þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended March 29, 2014
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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13-2622036
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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650 Madison Avenue, New York, New York
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10022
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Class A Common Stock, $.01 par value
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New York Stock Exchange
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•
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the loss of key personnel, including Mr. Ralph Lauren;
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•
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our ability to successfully implement our anticipated growth strategies and to capitalize on our repositioning initiatives in certain regions and merchandise categories;
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our ability to secure our facilities and systems and those of our third-party service providers from, among other things, cybersecurity breaches, acts of vandalism, computer viruses, or similar Internet or email events;
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our ability to continue to maintain our brand image and reputation and protect our trademarks;
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the impact of global economic conditions on us, our customers, our suppliers, and our vendors, and on our ability and their ability to access sources of liquidity;
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the impact of the volatile state of the global economy or consumer preferences on purchases of premium lifestyle products that we offer for sale and our ability to forecast consumer demand, which could result in a build-up of inventory;
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changes in the competitive marketplace, including the introduction of new products or pricing changes by our competitors, and consolidations, liquidations, restructurings, and other ownership changes in the retail industry;
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a variety of legal, regulatory, tax, political, and economic risks, including risks related to the importation and exportation of products, tariffs, and other trade barriers which our international operations are subject to and other risks associated with our international operations, such as compliance with the Foreign Corrupt Practices Act or violations of other anti-bribery and corruption laws prohibiting improper payments, and the burdens of complying with a variety of foreign laws and regulations, including tax laws, trade and labor restrictions, and related laws that may reduce the flexibility of our business;
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our ability to continue to expand or grow our business internationally, and the impact of related changes in our customer, channel, and geographic sales mix as a result;
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our exposure to domestic and foreign currency fluctuations and risks associated with increases in the costs of raw materials, transportation, and labor;
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changes to our effective tax rates in future years;
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changes in our relationships with department store customers and licensing partners;
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our efforts to improve the efficiency of our distribution system and to continue to enhance and upgrade our global information technology systems;
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our intention to introduce new products or enter into or renew alliances and exclusive relationships;
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our ability to access sources of liquidity to provide for our cash needs, including our debt obligations, payment of dividends, capital expenditures, and potential repurchase of our Class A common stock;
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our ability to open new retail stores, concession shops, and e-commerce sites in an effort to expand our direct-to-consumer presence;
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2
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our ability to make certain strategic acquisitions of selected licenses held by our licensees and successfully integrate the acquired businesses into our existing operations;
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our ability to maintain our credit profile and ratings within the financial community;
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the potential impact on our operations and on our customers resulting from natural or man-made disasters; and
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the impact to our business of events of unrest and instability that are currently taking place in certain parts of the world, as well as from any terrorist action, retaliation, and the threat of further action or retaliation.
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Item 1.
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Business.
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3
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4
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•
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International Growth;
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Direct-to-Consumer Growth;
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•
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Product Innovation and Brand Extension Growth;
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Investment in Operational Infrastructure;
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Global Talent Development and Management; and
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Strong Financial Management and Cash Flow Reinvestment.
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5
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Apparel
— Products include extensive collections of men's, women's, and children's clothing;
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•
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Accessories
— Products encompass a broad range, including footwear, eyewear, watches, fine jewelry, hats, belts, and leathergoods, including handbags and luggage;
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•
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Home
— Coordinated home products include bedding and bath products, furniture, fabric and wallpaper, lighting, paint, tabletop, and giftware; and
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•
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Fragrance
— Fragrance products are sold under our Big Pony, Romance, Midnight Romance, Polo, Lauren, Safari, Ralph, Black Label, and Purple Label brands, among others.
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6
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7
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8
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9
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10
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Location
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Number of Doors
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The Americas
(a)
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6,459
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Europe
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4,864
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Asia
(b)
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130
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Total
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11,453
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(a)
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Includes the U.S., Canada, and Latin America.
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(b)
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Includes Australia, China, Japan, the Philippines, and Thailand.
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11
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Location
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Ralph Lauren Stores
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The Americas
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57
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Europe
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27
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Asia
(a)
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54
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Total
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138
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(a)
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Includes Australia, China, Hong Kong, Japan, Macau, Malaysia, New Zealand, Singapore, South Korea, and Vietnam.
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12
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Location
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Factory Stores
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The Americas
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150
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Europe
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50
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Asia
(a)
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35
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Total
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235
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(a)
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Includes Australia, China, Hong Kong, Japan, Malaysia, South Korea, and Taiwan.
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•
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Our North American e-commerce sites located at www.RalphLauren.com and www.ClubMonaco.com, as well as our Club Monaco site in Canada located at www.ClubMonaco.ca;
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•
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Our Ralph Lauren
e-commerce sites in Europe, including www.RalphLauren.co.uk (servicing the United Kingdom), www.RalphLauren.fr (servicing Belgium, France, Italy, Luxembourg, the Netherlands, Portugal, and Spain), and www.RalphLauren.de (servicing Germany and Austria); and
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•
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Our Ralph Lauren
e-commerce sites in Asia, including www.RalphLauren.co.jp servicing Japan and www.RalphLauren.co.kr servicing South Korea.
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13
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Category
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Licensed Products
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Licensing Partners
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Men's Apparel
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Underwear and Sleepwear
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Hanesbrands, Inc.
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Chaps, Lauren, and Ralph Tailored Clothing
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Peerless, Inc.
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Beauty Products
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Fragrances, Cosmetics, Color, and Skin Care
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L'Oreal S.A. (global)
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Accessories
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Eyewear
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Luxottica Group, S.p.A. (global)
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Home
(a)
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Bedding and Bath
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Ichida (Japan) and Kohl's Department Stores, Inc.
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Utility and Blankets
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Hollander Sleep Products LLC and Kohl's Department Stores, Inc.
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Fabric and Wallpaper
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Designers Guild Limited and P. Kaufmann Inc.
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Furniture
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EJ Victor, Inc.
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(a)
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Our Home products are sold under our Ralph Lauren Home, Lauren by Ralph Lauren, and Chaps brands. As of March 29, 2014, we had agreements with
ten
domestic and
three
international Home product licensing partners.
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14
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15
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anticipate and respond to changing consumer demands in a timely manner;
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maintain favorable brand recognition, loyalty, and reputation for quality;
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develop and produce high quality products that appeal to consumers;
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appropriately source raw materials at cost-effective prices;
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appropriately price our products;
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provide strong and effective marketing support;
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ensure product availability; and
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obtain additional points of distribution and sufficient retail floor space, and effectively present our products at retail.
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16
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Geographic Region
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Facility Type
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Facility Location
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Facility
Ownership
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U.S.
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Wholesale and Retail distribution center
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Greensboro, North Carolina
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Owned
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Wholesale distribution center
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High Point, North Carolina
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Leased
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E-commerce distribution center
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High Point, North Carolina
(a)
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Owned
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Distribution center
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Chino Hills, California
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Third-party
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Distribution center
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Miami, Florida
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Third-party
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Canada
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Distribution center
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Toronto, Ontario
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Third-party
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Europe
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Distribution center
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Parma, Italy
(b)
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Third-party
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Japan
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Distribution center
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Yokohama, Japan
(c)
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Third-party
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South Korea
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Distribution center
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Bugok, South Korea
(d)
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Leased
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Greater China and Southeast Asia
(e)
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Distribution centers
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Hong Kong, China, Singapore,
Malaysia, and Taiwan
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Third-party
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Latin America
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Distribution center
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Colón, Panama
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Third-party
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(a)
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This distribution center performs customer order fulfillment for RalphLauren.com and ClubMonaco.com.
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(b)
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This distribution center performs customer order fulfillment for our European businesses, including our e-commerce operations in Europe.
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(c)
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This distribution center performs customer order fulfillment for our Japanese businesses, including our e-commerce operations in Japan.
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(d)
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This distribution center performs customer order fulfillment for our businesses in South Korea, including our e-commerce operations.
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(e)
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Includes China, Hong Kong, Macau, Malaysia, the Philippines, Singapore, Taiwan, Thailand, and Vietnam. Our distribution center in Hong Kong also performs customer order fulfillment for our businesses in Australia and New Zealand.
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•
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comprehensive order processing;
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production and design information;
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accounting information; and
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an enterprise view of information for our design, marketing, manufacturing, importing, and distribution functions.
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17
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PURPLE LABEL;
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BLACK LABEL;
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BLUE LABEL;
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RRL;
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RLX;
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LAUREN RALPH LAUREN;
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18
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DENIM & SUPPLY RALPH LAUREN;
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PINK PONY;
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LAUREN;
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RALPH;
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CHAPS;
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CLUB MONACO;
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RUGBY;
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AMERICAN LIVING; and
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Various trademarks pertaining to fragrances and cosmetics.
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19
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20
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Ralph Lauren
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Age 74
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Mr. Lauren has been our Chairman, Chief Executive Officer and director since prior to our initial public offering in 1997, and was a member of the Advisory Board of the Board of Directors of our predecessors since their organization. He founded our business in 1967. For over four decades, Mr. Lauren has cultivated the iconography of America into a global lifestyle brand.
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Roger N. Farah
(a)
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Age 61
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Mr. Farah has been Executive Vice Chairman of the Company since November 2013 and a director of the Company since April 2000. He was the Company's President and Chief Operating Officer from April 2000 through October 2013. Mr. Farah was Chairman of the board of directors of Venator Group, Inc. (now Foot Locker, Inc.) from December 1994 until April 2000, and was Chief Executive Officer of Venator Group, Inc. from December 1994 to August 1999. He is Chairman of the Finance Committee and a member of the Executive Committee of the National Retail Federation and is currently a member of the board of directors of Aetna, Inc., The Progressive Corporation, and Metro Bank.
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Jackwyn L. Nemerov
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Age 62
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Ms. Nemerov has been our President & Chief Operating Officer since November 2013 and a director of the Company since February 2007. She served as Executive Vice President of the Company from September 2004 through October 2013. Ms. Nemerov was President & Chief Operating Officer of Jones Apparel Group, Inc. from January 1998 until March 2002. Prior to that, Ms. Nemerov was affiliated with Allied Stores, Bernard Chaus and Gloria Vanderbilt for Murjani. Ms. Nemerov currently serves as a member of the board of governors of The New School University's Parsons School of Design.
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Christopher H. Peterson
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Age 47
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Mr. Peterson has been our Executive Vice President, Chief Administrative Officer and Chief Financial Officer since November 2013. He served as Senior Vice President and Chief Financial Officer of the Company from September 2012 through November 2013. From 1992 to 2012, Mr. Peterson held various positions with The Procter & Gamble Company, most recently serving as Vice President and Chief Financial Officer of its Global Household Care division.
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Mitchell A. Kosh
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Age 64
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Mr. Kosh has served as our Executive Vice President of Human Resources since March 2014. He was Senior Vice President of Human Resources of the Company from July 2000 through February 2014. Mr. Kosh was Senior Vice President of Human Resources of Conseco, Inc. from February 2000 to July 2000. Prior to that time, Mr. Kosh held executive human resource positions with the Venator Group, Inc. starting in 1996.
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(a)
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On May 8, 2014, Roger N. Farah notified us of his resignation from the Company as Executive Vice Chairman, effective as of May 31, 2014. Mr. Farah will remain on our Board of Directors until our 2014 Annual Meeting of Stockholders in August 2014.
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21
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Item 1A.
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Risk Factors
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22
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•
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the burdens of complying with a variety of foreign laws and regulations, including trade and labor restrictions;
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•
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compliance with U.S. and other country laws relating to foreign operations, including, but not limited to, the Foreign Corrupt Practices Act, which prohibits U.S. companies from making improper payments to foreign officials for the purpose of obtaining or retaining business, and the U.K. Bribery Act, which prohibits U.K. and related companies from any form of bribery;
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•
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unexpected changes in laws, judicial processes, or regulatory requirements;
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•
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adapting to local customs and culture; and
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•
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new tariffs or other barriers in certain international markets.
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•
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political instability and terrorist attacks;
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•
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changes in diplomatic and trade relationships, including sanctions resulting from the current political situation in Russia and Ukraine; and
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•
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general economic fluctuations in specific countries or markets.
