SECURITIES & EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) X QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 28, 1996 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-724 PHILLIPS-VAN HEUSEN CORPORATION (Exact name of registrant as specified in its charter) Delaware 13-1166910 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 1290 Avenue of the Americas New York, New York 10104 (Address of principal executive offices) (Zip Code) Registrant's telephone number (212) 541-5200 Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that registrant was required to file such reports), and (2) has been subject to such filing requirement for the past 90 days. Yes X No The number of outstanding shares of common stock, par value $1.00 per share, of Phillips-Van Heusen Corporation as of May 30, 1996: 26,992,486 shares.
PHILLIPS-VAN HEUSEN CORPORATION INDEX PART I -- FINANCIAL INFORMATION Independent Accountants' Review Report................................ 1 Condensed Consolidated Balance Sheets as of April 28, 1996 and January 28, 1996...................................................... 2 Condensed Consolidated Statements of Income for the thirteen weeks ended April 28, 1996 and April 30, 1995............................... 3 Condensed Consolidated Statements of Cash Flows for the thirteen weeks ended April 28, 1996 and April 30, 1995......................... 4 Notes to Condensed Consolidated Financial Statements.................. 5-6 Management's Discussion and Analysis of Results of Operations and Financial Condition............................................... 7-9 PART II -- OTHER INFORMATION ITEM 6 - Exhibits and Reports on Form 8-K............................. 10-13 Signatures............................................................ 14 Exhibit--Acknowledgment of Independent Accountants.................... 15 Exhibit--Financial Data Schedule...................................... 16
Independent Accountants' Review Report Stockholders and Board of Directors Phillips-Van Heusen Corporation We have reviewed the accompanying condensed consolidated balance sheet of Phillips-Van Heusen Corporation as of April 28, 1996, and the related condensed consolidated statements of income and cash flows for the thirteen week periods ended April 28, 1996 and April 30, 1995. These financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our reviews, we are not aware of any material modifications that should be made to the accompanying condensed consolidated financial statements referred to above for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Phillips-Van Heusen Corporation as of January 28, 1996, and the related consolidated statements of income, stockholders' equity, and cash flows for the year then ended (not presented herein) and in our report dated March 12, 1996, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of January 28, 1996, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. ERNST & YOUNG LLP New York, New York May 14, 1996 -1-
Phillips-Van Heusen Corporation Condensed Consolidated Balance Sheets (In thousands, except share data) <TABLE> <CAPTION> UNAUDITED AUDITED April 28, January 28, 1996 1996 <S> <C> <C> ASSETS Current Assets: Cash, including cash equivalents of $22,352 and $8,474 $ 25,374 $ 17,533 Trade receivables, less allowances of $5,461 and $5,514 92,631 109,866 Income tax refund receivable 16,987 16,987 Inventories 300,512 276,773 Other, including deferred taxes of $9,801 22,846 23,505 Total Current Assets 458,350 444,664 Property, Plant and Equipment, Net 139,949 143,398 Goodwill 119,090 119,914 Other Assets, including deferred taxes of $22,113 38,712 41,079 $756,101 $749,055 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Notes payable $ 99,000 $ 61,590 Accounts payable 29,721 38,796 Accrued expenses 65,975 72,603 Current portion of long-term debt 10,137 10,137 Total Current Liabilities 204,833 183,126 Long-Term Debt, less current portion 229,550 229,548 Other Liabilities 54,950 61,089 Stockholders' Equity: Preferred Stock, par value $100 per share; 150,000 shares authorized, no shares outstanding Common Stock, par value $1 per share; 100,000,000 shares authorized; shares issued 26,987,636 and 26,979,352 26,988 26,979 Additional Capital 116,024 115,977 Retained Earnings 123,756 132,336 Total Stockholders' Equity 266,768 275,292 $756,101 $749,055 </TABLE> See accompanying notes. -2-
