REDEEMABLE NON-CONTROLLING INTEREST

6 Months Ended

Aug. 01, 2021

Redeemable Non-Controlling Interest [Abstract]

REDEEMABLE NON-CONTROLLING INTEREST

REDEEMABLE NON-CONTROLLING INTEREST

The Company and Arvind formed PVH Ethiopia during 2016 to operate a manufacturing facility that produces finished products for the Company for distribution primarily in the United States. The Company and Arvind held initial economic interests of 75% and 25%, respectively, in PVH Ethiopia, with Arvind’s 25% interest accounted for as a redeemable non-controlling interest (“RNCI”). The Company consolidates PVH Ethiopia in its consolidated financial statements. The Company and Arvind amended, effective May 31, 2021, the capital structure of PVH Ethiopia and as a result the Company now solely manages and effectively owns all economic interests in the joint venture.

The fair value of the RNCI as of the date of formation of PVH Ethiopia was $0.1 million. The carrying amount of the RNCI prior to May 31, 2021 was adjusted to equal the redemption amount at the end of each reporting period, provided that this amount at the end of each reporting period could not be lower than the initial fair value adjusted for the minority shareholder’s share of net income or loss. Any adjustment to the redemption amount of the RNCI, determined after attribution of net income or loss of the RNCI, would have been recognized immediately in retained earnings of the Company, since it was probable that the RNCI would become redeemable in the future based on the passage of time. There was no adjustment to the redemption amount of the RNCI as of May 31, 2021.

The carrying amount of the RNCI as of January 31, 2021 and August 2, 2020 was $(3.4) million and $(2.7) million, respectively. In connection with the amendment of the capital structure of PVH Ethiopia, the Company reclassified the carrying amount of the RNCI as of May 31, 2021 of $(3.7) million to additional paid-in capital. Following this reclassification, the Company will not attribute any net income or loss in PVH Ethiopia to the redeemable non-controlling interest in future reporting periods.