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23
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24
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•
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changes in social, political, and economic conditions or terrorist acts that could result in the disruption of trade from the countries in which our manufacturers or suppliers are located;
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•
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the imposition of additional regulations relating to imports or exports, and costs of complying with laws relating to the identification and reporting of the sources of minerals used in the Company's products;
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•
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the imposition of additional duties, taxes, and other charges on imports or exports;
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•
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significant fluctuations in the cost of raw materials;
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•
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increases in the cost of labor, fuel, travel, and transportation;
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•
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disruptions of shipping and international trade caused by natural and man-made disasters;
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•
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significant delays in the delivery of cargo due to security considerations;
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•
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the imposition of anti-dumping or countervailing duty proceedings resulting in the potential assessment of special anti-dumping or countervailing duties; and
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•
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the imposition of sanctions in the form of additional duties either by the U.S. or its trading partners to remedy perceived illegal actions by national governments.
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25
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26
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27
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28
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•
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obtain capital;
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•
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manage its labor relations;
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•
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maintain relationships with its suppliers;
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•
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manage its credit and bankruptcy risks effectively; and
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•
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maintain relationships with its customers.
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29
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•
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general business conditions;
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•
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economic downturns;
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•
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employment levels;
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•
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downturns in the stock market;
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•
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interest rates;
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•
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the housing market;
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•
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consumer debt levels;
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•
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the availability of consumer credit;
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•
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increases in fuel prices;
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•
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taxation; and
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•
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consumer confidence in future economic conditions.
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•
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anticipating and responding to changing consumer demands in a timely manner;
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•
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creating and maintaining favorable brand recognition, loyalty, and a reputation for quality;
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•
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developing and maintaining innovative, high-quality products in sizes, colors, and styles that appeal to consumers;
|
•
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appropriately sourcing raw materials at cost-effective prices;
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•
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appropriately pricing products;
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30
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•
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anticipating and maintaining proper inventory levels;
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•
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providing strong and effective marketing support;
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•
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retaining and recruiting key employees;
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•
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creating an acceptable value proposition for retail customers;
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•
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ensuring product availability and optimizing supply chain and distribution efficiencies with manufacturers and retailers;
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•
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obtaining sufficient retail floor space and effective presentation of our products at retail stores;
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•
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maintaining and growing market share; and
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•
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protecting our intellectual property.
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Item 1B.
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Unresolved Staff Comments.
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31
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Item 2.
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Properties.
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Location
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Use
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Approximate
Sq. Ft.
|
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Current Lease Term
Expiration
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Greensboro, NC
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Wholesale and retail distribution facility
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1,500,000
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N/A - Owned
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North Pendleton Street, High Point, NC
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Retail e-commerce call center and distribution facility
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805,000
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N/A - Owned
|
Eagle Hill Drive, High Point, NC
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Wholesale distribution facility
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343,000
|
|
December 31, 2022
|
625 Madison Avenue, NYC
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|
Corporate offices and showrooms
|
|
412,000
|
|
December 31, 2019
|
650 Madison Avenue, NYC
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|
Executive and corporate offices, design studio, and showrooms
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270,000
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December 31, 2024
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Lyndhurst, NJ
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Corporate and retail administrative offices
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178,000
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December 31, 2019
|
550 7th Avenue, NYC
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|
Corporate offices, design studio, and Women's showrooms
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104,000
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|
December 31, 2018
|
Geneva, Switzerland
|
|
European corporate offices
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|
107,000
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|
June 22, 2027
|
Gateway Office, Hong Kong
|
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Asia corporate offices
|
|
56,000
|
|
October 31, 2015
|
Manhattan Place, Hong Kong
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|
Asia corporate and sourcing offices
|
|
46,000
|
|
October 31, 2016
|
London, UK
|
|
Retail flagship store
|
|
40,000
|
|
July 4, 2021
|
711 5th Avenue, NYC
(a)
|
|
Retail flagship store
|
|
38,000
|
|
June 30, 2029
|
888 Madison Avenue, NYC
|
|
Retail flagship store
|
|
37,900
|
|
August 31, 2027
|
750 N. Michigan Avenue, Chicago
|
|
Retail flagship store
|
|
37,500
|
|
November 14, 2017
|
867 Madison Avenue, NYC
|
|
Retail flagship store
|
|
27,700
|
|
December 31, 2023
|
Paris, France
|
|
Retail flagship store
|
|
25,700
|
|
May 31, 2018
|
Tokyo, Japan
|
|
Retail flagship store
|
|
25,000
|
|
December 31, 2020
|
Lee Gardens, Hong Kong
(a)
|
|
Retail flagship store
|
|
20,200
|
|
August 16, 2022
|
444 N. Rodeo Drive, Beverly Hills
|
|
Retail flagship store
|
|
19,400
|
|
September 30, 2033
|
|
(a)
|
Expected to open in Fall 2014.
|
|
32
|
|
Item 3.
|
Legal Proceedings.
|
Item 4.
|
Mine Safety Disclosures.
|
|
33
|
|
Item 5.
|
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
|
|
|
Market Price of
Class A
Common Stock
|
|
Dividends
Declared per
Common Share
|
||||||||
|
|
High
|
|
Low
|
|
|||||||
Fiscal 2014:
|
|
|
|
|
|
|
||||||
First Quarter
|
|
$
|
192.03
|
|
|
$
|
165.33
|
|
|
$
|
0.40
|
|
Second Quarter
|
|
189.80
|
|
|
161.98
|
|
|
0.40
|
|
|||
Third Quarter
|
|
181.07
|
|
|
157.01
|
|
|
0.45
|
|
|||
Fourth Quarter
|
|
178.59
|
|
|
146.00
|
|
|
0.45
|
|
|||
Fiscal 2013:
|
|
|
|
|
|
|
||||||
First Quarter
|
|
$
|
179.00
|
|
|
$
|
134.48
|
|
|
$
|
0.40
|
|
Second Quarter
|
|
164.28
|
|
|
134.29
|
|
|
0.40
|
|
|||
Third Quarter
|
|
165.41
|
|
|
144.14
|
|
|
0.40
|
|
|||
Fourth Quarter
|
|
179.90
|
|
|
146.58
|
|
|
0.40
|
|
|
|
Total Number of Shares Purchased
|
|
Average
Price
Paid per
Share
|
|
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs
|
|
Approximate Dollar
Value of Shares
That May Yet be
Purchased Under the
Plans or Programs
(1)
|
||||||
|
|
|
|
|
|
|
|
(millions)
|
||||||
December 29, 2013 to January 25, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
230
|
|
January 26, 2014 to February 22, 2014
|
|
513,364
|
|
|
155.83
|
|
|
513,364
|
|
|
650
|
|
||
February 23, 2014 to March 29, 2014
|
|
437,655
|
|
|
159.76
|
|
|
437,655
|
|
|
580
|
|
||
|
|
951,019
|
|
|
|
|
951,019
|
|
|
|
|
(1)
|
As of
March 29, 2014
, the remaining availability under our Class A common stock repurchase program was approximately
$580 million
, reflecting the February 4, 2014 approval by our Board of Directors to expand the program by up to an additional
$500 million
of Class A common stock repurchases. Repurchases of shares of Class A common stock are subject to overall business and market conditions.
|
|
34
|
|
Item 6.
|
Selected Financial Data
|
|
35
|
|
Item 7.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Overview.
This section provides a general description of our business, current trends and outlook, and a summary of our financial performance for
Fiscal 2014
. In addition, this section includes a discussion of recent developments and transactions affecting comparability that we believe are important in understanding our results of operations and financial condition, and in anticipating future trends.
|
•
|
Results of operations.
This section provides an analysis of our results of operations for
Fiscal 2014
as compared to
Fiscal 2013
and
Fiscal 2013
as compared to
Fiscal 2012
.
|
•
|
Financial condition and liquidity.
This section provides a discussion of our financial condition and liquidity as of
March 29, 2014
, which includes (i) an analysis of our financial condition compared to the prior fiscal year-end; (ii) an analysis of changes in our cash flows for
Fiscal 2014
and
Fiscal 2013
as compared to the respective prior fiscal year; (iii) an analysis of our liquidity, including common stock repurchases, payments of dividends, our outstanding debt and covenant compliance, and the availability under our credit facilities; and (iv) a summary of our contractual and other obligations as of
March 29, 2014
.
|
•
|
Market risk management.
This section discusses how we manage our risk exposures related to foreign currency exchange rates, interest rates, and our investments as of
March 29, 2014
.
|
•
|
Critical accounting policies.
This section discusses accounting policies considered to be important to our results of operations and financial condition, which require significant judgment and estimation in their application. In addition, our significant accounting policies are summarized in Note 3 to the accompanying audited consolidated financial statements.
|
•
|
Recently issued accounting standards.
This section discusses the potential impact on our reported results of operations and financial condition of certain accounting standards that have been recently issued or proposed.
|
|
36
|
|
|
37
|
|
|
38
|
|
•
|
certain pretax asset impairment and restructuring and other charges recorded during the periods presented. A summary of the effect of these items on pretax income for each fiscal year is summarized below (references to "Notes" are to the notes to the accompanying audited consolidated financial statements):
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014
|
|
March 30,
2013
|
|
March 31,
2012
|
||||||
|
|
(millions)
|
||||||||||
Impairments of assets (see Note 11)
|
|
$
|
(1
|
)
|
|
$
|
(19
|
)
|
|
$
|
(2
|
)
|
Restructuring and other charges (see Note 12)
|
|
(18
|
)
|
|
(12
|
)
|
|
(12
|
)
|
•
|
our acquisitions of previously licensed businesses, including the Chaps Menswear License Acquisition in April 2013, which resulted in a $16 million gain recorded during the first quarter of Fiscal 2014; the Australia and New Zealand Licensed Operations Acquisition in July 2013; and our acquisition of the Ralph Lauren-branded business in Latin America in June 2012;
|
•
|
discrete income tax benefits of $10 million and $15 million recognized within our provision for income taxes during
Fiscal 2014
and
Fiscal 2013
, respectively, in connection with the settlements of two separate tax examinations. During
Fiscal 2013
, the tax benefit from the tax examination settlement was more than offset by a discrete income tax reserve of $16 million for an interest assessment on a prior year withholding tax; and
|
•
|
the wind-down of our Rugby brand operations during the second half of Fiscal 2013 and the discontinuance of products sold under the American Living brand at JCPenney primarily effective for the Fall 2012 selling season.
|
|
39
|
|
|
|
Fiscal Years Ended
|
|
|
|
|
|||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
$
Change
|
|
% / bps
Change
|
|||||||
|
|
(millions, except per share data)
|
|
|
|||||||||||
Net revenues
|
|
$
|
7,450
|
|
|
$
|
6,945
|
|
|
$
|
505
|
|
|
7.3
|
%
|
Cost of goods sold
(a)
|
|
(3,140
|
)
|
|
(2,789
|
)
|
|
(351
|
)
|
|
12.6
|
%
|
|||
Gross profit
|
|
4,310
|
|
|
4,156
|
|
|
154
|
|
|
3.7
|
%
|
|||
Gross profit as % of net revenues
|
|
57.9
|
%
|
|
59.8
|
%
|
|
|
|
(190 bps)
|
|
||||
Selling, general, and administrative expenses
(a)
|
|
(3,142
|
)
|
|
(2,971
|
)
|
|
(171
|
)
|
|
5.7
|
%
|
|||
SG&A expenses as % of net revenues
|
|
42.2
|
%
|
|
42.8
|
%
|
|
|
|
(60 bps)
|
|
||||
Amortization of intangible assets
|
|
(35
|
)
|
|
(27
|
)
|
|
(8
|
)
|
|
30.7
|
%
|
|||
Gain on acquisition of Chaps
|
|
16
|
|
|
—
|
|
|
16
|
|
|
NM
|
|
|||
Impairment of assets
|
|
(1
|
)
|
|
(19
|
)
|
|
18
|
|
|
(93.1
|
%)
|
|||
Restructuring and other charges
|
|
(18
|
)
|
|
(12
|
)
|
|
(6
|
)
|
|
52.9
|
%
|
|||
Operating income
|
|
1,130
|
|
|
1,127
|
|
|
3
|
|
|
0.3
|
%
|
|||
Operating income as % of net revenues
|
|
15.2
|
%
|
|
16.2
|
%
|
|
|
|
(100 bps)
|
|
||||
Foreign currency losses
|
|
(8
|
)
|
|
(12
|
)
|
|
4
|
|
|
(30.1
|
%)
|
|||
Interest expense
|
|
(20
|
)
|
|
(22
|
)
|
|
2
|
|
|
(8.7
|
%)
|
|||
Interest and other income, net
|
|
3
|
|
|
6
|
|
|
(3
|
)
|
|
(38.2
|
%)
|
|||
Equity in losses of equity-method investees
|
|
(9
|
)
|
|
(10
|
)
|
|
1
|
|
|
(1.0
|
%)
|
|||
Income before provision for income taxes
|
|
1,096
|
|
|
1,089
|
|
|
7
|
|
|
0.6
|
%
|
|||
Provision for income taxes
|
|
(320
|
)
|
|
(339
|
)
|
|
19
|
|
|
(5.6
|
%)
|
|||
Effective tax rate
(b)
|
|
29.2
|
%
|
|
31.1
|
%
|
|
|
|
(190 bps)
|
|
||||
Net income
|
|
$
|
776
|
|
|
$
|
750
|
|
|
$
|
26
|
|
|
3.4
|
%
|
Net income per common share:
|
|
|
|
|
|
|
|
|
|||||||
Basic
|
|
$
|
8.55
|
|
|
$
|
8.21
|
|
|
$
|
0.34
|
|
|
4.1
|
%
|
Diluted
|
|
$
|
8.43
|
|
|
$
|
8.00
|
|
|
$
|
0.43
|
|
|
5.4
|
%
|
|
(a)
|
Includes total depreciation expense of
$223 million
and
$206 million
for
Fiscal 2014
and
Fiscal 2013
, respectively.