Phillips-Van Heusen Corporation Condensed Consolidated Statements of Income Unaudited (In thousands, except per share data) <TABLE> <CAPTION> Thirteen Weeks Ended April 28, April 30, 1996 1995 <S> <C> <C> Net sales $273,660 $282,987 Cost of goods sold 180,563 185,584 Gross profit 93,097 97,404 Selling, general and administrative expenses 96,358 97,756 Loss before interest and taxes (3,261) (352) Interest expense, net 6,153 4,783 Loss before taxes (9,414) (5,135) Income tax benefit 2,860 1,775 Net loss $ (6,554) $ (3,360) Net loss per share $ (0.24) $ (0.13) Cash dividends per share $ 0.0375 $ 0.0375 See accompanying notes. </TABLE> -3-
Phillips-Van Heusen Corporation Condensed Consolidated Statements of Cash Flows Unaudited (In thousands) <TABLE> <CAPTION> Thirteen Weeks Ended April 28, April 30, 1996 1995 <S> <C> <C> OPERATING ACTIVITIES: Net Loss $ (6,554) $ (3,360) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization 7,802 8,188 Amortization of contributions from landlords (1,617) (1,931) Deferred income taxes - (910) Changes in operating assets and liabilities: Receivables 19,437 10,201 Inventories (23,739) (45,253) Accounts payable and accrued expenses (15,545) (15,234) Other-net (1,855) (7,319) Net Cash Used By Operating Activities (22,071) (55,618) INVESTING ACTIVITIES: Acquisition of the Apparel Group of Crystal Brands, Inc. - (114,503) Property, plant and equipment acquired (3,805) (10,137) Contributions from landlords - 2,049 Other-net (1,724) 1,244 Net Cash Used By Investing Activities (5,529) (121,347) FINANCING ACTIVITIES: Proceeds from revolving line of credit and long-term borrowings 47,577 109,856 Payments on revolving line of credit and long-term borrowings (10,165) - Exercise of stock options 56 374 Cash dividends (2,027) (2,000) Net Cash Provided By Financing Activities 35,441 108,230 Increase (Decrease) In Cash 7,841 (68,735) Cash at beginning of period 17,533 80,473 Cash at end of period $ 25,374 $ 11,738 See accompanying notes. </TABLE> -4-
PHILLIPS-VAN HEUSEN CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) GENERAL The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, they do not contain all disclosures required by generally accepted accounting principles for complete financial statements. Reference should be made to the annual financial statements, including the footnotes thereto, included in the Company's Annual Report to Stockholders for the year ended January 28, 1996. The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from the estimates. The results of operations for the thirteen weeks ended April 28, 1996 and April 30, 1995 are not necessarily indicative of those for a full fiscal year because of seasonal factors. The data contained in these financial statements are unaudited and are subject to year-end adjustments; however, in the opinion of management, all known adjustments (which consist only of normal recurring accruals) have been made to present fairly the consolidated operating results for the unaudited periods. Certain reclassifications have been made to the condensed consolidated financial statements for the quarter ended April 30, 1995 to present them on a basis consistent with the quarter ended April 28, 1996. INVENTORIES Inventories are summarized as follows: April 28, January 28, 1996 1996 Raw materials $ 18,268 $ 14,194 Work in process 14,141 13,145 Finished goods 268,103 249,434 Total $300,512 $276,773 Inventories are stated at the lower of cost or market. Cost for the apparel business is determined principally using the last-in, first-out method (LIFO), except for certain sportswear inventories which are determined using the first-in, first-out method (FIFO). Cost for the footwear business is determined using FIFO. Inventories would have been $13,234 and $12,923 higher than reported at April 28, 1996 and January 28, 1996, respectively, if the FIFO method of inventory accounting had been used for the entire apparel business. -5-
