Pvh Corp. · NYSE:PVH
Pvh — Investor Presentation (June 2014)
39 slides from Pvh's investor presentation, June 2014
Slide 1: We Are PVH
WE ARE PVH, One of the World’s Largest Branded Lifestyle and Apparel Companies June 2014 1
Slide 2: Safe Harbor
Safe Harbor We (PVH Corp.) obtained or created the market and competitive position data used throughout this presentation from research, surveys or studies conducted by third parties (including, with respect to the U.S. department and chain store rankings, the NPD Group/POS Tracking Service), inform
Slide 3: A World Class Portfolio Of Brands
A World Class Portfolio Of Brands GLOBAL GROWTH BRANDS Owned* (1) Licensed* CHAPS DKNY Donald J. Trump Signature John Varvatos Elie Tahari Kenneth Cole Reaction Geoffrey Beene Kenneth Cole New York Ike Behar MICHAEL Michael Kors Nautica Sean John * Partial list (1) The Speedo brand is licensed for N
Slide 4: PVH Is A Global Leader In The Apparel Industry
PVH Is A Global Leader In The Apparel Industry With over $8.2 BN in revenues, PVH is one of the largest global apparel companies in the world $11.4 $8.2 $7.5 $5.1 $3.7 $3.4 $3.3 $3.3 $2.6 VFC PVH RL COH BRBY BOSS KORS FOSL GES Source: Factset. 4
Slide 5: Our 2013 Warnaco Acquisition Expands Our Focus on Calvin Klein and Tommy Hilfiger
Our 2013 Warnaco Acquisition Expands Our Focus on Calvin Klein and Tommy Hilfiger… Calvin Klein & Tommy Hilfiger currently account for ~75% of PVH’s revenues and ~85% of PVH’s EBIT (1) Total Revenue by Business EBIT by Business Segment (2013) Segment (2013) 14% 42% 24% 45% 34% 41% TOMMY HILFIGER CAL
Slide 6: Significant Presence in Asia and Latin America
… and Provides PVH With A Significant Presence in Asia and Latin America Asia and Latin America now account for ~12% of PVH’s revenues and over 20% of PVH’s EBIT (1) Total Revenue by Region EBIT by Region (2013) (2013) 2% 9% 5% 61% 15% 28% 56% 24% NORTH AMERICA EUROPE Note: ASIA North America includ
Slide 7: PVH Has a Long History of Delivering Double-Digit Sales and Earnings Growth
PVH Has a Long History of Delivering Double-Digit Sales and Earnings Growth $9,000 $8.00 $7.03 $8,000 Revenue & EPS Growth (2003 – 2013) $7.00 R $6.58 CAG $8,216 ev enue $5.44 8% R $7,000 $6.00 1 R CAG EPS $6,000 22% $4.31 $5.00 $ Millions $5,000 $4.00 $3.21 $2.99 $2.79 $4,000 $2.62 $3.00 $1.88 $5,8
Slide 8: WOM MM Y0 mT RLF IG EIR
WOM MM Y0 mT RLF IG EIR
Slide 9: Tommy Hilfiger — Brand Overview
Tommy Hilfiger — Brand Overview 2013 Global Retail Sales: $6.4 BN 7% 6% 12% 10% North America (1) Latin America 39% 41% (2) Asia 42% 43% Europe (3) Classic American Cool/Preppy With A Twist Strong Global Brand Awareness Proven Accessible Designer Lifestyle Brand (1) Latin America includes South Amer
Slide 10: Tommy Hilfiger — Extensive & Growing Global Distribution
Tommy Hilfiger — Extensive & Growing Global Distribution (1) Over 1,450 Stores and over 10,000 Doors Globally in over 90 countries as of February 2, 2014 (1) ~625 Company Operated Stores Europe (3) Total Stores: ~590 North America (2) Japan (1) (4) Total Stores: ~230 Total Stores: ~155 Asia (excl. J
Slide 11: Tommy Hilfiger — Global Marketing & Communications
Tommy Hilfiger — Global Marketing & Communications Continue To Drive Brand Forward • Over $185 million in global annual marketing spend • The Hilfigers campaign celebrates our Classic American Cool heritage & “Prep” point of view with a modern twist • Impactful Global Marketing Strategies o Most ela
Slide 12: Tommy Hilfiger — Business Overview & Financials
Tommy Hilfiger — Business Overview & Financials Tommy Hilfiger Business Summary • 1Q14 LTM Reported Revenues: $3.5 BN – LTM International Revenues: ~$1.9 BN – LTM North America Revenues: ~$1.6 BN • 1Q14 LTM EBIT Margin(1): 13.7% (1) Figure excludes non-recurring and one-time items. Refer to Appendix
Slide 13: Tommy Hilfiger Europe — Overview
Tommy Hilfiger Europe — Overview Europe accounts for ~50% of Tommy Hilfiger global reported revenues (1) 2013 Revenues by (2) Since 2000, revenues have grown at a 23% CAGR Distribu<on Model Premium brand positioning Solid Europe wholesale sales trends, despite difficult macro environment 37% • 1H14