|
(b)
|
Effective tax rate is calculated by dividing the provision for income taxes by income before provision for income taxes.
|
|
40
|
|
|
|
Fiscal Years Ended
|
|
|
|
|
|||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
$
Change
|
|
%
Change
|
|||||||
|
|
(millions)
|
|
|
|||||||||||
Net Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Wholesale
|
|
$
|
3,486
|
|
|
$
|
3,138
|
|
|
$
|
348
|
|
|
11.1
|
%
|
Retail
|
|
3,798
|
|
|
3,625
|
|
|
173
|
|
|
4.8
|
%
|
|||
Licensing
|
|
166
|
|
|
182
|
|
|
(16
|
)
|
|
(9.0
|
%)
|
|||
Total net revenues
|
|
$
|
7,450
|
|
|
$
|
6,945
|
|
|
$
|
505
|
|
|
7.3
|
%
|
•
|
a $382 million net increase related to our business in the Americas on a constant currency basis, largely due to $210 million of incremental revenues contributed by previously licensed businesses, including the Chaps Menswear Business acquired in April 2013 and certain businesses in Latin America acquired in June 2012. The increase in net revenues also reflected higher domestic revenues from our menswear, womenswear, and childrenswear product lines, as well as increased revenues from our accessories business. These increases were partially offset by lower Home product revenues primarily due to the rebranding of certain of our home products; and
|
•
|
a $7 million net increase in revenues due to the net favorable foreign currency effects, primarily related to the strengthening of the Euro, partially offset by the weakening of the Japanese Yen and the Canadian Dollar against the U.S. Dollar during Fiscal 2014.
|
•
|
a $16 million net decrease related to our European business on a constant currency basis, driven by our planned reduction in shipments across our menswear, womenswear, and childrenswear product lines due to the challenging European retail environment and softness in the specialty store business; and
|
•
|
a $23 million net decrease related to our Japanese business on a constant currency basis, primarily reflecting lower sell-throughs and the impact of a business model shift to the retail concessions-based channel.
|
•
|
a $29 million, or a 1%, net increase in consolidated comparable store sales on a constant currency basis, primarily driven by an increase from our Ralph Lauren e-commerce operations, partially offset by decreases in comparable store sales from our concession shops and our domestic factory stores. Comparable store sales related to our e-commerce operations increased by approximately 14% on a reported basis and 13% on a constant currency basis over the related prior fiscal year, and had a favorable impact on our total comparable store sales of approximately 2% to 3% on a reported basis and approximately 1% to 2% on a constant currency basis. Our consolidated comparable store sales excluding e-commerce decreased approximately 2% to 3% on a reported basis and were flat to down by 1% on a constant currency basis; and
|
|
41
|
|
•
|
a $197 million, or a 40%, net increase in non-comparable store sales on a constant currency basis, primarily driven by new store openings within the past twelve months, including store openings in Asia, new stores and concession shops assumed in connection with the Australia and New Zealand Licensed Operations Acquisition, other new global store openings, and the expansion of our e-commerce operations, which more than offset the impact of store closings, including those closed in connection with the Rugby Closure Plan.
|
•
|
a $53 million net decrease in revenues due to unfavorable foreign currency effects, comprised of unfavorable effects of $43 million and $10 million related to our comparable and non-comparable store sales, respectively. The unfavorable currency effects primarily related to the weakening of the Japanese Yen, partially offset by the strengthening of the Euro against the U.S. Dollar during Fiscal 2014 compared to the prior fiscal year.
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||
Stores:
|
|
|
|
|
||
Freestanding stores
|
|
433
|
|
|
388
|
|
Concession shops
|
|
503
|
|
|
494
|
|
Total stores
|
|
936
|
|
|
882
|
|
|
|
|
|
|
||
E-commerce Sites:
|
|
|
|
|
||
North American sites
(a)
|
|
3
|
|
|
3
|
|
European sites
(b)
|
|
3
|
|
|
3
|
|
Asian sites
(c)
|
|
2
|
|
|
1
|
|
Total e-commerce sites
|
|
8
|
|
|
7
|
|
|
(a)
|
Includes www.RalphLauren.com, www.ClubMonaco.com, and www.ClubMonaco.ca, which collectively service the U.S. and Canada.
|
(b)
|
Includes www.RalphLauren.co.uk (servicing the United Kingdom), www.RalphLauren.fr (servicing Belgium, France, Italy, Luxembourg, the Netherlands, Portugal, and Spain), and www.RalphLauren.de (servicing Germany and Austria).
|
(c)
|
Includes www.RalphLauren.co.jp, which services Japan and, as of March 29, 2014, our new e-commerce site at www.RalphLauren.co.kr, which services South Korea.
|
|
42
|
|
|
|
Fiscal 2014
Compared to
Fiscal 2013
|
||
|
|
(millions)
|
||
SG&A expense category:
|
|
|
||
Compensation-related expenses
(a)
|
|
$
|
44
|
|
Marketing, advertising, and promotional expenses
|
|
39
|
|
|
Shipping, warehousing, and distribution expenses
|
|
28
|
|
|
Rent and occupancy expenses
|
|
27
|
|
|
Depreciation expense
|
|
17
|
|
|
Acquisition-related costs
(b)
|
|
7
|
|
|
Other
|
|
9
|
|
|
Total change in SG&A expenses
(c)
|
|
$
|
171
|
|
|
(a)
|
Primarily due to increased salaries and related expenses to support business growth.
|
(b)
|
Comprised of acquisition-related costs for the Chaps Menswear License Acquisition in April 2013 and for the Australia and New Zealand Licensed Operations Acquisition in July 2013 (see
Note 5
to the accompanying audited consolidated financial statements).
|
(c)
|
Includes $62 million of incremental expenses associated with the aforementioned newly acquired businesses and $13 million of incremental expenses incurred in connection with the implementation of our global operating and financial reporting system.
|
|
43
|
|
|
|
Fiscal Years Ended
|
|
|
|
|
||||||||||||
|
March 29, 2014
|
|
March 30, 2013
|
|
|
|
|
|||||||||||
|
Operating
Income
|
|
Operating
Margin
|
|
Operating
Income
|
|
Operating
Margin
|
|
$
Change
|
|
Margin
Change
|
|||||||
|
(millions)
|
|
|
|
(millions)
|
|
|
|
(millions)
|
|
|
|||||||
Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Wholesale
|
|
$
|
963
|
|
|
27.6%
|
|
$
|
903
|
|
|
28.7%
|
|
$
|
60
|
|
|
(110 bps)
|
Retail
|
|
572
|
|
|
15.1%
|
|
615
|
|
|
17.0%
|
|
(43
|
)
|
|
(190 bps)
|
|||
Licensing
|
|
150
|
|
|
90.2%
|
|
152
|
|
|
83.6%
|
|
(2
|
)
|
|
660 bps
|
|||
|
|
1,685
|
|
|
|
|
1,670
|
|
|
|
|
15
|
|
|
|
|||
Unallocated corporate expenses
|
|
(553
|
)
|
|
|
|
(531
|
)
|
|
|
|
(22
|
)
|
|
|
|||
Gain on acquisition of Chaps
|
|
16
|
|
|
|
|
—
|
|
|
|
|
16
|
|
|
|
|||
Unallocated restructuring and other charges
|
|
(18
|
)
|
|
|
|
(12
|
)
|
|
|
|
(6
|
)
|
|
|
|||
Total operating income
|
|
$
|
1,130
|
|
|
15.2%
|
|
$
|
1,127
|
|
|
16.2%
|
|
$
|
3
|
|
|
(100 bps)
|
|
44
|
|
|
45
|
|
|
|
Fiscal Years Ended
|
|
|
|
|
|||||||||
|
|
March 30,
2013
|
|
March 31,
2012
|
|
$
Change
|
|
% / bps
Change
|
|||||||
|
|
(millions, except per share data)
|
|
|
|||||||||||
Net revenues
|
|
$
|
6,945
|
|
|
$
|
6,860
|
|
|
$
|
85
|
|
|
1.2
|
%
|
Cost of goods sold
(a)
|
|
(2,789
|
)
|
|
(2,862
|
)
|
|
73
|
|
|
(2.5
|
%)
|
|||
Gross profit
|
|
4,156
|
|
|
3,998
|
|
|
158
|
|
|
3.9
|
%
|
|||
Gross profit as % of net revenues
|
|
59.8
|
%
|
|
58.3
|
%
|
|
|
|
150 bps
|
|
||||
Selling, general, and administrative expenses
(a)
|
|
(2,971
|
)
|
|
(2,916
|
)
|
|
(55
|
)
|
|
1.9
|
%
|
|||
SG&A expenses as % of net revenues
|
|
42.8
|
%
|
|
42.5
|
%
|
|
|
|
30 bps
|
|
||||
Amortization of intangible assets
|
|
(27
|
)
|
|
(29
|
)
|
|
2
|
|
|
(7.3
|
%)
|
|||
Impairments of assets
|
|
(19
|
)
|
|
(2
|
)
|
|
(17
|
)
|
|
NM
|
|
|||
Restructuring and other charges
|
|
(12
|
)
|
|
(12
|
)
|
|
—
|
|
|
(5.6
|
%)
|
|||
Operating income
|
|
1,127
|
|
|
1,039
|
|
|
88
|
|
|
8.4
|
%
|
|||
Operating income as % of net revenues
|
|
16.2
|
%
|
|
15.2
|
%
|
|
|
|
100 bps
|
|
||||
Foreign currency losses
|
|
(12
|
)
|
|
(2
|
)
|
|
(10
|
)
|
|
NM
|
|
|||
Interest expense
|
|
(22
|
)
|
|
(24
|
)
|
|
2
|
|
|
(9.8
|
%)
|
|||
Interest and other income, net
|
|
6
|
|
|
11
|
|
|
(5
|
)
|
|
(48.2
|
%)
|
|||
Equity in losses of equity-method investees
|
|
(10
|
)
|
|
(9
|
)
|
|
(1
|
)
|
|
2.2
|
%
|
|||
Income before provision for income taxes
|
|
1,089
|
|
|
1,015
|
|
|
74
|
|
|
7.3
|
%
|
|||
Provision for income taxes
|
|
(339
|
)
|
|
(334
|
)
|
|
(5
|
)
|
|
1.6
|
%
|
|||
Effective tax rate
(b)
|
|
31.1
|
%
|
|
32.9
|
%
|
|
|
|
(180 bps)
|
|
||||
Net income
|
|
$
|
750
|
|
|
$
|
681
|
|
|
$
|
69
|
|
|
10.1
|
%
|
Net income per common share:
|
|
|
|
|
|
|
|
|
|||||||
Basic
|
|
$
|
8.21
|
|
|
$
|
7.35
|
|
|
$
|
0.86
|
|
|
11.7
|
%
|
Diluted
|
|
$
|
8.00
|
|
|
$
|
7.13
|
|
|
$
|
0.87
|
|
|
12.2
|
%
|
|
(a)
|
Includes total depreciation expense of $206 million and $196 million for Fiscal 2013 and Fiscal 2012, respectively.
