Hilfiger lay-offs

Tommy Hilfiger laid off approximately 150 people yesterday, according to sources within the company. The cuts come a week after the clothing company announced lower-than-expected earnings for the year ended March 31. Company officials weren't available for immediate comment.

Tommy Hilfiger has been looking for a buyer since it settled a federal investigation earlier this year, and analysts were not surprised by the layoffs.

“They've got to get it lean and ready to go,” says Marshal Cohen, chief analyst at trend-tracking NPD Group Inc. “It's also possible that they are closer to a deal than we know,” and Tommy is cleaning house before announcing a takeover.

7 October 2005

Tommy Hilfiger for sale

The Tommy Hilfiger Corporation is up for sale, as was reported yesterday. According to financial sources, Hilfiger is being quietly shopped around to select potential buyers. Sources said the asking price is at least $1.82 billion, but could go as high as $2.16 billion. The deal could net Tommy Hilfiger himself up to $250 million. Financial sources said a deal could be inked before Thanksgiving, meaning the sale process will proceed fairly quickly over a 60- to 90-day period.

The company, which posted first-quarter earnings results last week, ended the quarter with over $500 million in cash, according to a research note by an analyst at Lehman Brothers. For the first quarter ended June 30, net income was $319 million versus $329 million in the same year-ago quarter. Financial sources said Hilfiger has generated substantial interest among both financial and strategic players. Names whispered in the industry regarding strategic buyers include Jones Apparel Group, VF Corp. and Liz Claiborne, the typical players that routinely get named when a consumer brand is put on the auction block.

One name that has come up repeatedly is Li & Fung USA, which is changing its image from a sourcing powerhouse to a global branding model. Another analyst said many people don't recognize the potential for the Karl Lagerfeld business, which Tommy Hilfiger Corp. acquired last December. Lagerfeld is a huge opportunity in Europe and Hilfiger has the infrastructure to expand the brand in Europe . The analyst also believes there's a good chance Hilfiger might have a financial player as its new parent. "All that a financial buyer wants is to pay down the debt and then go public. Hilfiger is ideal for a financial buyer because it has [substantial] cash on hand and huge cash flow," he said.

Financial sources familiar with the book's contents said that $250 million from the company's cash could be used to buy out designer Tommy Hilfiger's contract. Until last week, Hilfiger's subsidiary Tommy Hilfiger U.S.A. Inc. was being investigated by the U.S. Attorney's office for its commission policies. The company last Wednesday said it settled the U.S. tax probe for $18.1 million, and that the U.S. Attorney's office agreed not to prosecute Hilfiger or its subsidiary. Although there are still some state tax issues pending, now that the criminal probe is resolved, the path seems clear for the company to be sold.

www.tommyhilfiger.com
18 August 2005

Hilfiger in trouble

Last Wednesday the Hong Kong-based Tommy Hilfiger Corp reported a 58.6% plummet in third quarter income before taxes.

The company also cut its pre-tax income forecast for the fiscal year 2005. Furthermore, it said that it would discontinue distribution of its H Hilfiger collections to US department stores in an effort to concentrate on a new specialty store concept currently in development.

The struggling company is also momentarily facing a federal tax probe. It included the $6.6 million (GBP 3.68 million) for legal and advisory fees relating to this investigation in its third quarter pre-tax income of $12.6 million. During the same period last year this amount was $30.4 million. Net revenue was down by 5% to $427.9 million.

Last month the company announced that it was to cut jobs in its US wholesale division and close its young men's jeans division, costing 200 jobs as a result. David Fyer, president and chief executive officer, said in a statement: "Our results continue to reflect a challenging US department store environment, as well as higher-than-expected promotional activity during the fall and holiday seasons." He continued: "We are pleased with the performance of our US company stores where comparable store sales trends turned positive for the quarter, along with the strong results in Europe, Canada and licensing businesses."

Wholesale revenues slumped by 19% to $242.7 million from $299.7 million the same period the year before. The company's European wholesale division grew by 33.2 % to $61 million from $45.8 million a year ago. Meanwhile the US wholesale business dropped by 30.8% from $238.8 million to $165.3 million.

