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Retail sales rose 2 percent to $130.3 million, driven by an increase in the number of stores for the quarter, but comparable-store sales posted a mid-single-digit decline in the quarter.
Licensing revenue jumped 22.2 percent to $15.5 million due mostly to higher royalties received and an increase in the company’s Far East buying office revenue. Licensing income is likely to see future gains from the newly announced agreements for the distribution of Tommy apparel in South Korea and Australia.
Joel Horowitz, the chief executive officer who added the title of chairman on Tuesday, said in a conference call: "In the United States, our children’s business was much improved and our women’s business remained a category leader. However, we continued to experience difficulty in the men’s wear arena. Our outlet retail business also remains a strong and consistent source of profits and cash flow.
"Internationally, we are very pleased with the continued growth and profitability of Tommy Europe, even as weakening markets pose new challenges."
Horowitz reiterated that he plans to remain ceo while the search for his successor in that post continues. He said that he is interviewing candidates both inside and outside the apparel industry on an ongoing basis. "It’s a succession plan, so we’re not in any hurry to do something. When the right candidate is found, it will be announced," Horowitz said.
As reported, Horowitz will not renew his contract as ceo when it expires in March 2004. The designer, who was chairman for just three months, returns to his role as honorary chairman and principal designer.
The restructuring of Hilfiger’s wholesale units took place even before the news of Horowitz’s new title had been digested. In the new structure, Christa Michalaros will serve as president of missy sportswear, junior jeans and TH Woman; David McTague as president of men’s sportswear and jeans, and Michael Spillane as president of children’s.