|
(b)
|
Effective tax rate is calculated by dividing the provision for income taxes by income before provision for income taxes.
|
NM =
|
Not meaningful.
|
|
46
|
|
|
|
Fiscal Years Ended
|
|
$
Change
|
|
%
Change
|
|||||||||
|
|
March 30,
2013
|
|
March 31,
2012
|
|
||||||||||
|
|
(millions)
|
|
|
|||||||||||
Net Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Wholesale
|
|
$
|
3,138
|
|
|
$
|
3,247
|
|
|
$
|
(109
|
)
|
|
(3.3
|
%)
|
Retail
|
|
3,625
|
|
|
3,432
|
|
|
193
|
|
|
5.6
|
%
|
|||
Licensing
|
|
182
|
|
|
181
|
|
|
1
|
|
|
0.7
|
%
|
|||
Total net revenues
|
|
$
|
6,945
|
|
|
$
|
6,860
|
|
|
$
|
85
|
|
|
1.2
|
%
|
•
|
a $78 million net decrease related to our European businesses on a constant currency basis driven by reduced shipments across our core menswear, womenswear, and childrenswear product lines, reflecting the challenging European retail environment and softness in the specialty store business, particularly in Southern Europe. These decreases were partially offset by increased sales from our accessories product lines, driven by new product offerings and an increased department store presence;
|
•
|
a $15 million net decrease related to our Japanese businesses on a constant currency basis, primarily due to the impact of our business model shift to the retail concession-based channel and the softness in the department store business; and
|
•
|
a $50 million net decrease in revenues due to net unfavorable foreign currency effects, primarily related to the weakening of the Euro against the U.S. Dollar during Fiscal 2013.
|
•
|
a $33 million net increase related to our businesses in the Americas, reflecting higher menswear and womenswear revenues due in part to additional product line offerings, partially offset by declines due to the discontinuance of the majority of product categories under the American Living brand sold to JCPenney. The increase in net revenues was also due to incremental Home product revenues related to our assumption of control over the distribution of the previously licensed bedding and bath business on May 1, 2011, which was partially offset by lower revenues from our childrenswear product line.
|
•
|
a $119 million, or a 4%, net increase in consolidated comparable store sales on a constant currency basis, primarily driven by increases from our North American and European factory stores and our Ralph Lauren e-commerce operations, partially offset by decreases in comparable store sales from certain of our Ralph Lauren stores and our concession shops in Asia. Comparable store sales related to our e-commerce operations increased by approximately 18% on both a reported and constant currency basis over Fiscal 2012, and had a favorable impact on our total comparable store sales of 1% to 2% on both a reported and constant currency basis. Our consolidated comparable store sales excluding e-commerce increased between 1% and 2% on a reported basis and between 2% and 3% on a constant currency basis; and
|
•
|
a $120 million, or a 22%, net increase in non-comparable store sales on a constant currency basis, driven by new store openings over the past twelve months and the growth of our e-commerce operations through our recently launched Ralph Lauren e-commerce sites in Germany and Japan and Club Monaco e-commerce sites in North America. The effect of these new openings and launches more than offset the impact of store closings in the Asia-Pacific region due to our network repositioning initiative.
|
|
47
|
|
•
|
a $46 million net decrease in revenues due to unfavorable foreign currency effects, comprised of unfavorable effects of $36 million and $10 million related to our comparable and non-comparable store sales, respectively, primarily related to the weakening of the Euro and the Yen against the U.S. Dollar during Fiscal 2013.
|
|
|
March 30,
2013 |
|
March 31,
2012
|
||
Stores:
|
|
|
|
|
||
Freestanding stores
|
|
388
|
|
|
379
|
|
Concession shops
|
|
494
|
|
|
474
|
|
Total stores
|
|
882
|
|
|
853
|
|
|
|
|
|
|
||
E-commerce Sites:
|
|
|
|
|
||
North American sites
(a)
|
|
3
|
|
|
3
|
|
European sites
(b)
|
|
3
|
|
|
3
|
|
Asian site
(c)
|
|
1
|
|
|
—
|
|
Total e-commerce sites
|
|
7
|
|
|
6
|
|
|
(a)
|
Our North American e-commerce sites as of March 30, 2013 include www.RalphLauren.com, www.ClubMonaco.com, and www.ClubMonaco.ca, which collectively service the U.S. and Canada. As of March 31, 2012, our North American e-commerce sites included www.RalphLauren.com, www.ClubMonaco.com, and www.Rugby.com.
|
(b)
|
Includes www.RalphLauren.co.uk (servicing the United Kingdom), www.RalphLauren.fr (servicing Belgium, France, Italy, Luxembourg, the Netherlands, Portugal, and Spain), and www.RalphLauren.de (servicing Germany and Austria).
|
(c)
|
Includes www.RalphLauren.co.jp servicing Japan, which was launched in Fiscal 2013.
|
|
48
|
|
|
|
Fiscal 2013
Compared to
Fiscal 2012
|
||
|
|
(millions)
|
||
SG&A expense category:
|
|
|
||
Compensation-related expenses
(a)
|
|
$
|
26
|
|
Selling expenses
|
|
7
|
|
|
Depreciation expense
|
|
7
|
|
|
Shipping, warehousing, and distribution expenses
|
|
6
|
|
|
Rent and occupancy-related expenses
|
|
5
|
|
|
Marketing, advertising, and promotional expenses
|
|
4
|
|
|
Total change in SG&A expenses
|
|
$
|
55
|
|
|
(a)
|
Primarily related to increased salaries to support retail growth and higher stock-based compensation expenses.
|
|
49
|
|
|
|
Fiscal Years Ended
|
|
$
Change
|
|
Margin
Change
|
||||||||||||||
|
|
March 30, 2013
|
|
March 31, 2012
|
|
|||||||||||||||
|
|
Operating
Income
|
|
Operating
Margin
|
|
Operating
Income
|
|
Operating
Margin
|
|
|||||||||||
|
|
(millions)
|
|
|
|
(millions)
|
|
|
|
(millions)
|
|
|
||||||||
Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Wholesale
|
|
$
|
903
|
|
|
28.7
|
%
|
|
$
|
835
|
|
|
25.7
|
%
|
|
$
|
68
|
|
|
300 bps
|
Retail
|
|
615
|
|
|
17.0
|
%
|
|
553
|
|
|
16.1
|
%
|
|
62
|
|
|
90 bps
|
|||
Licensing
|
|
152
|
|
|
83.6
|
%
|
|
149
|
|
|
82.6
|
%
|
|
3
|
|
|
100 bps
|
|||
|
|
1,670
|
|
|
|
|
1,537
|
|
|
|
|
133
|
|
|
|
|||||
Unallocated corporate expenses
|
|
(531
|
)
|
|
|
|
(486
|
)
|
|
|
|
(45
|
)
|
|
|
|||||
Unallocated restructuring and other charges, net
|
|
(12
|
)
|
|
|
|
(12
|
)
|
|
|
|
—
|
|
|
|
|||||
Total operating income
|
|
$
|
1,127
|
|
|
16.2
|
%
|
|
$
|
1,039
|
|
|
15.2
|
%
|
|
$
|
88
|
|
|
100 bps
|
|
50
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
|
$
Change |
||||||
|
|
(millions)
|
||||||||||
Cash and cash equivalents
|
|
$
|
797
|
|
|
$
|
974
|
|
|
$
|
(177
|
)
|
Short-term investments
|
|
488
|
|
|
325
|
|
|
163
|
|
|||
Non-current investments
|
|
2
|
|
|
81
|
|
|
(79
|
)
|
|||
Current portion of long-term debt
(a)
|
|
—
|
|
|
(267
|
)
|
|
267
|
|
|||
Long-term debt
|
|
(300
|
)
|
|
—
|
|
|
(300
|
)
|
|||
Net cash and investments
(b)
|
|
$
|
987
|
|
|
$
|
1,113
|
|
|
$
|
(126
|
)
|
Equity
|
|
$
|
4,034
|
|
|
$
|
3,785
|
|
|
$
|
249
|
|
|
(a)
|
Represents our Euro Debt, which was repaid upon maturity on October 4, 2013.
|
(b)
|
"Net cash and investments" is defined as cash and cash equivalents, plus short-term and non-current investments, less total debt.
|
|
51
|
|
|
|
Fiscal Years Ended
|
|
|
||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
$
Change |
||||||
|
|
(millions)
|
||||||||||
Net cash provided by operating activities
|
|
$
|
907
|
|
|
$
|
1,019
|
|
|
$
|
(112
|
)
|
Net cash used in investing activities
|
|
(488
|
)
|
|
(113
|
)
|
|
(375
|
)
|
|||
Net cash used in financing activities
|
|
(599
|
)
|
|
(595
|
)
|
|
(4
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
3
|
|
|
(9
|
)
|
|
12
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
$
|
(177
|
)
|
|
$
|
302
|
|
|
$
|
(479
|
)
|
•
|
an increase associated with the changes in our accounts receivable balance, resulting from higher revenues at the end of Fiscal 2014 and the timing of cash collections; and
|
•
|
an increase in prepaid expenses and other current assets, primarily attributable to an increase in non-income tax receivables related to our foreign operations and the timing of related payments.
|
•
|
increases related to accounts payable and accrued liabilities and income taxes, primarily due to the timing of the related payments.
|
•
|
a
$238 million
increase in cash used to purchase investments, less proceeds from sales and maturities of investments. During
Fiscal 2014
, we made net investment purchases of
$56 million
, as compared to net investment sales of
$182 million
during
Fiscal 2013
;
|
•
|
a
$114 million
increase in cash used for capital expenditures. During
Fiscal 2014
, we spent
$390 million
on capital expenditures, as compared to
$276 million
during
Fiscal 2013
. Our capital expenditures were primarily associated with global retail store expansion, department store renovations, the purchase and expansion of a distribution facility in High Point, North Carolina, and enhancements to our global information technology systems, including the continued implementation of our new global operating and financial reporting information technology system, SAP. In Fiscal 2015, we expect to spend between $400 million and $500 million in capital expenditures, primarily to support our global retail store expansion, including the opening of our first Polo flagship store in New York City, the introduction of the Polo store concept around the world, new store openings in Asia, including the opening of our first flagship store in Hong Kong, and the expansion of the Chaps brand. Our capital expenditures will also be focused on department store renovations, the continued implementation of SAP and other systems, and further development of our infrastructure, including investment in a new global e-commerce platform; and
|
•
|
an
$18 million
increase in cash used to fund our acquisitions and ventures. During
Fiscal 2014
, we used
$40 million
of cash to fund our acquisitions and ventures, including
$18 million
to fund the Chaps Menswear License Acquisition,
$15 million
to fund the Australia and New Zealand Licensed Operations Acquisition, as well as amounts to support the continued funding of our joint venture, the RL Watch Company. During
Fiscal 2013
, we used
$22 million
of cash, primarily in connection with our acquisition of the previously licensed business in Latin America, and to fund the operations of the RL Watch Company.
|
|
52
|
|
•
|
a
$21 million
increase in cash used to pay dividends. During
Fiscal 2014
, we used
$149 million
to pay dividends, as compared to
$128 million
during
Fiscal 2013
, primarily due to the increase in the quarterly cash dividend from
$0.40
per share to
$0.45
per share, effective in November 2013; and
|
•
|
an $11 million increase in cash used to repurchase shares of our Class A common stock. During
Fiscal 2014
, we used $498 million to repurchase shares of Class A common stock pursuant to our common stock repurchase program, and an additional
$60 million
in shares of Class A common stock were surrendered or withheld in satisfaction of withholding taxes in connection with the vesting of awards under our 1997 Long-Term Stock Incentive Plan, as amended (the "1997 Incentive Plan") and our 2010 Long-Term Stock Incentive Plan, as amended (the "2010 Incentive Plan"). On a comparative basis, during
Fiscal 2013
, we used
$450 million
to repurchase shares of Class A common stock pursuant to our common stock repurchase program, and an additional
$47 million
in shares of Class A common stock were surrendered or withheld for taxes. In addition, during Fiscal 2013, we made a $50 million payment in connection with our prepaid share repurchase program.
