SEGMENT DATA

The Company manages its operations through its operating divisions, which are presented as six reportable segments: (i) Calvin Klein North America; (ii) Calvin Klein International; (iii) Tommy Hilfiger North America; (iv) Tommy Hilfiger International; (v) Heritage Brands Wholesale; and (vi) Heritage Brands Retail.

Calvin Klein North America Segment - This segment consists of the Company’s Calvin Klein North America division. This segment derives revenue principally from (i) marketing Calvin Klein branded apparel and related products at wholesale in North America, primarily to department and specialty stores; (ii) operating retail stores, which are primarily located in premium outlet centers in North America, and e-commerce websites in North America, which sell Calvin Klein branded apparel, accessories and related products; and (iii) licensing and similar arrangements relating to the use by third parties of the brand names Calvin Klein Collection, Calvin Klein (platinum label) and Calvin Klein (white label) for a broad array of products and retail services in North America.

Calvin Klein International Segment - This segment consists of the Company’s Calvin Klein International division. This segment derives revenue principally from (i) marketing Calvin Klein branded apparel and related products at wholesale principally in Europe, Asia and Brazil, primarily to department and specialty stores, franchisees of Calvin Klein, distributors and licensees; (ii) operating retail stores and e-commerce websites in Europe, Asia and Brazil, which sell Calvin Klein branded apparel, accessories and related products; and (iii) licensing and similar arrangements relating to the use by third parties of the brand names Calvin Klein Collection, Calvin Klein (platinum label) and Calvin Klein (white label) for a broad array of products and retail services outside of North America. This segment also includes the Company’s proportionate share of the net income or loss of its investments in unconsolidated Calvin Klein foreign affiliates in Australia and India.

Tommy Hilfiger North America Segment - This segment consists of the Company’s Tommy Hilfiger North America division. This segment derives revenue principally from (i) marketing Tommy Hilfiger branded apparel and related products at wholesale in North America, primarily to department stores, principally Macy’s and Hudson’s Bay; and (ii) operating retail stores, which are primarily located in premium outlet centers in North America, and e-commerce websites in North America, which sell Tommy Hilfiger branded apparel, accessories and related products. This segment also derives revenue from licensing and similar arrangements relating to the use by third parties of the Tommy Hilfiger brand name for a broad array of products in North America.

Tommy Hilfiger International Segment - This segment consists of the Company’s Tommy Hilfiger International division. This segment derives revenue principally from (i) marketing Tommy Hilfiger branded apparel and related products at wholesale principally in Europe, primarily to department and specialty stores, franchisees of Tommy Hilfiger, distributors and licensees; and (ii) operating retail stores in Europe and Japan and international e-commerce websites, which sell Tommy Hilfiger branded apparel, accessories and related products. This segment also includes the Company’s proportionate share of the net income or loss of its investments in unconsolidated Tommy Hilfiger foreign affiliates in Brazil, China, India and Australia. This segment also derives revenue from licensing and similar arrangements relating to the use by third parties of the Tommy Hilfiger brand name for a broad array of products outside of North America.

Heritage Brands Wholesale Segment - This segment consists of the Company’s Heritage Brands wholesale division. This segment derives revenue primarily from the marketing to department, chain and specialty stores in North America of (i) dress shirts, neckwear and underwear under various owned and licensed brand names, including several private label brands; (ii) men’s sportswear principally under the brand names Van Heusen, IZOD and ARROW; (iii) swimwear, fitness apparel, swim accessories and related products under the brand name Speedo; and (iv) women’s intimate apparel under the brand names Warner’s and Olga. This segment also includes the Company’s proportionate share of the net income or loss of its investment in its unconsolidated Heritage Brands foreign affiliate in Australia.

Heritage Brands Retail Segment - This segment consists of the Company’s Heritage Brands retail division. This segment derives revenue principally from operating retail stores, primarily located in outlet centers in North America, which sell apparel, accessories and related products under the brand names Van Heusen and IZOD. During the fourth quarter of 2014, the Company announced its plan to exit its Izod retail business in 2015.

The following tables present summarized information by segment:



	Thirteen Weeks Ended
(In millions)	5/3/15		⁽¹⁾	5/4/14
Revenue – Calvin Klein North America
Net sales	$	299.3		$	301.6
Royalty revenue	29.7			25.5
Advertising and other revenue	9.8			10.5
Total	338.8			337.6

Revenue – Calvin Klein International
Net sales	291.6			300.2
Royalty revenue	17.7			19.4
Advertising and other revenue	5.8			8.1
Total	315.1			327.7

Revenue – Tommy Hilfiger North America
Net sales	341.5			354.2
Royalty revenue	9.6			6.0
Advertising and other revenue	2.8			2.2
Total	353.9			362.4