The determination of cost of sales and inventories under the LIFO method can only be made at the end of each fiscal year based on inventory cost and quantities on hand. Interim LIFO determinations are based on management's estimates of expected year-end inventory levels and costs. Such estimates are subject to revision at the end of each quarter. Since estimates of future inventory levels and costs are subject to external factors, interim financial results are subject to year-end LIFO inventory adjustments. SEGMENT DATA The Company operates in two industry segments: (i) apparel - the manufacture, procurement for sale and marketing of a broad range of men's, women's and children's apparel to wholesale customers as well as through Company-owned retail stores, and (ii) footwear - the manufacture, procurement for sale and marketing of a broad range of men's, women's and children's shoes to wholesale customers as well as through Company-owned retail stores. Operating income represents net sales less operating expenses. Excluded from operating results of the segments are interest expense, net, corporate expenses and income taxes. Thirteen Weeks Ended April 28, April 30, 1996 1995 Net sales-apparel $200,198 $204,991 Net sales-footwear 73,462 77,996 Total net sales $273,660 $282,987 Operating loss-apparel $ (1,881) $ (1,333) Operating income-footwear 1,790 3,357 Total operating income (loss) (91) 2,024 Corporate expenses 3,170 2,376 Interest expense, net 6,153 4,783 Loss before taxes $ (9,414) $ (5,135) ACQUISITION On February 17, 1995, the Company completed the acquisition of the Apparel Group of Crystal Brands, Inc. (Gant and Izod) for $114,503 in cash, net of cash acquired, and subject to certain adjustments. This acquisition was accounted for as a purchase. The acquired operations are included in the Company's consolidated financial statements since February 17, 1995. OTHER The Company is a party to certain litigation which, in management's judgement based in part on the opinion of legal counsel, will not have a material adverse effect on the Company's financial position. -6-
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION RESULTS OF OPERATIONS Thirteen Weeks Ended April 28, 1996 Compared to Thirteen Weeks Ended April 30, 1995 APPAREL Net sales of the Company's apparel segment in the first quarter were $200.2 million in 1996 and $205.0 million last year, a decrease of approximately 2.3%. The sales decline results primarily from the Company's strategic initiatives to close underperforming outlet stores and reduce the amount of lower margin private label business, offset, in part, by higher sales of Gant and Izod products, which brands were acquired on February 17, 1995. Gross profit on apparel sales was 33.4% in the first quarter of 1996 compared with 32.6% in the prior year. The margins from the Van Heusen brand were better at each distribution channel. Also contributing to the improvement was a decreased LIFO charge of $0.3 million in the first quarter compared with $0.9 million in last year's quarter. Selling, general and administrative expenses as a percent of apparel sales in the first quarter increased from 33.2% last year to 34.3% this year. FOOTWEAR Net sales of the Company's footwear segment in the first quarter were $73.5 million in 1996 and $78.0 million last year, a decrease of approximately 5.8%. The sales decline represents the continuing weakness in the casual footwear market. Gross profit on footwear sales was 35.8% in the current quarter compared with 39.2% in the prior year's quarter. The continuing weak casual footwear market contributed to lower wholesale margins. Selling, general and administrative expenses as a percent of footwear sales were 33.3% in the current quarter compared with 34.9% in the prior year's quarter. The decreased expense level is related principally to closing 100 of the weakest performing footwear stores. INTEREST EXPENSE Net interest expense was $6.2 million in the first quarter of 1996 compared with $4.8 million last year. This increase is directly related to the timing of the Gant and Izod acquisition and the funding of the cash portion of the Company's $27.0 million restructuring initiatives in the prior year. INCOME TAXES Income taxes were estimated at a rate of 30.4% for the current year compared with last year's first quarter rate of 34.6%. The decrease in the 1996 rate is due principally to a lower proportion of U.S. income taxed at normal rates versus tax exempt income from operations in Puerto Rico, as compared to last year. -7-