|
•
|
$31 million in proceeds from the issuance of long-term debt, net of repayments. During
Fiscal 2014
, we received
$300 million
in proceeds from our issuance of 2.125% unsecured Senior Notes in September 2013. A portion of these proceeds was used to repay the
$269 million
principal amount outstanding of the 4.5% Euro-denominated notes upon their maturity on October 4, 2013.
|
|
|
Fiscal Years Ended
|
|
|
||||||||
|
|
March 30,
2013 |
|
March 31,
2012 |
|
$
Change |
||||||
|
|
(millions)
|
||||||||||
Net cash provided by operating activities
|
|
$
|
1,019
|
|
|
$
|
885
|
|
|
$
|
134
|
|
Net cash used in investing activities
|
|
(113
|
)
|
|
(249
|
)
|
|
136
|
|
|||
Net cash used in financing activities
|
|
(595
|
)
|
|
(408
|
)
|
|
(187
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(9
|
)
|
|
(9
|
)
|
|
—
|
|
|||
Net increase in cash and cash equivalents
|
|
$
|
302
|
|
|
$
|
219
|
|
|
$
|
83
|
|
•
|
an increase in net income before depreciation and amortization, stock-based compensation, impairment charges, and other non-cash items; and
|
•
|
a net improvement in our working capital, primarily reflecting a smaller increase in inventories than in the prior fiscal year, as increased inventory levels to support our new product offerings, store openings, and new e-commerce sites were partially offset by the timing of inventory receipts, inventory management initiatives, and lower sourcing costs in Fiscal 2013. In addition, accounts receivable declined due to lower wholesale revenues and higher cash collections in Fiscal 2013, resulting in an improvement in days sales outstanding of approximately three days. These increases in cash were largely offset by declines related to income taxes and accounts payable and accrued expenses, primarily related to the timing of payments.
|
|
53
|
|
•
|
an increase in proceeds from sales and maturities of investments, less cash used to purchase investments. During Fiscal 2013, we received net proceeds of $182 million on our investments, as compared to net proceeds of $34 million in Fiscal 2012.
|
•
|
a $10 million increase in net cash used to fund our acquisitions and ventures. In Fiscal 2013, we used $22 million of cash to fund the acquisitions of certain previously licensed businesses and to provide continued funding to our joint venture, the RL Watch Company. In Fiscal 2012, we used $12 million, primarily to fund the RL Watch Company's operations; and
|
•
|
an increase in cash used for capital expenditures. In Fiscal 2013, we spent $276 million for capital expenditures, as compared to $272 million in Fiscal 2012. Our capital expenditures were primarily associated with global retail store expansion and construction, our renovation of department store shop-within-shops, investments in our facilities, and enhancements to our global information technology systems.
|
•
|
an increase in cash used in connection with repurchases of our Class A common stock. During Fiscal 2013, we repurchased 3.0 million shares of Class A common stock at a cost of $450 million pursuant to our common stock repurchase program, and 0.4 million shares of Class A common stock at a cost of $47 million were surrendered or withheld in satisfaction of withholding taxes in connection with the vesting of awards under our 1997 Incentive Plan and our 2010 Incentive Plan. In addition, during Fiscal 2013, we made a $50 million payment in connection with our prepaid share repurchase program. On a comparative basis, during Fiscal 2012, 3.2 million shares of Class A common stock at a cost of $395 million were repurchased pursuant to our common stock repurchase program, and 0.2 million shares of Class A common stock at a cost of $24 million were withheld in satisfaction of withholding taxes in connection with the vesting of awards under our 1997 Incentive Plan and our 2010 Incentive Plan;
|
•
|
an increase in cash used to pay dividends. During Fiscal 2013, we used $128 million to pay dividends, as compared to $74 million during Fiscal 2012; and
|
•
|
a decrease in cash received from stock option exercises. In Fiscal 2013, we received $49 million from the exercise of employee stock options, as compared to $61 million in Fiscal 2012.
|
|
54
|
|
|
Fiscal Years Ended
|
||||||||||
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
(in millions)
|
||||||||||
Cost of shares repurchased
|
$
|
548
|
|
(a)
|
$
|
450
|
|
|
$
|
395
|
|
Number of shares repurchased
|
3.2
|
|
(a)
|
3.0
|
|
|
3.2
|
|
|
(a)
|
Includes a
$50 million
prepayment made in March 2013 under our share repurchase program with a third-party financial institution, in exchange for the right to receive shares of our Class A common stock at the conclusion of the
93
-day repurchase term. The
$50 million
prepayment was recorded as a reduction to additional paid-in capital in our consolidated balance sheet as of March 30, 2013. The related
0.3 million
shares were delivered to us during
Fiscal 2014
, based on the volume-weighted average market price of our Class A common stock over the
93
-day repurchase term, less a discount.
|
|
55
|
|
|
56
|
|
|
|
Fiscal
2015
|
|
Fiscal
2016-2017
|
|
Fiscal
2018-2019
|
|
Fiscal
2020 and
Thereafter
|
|
Total
|
||||||||||
|
|
(millions)
|
||||||||||||||||||
Senior Notes
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
—
|
|
|
$
|
300
|
|
Interest payments on Senior Notes
|
|
6
|
|
|
13
|
|
|
10
|
|
|
—
|
|
|
29
|
|
|||||
Capital leases
|
|
24
|
|
|
48
|
|
|
46
|
|
|
98
|
|
|
216
|
|
|||||
Operating leases
|
|
336
|
|
|
605
|
|
|
518
|
|
|
927
|
|
|
2,386
|
|
|||||
Inventory purchase commitments
|
|
1,106
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,106
|
|
|||||
Other commitments
|
|
81
|
|
|
58
|
|
|
43
|
|
|
55
|
|
|
237
|
|
|||||
Total
|
|
$
|
1,553
|
|
|
$
|
724
|
|
|
$
|
917
|
|
|
$
|
1,080
|
|
|
$
|
4,274
|
|
•
|
Senior Notes
represents the principal amount of our outstanding unsecured senior notes due September 26, 2018. Amount does not include any fair value adjustments, call premiums, or interest payments (see below);
|
•
|
Interest payments on Senior Notes
represent the semi-annual contractual interest payments due on our Senior Notes, which bear interest at a fixed annual rate of
2.125%
;
|
•
|
Lease obligations
represent the minimum lease rental payments due under noncancelable leases for our real estate and operating equipment in various locations around the world. In addition to such amounts, we are normally required to pay taxes, insurance, and occupancy costs relating to our leased real estate properties, which are not included in the table above. Approximately 70% of these lease obligations relate to our retail operations. Information has been presented separately for operating and capital leases. In Fiscal 2014, we entered into a build-to-suit lease agreement for a new Polo flagship store on Fifth Avenue in New York City. The total commitment related to this lease is $235 million, comprised of a $74 million operating lease obligation related to the land portion of the lease (included in the operating lease obligations above) and a $161 million obligation related to the building portion of the lease (included in the capital lease obligations above);
|
•
|
Inventory purchase commitments
represent our legally-binding agreements to purchase fixed or minimum quantities of goods at determinable prices; and
|
•
|
Other commitments
primarily represent our legally-binding obligations under sponsorship, licensing, and other marketing and advertising agreements; distribution-related agreements; information technology-related service agreements; and pension-related obligations.
|
|
57
|
|
•
|
Forecasted Inventory Purchases
— Recognized as part of the cost of the inventory being hedged within cost of goods sold when the related inventory is sold to a third party.
|
|
58
|
|
•
|
Intercompany Royalty Payments and Marketing Contributions
— Recognized within foreign currency gains (losses) in the period in which the related royalties or marketing contributions being hedged are received or paid.
|
|
59
|
|
|
60
|
|
|
61
|
|
|
62
|
|
|
63
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures about Market Risk.
|
Item 8.
|
Financial Statements and Supplementary Data.
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
|
|
64
|
|
Item 9A.
|
Controls and Procedures.
|
|
65
|
|
Item 9B.
|
Other Information.
|
|
66
|
|
Item 10.
|
Directors, Executive Officers and Corporate Governance.
|
Item 11.
|
Executive Compensation.
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
|
|
(1)
|
Consists of 3,026,335 options to purchase shares of our Class A common stock and 1,489,134 restricted stock units that are payable solely in shares of Class A common stock (including 539,284 service-based restricted stock units that have fully vested but for which the underlying shares have not yet been delivered as of
March 29, 2014
). Does not include 5,185 outstanding restricted shares that are subject to forfeiture.
|
(2)
|
Represents the weighted average exercise price of outstanding stock options.
|
(3)
|
All of the securities remaining available for future issuance set forth in column (c) may be in the form of options, stock appreciation rights, restricted stock, restricted stock units, performance awards, or other stock-based awards under the Company's 1997 Stock Incentive Plan and 2010 Stock Incentive Plan (the "Plans"). An additional 5,185 outstanding shares of restricted stock granted under the Company's Plans that remain subject to forfeiture are not reflected in column (c).
|
|
67
|
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence.
|
Item 14.
|
Principal Accounting Fees and Services.
|
|
68
|
|
Item 15.
|
Exhibits, Financial Statement Schedules.
