PVH Corp. engages in the design and marketing of branded dress shirts, neckwear, sportswear, jeans wear, intimate apparel, swim products, handbags, footwear, and other related products. It operates through the following segments: Calvin Klein North America, Calvin Klein International, Tommy Hilfiger North America, Tommy Hilfiger International, Heritage Brands Wholesale, and Heritage Brands Retail. The Calvin Klein North America and Calvin Klein International segment operates in North America; and Europe, Asia, and Brazil respectively. It sells its products under the brand names CALVIN KLEIN 205 W39 NYC, CK Calvin Klein, and CALVIN KLEIN. The Tommy Hilfiger North America and Tommy Hilfiger International segment wholesales in North America; and Europe and China respectively. It consists of Tommy Hilfiger, Hilfiger Denim, Hilfiger Collection, and Tommy Hilfiger Tailored brands. The Heritage Brands Wholesale segment markets its products to department, chain, and specialty stores, digital commerce sites operated by select wholesale partners and pure play digital commerce retailers in North America. The Heritage Brands Retail segment manages retail stores, primarily located in outlet centers throughout the United States and Canada. PVH was founded in 1881 and is headquartered in New York, NY.
A substantial portion of our revenue and gross profit is derived from a small number of large wholesale customers and the loss of any of these customers or significant financial difficulties in their businesses could substantially reduce our revenue.
We may not be able to continue to develop and grow our Tommy Hilfiger and Calvin Klein businesses.
Our retail stores are heavily dependent on the ability and desire of consumers to travel and shop.
Acquisitions may not be successful in achieving intended benefits, cost savings and synergies.
Future economic conditions, including volatility in the financial and credit markets may adversely affect our business.
Our business is exposed to foreign currency exchange rate fluctuations and control regulations.
Our level of debt could impair our financial condition and ability to operate.
We primarily use foreign suppliers for our products and raw materials, which poses risks to our business operations.
If our manufacturers, the manufacturers used by our licensees, or our licensees themselves fail to use legal and ethical business practices, our business could suffer.
We are dependent on third parties to source and manufacture our products and any disruption in our relationships with these parties or in their businesses may materially adversely affect our businesses.
We are dependent on a limited number of distribution facilities. If one becomes inoperable, our business, financial condition and operating results could be negatively impacted.
A portion of our revenue is dependent on royalties and licensing.
Our licensing business makes us susceptible to the actions of third parties over whom we have limited control.
We may be unable to protect our trademarks and other intellectual property rights.
We face intense competition in the apparel industry.
Our profitability may decline as a result of increasing pressure on margins.
If we are unable to manage our inventory effectively and accurately forecast demand for our products, our results of operations could be materially adversely affected.
The loss of members of our executive management and other key employees could have a material adverse effect on our business.
A significant shift in the relative sources of our earnings, adverse decisions of tax authorities or changes in tax treaties, laws, rules or interpretations could have a material adverse effect on our results of operations and cash flow.
If we are unable to fully utilize our deferred tax assets, our profitability could be reduced.
Volatility in securities markets, interest rates and other economic factors could increase substantially our defined benefit pension costs and liabilities.
Our balance sheet includes a significant amount of intangible assets and goodwill. A decline in the estimated fair value of an intangible asset or of a reporting unit could result in an impairment charge recorded in our operating results, which could be material.
Provisions in our certificate of incorporation and our by-laws and Delaware General Corporation Law could make it more difficult to acquire us and may reduce the market price of our common stock.
We generate net sales from (i) the wholesale distribution to retailers, franchisees, licensees and distributors of dress shirts, neckwear, sportswear, jeanswear, performance apparel, intimate apparel, underwear, swim products, handbags, accessories, footwear and other related products under owned and licensed trademarks, including through digital commerce sites operated by our wholesale partners and pure play digital commerce retailers, and (ii) the sale of certain of these products through (a) approximately 1,700 Company-operated free-standing retail store locations worldwide under our TOMMY HILFIGER, CALVIN KLEIN and certain of our heritage brands trademarks, (b) approximately 1,500 Company-operated shop-in-shop/concession locations worldwide under our TOMMY HILFIGER and CALVIN KLEIN trademarks, and (c) digital commerce sites in over 30 countries under each of our TOMMY HILFIGER and CALVIN KLEIN trademarks and in the United States through our SpeedoUSA.com, TrueAndCo.com, VanHeusen.com, IZOD.com and styleBureau.com digital commerce sites. Additionally, we generate royalty, advertising and other revenue from fees for licensing the use of our trademarks. We manage our operations through our operating divisions, which are presented as six reportable segments: (i) Tommy Hilfiger North America; (ii) Tommy Hilfiger International; (iii) Calvin Klein North America; (iv) Calvin Klein International; (v) Heritage Brands Wholesale; and (vi) Heritage Brands Retail.