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As the economy stabilizes and more M&A deals come to fruition, Phillips-Van Heusen Corp. is poised as a prime acquirer of companies and brands. As of November, PVH was sitting on $356.6 million in cash and chief executive officer Emanuel Chirico has not been shy about his intentions for the funds.
"We would like, all things being equal, to utilize our cash to continue to make strategic acquisitions," he said on the company's third-quarter earnings call. "We're not a bank and we're not going to just accumulate cash over a period of time."
Since 2003, PVH has bought the Calvin Klein and Arrow brands, as well as neckwear maker Superba Inc., but has been absent from the M&A fray for the past three years. The company has posted strong results through the retail downturn — increasing its market share in its core department store dress shirt business by 10 points over the past two years, to 45 percent — positioning it well for an economic upswing.
This month, the company upped its 2009 revenue and earnings estimates on the strength of better-than-expected performance from its outlet stores and a 10 percent boost in fourth-quarter Calvin Klein royalty revenue. It also hiked its cash flow projections for the year to between $100 million and $110 million, up from a previous forecast of $80 million to $85 million.