Slide 14: Tommy Hilfiger Europe — European Growth Opportunity
Tommy Hilfiger Europe — European Growth Opportunity Significant opportunities remain across Europe Nurture Expand Conquer Further Penetra<on in Accelerate Growth Improve Produc<vity in Objec<ve: Northern & Central in Newer Exis<ng Markets European Markets Underpenetrated Markets Belgium Germany Russ
Slide 15: Tommy Hilfiger North America — Overview
Tommy Hilfiger North America — Overview • North America accounts for ~45% of Tommy Hilfiger global reported revenues • Strong retail presence of ~230 stores, which are primarily company stores: ― 1Q14 Comps: +1% (1) (1) ― 2013 Comps: +4% ; 2012 Comps: +10% • Wholesale: Strong 2013 performance on top
Slide 16: Tommy Hilfiger Latin America — Overview
Tommy Hilfiger Latin America — Overview • 2013 Retail Sales of >$360 MM Caribbean • Entire region licensed and exhibiting positive momentum, despite regional challenges Central America • Approximately 180 franchise stores • Brazil remains largest underpenetrated opportunity • January 2013 joint vent
Slide 17: Tommy Hilfiger Asia — Overview
Tommy Hilfiger Asia — Overview Geographic expansion continues in Asia: South Korea Most regions experiencing double-digit growth • 2013 Global Retail Sales ~$670 MM • Japan Japan – Retail Sales: ~$175 MM – Retail only model: ~155 stores China & HK • China India – Retail Sales: ~$135 MM – Joint ventu
Slide 18: Tommy Hilfiger — Significant Growth Opportunities Remain
Tommy Hilfiger — Significant Growth Opportunities Remain Across The Business Globally We see ~$2.5 billion in global growth prospects for Tommy Hilfiger in the next four years driven by: • Broadening distribution globally and growing global market share, particularly in emerging markets • Continuall
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Slide 20: Calvin Klein — Brand Overview
Calvin Klein — Brand Overview - Calvin Klein Collection offers halo and inspiration to Calvin Klein platinum label (bridge apparel), Calvin Klein white label (better apparel), Calvin Klein Jeans and Calvin Klein Underwear - Brand leveraged across multiple products, channels & price points - Signific
Slide 21: Calvin Klein — Strong Global Presence With Significant Growth Opportunities
Calvin Klein — Strong Global Presence With Significant Growth Opportunities Nearly 3,000 retail locations and over 20,000 wholesale doors globally as of February 2, 2014 Approximately 1,700 Company Operated Stores North America (1) Europe (2) Total Stores: ~160 Total Stores: ~850 Latin America (3) A
Slide 22: The Power of the Brand — Calvin Klein Recognized in Time Magazine and WWD
The Power of the Brand — Calvin Klein Recognized in Time Magazine and WWD Over $300mm of annual spend on marketing and public relations to drive commercial success for the brand Time Magazine named Calvin Klein one of the “Top 100 Icons in Fashion, Style and Design” - The designer was cited as one o
Slide 23: Calvin Klein — Business Overview And Financials
Calvin Klein — Business Overview And Financials Summary Financials Despite the fact that we brought back in house our two largest apparel categories in 2013, 1Q14 LTM Reported Revenues $2.8 BN over 50% of the brand continues to be licensed 1Q14 LTM EBIT Margin(1) 14.4% Past Today Licensee Licensee 8
Slide 24: Calvin Klein — North America Overview
Calvin Klein — North America Overview Calvin Klein North America revenues accounted for ~50% of Calvin Klein global reported revenues in 2013 Strong wholesale and retail businesses, though Calvin Klein Jeans is in transition Wholesale: • Sportswear posted robust performance with sales up high single
Slide 25: Calvin Klein — Asia Overview
Calvin Klein — Asia Overview • Asia accounted for ~20% of Calvin Klein global reported revenues in 2013 • Primarily retail-oriented model (concession shops and free-standing stores) • High-teens operating margins for the region − China: ~40% of Asia revenues; Experiencing solid sales growth − Korea:
Slide 26: Calvin Klein — Latin America Overview
