3. PVH
• Phillips-Van Heusen started in 1876
• Was primarily a dress shirt company
– First collar-attached shirt was introduced in 1929
2012 Fortune
500 Ranking:
#419
4. Acquisitions
• 1987 – G. H. Bass & Co.
• 1995 – IZOD
• 2003 – Calvin Klein
• 2004 – Arrow
• 2010 – Tommy Hilfiger
• 2013 – Warnaco
5. Stock Price
Tommy Hilfiger acquired for $3B PVH Corp.'s THG Buys 50% In Arvind Limited's JV PVH license takes Izod south of the border
Ike Behar Expands Licensing PVH Corp.'s THG Global Licensing With Ittierre S&P assigns 'BB' rtg to PVH notes
LA With Ram Pacific Pte Ltd. For IZOD Piper Jaffray Downgrades “Neutral”
THG and Inbrands announce JV in Brazil Completes Acquisition Of Warnaco Group Inc
Phillips-Van Heusen Changes Name to PVH LA with Concept One Accessories for Headwear
LA Dishang Group's Fashion Brands For IZOD LA with American Essentials for Legwear
LA with Stepping Stones for Infant
LA Oracon for Men’s ARROW Clothing in Brazil
$0.00
$20.00
$40.00
$60.00
$80.00
$100.00
$120.00
$140.00
1/4/2010 4/4/2010 7/4/2010 10/4/2010 1/4/2011 4/4/2011 7/4/2011 10/4/2011 1/4/2012 4/4/2012 7/4/2012 10/4/2012 1/4/2013
PVH Share Price
PVH
12. Ratios
2008-01 2009-01 2010-01 2011-01 2012-01 INDUSTRY
Current Ratio 2.32 2.48 2.74 1.97 1.67 1.44
Acid Test/Quick Ratio 1.18 1.48 1.85 1.00 0.67 0.94
Receiveables Turnover 15.75 14.57 12.73 14.89 13.06 5.25
Average Collection Period 23.2 25.0 28.7 24.5 27.9 69.5
Inventory Turnover 3.83 4.27 4.45 4.54 3.73 1.51
Days in Inventory 95.24 85.52 82.09 80.32 97.84 241.72
Profit Margin 7.5% 3.7% 6.8% 1.2% 5.4% 4.9%
Operating Margin 12.7% 7.0% 10.2% 4.4% 9.5% 6.8%
Asset Turnover 111.6% 114.0% 105.7% 101.6% 87.0% 48.0%
Return on Assets 8.4% 4.2% 7.1% 1.2% 4.7% 3.8%
Return on Equity 19.1% 9.4% 14.9% 3.0% 12.3% 6.2%
Earnings per share ($) $3.29 $1.78 $3.14 $0.82 $4.46
Price Earnings Ratio 12.79 10.69 12.51 71.18 17.31 15.89
Payout Ratio 4.4% 8.7% 4.9% 18.5% 3.5% 21.4%
Debt to Assets 56.0% 54.6% 50.0% 64.0% 59.8% 28.3%
Interest Coverage Ratio 9.68 5.29 7.24 1.60 4.35 6.62
Free Cash Flow ($MM) $126.00 $151.00 $190.00 $251.00 $321.00
Free Cash Flow net Div ($MM) $118.00 $143.00 $182.00 $241.00 $310.00
LiquiditySolvencyProfitability
13. Goodwill from Acquisitions –
Tommy Hilfiger
• Goodwill recorded - $1.27B
• Estimated Carrying Value of Net Assets - $1.69B
• Cash portion funded through:
– Cash on hand
– The sale on April 28, 2010 of 5,750 shares of the Company’s common stock
– Issuances of an aggregate of 8 shares of Series A convertible preferred stock, which are
convertible into 4,189 shares of the company’s common stock, for an aggregate gross
purchase price of $200M
– Issuance of $600M of 7 3/8% senior Notes due 2020
– Borrowing of approximately $1.9B of term loans under new credit facilities
*in thousands
14. Goodwill from Acquisitions - CK
• 2003 Acquisition
Contingent Price
Payments to Mr. Calvin
Klein
• 1.15% of estimate WW
Sales through 2018
2009 • $38.9M
2010 • $45.3M
2011 • $51.3M
2012 • $55.0M Est.
15. • Indefinite-lived intangible
assets tested annually 3Q
• Fair Value of goodwill
– Discounted Cash Flow
Approach
– Weighted Average Cost of
Capital
• Includes risk premium, risk
free rates
• No impairment of goodwill
or other intangible assets
resulted from any of these
tests – 2011/2010/2009
Goodwill from Acquisitions –
Impairments
16. Carrying Amounts of Goodwill
$1,820.5 M $1,822.5 M
$ 419.2 M
45.3 M
1,271.8 M 6.4 M
(4.2M)
81.9 M
51.3 M
(49.3M)
2009 Goodwill
Balance
CK Contingent
Payment
Tommy Hilfiger Tommy Hilfiger
Handbag
Disposal of
Goodwill
Currency 2010 Goodwill
Balance
CK Contingent
Payment
Currency 2011 Goodwill
Balance
The Company performed its required annual impairment tests for goodwill and other indefinite-lived intangible assets at the beginning of the third quarters of 2011, 2010 and 2009. No impairment of goodwill or other intangible assets resulted from any of these tests.