CORPORATE EXPENSES Corporate expenses were $3.2 million in the first quarter of 1996 compared with $2.4 million last year. The increase is due solely to timing as expenses are expected to be substantially flat for the year. SEASONALITY The Company's business is seasonal, with higher sales and income during its third and fourth quarters, which coincide with the Company's two peak retail selling seasons: the first running from the start of the back to school and Fall selling seasons beginning in August and continuing through September; the second being the Christmas selling season beginning with the weekend following Thanksgiving and continuing through the week after Christmas. Also contributing to the strength of the third quarter is the high volume of fall shipments to wholesale customers which are more profitable than spring shipments. The slower spring selling season at wholesale combined with retail seasonality makes the first quarter particularly weak. LIQUIDITY AND CAPITAL RESOURCES The seasonal nature of the Company's business typically requires the use of cash to fund a build up in the Company's inventory in the first half of each fiscal year. During the third and fourth quarters, the Company's higher level of sales tends to reduce its inventory and generate cash from operations. Cash used by operations in the first quarter totalled $22.1 million in 1996 and $55.6 million last year. The decrease is principally related to the reduction in working capital requirements due to the downsizing of the Company's retail business. Capital spending was $3.8 million in the first quarter of 1996 as compared with $10.1 million last year. This decrease is in line with the Company's planned capital spending reduction. The Company has a credit agreement which includes a revolving credit facility under which the Company may, at its option, borrow and repay amounts within certain limits. The credit agreement also includes a letter of credit facility. The total amount available to the Company under each of the revolving credit and the letter of credit facility is $250 million provided, however, that the aggregate maximum amount outstanding at any time under both facilities is $400 million. The Company believes that its borrowing capacity under this facility is adequate for its 1996 peak seasonal needs. At the end of the current year's first quarter, the Company estimated that $70 million of the outstanding borrowings under this facility are non-current compared with $25 million at the end of last year's first quarter. This has increased the Company's long-term debt (net of invested cash) as a percentage of total capital to 43.7% at the end of the current quarter compared with 40.6% at the end of last year's first quarter. -8-
* * * ****************************************************************************** * * * Safe Harbor Statement Under the Private Securities Litigation Reform Act * * of 1995: Except for the historical information contained herein, the * * matters discussed in this Form 10-Q report may be deemed to consist of * * forward-looking statements that may involve risks to and uncertainties in * * the Company's business. Such risks and uncertainties primarily relate to * * the levels of sales of the Company's apparel and footwear products, both * * to its wholesale customers and in its retail stores, to the extent of * * discounts and promotional pricing in which the Company is required to * * engage, and to other risks and uncertainties which may be detailed from * * time to time in the Company's reports filed with the Securities and * * Exchange Commission. * * * ****************************************************************************** -9-