The retail division fared better with a 21.8% increase in third quarter revenue to $165.6 million.

www.tommyhilfiger.com
7 February 2005

Tommy Hilfiger Cuts Jobs In Restructuring

Analysts widely supported Tommy Hilfiger Corp.'s move to restructure its operations and close down pieces of its business, but they cautioned Monday that more is needed. "While this is a significant step, we still think the business is unhealthy," said Prudential Equity Group analyst Lizabeth Dunn. Investors, however, liked the news enough to lift shares of Hong Kong-based Tommy Hilfiger which ended up 49 cents, or 4.7 percent to $10.89. They earlier reached an intraday high of $11.35.

Late Friday, Tommy Hilfiger said that it's slashing 100 jobs, or 20 percent of its work force, in shutting down its young men's jeans division, consolidating men's sportswear into three collections and integrating jeans into them, and changing its U.S. men's, women's and children's wholesale division to include design, merchandising and production teams.

The largely operational steps are expected to cost $10 million to $14 million in fiscal 2005. On an annual basis, however, Tommy Hilfiger is projecting savings of $40 million beginning in 2006. The moves are part of what's turning out to be an incremental restructuring of the struggling apparel maker under David Dyer, the former Lands' End boss who was named chief executive 18 months ago to turn the designer's fortunes around.

Tommy Hilfiger made a major strategic shift away from its core preppy attire with the acquisition last month of the trademarks of designer Karl Lagerfeld, an internationally known designer. "This acquisition is an important first step in our long-term strategy of building a multibrand portfolio of businesses," Dyer said in a press release at the time.

www.tommyhilfiger.com
24 January 2005

Hilfiger hires Armani exec

Tommy Hilfiger has hired a longtime Giorgio Armani executive to run the newly acquired Karl Lagerfeld business, according to The Post.

Rodney Hutton, a former merchandise with Giorgio Armani, joined Tommy Hilfiger last month as senior vice president and general merchandise manager for the Karl Lagerfeld division, sources said.

Tommy Hilfiger purchased the Karl Lagerfeld trademarks, including Lagerfeld Gallery, an upscale women's line, and Lagerfeld, a licensed men's wear line, in December, part of an attempt to expand beyond its namesake brand. Plans to grow the Lagerfeld business have not been finalized, people close to the company said yesterday.

www.tommyhilfiger.com
6 January 2005

Hilfiger's Christmas Purchase

This morning fashion mogul Tommy Hilfiger announced that the company has acquired the trademarks of Karl Lagerfeld for an undisclosed amount. This deal includes the Lagerfeld Gallery, his women's luxury ready-to-wear collection, and other Lagerfeld collections, including boutiques in Monaco and Paris. Hilfiger will allow the Lagerfeld brand to grow internationally, with Karl Lagerfeld as creative director. The transaction will not affect his running contracts with Chanel or Fendi.

Lagerfeld told reporters that he was looking for a partner that had already built a global business, which had the infrastructure and resources in place to "make our vision of the Lagerfeld brand become a reality." He was excited about the deal and said: "I have been impressed with Tommy and his team and I look forward to working together on new initiatives."

President and chief executive of the Tommy Hilfiger Corporation, David Dyer, said the acquisition was an important move in the company's bid to build a multi-brand portfolio of businesses. Furthermore, he told reporters, the Lagerfeld name has enormous cachet and he believed that although the company was still in its start-up phase, it would contribute to increased revenues in the future.

Hilfiger responded by calling Lagerfeld a true inspiration. "Designing for the world's most prestigious collections, he has continuously set the benchmark of style, creativity and sophistication," said Hilfiger. He emphasised that Lagerfeld will continue to wield the creative power over his new brand, which is presently in its start-up phase. The transaction will be completed within the next thirty days, pending closing conditions.

www.tommyhilfiger.com
13 December 2004

Tommy Hildfiger Delays Release of Profits

Tommy Hilfiger Corporation, amidst a facing US investigation, reported disappointing sales and declining operating margins. The company announced that it would delay the release of its earnings for the quarter because of the investigation, which could affect the company's tax liability.

The president and chief executive, David F. Dyer, said sales for the quarter were below expectations. Pretax profit fell 14 percent from the quarter a year ago, and the company lowered its outlook for the year ending March 31.

www.tommyhilfiger.com
4 November 2004

Hilfiger accused of fraud

Tommy Hilfiger Corporation is being accused of fraud. Law firm Abbey Gardy has commenced a class action against the Company. The firm is working on behalf of all puchasers of the corporation's shares between 3 November 1999 and 24 September 2004.