Calvin Klein — Latin America Overview • Latin America accounted for ~6%* of Calvin Klein global reported revenues in 2013, primarily driven by Brazil • Revenues grew high single-digits in 2013 • 2013 operating margins in the high-teens • Primarily wholesale model with select retail stores as a compl
Slide 27: Calvin Klein — Europe Overview
Calvin Klein — Europe Overview • Europe accounted for ~20% of Calvin Klein global reported revenues in 2013 • Categories: Jeanswear and related products, underwear, accessories, bridge apparel • Business model: 50% retail / 50% wholesale • Operating margins are underperforming • Key Initiatives To T
Slide 28: Calvin Klein — Global Licensing
Calvin Klein — Global Licensing • Licensed products currently represent ~55% of global retail sales • 1Q14 LTM Global licensing revenues were ~$270 MM Update On Our Top Licensees • 2013 retail sales: ~$1.4 BN • Third largest designer global fragrance brand • Long history of successful launches • New
Slide 29: Calvin Klein — Significant Growth Opportunities
Calvin Klein — Significant Growth Opportunities • Get greater control of the brand by moving from a licensor to owner and operator • Enhance and elevate product through: – Expanding footprint of our lifestyle categories across all markets – Building integrated omni-channel presence with e-commerce,
Slide 30: Heritage Brands
IZOD +* VAN HEUSEN + ARROW «+ SPEEDO HERITAGE BRANDS WARNER’S + OLGA * DRESS FURNISHINGS PVH
Slide 31: Heritage Brands — Overview & Financials
Heritage Brands — Overview & Financials Summary Financials 1Q14 LTM Reported Revenues(1) $1.8 BN 1Q14 LTM EBIT Margin(1)( 2) 8.1% Heritage Brands Wholesale Retail 1Q14 LTM Revenues(1) as % of Total ~80% ~20% Wholesale sportswear has generally been strong, reflecting initiatives to better position th
Slide 32: Our Heritage Brands Categories Have Strong Market Share Positions
Our Heritage Brands Categories Have Strong Market Share Positions Category Unit Share Neckwear > 50% (1) Dress Shirts 43% (1) Woven Shirts 16% (1) Knit Shirts 11% (1) Casual Pants 5% (1) Bras & Panties 9% (1) Men’s Swim 7% (1) Based on percentage of 2013 unit volume in US Department and Chain Stores
Slide 33: Financial Outlook
Financial Outlook 33
Slide 34: We Have a Long History of Delivering Robust Sales and Earnings Growth
We Have a Long History of Delivering Robust Sales and Earnings Growth $9,000 Investments made in 2013-2014 to drive future growth $7.30-$7.40 $8.00 $7.03 • Stabilize and integrate acquired businesses $8,000 ~$8,500 $7.00 • Invest and reset earnings (1) $6.58 $8,216 eC AGR $5.44 $7,000 Re venu $6.00
Slide 35: Review Of 2Q14 And FY14 Guidance
Review Of 2Q14 And FY14 Guidance 2Q14 vs. 2Q13 FY14 vs. FY13 2Q14 % Growth FY14 % Growth (2) (3) Revenue ~$2.0 BN ~1% ~$8.5 BN ~3% EPS (1) $1.40-$1.45 1% - 4% $7.30-$7.40 4% - 5% (1) Figures exclude non-recurring and one-time items. Refer to Form 8-K dated 6/4/14 for GAAP reconciliations. (2) Includ
Slide 36: Calvin Klein and Tommy Hilfiger Continue To Fuel PVH's Future
Calvin Klein and Tommy Hilfiger Continue To Fuel PVH’s Future Multiple growth opportunities driving retail sales of ~$24 BN (2) Tommy Hilfiger Calvin Klein Heritage Brands th: >$10.5 BN G ro(w 1) ned 0% ~$9.0 BN Plan8% – 1 $7.8 BN th : $6.4 BN ed Gro(w 1) n $5.8 BN Plan – 4% 2% ~$4.3 BN $4.4 BN $3.7
Slide 37: Appendix
Calvin Klein TOMMY SHILFIGER HERITAGE BRANDS
Slide 38: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations GAAP to Non-‐GAAP Reconciliations Net Income Per Common Share (Dollars and Shares i n Millions, Except Per Share Data) 2010 2009 2008 (1) (2) GAAP Adjustments Non-‐GAAP GAAP Adjustments Non-‐GAAP GAAP Adjustments(3) Non-‐GAAP Net Income per Common Share Calculati
Slide 39: 1Q14 LTM Reconciliations
1Q14 LTM Reconciliations Q1 2014 LTM Reconciliations (Dollars in Millions) Q1 2014 LTM Revenue Reconciliation Full Year Three Months LTM 2013 2013 2014 Q1 2014 Total Calvin Klein $ 2,796.6 $ 637.9 $ 665.3 $ 2,824.0 Tommy Hilfiger North America $ 1,542.2 $ 346.6 $ 362.4 $ 1,558.0 Tommy Hilfiger Inter