Phillips-Van revenues go up 16% to $2,425.2 mn

25 Mar '08

3 min read

Revenue in the Company's combined wholesale and retail businesses increased 4% and operating earnings decreased 10% for the fourth quarter of 2007. Factors that negatively affected operating earnings included:

(i) approximately $8 million of start-up costs associated with the Company's Timberland wholesale sportswear business and Calvin Klein specialty retail stores;

(ii) the negative impact on 2007 of the extra week of revenue (53rd week) in 2006, which resulted in the 13 week period in the fourth quarter of 2007 being compared to a 14 week period in 2006;

(iii) the calendar shift caused by the 53rd week in 2006, which resulted in a week of holiday selling being reported in the third quarter of 2007 when the same calendar week in 2006 was reported in the fourth quarter; and

(iv) heavy promotional selling as a result of the weak retail environment during and after the holiday season in order to maintain clean inventory levels heading into fiscal 2008, which negatively affected the Company's moderate wholesale sportswear and retail businesses.

Partially offsetting these negative factors was strong earnings growth in the dress furnishings, IZOD women's sportswear and Calvin Klein outlet retail businesses.

Earnings for the fourth quarter were also positively impacted by a shift in net advertising spending, as approximately $10 million shifted from the fourth quarter into the third quarter when compared to the prior year.

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Phillips-Van Heusen Corporation

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