The plaintiff is accusing the Company of creative accounting practices. Reportedly Hilfiger reported inflated net income after tax, in violation of General Accepted Accounting Principles (GAAP). Furthermore, the Company is accused of reporting revenue generated in the US, thereby lowering its tax rate.

Last week the Company was subpoenaed by a grand jury to provide documents regarding buying office commissions since 1990. The market reacted in shock and Hilfiger shares dropped. Abbey Gardy is intent on recovering damages on behalf of the victims.

www.tommyhilfiger.com
5 October 2004

Tommy Hilfiger Commission Investigation

Tommy Hilfiger Inc., said on Friday that it received a federal grand jury subpoena seeking documents relating to commissions that were paid to a non-U.S. subsidiary since 1990. The investigation focuses on the question of whether the commission rate is appropriate, the clothing company said in a news release.

Other subpoenas, also issued by the U.S. Attorney's Office for the Southern District of New York, were sent to current and former employees, the company said. Tommy Hilfiger U.S.A., a wholly owned subsidiary of Hong-Kong based retailer and wholesaler Tommy Hilfiger Corp, said it pays commissions to a non-U.S. unit of its parent company to provide or secure services like product development, sourcing, production scheduling and quality control functions.

The company said it cannot predict the outcome or timing of the inquiry, but is responding to it by providing the documents requested in the subpoena.

www.tommyhilfiger.com
27 September 2004

The Real World Featuring Hilfiger

Fashion designer Tommy Hilfiger has become the latest business tycoon to cash in on the reality TV phenomenon. Hilfiger will star in a contest series based on property mogul Donald Trump's reality TV hit, The Apprentice. The CBS network has unveiled the new show, tentatively titled The Cut, which sets out to discover the country's hottest fashion trendsetter. Hilfiger will host the program.

The Cut will feature 16 style-savvy contestants vying for the chance to design a fashion collection under the Tommy Hilfiger label. Viewers are expected to see high drama unfold in a New York loft where the wannabe designers will have their business and fashion skills put to the test.

The cut-throat world of fashion will be revealed each week over 13 episodes, when a "style council" cuts one from the group until a winner is chosen. Hilfiger, who launched his first menswear collection in 1984, joins a list of US celebrities who have used their high profile to launch reality shows.

The success of The Apprentice - series two is scheduled to air to US audiences in September - has spawned a new style of reality program in America. These include America's Next Top Model, featuring supermodel Tyra Banks, while Virgin boss Richard Branson's The Billionaire: Branson's Quest For The Best, is set to air on the Fox Network in November.

www.tommyhilfiger.com
30 August 2004

Hilfiger No Stranger To Six Figure Salary

Casualwear fashion designer Tommy Hilfiger Corp. paid its honorary chairman, principal designer and namesake, Thomas J. Hilfiger, a salary of USD18.3 million for the year ended March 31, down about 11 percent from a year earlier. In the fiscal year ended March 31, 2003, the company paid Hilfiger a salary of USD20.6 million. The executive received no bonus in either period.

The company said Monday in its annual report that under an employment agreement Hilfiger signed before the company's initial public offering, it pays him an annual salary of USD900,000 plus 1.5% of net sales over USD48.3 million for Tommy Hilfiger USA and its units. The company gave former chief executive and current executive chairman Joel J. Horowitz total compensation of USD8.9 million in fiscal 2004, compared with USD8.3 million the previous year.

Horowitz got an USD8.2 million bonus and a USD676,595 salary for fiscal 2004, compared with a USD7.6 million bonus and USD662,678 salary for fiscal 2003. Horowitz receives an annual bonus equal to 5 percent of Tommy Hilfiger's operating earnings under an incentive plan approved by shareholders, according to the annual report.

The company said Horowitz will receive a USD1 million base salary in his position as executive chairman of Tommy Hilfiger Corp. and Tommy Hilfiger USA for the current fiscal year, ending March 31, 2005, under an April 1 employment agreement. Horowitz has served as executive chairman since February 2003. Shares of the company closed Monday at USD14.01, down 19 cents, or 1.3 percent, on the New York Stock Exchange.

www.tommyhilfiger.com
17 June 2004

Hilfiger Reports Profits For 4Q

Strong results from its European retailing has kept profits rolling for New York based Tommy Hilfiger in the fourth quarter. However, the New York-based fashion company said Wednesday it expects a loss in the first quarter and anticipates revenue for the rest of the year to be below projections.

