incentive Stock
Option Agreement, dated as of December 3, 1993, between the Company
and Bruce J. Klatsky (reload of April 28, 1993 Non-Incentive Stock
Option Agreement) (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).
10.16 Consulting and non-competition agreement, dated February 14, 1995,
between the Company and Lawrence S. Phillips (incorporated by
reference to Exhibit 10.14 to the Company's Annual Report on Form
10-K for the fiscal year ended January 29, 1995).
15. Acknowledgement of Independent Accountants.
27. Financial Data Schedule
(b) Reports on Form 8-K
No reports have been filed on Form 8-K during the quarter covered by this
report.
-15-
<PAGE>
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
December 10, 1996 /s/ Emanuel Chirico
Emanuel Chirico, Controller
Vice President and
Chief Accounting Officer
-16-
<PAGE>
Exhibit 15
November 19, 1996
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) Post-Effective Amendment No. 4 to Registration Statement (Form S-8,
No. 2-72959), Post Effective Amendment No. 6 to Registration Statement
(Form S-8, No. 2-64564), and Post Effective Amendment No. 13 to
Registration Statement (Form S-8, No. 2-47910), each of which relate to
the 1973 Employee's Stock Option Plan of Phillips-Van Heusen
Corporation, and
(v) 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,
of our report dated November 19, 1996 relating to the unaudited condensed
consolidated interim financial statements of Phillips-Van Heusen Corporation
which are included in its Form 10-Q for the three month period ended October
27, 1996.
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
-17-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
PHILLIPS-VAN HEUSEN CORPORATION FINANCIAL STATEMENTS INCLUDED IN ITS 10-Q REPORT
FOR THE QUARTER ENDED OCTOBER 27, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> FEB-02-1997
<PERIOD-END> OCT-27-1996
<CASH> 23,204
<SECURITIES> 0
<RECEIVABLES> 133,692
<ALLOWANCES> 4,918
<INVENTORY> 299,121
<CURRENT-ASSETS> 475,138
<PP&E> 138,605<F1>
<DEPRECIATION> 0<F1>
<TOTAL-ASSETS> 770,792
<CURRENT-LIABILITIES> 202,668
<BONDS> 0
0
0
<COMMON> 27,031
<OTHER-SE> 255,100
<TOTAL-LIABILITY-AND-EQUITY> 770,792
<SALES> 978,712
<TOTAL-REVENUES> 978,712
<CGS> 650,581
<TOTAL-COSTS> 650,581
<OTHER-EXPENSES> 295,538
<LOSS-PROVISION> 0<F2>
<INTEREST-EXPENSE> 18,029
<INCOME-PRETAX> 14,564
<INCOME-TAX> 3,957
<INCOME-CONTINUING> 10,607
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,607
<EPS-PRIMARY> .39
<EPS-DILUTED> .39
<FN>
<F1>Property, plant and equipment is presented net of accumulated depreciation.
<F2>Provision for doubtful accounts is included in other costs and expenses.
</FN>
</TABLE>