Revenue – Tommy Hilfiger International
Net sales	400.2			484.6
Royalty revenue	12.1			14.0
Advertising and other revenue	0.9			1.4
Total	413.2			500.0

Revenue – Heritage Brands Wholesale
Net sales	367.5			354.9
Royalty revenue	4.6			3.9
Advertising and other revenue	0.6			0.5
Total	372.7			359.3

Revenue – Heritage Brands Retail
Net sales	85.0			76.0
Royalty revenue	0.5			0.6
Advertising and other revenue	0.1			0.1
Total	85.6			76.7

Total Revenue
Net sales	1,785.1			1,871.5
Royalty revenue	74.2			69.4
Advertising and other revenue	20.0			22.8
Total	$	1,879.3		$	1,963.7

⁽¹⁾

Revenue for the thirteen weeks ended May 3, 2015 was significantly impacted by the strengthening of the United States dollar against other currencies in which the Company transacts significant levels of business. Please see section entitled “Results of Operations” in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Item 2 of this report for a further discussion.



	Thirteen Weeks Ended
(In millions)	5/3/15			⁽¹⁾	5/4/14
Income before interest and taxes – Calvin Klein North America	$	40.4		⁽³⁾	$	41.1		⁽⁵⁾

Income before interest and taxes – Calvin Klein International	49.3			⁽³⁾	32.8			⁽⁵⁾⁽⁶⁾

Income before interest and taxes – Tommy Hilfiger North America	30.3				40.2

Income before interest and taxes – Tommy Hilfiger International	61.8				75.0

Income before interest and taxes – Heritage Brands Wholesale	30.3			⁽³⁾	27.0			⁽⁵⁾

Loss before interest and taxes – Heritage Brands Retail	(0.1		)	⁽⁴⁾	(3.2		)

Loss before interest and taxes – Corporate⁽²⁾	(35.2		)	⁽³⁾	(128.4		)	⁽⁵⁾⁽⁷⁾

Income before interest and taxes	$	176.8			$	84.5

⁽¹⁾

Income (loss) before interest and taxes for the thirteen weeks ended May 3, 2015 was significantly impacted by the strengthening of the United States dollar against other currencies in which the Company transacts significant levels of business. Please see section entitled “Results of Operations” in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Item 2 of this report for a further discussion.

⁽²⁾

Includes corporate expenses not allocated to any reportable segments, as well as the Company’s proportionate share of the net income or loss of its investment in Kingdom Holding 1 B.V., the parent company of the Karl Lagerfeld brand. Corporate expenses represent overhead operating expenses and include expenses for senior corporate management, corporate finance, information technology related to corporate infrastructure and actuarial gains and losses from the Company’s pension and other postretirement plans (which are generally recorded in the fourth quarter).

⁽³⁾

Income (loss) before interest and taxes for the thirteen weeks ended May 3, 2015 includes costs of $18.8 million associated with the Company’s integration of Warnaco and the related restructuring. Such costs were included in the Company’s segments as follows: $2.1 million in Calvin Klein North America; $3.9 million in Calvin Klein International; $3.6 million in Heritage Brands Wholesale; and $9.2 million in corporate expenses not allocated to any reportable segments.


⁽⁴⁾	Loss before interest and taxes for the thirteen weeks ended May 3, 2015 includes costs of $0.5 million related to operating and exiting the Company’s Izod retail business.

⁽⁵⁾

Income (loss) before interest and taxes for the thirteen weeks ended May 4, 2014 includes costs of $32.6 million associated with the Company’s integration of Warnaco and the related restructuring. Such costs were included in the Company’s segments as follows: $5.0 million in Calvin Klein North America; $11.2 million in Calvin Klein International; $4.0 million in Heritage Brands Wholesale; and $12.4 million in corporate expenses not allocated to any reportable segments.

⁽⁶⁾

Income before interest and taxes for the thirteen weeks ended May 4, 2014 includes a net gain of $8.0 million associated with the deconsolidation of certain Calvin Klein subsidiaries in Australia and the Company’s previously consolidated Calvin Klein joint venture in India. Please refer to Note 4, “Investments in Unconsolidated Affiliates” and Note 5, “Redeemable Non-Controlling Interest” for a further discussion.


⁽⁷⁾	Loss before interest and taxes for the thirteen weeks ended May 4, 2014 includes costs of $93.1 million associated with the Company’s amendment and restatement of the 2013 facilities and the related redemption of its 7 3/8% senior notes due 2020. Please refer to Note 8, “Debt,” for a further discussion.

Intersegment transactions primarily consist of transfers of inventory principally from the Heritage Brands Wholesale segment to the Heritage Brands Retail segment and the Calvin Klein North America segment. These transfers are recorded at cost plus a standard markup percentage. Such markup percentage on ending inventory is eliminated principally in the Heritage Brands Retail segment and the Calvin Klein North America segment.