Its shares sank USD1.71, or 11 percent, to USD13.79 in early trading on the New York Stock Exchange. The company earned USD26.9 million, or 29 cents per share, in the three months ended March 31. That contrasts with a loss of USD113.8 million, or USD1.26 per share, in the year-ago period.

www.tommyhilfiger.com
10 June 2004

Tommy Hilfiger Treats Beyonce

Clothing designer Tommy Hilfiger has served up an extra treat for Beyonce Knowles - her own beach house in paradise. Hilfiger handed over the keys to one of the guest beach houses on his sprawling estate on Mustique in the Caribbean as a thank you for her efforts in launching his new fragrance True Star.

The treat was a real thrill for Beyonce, whose press trip to Mustique this past weekend was her first, but she admits she didn't really get the chance to explore her new vacation home - because she was too tired.

She says, "We landed in this small plane and we got on this little cart and drove around the whole island and rolled up to this beautiful place and I had my own beach house. Then I slept for 12 hours."

www.tommyhilfiger.com
1 June 2004

Beyonce Spokesperson For Tommy Hilfiger

Tommy Hilfiger Toiletries has announced that they will team with music icon
Beyonce Knowles in a multi-year deal as the spokesperson for a new fragrance slated for a global launch in the fall.

Beyonce is a true star," said Tommy Hilfiger. "Not only is she extremely talented and
beautiful, but she is sophisticated, intelligent and charming. Her career is
serious, professional and on the rise." Terms of the deal were not disclosed.

www.tommyhilfiger.com
29 January 2004

Hilfiger storms through Europe

US fashion group Tommy Hilfiger is taking Europe by storm with quarterly sales soaring 58 per cent to GBP91m helped by the stronger euro. US sales fell, but group net* profits rose 6 per cent to GBP39m.

6 November 2003
www.tommyhilfiger.com

David Bowie To Appear in Hilfiger Ads

Rock legend David Bowie and his supermodel wife, Iman, will appear in an ad campaign for designer Tommy Hilfiger's new spring 04 collection, H Hilfiger.

According to Hilfiger: "David Bowie and Iman bring everything I'm looking for to represent this brand - music, style, elegance, creativity, sophistication - they're a living testament to all that influences and inspires me."

www.tommyhilfiger.com
29 October 2003

Tommy Hilfiger to Lounge In-House

Tommy Hilfiger announced plans to bring men's robes, sleepwear and loungewear business in-house beginning next spring.

Russell-Newman Inc. has held the license for Hilfiger's men's robes, sleepwear and loungewear since 1994. Russell-Newman also holds and will retain control of women's robes, sleepwear and loungewear, as the company has since 1998.

The new in-house business, Tommy Hilfiger Men's Underwear and Loungewear, will be operated by Michael Spillane, who in addition to this new responsibility, will continue as president of children's wear for Tommy Hilfiger.

9 July 2003
www.tommyhilfiger.com

J-Lo to Revitalise Tommy Hilfiger

Tommy Hilfiger, the troubled clothing group, is understood to be in talks to merge with The Sweetface Fashion Company, the Jennifer Lopez clothing range.

It has not been a good year for Hilfiger as the company suffered losses of around GBP 307m due in part to its flailing US wholesaling operation. A takeover by the American Jones Apparel Group fell apart earlier in the year, and analysts say Hilfiger needs a younger, fresher brand to stay competitive. Furthermore, Joel Horowitz, the company's chief executive, has said he is stepping down.

The J-Lo brand has taken a market position that was dominated by Hilfiger only three or four years ago. Sweetface has an annual turnover of 100m and could be the answers to Tommy's dreams. Sweetface is half owned by Tommy Hilfiger's brother, Alan, with the remaining shares owned by Ms Lopez. Denise Seegal, Sweet face' chief executive, could easily replace Mr Horowitz.

16 June 2003
www.tommyhilfiger.com

Tommy takes a step 'down'

Tommy Hilfiger Corporation announced on Wednesday that Joel Horowitz has been named Chairman of the Company, replacing Tommy Hilfiger, who will resume his long-time role as Honorary Chairman and Principal Designer. Mr. Horowitz will also continue in his role as Chief Executive Officer and President.

"We considered the most effective way to continue the successful long-term partnership between Joel Horowitz and myself. I came to realize the Company would be better served by each of us focusing on the work that best plays to our strengths and passions," said Tommy Hilfiger. Hilfiger is going to concentrate more on the creative aspects, such as design and marketing.

