NEW YORK — Phillips-Van Heusen Corp. is on the lookout for its next deal, having integrated Calvin Klein International and tightened up its other operations.
PVH is positioned to take advantage of “any acquisition that might come along,” chairman and chief executive officer Bruce Klatsky said at the firm’s annual meeting, held at the Elebash Recital Hall at 365 Fifth Avenue here Tuesday.
However, no deal is currently in the works, he said.
“We always look for who’s available,” president and chief operating officer Mark Weber said after the meeting. “This industry will continue to consolidate and we’ll be one of the consolidating players.”
Given the firm’s operating platform, PVH is willing to overlook some back-end flaws in an acquisition target but a solid brand is a must, said Weber.
“We have started and fixed brands, Bruce and I, for the last 30 years,” said Weber, noting it was instead time to acquire more established names.
In addition to taking over CKI, acquired in February 2003, PVH earlier this year discontinued its wholesale footwear business and is in the process of closing 200 outlet stores. The firm also refinanced its long-term debt in February, issuing $150 million worth of senior unsecured notes due in 2011, and used the proceeds to pay off 9.5 percent of senior subordinated notes due in 2008.
Weighed down by costs to integrate CKI, PVH in 2003 had losses of $5.3 million, or 18 cents a diluted share, as reported. This compared with earnings of $30.4 million, or $1.08, in 2002. Sales for 2003 increased 12.6 percent to $1.58 billion.
Much of the meeting focused on the Calvin Klein business, which now includes women’s better sportswear, produced under license to Kellwood Co. and designed by G.A.V., a forthcoming men’s better line and a ck Calvin Klein bridge apparel line licensed to G.A.V.
“The mantra in our company is, ‘How did Calvin Klein become Calvin Klein?’ This is what we focused on this year,” said Weber in his presentation to shareholders. “A tremendous amount of effort, time and money was spent marketing this brand.”The brand is bolstered by an annual marketing budget of more than $200 million.
“It has always been about sex,” Weber said. “Calvin Klein, as the world knows, owns sex and it’s always been a very, very out-front creative advertising company.”
Advertising for the brand continues to exude sexuality and celebrity, with the likes of actresses Scarlett Johansson and Hilary Swank, as well as U.K. soccer star Freddie Ljungberg. However, some of the brand’s marketing is moving off the glossy page and onto the big screen. A Calvin Klein Jeans commercial will be shown in movie theaters throughout the world in July and August. The initiative will take open-to-buy dollars away from magazines, said Weber.
The commercial puts those dollars “into movie theaters where young people are, where we know the audience is captive,” said Weber. “People want their popcorn and they want their sodas, and they don’t want to miss the coming attractions.”
Previewed at the meeting, the commercial features a gaggle of girls in Calvin Klein Jeans and white T-shirts dancing suggestively in the rain.
Calvin Klein, though, hasn’t stolen the show entirely at PVH. The firm is also mixing up the ad campaign for its Izod brand with a move into TV. In November, a moderately priced women’s apparel line under the Izod name was launched. Weber said that line, which is also produced under license by Kellwood, would post sales of $50 million in 2004.
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Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia