Tommy Hilfiger Corporation today announced a series of actions to reposition and streamline its U.S. wholesale business to improve its performance and profitability.
David F. Dyer, President and Chief Executive Officer, commented, “We have made a commitment to turn around the performance of our U.S. wholesale business, and we are moving forward aggressively to take the necessary steps to achieve that objective. Key to this effort is assuring we have the right operating structure in place, so that we are delivering the right product for our customers and consumers as efficiently as possible. An important first step was appointing Lynn Shanahan as Group President of U.S. Wholesale with responsibility for sales, merchandising, marketing, design, production and other support functions. Today, we are building on this initial step by assuring that our division presidents have the dedicated resources they need to improve performance, while increasing accountability for delivering results.”
“We regret that the actions announced today will result in the elimination of positions for some of our associates. However, we believe these steps are necessary to better align our U.S. wholesale operating costs with the current volume of the business. We will be providing severance and other assistance to help ease the transition for those individuals affected,” Mr. Dyer said.
“Overall, we are confident that the changes announced today put us in a stronger position for the future, while enabling us to continue to invest in key growth opportunities, including Tommy Hilfiger Europe, our U.S. retail store operations, e-commerce and our new Karl Lagerfeld business,” concluded Mr. Dyer.
The Company plans to announce its results for the third quarter of fiscal 2005, the period ended December 31, 2004, on February 2, 2005. At that time, the Company will provide further detail on the U.S. wholesale special charge and other special charges expected to be recorded in fiscal 2005. The Company also expects to provide its initial outlook for fiscal 2006.
Tommy Hilfiger Corporation, through its subsidiaries, designs, sources and markets men's and women's sportswear, jeanswear and childrenswear under the Tommy Hilfiger trademarks. Through a range of strategic licensing agreements, the Company also offers a broad array of related apparel, accessories, footwear, fragrance and home furnishings. The Company's products can be found in leading department and specialty stores throughout the United States, Canada, Europe, Mexico, Central and South America, Japan, Hong Kong, Australia and other countries in the Far East, as well as the Company's own network of specialty and outlet stores in the United States, Canada and Europe.
Safe Harbor Statement
Statements made by the Company that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are indicated by words or phrases such as “anticipate,” “estimate,” “project,” “expect,” “believe” and similar words or phrases. Such statements are based on current expectations and are subject to certain risks and uncertainties, including, but not limited to, the overall level of consumer spending on apparel; the financial strength of the retail industry generally and the Company's customers, distributors, licensees and franchisees in particular; changes in trends in the market segments and geographic areas in which the Company competes; the level of demand for the Company's products; actions by our major customers or existing or new competitors; the effect of the Company's strategy to reduce U.S. distribution in order to bring supply and demand into balance; changes in currency and interest rates; changes in applicable tax laws, regulations and treaties (including the U.S./Barbados treaty); changes in economic or political conditions or trade regulations in the markets where the Company sells or sources its products; the effects of any consolidation of the Company's facilities and actions to reduce selling, general and administrative expenses; the outcome of the investigation being conducted by the U.S. Attorney's Office, the related class action lawsuits and the Special Committee's investigation; the ability of the Company to obtain waivers and/or satisfy covenants under its credit agreement and indenture on a timely basis relating to the providing of required financial information; as well as other risks and uncertainties set forth in the Company's publicly- filed documents, including its Annual Report on Form 10-K for the fiscal year ended March 31, 2004. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. The Company disclaims any intention or obligation to update or revise any forward- looking statements, whether as a result of new information, future events or otherwise.