Mr. Horowitz said, "I have always said I wanted to continue a strong involvement with this Company, and I am delighted to have the opportunity to do so as Chairman. At the same time, we are actively continuing our search for my successor as Chief Executive Officer." Tommy Hilfiger Corporation designs, sources and markets men's and women's sportswear, jeanswear and childrenswear under the Tommy Hilfiger trademarks. The company also offers a broad array of related apparel, accessories, footwear, fragrance and home furnishings.

www.tommyhilfiger.com
February 6, 2003

Hilfiger goes Australia

Tommy Hilfiger has announced a new licensing agreement with Tommy Hilfiger Australia Pty Ltd. for the distribution of men's sportswear in Australia.

Through the exclusive multi-year agreement, the Tommy Hilfiger men's sportswear collection will be available at retail in leading department stores across the continent, beginning July 2003

"We are very excited to launch Tommy Hilfiger men's sportswear in Australia. This new agreement is part of our commitment towards offering the complete Tommy Hilfiger lifestyle to the Australian consumer," said Lynn Shanahan, President of Licensing at Tommy Hilfiger U.S.A., Inc.

January 16, 2003
www.tommyhilfiger.com

Hilfiger launches apparel in Korea

Tommy Hilfiger Licensing, Inc announced this week that is has signed a new retail licensing agreement with SK Global Co. for the distribution of Tommy Hilfiger products in South Korea.

Through the exclusive multi-year agreement, the Tommy Hilfiger sportswear, jeanswear and childrenswear collections will be made available in the Korean market. The men's sportswear collection will be first to debut in leading department store concessions and in freestanding stores in fall 2003, followed by the womenswear, jeanswear, and childrenswear collections.

"We are very excited to launch Tommy Hilfiger in a market as important as Korea. This new marketing and distribution agreement is part of our commitment to further develop the global market strategy for the Tommy Hilfiger brand," said Lynn Shanahan, President of Licensing at Tommy Hilfiger.

January 11, 2003
www.tommyhilfiger.com

Hilfiger launches men’s leather wear

Tommy Hilfiger has launched a new attack in an attempt to win back American and Canadian customers. This week the company announced a new licensing agreement with Winlit Group for the manufacture and distribution of men's leather outerwear. The new line will be available in leading department and specialty stores throughout the United States and Canada beginning in Fall 2003.

Through the licensing agreement, Tommy Hilfiger will provide customers with a broad range of leather offerings at prices ranging from USD 200 to USD 600. The line will include classic outerwear pieces in smooth New Zealand lambskins, textured cowhides, faux shearling and other fashion pieces in novelty types of leathers.

November 7, 2002
www.tommyhilfiger.com

Hilfiger forced to close 37 U.S. retail stores

Tommy Hilfiger announced plans to close most of its U.S. full-priced retail stores, hampered by declining sales in its menswear and children's wear. The company gave off warning that earnings for the second half of its fiscal year will be well short of expectations.

Officials said thirty-seven of the company's 44 U.S. specialty stores will be shut down, in part to concentrate on growth opportunities in Europe. About 500 people will lose their jobs. The company said it plans to keep seven specialty stores -- three in New York and four in Los Angeles -- to be used primarily as vehicles for developing exclusive merchandise lines.

In its retail division, Tommy Hilfiger saw total sales increase 10.8 percent, helped by new store openings. But sales at stores opened at least a year, considered the best indicator of a retailer's health, fell by single digit percentages.

As of the end of its second quarter, the company operated a total of 176 stores, including 112 outlet stores and 64 specialty stores worldwide.

For the first six months of the year, Tommy Hilfiger lost $377.8 million. That compares with a profit of $56.9 million in the year-ago period. Revenues were $912.8 million for the six-month period, down from $902.1 million.

November 1, 2002
www.tommyhilfiger.com

Watch out Tommy!

Classic clothing labels such as Tommy Hilfiger and Nautica are getting some edgy urban competition in American department stores - from names like Sean John, Phat Pharm, Ecko and Enyce that were once seen as too gritty for upscale stores.

Urban clothing brands, which in the past were showcased only in small clothing stores and inner-city chains, are gaining more space and attention at department store companies such as Saks Inc. and Federated Department Stores. Industry analysts say the clothes are re-energizing the stores' young men's floors, and as the labels move into women's, children's and accessories areas, they're expected to give the stores a more modern feel.

It is seen as an opportunity to reinvent the department store model. Department stores haven't been on the top of the minds for young men and teen girls for a long time. This is about to change now that the number of department stores that carry urban brands is up.

The popularity of urban brands, particularly in clothing stores, isn't new. But with sales of many of these brands reaching well over $100 million, they are appealing more to suburban youths rather than just those in the inner city.

Department stores weren't always willing to showcase urban lines, given the bad boy image of some of the rap artists behind these clothing lines, such as Sean "P. Diddy" Combs, who owns the Sean John fashion company. Now, however, after seeing such overwhelming appeal and sales volumes, the department stores can't afford not to market the clothes aggressively.

Still, many executives from companies like Phat Farm and Sean Jean say they don't want to be stereotyped as urban brands, given their multicultural appeal. And they emphasize that each of the lines feature their own design aesthetic and are going to keep it that way.

www.tommyhilfiger.com
09-24-02

Tommy Hilfiger kid's and men's wear means trouble

Tommy Hilfiger said that childrenswear and menswear remained a challenge for the company as it reported a decline in turnover and profits. In the nine months to 31 December 2001, turnover was down by 2.2 per cent to EUR 1.5bn, profit declined to $ 93.8, from $ 97.4m in the year-earlier period.

Tommy Hilfiger Corporation (NYSE:TOM) today reported its results for the third quarter ended December 31, 2001 of fiscal year 2002. For the third quarter of fiscal 2002, diluted earnings per share were $0.41 versus $0.47 for the comparable period last year. Net revenue was $474.8 million compared to $475.8 million in the third quarter of fiscal 2001. Net income was $37.0 million versus $42.7 million in the same period a year ago. There were 90.1 million average shares and share equivalents outstanding during the quarter compared to 90.7 million last year. The current year quarterly results include the operations of Tommy Europe, which the Company acquired on July 5, 2001. Earnings per share exceeded the consensus estimate of $0.38, as reported by First Call, principally due to a lower than anticipated effective tax rate for the quarter.

Chief Executive Officer Joel Horowitz commented, "We are very pleased to have achieved our financial objectives for the quarter, particularly given the impact of the economic slowdown on consumer apparel spending. The continued global appeal of the Tommy Hilfiger brand and our design and merchandising strategies - focused on traditional American 'classics with a twist' - contributed strongly to the results. Both our women's sportswear and juniors' lines continued to be among the best performers at retail this holiday season and were complemented by strong sales of our women's licensed products. In addition, our recently acquired European business performed well in all segments."

In the Company's wholesale segment, revenues in the womens component were up slightly from a year ago, while the childrens and mens components reported declines of 11.8% and 6.1%, respectively. In the aggregate, wholesale segment revenues declined 4.4% compared to the prior year. In the Company's retail segment, revenues for the quarter increased 16.5%, driven principally by sales in newly opened stores. Comparable store sales registered a mid-single digit decline for the quarter, but equaled the comparable store sales results of a year ago for the month of December. As of December 31, 2001, the Company's total store count, including 13 stores in Europe, was 160, consisting of 111 outlet stores and 49 specialty stores, compared to 93 outlet stores and 6 specialty stores a year ago. Licensing segment revenues were, as expected, down 23.0% versus the prior year quarter, due principally to the exclusion of royalties and buying agency commissions from Tommy Europe in the fiscal 2002 quarter.

For the nine months ended December 31, 2001, diluted earnings per share were $1.04 versus $1.06 for the comparable period last year. Net revenue was $1,376.9 million compared to $1,408.9 million for the same period of fiscal 2001. Net income was $93.8 million versus $97.4 million in the comparable period a year ago. There were 89.8 million average shares and share equivalents outstanding for the nine months ended December 31, 2001 compared to 92.0 million a year ago. The current year results include the operations of Tommy Europe, which the Company acquired on July 5, 2001.

Mr. Horowitz continued, "Within the current environment, we are focused on continuing to refine our product lines, balancing supply and demand, supporting our brand with focused marketing and maintaining strict inventory and cost controls. We believe it is too early to predict if and when U.S. consumers will return to previous levels of apparel spending. As a result, we are planning both our wholesale and retail businesses accordingly."

The Company said that it is currently comfortable with a fourth quarter fiscal 2002 earnings per share estimate of $0.40, which is the current First Call consensus estimate of $0.38 adjusted upward to reflect the Company's lower tax rate. Net revenue for the quarter is expected to increase in the mid single digits from the fourth quarter last year.