Part II - OTHER INFORMATION ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K (a) The following exhibits are included herein: 4.1 Specimen of Common Stock certificate (incorporated by reference to Exhibit 4 to the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 1981). 4.2 Preferred Stock Purchase Rights Agreement (the "Rights Agreement"), dated June 10, 1986 between PVH and The Chase Manhattan Bank, N.A. (incorporated by reference to Exhibit 3 to the Company's Quarterly Report as filed on Form 10-Q for the period ended May 4, 1986). 4.3 Amendment to the Rights Agreement, dated March 31, 1987 between PVH and The Chase Manhattan Bank, N.A. (incorporated by reference to Exhibit 4(c) to the Company's Annual Report on Form 10-K for the year ended February 2, 1987). 4.4 Supplemental Rights Agreement and Second Amendment to the Rights Agreement, dated as of July 30, 1987, between PVH and The Chase Manhattan Bank, N.A. (incorporated by reference to Exhibit (c)(4) to the Company's Schedule 13E-4, Issuer Tender Offer Statement, dated July 31, 1987). 4.5 Credit Agreement, dated as of December 16, 1993, among PVH, Bankers Trust Company, The Chase Manhattan Bank, N.A., Citibank, N.A., The Bank of New York, Chemical Bank and Philadelphia National Bank, and Bankers Trust Company, as agent (incorporated by reference to Exhibit 4.5 to the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 1994). 4.6 First Amendment, dated as of February 13, 1995, to the Credit Agreement dated as of December 16, 1993 (incorporated by reference to Exhibit 4.6 to the Company's Annual Report on Form 10-K for the fiscal year ended January 29, 1995). 4.7 Second Amendment, dated as of July 17, 1995, to the Credit Agreement dated as of December 16, 1993 (incorporated by reference to Exhibit 4.7 to the Company's report on Form 10-Q for the period ending October 29, 1995). 4.8 Third Amendment, dated as of September 27, 1995, to the Credit Agreement dated as of December 16, 1993 (incorporated by reference to Exhibit 4.8 to the Company's report on Form 10-Q for the period ending October 29, 1995). 4.9 Fourth Amendment, dated as of September 28, 1995, to the Credit Agreement dated as of December 16, 1993 (incorporated by reference to Exhibit 4.9 to the Company's report on Form 10-Q for the period ending October 29, 1995). -10-
4.10 Fifth Amendment, dated as of April 1, 1996, to the Credit Agreement dated as of December 16, 1993 (incorporated by reference to Exhibit 4.10 to the Company's Annual Report on Form 10-K for the fiscal year ended January 28, 1996). 4.11 Note Agreement, dated October 1, 1992, among PVH, The Equitable Life Assurance Society of the United States, Equitable Variable Life Insurance Company, Unum Life Insurance Company of America, Nationwide Life Insurance Company, Employers Life Insurance Company of Wausau and Lutheran Brotherhood (incorporated by reference to Exhibit 4.21 to the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 1993). 4.12 Indenture, dated as of November 1, 1993, between PVH and The Bank of New York, as Trustee (incorporated by reference to Exhibit 4.01 to the Company's Registration Statement on Form S-3 (Reg. No. 33- 50751) filed on October 26, 1993). 4.13 Notice of extension of the Rights Agreement, dated June 5, 1996, from Phillips-Van Heusen Corporation to The Bank of New York. *10.1 1987 Stock Option Plan, including all amendments through June 13, 1995 (incorporated by reference to Exhibit 10.1 to the Company's report on Form 10-Q for the period ended October 29, 1995). *10.2 1973 Employees' Stock Option Plan (incorporated by reference to Exhibit 1 to the Company's Registration Statement on Form S-8 (Reg. No. 2-72959) filed on July 15, 1981). *10.3 Supplement to 1973 Employees' Stock Option Plan (incorporated by reference to the Company's Prospectus filed pursuant to Rule 424(c) to the Registration Statement on Form S-8 (Reg. No. 2-72959) filed on March 31, 1982). *10.4 Phillips-Van Heusen Corporation Special Severance Benefit Plan, as amended as of April 16, 1996 (incorporated by reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K for the fiscal year ended January 28, 1996). *10.5 Phillips-Van Heusen Corporation Capital Accumulation Plan (incorporated by reference to the Company's Report on Form 8-K filed on January 16, 1987). *10.6 Phillips-Van Heusen Corporation Amendment to Capital Accumulation Plan (incorporated by reference to Exhibit 10(n) to the Company's Annual Report on Form 10-K for the fiscal year ended February 2, 1987). -11-