|
Exhibit
Number
|
|
Description
|
3.1
|
|
Amended and Restated Certificate of Incorporation of the Company (filed as Exhibit 3.1 to the Company's Registration Statement on Form S-1 (File No. 333-24733) (the "S-1"))
|
3.2
|
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of the Company (filed as Exhibit 3.1 to the Form 8-K filed August 16, 2011)
|
3.3
|
|
Third Amended and Restated By-laws of the Company (filed as Exhibit 3.1 to the Form 8-K dated February 4, 2014)
|
4.1
|
|
Indenture, dated as of September 26, 2013, by and between the Company and Wells Fargo Bank, National Association (including the form of Note) (filed as Exhibit 4.1 to the Form 8-K dated September 23, 2013)
|
4.2
|
|
First Supplemental Indenture, dated as of September 26, 2013, by and between the Company and Wells Fargo Bank, National Association (filed as Exhibit 4.2 to the Form 8-K dated September 23, 2013)
|
10.1
|
|
Registration Rights Agreement dated as of June 9, 1997 by and among Ralph Lauren, GS Capital Partners, L.P., GS Capital Partner PRL Holding I, L.P., GS Capital Partners PRL Holding II, L.P., Stone Street Fund 1994, L.P., Stone Street 1994 Subsidiary Corp., Bridge Street Fund 1994, L.P., and the Company (filed as Exhibit 10.3 to the S-1)
|
10.2
|
|
Form of Indemnification Agreement between the Company and its Directors and Executive Officers (filed as Exhibit 10.26 to the S-1)
|
10.3
|
|
Amended and Restated Employment Agreement, made effective as of June 26, 2012, between the Company and Ralph Lauren (filed as Exhibit 10.1 to the Form 8-K filed July 2, 2012)†
|
10.4
|
|
Amended and Restated Employment Agreement, effective as of November 1, 2013, between the Company and Roger N. Farah (filed as Exhibit 10.1 to the Form 8-K dated September 18, 2013)†
|
10.5
|
|
Amended and Restated Employment Agreement, effective as of November 1, 2013, between the Company and Jackwyn Nemerov (filed as Exhibit 10.2 to the Form 8-K dated September 18, 2013)†
|
10.6*
|
|
Amendment No. 1 to the Amended and Restated Employment Agreement, made effective as of March 30, 2014, between the Company and Jackwyn Nemerov†
|
10.7
|
|
Amended and Restated Employment Agreement, effective as of November 1, 2013, between the Company and Christopher H. Peterson (filed as Exhibit 10.3 to the Form 8-K dated September 18, 2013)†
|
10.8*
|
|
Amendment No. 1 to the Amended and Restated Employment Agreement, made effective as of March 30, 2014, between the Company and Christopher Peterson†
|
10.9
|
|
Amended and Restated Employment Agreement, effective as of March 1, 2014, between the Company and Mitchell A. Kosh (filed as Exhibit 10.1 to the Form 8-K dated February 11, 2014)†
|
10.10
|
|
Non-Qualified Stock Option Agreement, dated as of June 8, 2004, between the Company and Ralph Lauren (filed as Exhibit 10.14 to the Company's Annual Report on Form 10-K for the fiscal year ended April 2, 2005 (the "Fiscal 2005 10-K"))†
|
10.11
|
|
Restricted Stock Unit Award Agreement, dated as of June 8, 2004, between the Company and Ralph Lauren (filed as Exhibit 10.15 to the Fiscal 2005 10-K)†
|
10.12
|
|
Executive Officer Annual Incentive Plan, as amended as of August 9, 2012 (filed as Appendix B to the Company's Definitive Proxy Statement dated July 2, 2012)†
|
10.13
|
|
Restricted Stock Unit Award Agreement, dated as of July 1, 2004, between the Company and Roger N. Farah (filed as Exhibit 10.18 to the Fiscal 2005 10-K)†
|
10.14
|
|
Amendment No. 1, dated as of December 23, 2008, to the Restricted Stock Unit Award Agreement between the Company and Roger N. Farah (filed as Exhibit 10.2 to the Form 10-Q for the quarterly period ended December 27, 2008)†
|
10.15
|
|
Restricted Stock Award Agreement, dated as of July 23, 2002, between the Company and Roger N. Farah (filed as Exhibit 10.19 to the Fiscal 2005 10-K)†
|
10.16
|
|
Non-Qualified Stock Option Agreement, dated as of July 23, 2002, between the Company and Roger N. Farah (filed as Exhibit 10.20 to the Fiscal 2005 10-K)†
|
|
69
|
|
Exhibit
Number
|
|
Description
|
10.17
|
|
Deferred Compensation Agreement, dated as of September 19, 2002, between the Company and Roger N. Farah (filed as Exhibit 10.21 to the Fiscal 2005 10-K)†
|
10.18
|
|
1997 Long-Term Stock Incentive Plan, as Amended and Restated as of August 12, 2004 (filed as Exhibit 99.1 to the Form 8-K dated August 12, 2004)†
|
10.19
|
|
Amendment, as of June 30, 2006, to the 1997 Long-Term Stock Incentive Plan, as Amended and Restated as of August 12, 2004 (filed as Exhibit 10.4 to the Form 10-Q for the quarterly period ended July 1, 2006)†
|
10.20
|
|
Amendment No. 2, dated as of May 21, 2009, to the 1997 Long-Term Stock Incentive Plan, as Amended and Restated as of August 12, 2004 (filed as Exhibit 10.26 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 28, 2009)†
|
10.21
|
|
Amended and Restated 2010 Long-Term Incentive Plan, amended as of August 8, 2013 (filed as Exhibit 10.1 to the Form 10-Q for the quarterly period ended June 29, 2013)†
|
10.22
|
|
Cliff Restricted Performance Share Unit Award Overview containing the standard terms of restricted performance share awards under the 1997 Long-Term Stock Incentive Plan (filed as Exhibit 10.1 to the Form 10-Q for the quarterly period ended July 1, 2006)†
|
10.23
|
|
Pro-Rata Restricted Performance Share Unit Award Overview containing the standard terms of restricted performance share awards under the 1997 Long-Term Stock Incentive Plan (filed as Exhibit 10.3 to the Form 10-Q for the quarterly period ended July 1, 2006)†
|
10.24
|
|
Stock Option Award Overview - U.S. containing the standard terms of stock option awards under the 1997 Long-Term Stock Incentive Plan (filed as Exhibit 10.2 to the Form 10-Q for the quarterly period ended July 1, 2006)†
|
10.25*
|
|
Cliff Restricted Performance Share Unit Award Overview containing the standard terms of cliff restricted performance share unit awards under the Amended and Restated 2010 Long-Term Stock Incentive Plan†
|
10.26*
|
|
Pro-Rata Restricted Performance Share Unit Award Overview containing the standard terms of restricted performance share unit awards under the Amended and Restated 2010 Long-Term Stock Incentive Plan†
|
10.27*
|
|
Stock Option Award Overview containing the standard terms of stock option awards under the Amended and Restated 2010 Long-Term Stock Incentive Plan†
|
10.28*
|
|
Cliff Restricted Performance Share Unit with TSR Modifier Award Overview containing the standard terms of cliff restricted performance share unit awards under the Amended and Restated 2010 Long-Term Stock Incentive Plan†
|
10.29
|
|
Credit Agreement, dated March 10, 2011, among the Company, Polo JP Acqui C.V., Polo Ralph Lauren Kabushiki Kaisha and Polo Ralph Lauren Asia Pacific Limited, as the borrowers, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent (filed as Exhibit 10.1 to the Form 10-Q for the quarterly period ended October 1, 2011)
|
10.30
|
|
Amended and Restated Polo Ralph Lauren Supplemental Executive Retirement Plan (filed as Exhibit 10.1 to the Company’s Form 10-Q for the quarterly period ended December 31, 2005)†
|
12.1*
|
|
Computation of Ratio of Earnings to Fixed Charges
|
14.1
|
|
Code of Ethics for Principal Executive Officers and Senior Financial Officers (filed as Exhibit 14.1 to the Company's Annual Report on Form 10-K for the fiscal year ended March 29, 2003)
|
21.1*
|
|
List of Significant Subsidiaries of the Company
|
23.1*
|
|
Consent of Ernst & Young LLP
|
31.1*
|
|
Certification of Ralph Lauren required by 17 CFR 240.13a-14(a)
|
31.2*
|
|
Certification of Christopher H. Peterson required by 17 CFR 240.13a-14(a)
|
32.1*
|
|
Certification of Ralph Lauren Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2*
|
|
Certification of Christopher H. Peterson Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
70
|
|
Exhibit
Number
|
|
Description
|
101*
|
|
Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets at March 29, 2014 and March 30, 2013, (ii) the Consolidated Statements of Income for the fiscal years ended March 29, 2014, March 30, 2013, and March 31, 2012, (iii) the Consolidated Statements of Comprehensive Income for the fiscal years ended March 29, 2014, March 30, 2013, and March 31, 2012, (iv) the Consolidated Statements of Cash Flows for the fiscal years ended March 29, 2014, March 30, 2013, and March 31, 2012, (v) the Consolidated Statements of Equity for the fiscal years ended March 29, 2014, March 30, 2013, and March 31, 2012, and (vi) the Notes to the Consolidated Financial Statements.
|
|
*
|
Filed herewith.
|
†
|
Management contract or compensatory plan or arrangement.
|
|
71
|
|
|
|
RALPH LAUREN CORPORATION
|
|
|
|
|
By:
|
/
S
/ CHRISTOPHER H. PETERSON
|
|
|
Christopher H. Peterson
|
|
|
Executive Vice President, Chief Administrative Officer and Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
Date: May 15, 2014
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/
S
/ RALPH LAUREN
|
|
Chairman of the Board, Chief Executive Officer and Director (Principal Executive Officer)
|
|
May 15, 2014
|
Ralph Lauren
|
|
|||
|
|
|
|
|
/
S
/ ROGER N. FARAH
|
|
Executive Vice Chairman and Director
|
|
May 15, 2014
|
Roger N. Farah
|
|
|||
|
|
|
|
|
/
S
/ JACKWYN L. NEMEROV
|
|
President & Chief Operating Officer and Director
|
|
May 15, 2014
|
Jackwyn L. Nemerov
|
|
|||
|
|
|
|
|
/
S
/ CHRISTOPHER H. PETERSON
|
|
Executive Vice President, Chief Administrative Officer and Chief Financial Officer
(Principal Financial and Accounting Officer)
|
|
May 15, 2014
|
Christopher H. Peterson
|
|
|||
|
|
|
|
|
/
S
/ JOHN R. ALCHIN
|
|
Director
|
|
May 15, 2014
|
John R. Alchin
|
|
|||
|
|
|
|
|
/
S
/ ARNOLD H. ARONSON
|
|
Director
|
|
May 15, 2014
|
Arnold H. Aronson
|
|
|||
|
|
|
|
|
/
S
/ FRANK A. BENNACK, JR.
|
|
Director
|
|
May 15, 2014
|
Frank A. Bennack, Jr.
|
|
|||
|
|
|
|
|
/
S
/ DR. JOYCE F. BROWN
|
|
Director
|
|
May 15, 2014
|
Dr. Joyce F. Brown
|
|
|||
|
|
|
|
|
/
S
/ JOEL L. FLEISHMAN
|
|
Director
|
|
May 15, 2014
|
Joel L. Fleishman
|
|
|||
|
|
|
|
|
/
S
/ HUBERT JOLY
|
|
Director
|
|
May 15, 2014
|
Hubert Joly
|
|
|
72
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/
S
/ DAVID LAUREN
|
|
Director
|
|
May 15, 2014
|
David Lauren
|
|
|||
|
|
|
|
|
/
S
/ JUDITH A. MCHALE
|
|
Director
|
|
May 15, 2014
|
Judith A. McHale
|
|
|||
|
|
|
|
|
/
S
/ STEVEN P. MURPHY
|
|
Director
|
|
May 15, 2014
|
Steven P. Murphy
|
|
|||
|
|
|
|
|
/
S
/ ROBERT C. WRIGHT
|
|
Director
|
|
May 15, 2014
|
Robert C. Wright
|
|
|
73
|
|
|
Page
|
|
Consolidated Financial Statements:
|
|
|
Supplementary Information:
|
|
|
|
||
EX-10.6
|
|
|
EX-10.8
|
|
|
EX-10.25
|
|
|
EX-10.26
|
|
|
EX-10.27
|
|
|
EX-10.28
|
|
|
EX-12.1
|
|
|
EX-21.1
|
|
|
EX-23.1
|
|
|
EX-31.1
|
|
|
EX-31.2
|
|
|
EX-32.1
|
|
|
EX-32.2
|
|
|
EX-101
|
INSTANCE DOCUMENT
|
|
EX-101
|
SCHEMA DOCUMENT
|
|
EX-101
|
CALCULATION LINKBASE DOCUMENT
|
|
EX-101
|
LABELS LINKBASE DOCUMENT
|
|
EX-101
|
PRESENTATION LINKBASE DOCUMENT
|
|
EX-101
|
DEFINITION LINKBASE DOCUMENT
|
|
|
F-1
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
ASSETS
|
||||||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
797
|
|
|
$
|
974
|
|
Short-term investments
|
|
488
|
|
|
325
|
|
||
Accounts receivable, net of allowances of $270 million and $245 million
