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Philipp van Heusen

At PVH, we plan for change. We have a proven method and process in place that is designed to capitalize on its inevitability. We encourage and initiate strategies by all our businesses, thereby enabling us to anticipate and respond to opportunities that arise from shifts in retail channels or consumer preferences.

2006 marked a year of significant change in our industry as a result of department store consolidation and store closings. The associated effects were felt across markets, across brands, and by our retail partners. Our reaction to these changes was not one of uncertainty, but rather one of anticipation. We adapted our strategy and methodologies early, in preparation for the inevitable and often tumultuous shifts in the marketplace.

We believe PVH is philosophically and structurally unique. We operate within two business models instead of one. We are organized by product-specific operating divisions for purposes of merchandising, design and sales, while organized across multiple divisions for purposes of logistics, sourcing and marketing. This dual model is, by design, both operationally efficient and brand-centric, providing a structure and platform to expand our portfolio with complementary new brands and product extensions, thus enabling us to seize upon appropriate opportunities to fill the “empty spaces” within the marketplace.

Our strategy and structure enable us to accomplish our goals efficiently and with speed. This year’s financial results are a testament to that, reflecting improvement in virtually every important metric of performance.

We design and market substantially all of our products on a brand-by-brand basis, targeting distinct consumer demographics and lifestyles. We market our brands at multiple price points and across multiple channels of distribution. This strategy enables us to provide product to a broad range of consumers, while minimizing competition among our brands and reducing our reliance on any one demographic group, merchandise preference or distribution channel.

Currently our products are distributed through more than 15,000 doors in department, mid-tier, mass-market and specialty stores in the United States. We also license our brands, where appropriate, to qualified business partners, domestically and around the world. This enhances brand awareness and strength, while increasing revenues and expanding operating margins.





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