*10.7 Form of Agreement amending Phillips-Van Heusen Corporation Capital Accumulation Plan with respect to individual participants (incorporated by reference to Exhibit 10(1) to the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 1988). *10.8 Form of Agreement amending Phillips-Van Heusen Corporation Capital Accumulation Plan with respect to individual participants (incorporated by reference to Exhibit 10.8 to the Company's report on Form 10-Q for the period ending October 29, 1995). *10.9 Phillips-Van Heusen Corporation Supplemental Defined Benefit Plan, dated January 1, 1991, as amended and restated on June 2, 1992 (incorporated by reference to Exhibit 10.10 to the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 1993). *10.10 Phillips-Van Heusen Corporation Supplemental Savings Plan, dated as of January 1, 1991 and amended and restated as of July 1, 1995 (incorporated by reference to Exhibit 10.10 to the Company's Annual Report on Form 10-K for the fiscal year ended January 28, 1996). 10.11 Asset Sale Agreement, dated January 24, 1995, Among the Company and Crystal Brands, Inc., Crystal Apparel, Inc., Gant Corporation, Crystal Sales, Inc., Eagle Shirtmakers, Inc., and Crystal Brands (Hong Kong) Limited (incorporated by reference to Exhibit 1 to the Company's Report on Form 8-K dated March 6, 1995). *10.12 Agreement, dated as of April 28, 1993, between Bruce J. Klatsky, Lawrence S. Phillips and the Company (incorporated by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the fiscal year ended January 29, 1995). *10.13 Non-Incentive Stock Option Agreement, dated as of April 28, 1993, between the Company and Bruce J. Klatsky. Non-Incentive Stock Option Agreement, dated as of December 3, 1993, between the Company and Bruce J. Klatsky (reload of April 28, 1993 Non-Incentive Stock Option Agreement) (incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended January 29, 1995). *10.14 Amendment, dated December 6, 1993, to the Agreement, dated April 28, 1993, between Bruce J. Klatsky, Lawrence S. Phillips and the Company (incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the fiscal year ended January 29, 1995). *10.15 Consulting and non-competition agreement, dated February 14, 1995, between the Company and Lawrence S. Phillips (incorporated by reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K for the fiscal year ended January 29, 1995). -12-
*10.16 Performance Restricted Stock Plan, as amended as of April 16, 1996 (incorporated by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ended January 28, 1996). *10.17 Phillips-Van Heusen Corporation (Crystal Brands Division) Associates Investment Plan, dated as of November 1, 1985, as amended and restated as of July 1, 1995. 15. Acknowledgement of Independent Accountants. 27. Financial Data Schedule * Management contract or compensatory plan or arrangement required to be identified pursuant to Item 14(a) of this report. (b) Reports on Form 8-K filed during the quarter ended April 28, 1996. NONE -13-
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. PHILLIPS-VAN HEUSEN CORPORATION Registrant June 11, 1996 /s/ Emanuel Chirico Emanuel Chirico, Controller Vice President and Chief Accounting Officer -14-
Exhibit 15 May 14, 1996 Stockholders and Board of Directors Phillips-Van Heusen Corporation We are aware of the incorporation by reference in the Registration Statement (Form S-8, No. 33-59101), Registration Statement (Form S-3, No. 33-50751), Registration Statement (Form S-8, No. 33-59602), Registration Statement (Form S-3, No. 33-46770), Registration Statement (Form S-8, No. 33-38698), Post- Effective amendment No. 1 to the Registration Statement (Form S-8, No. 33- 24057), Post-Effective amendment No. 2 to the Registration Statement (Form S- 8, No. 2-73803), Post-Effective amendment No. 4 to the Registration Statement (Form S-8, No. 2-72959), Post-Effective amendment No. 6 to the Registration Statement (Form S-8, No. 2-64564), and Post-Effective amendment No. 13 to the Registration Statement (Form S-8, No. 2-47910), of Phillips-Van Heusen Corporation of our report dated May 14, 1996 relating to the unaudited condensed consolidated interim financial statements of Phillips-Van Heusen Corporation which are included in its Form 10-Q for the thirteen week period ended April 28, 1996. Pursuant to Rule 436(c) of the Securities Act of 1933, our report is not a part of the registration statements or post-effective amendments prepared or certified by accountants within the meaning of Section 7 or 11 of the Securities Act of 1933. ERNST & YOUNG LLP New York, New York -15-