|
|
588
|
|
|
458
|
|
||
Inventories
|
|
1,020
|
|
|
896
|
|
||
Income tax receivable
|
|
62
|
|
|
29
|
|
||
Deferred tax assets
|
|
150
|
|
|
120
|
|
||
Prepaid expenses and other current assets
|
|
224
|
|
|
161
|
|
||
Total current assets
|
|
3,329
|
|
|
2,963
|
|
||
Non-current investments
|
|
2
|
|
|
81
|
|
||
Property and equipment, net
|
|
1,322
|
|
|
932
|
|
||
Deferred tax assets
|
|
39
|
|
|
22
|
|
||
Goodwill
|
|
964
|
|
|
968
|
|
||
Intangible assets, net
|
|
299
|
|
|
328
|
|
||
Other non-current assets
|
|
135
|
|
|
124
|
|
||
Total assets
|
|
$
|
6,090
|
|
|
$
|
5,418
|
|
LIABILITIES AND EQUITY
|
||||||||
Current liabilities:
|
|
|
|
|
||||
Current portion of long-term debt
|
|
$
|
—
|
|
|
$
|
267
|
|
Accounts payable
|
|
203
|
|
|
147
|
|
||
Income tax payable
|
|
77
|
|
|
43
|
|
||
Accrued expenses and other current liabilities
|
|
690
|
|
|
664
|
|
||
Total current liabilities
|
|
970
|
|
|
1,121
|
|
||
Long-term debt
|
|
300
|
|
|
—
|
|
||
Non-current liability for unrecognized tax benefits
|
|
132
|
|
|
150
|
|
||
Other non-current liabilities
|
|
654
|
|
|
362
|
|
||
Commitments and contingencies (Note 17)
|
|
|
|
|
||||
Total liabilities
|
|
2,056
|
|
|
1,633
|
|
||
Equity:
|
|
|
|
|
||||
Class A common stock, par value $.01 per share; 98.0 million and 93.6 million shares issued; 61.8 million and 61.0 million shares outstanding
|
|
1
|
|
|
1
|
|
||
Class B common stock, par value $.01 per share; 26.9 million and 29.9 million shares issued and outstanding
|
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
|
1,979
|
|
|
1,752
|
|
||
Retained earnings
|
|
5,257
|
|
|
4,647
|
|
||
Treasury stock, Class A, at cost (36.2 million and 32.6 million shares)
|
|
(3,317
|
)
|
|
(2,709
|
)
|
||
Accumulated other comprehensive income
|
|
114
|
|
|
94
|
|
||
Total equity
|
|
4,034
|
|
|
3,785
|
|
||
Total liabilities and equity
|
|
$
|
6,090
|
|
|
$
|
5,418
|
|
|
F-2
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions, except per share data)
|
||||||||||
Net sales
|
|
$
|
7,284
|
|
|
$
|
6,763
|
|
|
$
|
6,679
|
|
Licensing revenue
|
|
166
|
|
|
182
|
|
|
181
|
|
|||
Net revenues
|
|
7,450
|
|
|
6,945
|
|
|
6,860
|
|
|||
Cost of goods sold
(a)
|
|
(3,140
|
)
|
|
(2,789
|
)
|
|
(2,862
|
)
|
|||
Gross profit
|
|
4,310
|
|
|
4,156
|
|
|
3,998
|
|
|||
Other costs and expenses:
|
|
|
|
|
|
|
||||||
Selling, general, and administrative expenses
(a)
|
|
(3,142
|
)
|
|
(2,971
|
)
|
|
(2,916
|
)
|
|||
Amortization of intangible assets
|
|
(35
|
)
|
|
(27
|
)
|
|
(29
|
)
|
|||
Gain on acquisition of Chaps
|
|
16
|
|
|
—
|
|
|
—
|
|
|||
Impairments of assets
|
|
(1
|
)
|
|
(19
|
)
|
|
(2
|
)
|
|||
Restructuring and other charges
|
|
(18
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|||
Total other costs and expenses, net
|
|
(3,180
|
)
|
|
(3,029
|
)
|
|
(2,959
|
)
|
|||
Operating income
|
|
1,130
|
|
|
1,127
|
|
|
1,039
|
|
|||
Foreign currency losses
|
|
(8
|
)
|
|
(12
|
)
|
|
(2
|
)
|
|||
Interest expense
|
|
(20
|
)
|
|
(22
|
)
|
|
(24
|
)
|
|||
Interest and other income, net
|
|
3
|
|
|
6
|
|
|
11
|
|
|||
Equity in losses of equity-method investees
|
|
(9
|
)
|
|
(10
|
)
|
|
(9
|
)
|
|||
Income before provision for income taxes
|
|
1,096
|
|
|
1,089
|
|
|
1,015
|
|
|||
Provision for income taxes
|
|
(320
|
)
|
|
(339
|
)
|
|
(334
|
)
|
|||
Net income
|
|
$
|
776
|
|
|
$
|
750
|
|
|
$
|
681
|
|
|
|
|
|
|
|
|
||||||
Net income per common share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
8.55
|
|
|
$
|
8.21
|
|
|
$
|
7.35
|
|
Diluted
|
|
$
|
8.43
|
|
|
$
|
8.00
|
|
|
$
|
7.13
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
90.7
|
|
|
91.3
|
|
|
92.7
|
|
|||
Diluted
|
|
92.0
|
|
|
93.7
|
|
|
95.5
|
|
|||
Dividends declared per share
|
|
$
|
1.70
|
|
|
$
|
1.60
|
|
|
$
|
0.80
|
|
(a)
Includes total depreciation expense of:
|
|
$
|
(223
|
)
|
|
$
|
(206
|
)
|
|
$
|
(196
|
)
|
|
F-3
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Net income
|
|
$
|
776
|
|
|
$
|
750
|
|
|
$
|
681
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
52
|
|
|
(93
|
)
|
|
(50
|
)
|
|||
Net realized and unrealized gains (losses) on derivatives
|
|
(27
|
)
|
|
(13
|
)
|
|
32
|
|
|||
Net realized and unrealized gains (losses) on available-for-sale investments
|
|
(5
|
)
|
|
4
|
|
|
1
|
|
|||
Net realized and unrealized losses on defined benefit plans
|
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|||
Other comprehensive income (loss), net of tax
|
|
20
|
|
|
(103
|
)
|
|
(19
|
)
|
|||
Total comprehensive income
|
|
$
|
796
|
|
|
$
|
647
|
|
|
$
|
662
|
|
|
F-4
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
776
|
|
|
$
|
750
|
|
|
$
|
681
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization expense
|
|
258
|
|
|
233
|
|
|
225
|
|
|||
Deferred income tax expense (benefit)
|
|
1
|
|
|
14
|
|
|
(15
|
)
|
|||
Equity in losses of equity-method investees
|
|
9
|
|
|
10
|
|
|
9
|
|
|||
Non-cash stock-based compensation expense
|
|
93
|
|
|
88
|
|
|
78
|
|
|||
Gain on acquisition of Chaps
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|||
Non-cash impairment of assets
|
|
1
|
|
|
19
|
|
|
2
|
|
|||
Other non-cash charges, net
|
|
6
|
|
|
3
|
|
|
3
|
|
|||
Excess tax benefits from stock-based compensation arrangements
|
|
(34
|
)
|
|
(41
|
)
|
|
(40
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
(104
|
)
|
|
82
|
|
|
(114
|
)
|
|||
Inventories
|
|
(77
|
)
|
|
(68
|
)
|
|
(148
|
)
|
|||
Prepaid expenses and other current assets
|
|
(56
|
)
|
|
4
|
|
|
(39
|
)
|
|||
Accounts payable and accrued liabilities
|
|
43
|
|
|
(57
|
)
|
|
33
|
|
|||
Income tax receivables and payables
|
|
59
|
|
|
(13
|
)
|
|
122
|
|
|||
Deferred income
|
|
(18
|
)
|
|
(30
|
)
|
|
(19
|
)
|
|||
Other balance sheet changes, net
|
|
(34
|
)
|
|
25
|
|
|
107
|
|
|||
Net cash provided by operating activities
|
|
907
|
|
|
1,019
|
|
|
885
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Capital expenditures
|
|
(390
|
)
|
|
(276
|
)
|
|
(272
|
)
|
|||
Purchases of investments
|
|
(1,067
|
)
|
|
(876
|
)
|
|
(1,360
|
)
|
|||
Proceeds from sales and maturities of investments
|
|
1,011
|
|
|
1,058
|
|
|
1,394
|
|
|||
Acquisitions and ventures, net of cash acquired
|
|
(40
|
)
|
|
(22
|
)
|
|
(12
|
)
|
|||
Change in restricted cash deposits
|
|
(2
|
)
|
|
3
|
|
|
1
|
|
|||
Net cash used in investing activities
|
|
(488
|
)
|
|
(113
|
)
|
|
(249
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Proceeds from issuance of debt
|
|
300
|
|
|
—
|
|
|
108
|
|
|||
Repayment of debt
|
|
(269
|
)
|
|
—
|
|
|
(108
|
)
|
|||
Payments of capital lease obligations
|
|
(9
|
)
|
|
(9
|
)
|
|
(8
|
)
|
|||
Payments of dividends
|
|
(149
|
)
|
|
(128
|
)
|
|
(74
|
)
|
|||
Repurchases of common stock, including shares surrendered for tax withholdings
|
|
(558
|
)
|
|
(497
|
)
|
|
(419
|
)
|
|||
Prepayments of common stock repurchases
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|||
Proceeds from exercise of stock options
|
|
52
|
|
|
49
|
|
|
61
|
|
|||
Excess tax benefits from stock-based compensation arrangements
|
|
34
|
|
|
41
|
|
|
40
|
|
|||
Payment on interest rate swap termination
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||
Other financing activities
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||
Net cash used in financing activities
|
|
(599
|
)
|
|
(595
|
)
|
|
(408
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
3
|
|
|
(9
|
)
|
|
(9
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
(177
|
)
|
|
302
|
|
|
219
|
|
|||
Cash and cash equivalents at beginning of period
|
|
974
|
|
|
672
|
|
|
453
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
797
|
|
|
$
|
974
|
|
|
$
|
672
|
|
|
F-5
|
|
RALPH LAUREN CORPORATION
|
||||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF EQUITY
|
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
Additional
|
|
|
|
Treasury Stock
|
|
|
|
|
||||||||||||||||
|
|
Common Stock
(a)
|
|
Paid-in
|
|
Retained
|
|
at Cost
|
|
|
|
Total
|
||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Earnings
|
|
Shares
|
|
Amount
|
|
AOCI
(b)
|
|
Equity
|
||||||||||||||
|
|
(millions)
|
||||||||||||||||||||||||||||
Balance at April 2, 2011
|
|
120.3
|
|
|
$
|
1
|
|
|
$
|
1,445
|
|
|
$
|
3,436
|
|
|
25.8
|
|
|
$
|
(1,793
|
)
|
|
$
|
216
|
|
|
$
|
3,305
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
|
|
|
|
|
|
|
681
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19
|
)
|
|
|
|||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
662
|
|
|||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
(74
|
)
|
|
|
|
|
|
|
|
(74
|
)
|
||||||||||||
Repurchases of common stock
|
|
|
|
|
|
|
|
|
|
3.4
|
|
|
(419
|
)
|
|
|
|
(419
|
)
|
|||||||||||
Stock-based compensation
|
|
|
|
|
|
78
|
|
|
|
|
|
|
|
|
|
|
78
|
|
||||||||||||
Shares issued and tax benefits recognized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
pursuant to stock-based compensation plans
(d)
|
|
1.6
|
|
|
—
|
|
|
101
|
|
|
|
|
|
|
|
|
|
|
101
|
|
||||||||||
Balance at March 31, 2012
|
|
121.9
|
|
|
$
|
1
|
|
|
$
|
1,624
|
|
|
$
|
4,043
|
|
|
29.2
|
|
|
$
|
(2,212
|
)
|
|
$
|
197
|
|
|
$
|
3,653
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
|
|
|
|
|
|
|
750
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(103
|
)
|
|
|
|||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
647
|
|
|||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
(146
|
)
|
|
|
|
|
|
|
|
(146
|
)
|
||||||||||||
Repurchases of common stock
|
|
|
|
|
|
(50
|
)
|
(c)
|
|
|
3.4
|
|
|
(497
|
)
|
|
|
|
(547
|
)
|
||||||||||
Stock-based compensation
|
|
|
|
|
|
88
|
|
|
|
|
|
|
|
|
|
|
88
|
|
||||||||||||
Shares issued and tax benefits recognized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
pursuant to stock-based compensation plans
(d)
|
|
1.6
|
|
|
—
|
|
|
90
|
|
|
|
|
|
|
|
|
|
|
90
|
|
||||||||||
Balance at March 30, 2013
|
|
123.5
|
|
|
$
|
1
|
|
|
$
|
1,752
|
|
|
$
|
4,647
|
|
|
32.6
|
|
|
$
|
(2,709
|
)
|
|
$
|
94
|
|
|
$
|
3,785
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
|
|
|
|
|
|
|
776
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20
|
|
|
|
|||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
796
|
|
|||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
(153
|
)
|
|
|
|
|
|
|
|
(153
|
)
|
||||||||||||
Repurchases of common stock
|
|
|
|
|
|
50
|
|
(c)
|
|
|
3.6
|
|
|
(608
|
)
|
|
|
|
(558
|
)
|
||||||||||
Stock-based compensation
|
|
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
93
|
|
||||||||||||
Shares issued and tax benefits recognized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
pursuant to stock-based compensation plans
(d)
|
|
1.4
|
|
|
—
|
|
|
86
|
|
|
|
|
|
|
|
|
|
|
86
|
|
||||||||||
Conversion of stock-based compensation awards
(e)
|
|
|
|
|
|
(2
|
)
|
|
(13
|
)
|
|
|
|
|
|
|
|
(15
|
)
|
|||||||||||
Balance at March 29, 2014
|
|
124.9
|
|
|
$
|
1
|
|
|
$
|
1,979
|
|
|
$
|
5,257
|
|
|
36.2
|
|
|
$
|
(3,317
|
)
|
|
$
|
114
|
|
|
$
|
4,034
|
|
|
(a)
|
Includes Class A and Class B common stock. In Fiscal 2014 and Fiscal 2013,
3.0 million
and
1.0 million
shares, respectively, of Class B common stock were converted into an equal number of shares of Class A common stock pursuant to the terms of the Class B common stock (see
Note 18
).