The Company reported cash and cash equivalents of $451.1 million and long-term debt of $661.1 million at December 31, 2001. During the third quarter, the Company issued $150 million of 9% Senior Bonds due 2031, paid down the outstanding $20 million revolving debt balance under its principal bank facility and prepaid $12.5 million of bank term debt. Earlier this month, the Company prepaid the remaining $60 million of its outstanding bank term debt.

FY 2003 Forecast
For fiscal 2003, the Company currently expects net revenue to be essentially unchanged from fiscal 2002, with a low single digit decline in first half revenues offset by second half increases. Operating income for fiscal 2003 is expected to improve over fiscal 2002 due to the adoption of a new accounting standard that suspends the amortization of goodwill and certain intangibles effective April 1, 2002. As reported in the Company's most recent 10-Q filing, adoption of the standard is expected to increase operating income for fiscal 2003 by approximately $32.0 million and increase income tax expense by approximately $6.0 million. Excluding the impact of the accounting change, the Company expects operating income for fiscal 2003 to be approximately the same as in fiscal 2002. Addressing projected earnings, Mr. Horowitz added, "The range of our projected earnings for fiscal 2003 reflects the prevailing economic uncertainty as well as the assumption of certain operating improvements compared to fiscal 2002. Taking into account these assumptions, as well as the increase in interest expense due to the issuance of the Senior Bonds due 2031 and the effects of the accounting changes referred to above, at this point we expect earnings per share for fiscal 2003 to be in the range of $1.55 to $1.75, comprising a range of $0.59 to $0.66 per share in the first half of fiscal 2003 and $0.96 to $1.09 per share in the second half. Our projections for fiscal 2003 also assume continued tight control over working capital, as well as a reduction in capital expenditures to the $75 to $80 million range from approximately $95 to $100 million in the current fiscal year."

The Company plans to provide quarterly projections for fiscal 2003 when it reports full year results for fiscal 2002. The Company did note that first quarter fiscal 2003 results are expected to be affected by the acquisition of Tommy Europe, which was completed in July. As previously reported, Tommy Europe's seasonal shipping patterns result in a low percentage of revenue being recognized in the first fiscal quarter. As a result, the Company expects consolidated earnings for that quarter to be approximately break-even. As disclosed in the Company's most recent 10-Q filing, the new accounting standard referred to above provides new criteria for performing impairment tests on goodwill and intangible assets and requires that such tests be performed within six months and three months of adoption, respectively. As of December 31, 2001, the Company's balance sheet included unamortized goodwill and other intangible assets of approximately $781.0 million and $626.9 million, respectively, and related deferred tax liabilities of $244.9 million, most of which were recorded in connection with the Company's acquisition of its jeanswear, womenswear and Canadian licensees in 1998.

The Company has not yet determined the amount of any transitional impairment loss required to be recognized upon adoption of this accounting standard. Such a loss, however, could materially decrease the Company's reported results of net income and earnings per share or result in a net loss for fiscal 2003. Any transitional impairment loss would be recorded as the cumulative effect of a change in accounting principle in the Company's fiscal 2003 income statements and would be a non-cash and non-operating charge. As previously announced, the Company will be hosting a conference call today at 8:45 a.m. Eastern Time to discuss its financial results and outlook. Those interested in listening to the conference call can access the online broadcast at www.companyboardroom.com. A replay of the call will be available online shortly after the completion of the conference call through Wednesday, February 6, 2002.

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 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.
www.tommyhilfiger.com
JANUARY 30, 2002

Hilfiger profits rise due to European business

US based fashion corporation, Tommy Hilfiger, posted better than expected second-quarter profits, mainly due to the acquisition of Tommy Hilfiger Europe in July this year. The contribution of Hilfiger's European business offset declining like-for-like sales in the US.

The net profit in the 3 months to 30 September was up to $ 47.9m (EUR 52.9m) compared to $ 44.9m in the same period last year. In the first half year, net profit amounted to $ 56.9m. Tommy Hilfiger Europe is expected to contribute $ 115m to Hilfiger's financial year. Turnover in the first half declined from $ 933.2m to $ 902.1m. Womenswear is continuing to perform strongly, while children's wear and menswear and sales declined.

At this moment the company has a total of 145 stores, of which 15 in Europe. Despite the current uncertain economic situation, the company would slightly adjust its guidance upward, Hilfiger's CEO Joel Horowitz stated.

www.tommyhilfiger.com