|
(b)
|
Accumulated other comprehensive income (loss).
|
(c)
|
Relates to a
$50 million
payment made in March 2013 under a prepaid share repurchase repurchase program, which resulted in the delivery of the related shares at the conclusion of the repurchase term in
Fiscal 2014
(see
Note 18
).
|
(d)
|
Includes excess tax benefits relating to stock-based compensation arrangements of approximately
$34 million
,
$41 million
, and
$40 million
in
Fiscal 2014
,
Fiscal 2013
, and
Fiscal 2012
, respectively.
|
(e)
|
Includes the conversion of certain fully-vested and expensed stock-based compensation awards to a cash contribution into a deferred compensation account (see
Note 18
).
|
|
F-6
|
|
1.
|
Description of Business
|
2.
|
Basis of Presentation
|
|
F-7
|
|
3.
|
Summary of Significant Accounting Policies
|
|
F-8
|
|
|
|
Fiscal Years Ended
|
|||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
|||
|
|
|
|||||||
Basic shares
|
|
90.7
|
|
|
91.3
|
|
|
92.7
|
|
Dilutive effect of stock options, restricted stock, and RSUs
|
|
1.3
|
|
|
2.4
|
|
|
2.8
|
|
Diluted shares
|
|
92.0
|
|
|
93.7
|
|
|
95.5
|
|
|
F-9
|
|
|
F-10
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Beginning reserve balance
|
|
$
|
230
|
|
|
$
|
247
|
|
|
$
|
213
|
|
Amount charged against revenue to increase reserve
|
|
783
|
|
|
707
|
|
|
650
|
|
|||
Amount credited against customer accounts to decrease reserve
|
|
(764
|
)
|
|
(718
|
)
|
|
(611
|
)
|
|||
Foreign currency translation
|
|
5
|
|
|
(6
|
)
|
|
(5
|
)
|
|||
Ending reserve balance
|
|
$
|
254
|
|
|
$
|
230
|
|
|
$
|
247
|
|
|
F-11
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Beginning reserve balance
|
|
$
|
15
|
|
|
$
|
16
|
|
|
$
|
18
|
|
Amount recorded to expense to increase reserve
(a)
|
|
3
|
|
|
3
|
|
|
2
|
|
|||
Amount written-off against customer accounts to decrease reserve
|
|
(3
|
)
|
|
(3
|
)
|
|
(3
|
)
|
|||
Foreign currency translation
|
|
1
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Ending reserve balance
|
|
$
|
16
|
|
|
$
|
15
|
|
|
$
|
16
|
|
|
(a)
|
Amounts recorded to bad debt expense are included within SG&A expenses in the consolidated statements of income.
|
|
F-12
|
|
|
F-13
|
|
|
F-14
|
|
•
|
Forecasted Inventory Purchases
— Recognized as part of the cost of the inventory purchases being hedged within cost of goods sold when the related inventory is sold to a third party.
|
•
|
Intercompany Royalty Payments and Marketing Contributions
— Recognized within foreign currency gains (losses) generally in the period in which the related payments or contributions being hedged are received or paid.
|
4.
|
Recently Issued Accounting Standards
|
|
F-15
|
|
5.
|
Acquisitions
|
|
F-16
|
|
Assets acquired:
|
|
|
||
Inventory
|
|
$
|
30
|
|
Accounts receivable
|
|
19
|
|
|
Licensed trademark intangible asset
|
|
9
|
|
|
Total assets acquired
|
|
58
|
|
|
Liabilities assumed:
|
|
|
||
Accounts payable
|
|
(22
|
)
|
|
Other net liabilities
|
|
(2
|
)
|
|
Total net liabilities assumed
|
|
(24
|
)
|
|
Fair value of net assets acquired
|
|
34
|
|
|
Consideration paid
|
|
18
|
|
|
Gain on acquisition
(a)
|
|
$
|
16
|
|
|
(a)
|
Represents the difference between the acquisition date fair value of net assets acquired and the contractually-defined purchase price under the Company's license agreement with Warnaco, which granted the Company the right to early-terminate the license upon PVH's acquisition of Warnaco in February 2013.
|
6.
|
Inventories
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Raw materials
|
|
$
|
3
|
|
|
$
|
5
|
|
Work-in-process
|
|
2
|
|
|
1
|
|
||
Finished goods
|
|
1,015
|
|
|
890
|
|
||
Total inventories
|
|
$
|
1,020
|
|
|
$
|
896
|
|
|
F-17
|
|
7.
|
Property and Equipment
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Land and improvements
|
|
$
|
17
|
|
|
$
|
10
|
|
Buildings and improvements
|
|
183
|
|
|
130
|
|
||
Furniture and fixtures
|
|
661
|
|
|
601
|
|
||
Machinery and equipment
|
|
245
|
|
|
189
|
|
||
Capitalized software
|
|
366
|
|
|
252
|
|
||
Leasehold improvements
|
|
1,064
|
|
|
934
|
|
||
Construction in progress
|
|
312
|
|
|
137
|
|
||
|
|
2,848
|
|
|
2,253
|
|
||
Less: accumulated depreciation
|
|
(1,526
|
)
|
|
(1,321
|
)
|
||
Property and equipment, net
|
|
$
|
1,322
|
|
|
$
|
932
|
|
8.
|
Goodwill and Other Intangible Assets
|
|
|
Wholesale
|
|
Retail
|
|
Licensing
|
|
Total
|
||||||||
|
|
(millions)
|
||||||||||||||
Balance at March 31, 2012
|
|
$
|
635
|
|
|
$
|
223
|
|
|
$
|
146
|
|
|
$
|
1,004
|
|
Foreign currency translation
|
|
(21
|
)
|
|
(9
|
)
|
|
(6
|
)
|
|
(36
|
)
|
||||
Balance at March 30, 2013
|
|
614
|
|
|
214
|
|
|
140
|
|
|
968
|
|
||||
Foreign currency translation
|
|
3
|
|
|
(4
|
)
|
|
(3
|
)
|
|
(4
|
)
|
||||
Balance at March 29, 2014
|
|
$
|
617
|
|
|
$
|
210
|
|
|
$
|
137
|
|
|
$
|
964
|
|
|
F-18
|
|
|
|
March 29, 2014
|
|
March 30, 2013
|
|
||||||||||||||||||||
|
|
Gross Carrying Amount
|
|
Accum. Amort.
|
|
Net
|
|
Gross Carrying Amount
|
|
Accum. Amort.
|
|
Net
|
|
||||||||||||
|
|
(millions)
|
|
||||||||||||||||||||||
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Re-acquired licensed trademarks
|
|
$
|
234
|
|
|
$
|
(109
|
)
|
|
$
|
125
|
|
|
$
|
228
|
|
|
$
|
(94
|
)
|
|
$
|
134
|
|
|
Customer relationships
|
|
261
|
|
|
(112
|
)
|
|
149
|
|
|
265
|
|
|
(99
|
)
|
|
166
|
|
|
||||||
Other
|
|
29
|
|
|
(11
|
)
|
|
18
|
|
|
30
|
|
|
(9
|
)
|
|
21
|
|
(a)
|
||||||
Total intangible assets subject to amortization
|
|
524
|
|
|
(232
|
)
|
|
292
|
|
|
523
|
|
|
(202
|
)
|
|
321
|
|
|
||||||
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks and brands
|
|
7
|
|
|
N/A
|
|
|
7
|
|
|
7
|
|
|
N/A
|
|
|
7
|
|
(a)
|
||||||
Total intangible assets
|
|
$
|
531
|
|
|
$
|
(232
|
)
|
|
$
|
299
|
|
|
$
|
530
|
|
|
$
|
(202
|
)
|
|
$
|
328
|
|
|
|
(a)
|
Includes
$2 million
of impairment charges related to the write-off of certain intangible assets in connection with the Rugby Closure Plan (see Notes 11 and 12).
|
|
|
Amortization Expense
|
||
|
|
(millions)
|
||
Fiscal 2015
|
|
$
|
26
|
|
Fiscal 2016
|
|
26
|
|
|
Fiscal 2017
|
|
25
|
|
|
Fiscal 2018
|
|
25
|
|
|
Fiscal 2019
|
|
24
|
|
|
Fiscal 2020 and thereafter
|
|
166
|
|
|
Total
|
|
$
|
292
|
|
|
F-19
|
|
9.
|
Other Current and Non-Current Assets
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Other taxes receivable
|
|
$
|
77
|
|
|
$
|
31
|
|
Prepaid rent expense
|
|
31
|
|
|
28
|
|
||
Tenant allowances receivable
|
|
22
|
|
|
17
|
|
||
Fixed asset advance
|
|
19
|
|
|
—
|
|
||
Prepaid samples
|
|
13
|
|
|
14
|
|
||
Derivative financial instruments
|
|
3
|
|
|
15
|
|
||
Other prepaid expenses and current assets
|
|
59
|
|
|
56
|
|
||
Total prepaid expenses and other current assets
|
|
$
|
224
|
|
|
$
|
161
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Restricted cash
|
|
$
|
42
|
|
|
$
|
40
|
|
Security deposits
|
|
27
|
|
|
23
|
|
||
Assets held under deferred compensation arrangements
|
|
20
|
|
|
3
|
|
||
Officers' life insurance policies
|
|
4
|
|
|
23
|
|
||
Other non-current assets
|
|
42
|
|
|
35
|
|
||
Total other non-current assets
|
|
$
|
135
|
|
|
$
|
124
|
|
10.
|
Other Current and Non-Current Liabilities
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Accrued payroll and benefits
|
|
$
|
190
|
|
|
$
|
199
|
|
Accrued operating expenses
|
|
183
|
|
|
169
|
|
||
Accrued inventory
|
|
84
|
|
|
93
|
|
||
Other taxes payable
|
|
76
|
|
|
51
|
|
||
Accrued capital expenditures
|
|
45
|
|
|
53
|
|
||
Deferred income
|
|
41
|
|
|
40
|
|
||
Dividends payable
|
|
40
|
|
|
36
|
|
||
Capital lease obligations
|
|
16
|
|
|
4
|
|
||
Other accrued expenses and current liabilities
|
|
15
|
|
|
19
|
|
||
Total accrued expenses and other current liabilities
|
|
$
|
690
|
|
|
$
|
664
|
|
|
F-20
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Capital lease obligations
|
|
$
|
255
|
|
|
$
|
38
|
|
Deferred rent obligations
|
|
224
|
|
|
189
|
|
||
Deferred income
|
|
39
|
|
|
58
|
|
||
Deferred tax liabilities
|
|
81
|
|
|
30
|
|
||
Deferred compensation
|
|
29
|
|
|
12
|
|
||
Other non-current liabilities
|
|
26
|
|
|
35
|
|
||
Total other non-current liabilities
|
|
$
|
654
|
|
|
$
|
362
|
|
11.
|
Impairments of Assets
|
12.
|
Restructuring and Other Charges
|
|
F-21
|
|
13.
|
Income Taxes
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Domestic
|
|
$
|
710
|
|
|
$
|
672
|
|
|
$
|
618
|
|
Foreign
|
|
386
|
|
|
417
|
|
|
397
|
|
|||
Total income before provision for income taxes
|
|
$
|
1,096
|
|
|
$
|
1,089
|
|
|
$
|
1,015
|
|
|
F-22
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
(a)
|
|
$
|
211
|
|
|
$
|
189
|
|
|
$
|
203
|
|
State and local
(a)
|
|
51
|
|
|
42
|
|
|
51
|
|
|||
Foreign
|
|
57
|
|
|
94
|
|
|
95
|
|
|||
|
|
319
|
|
|
325
|
|
|
349
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
(4
|
)
|
|
9
|
|
|
4
|
|
|||
State and local
|
|
1
|
|
|
5
|
|
|
(2
|
)
|
|||
Foreign
|
|
4
|
|
|
—
|
|
|
(17
|
)
|
|||
|
|
1
|
|
|
14
|
|
|
(15
|
)
|
|||
Total provision for income taxes
|
|
$
|
320
|
|
|
$
|
339
|
|
|
$
|
334
|
|
|
(a)
|
Excludes federal, state, and local tax benefits of approximately
$34 million
,
$41 million
, and
$40 million
in
Fiscal 2014
,
Fiscal 2013
, and
Fiscal 2012
, respectively, resulting from stock-based compensation arrangements. Such amounts were recorded within equity.
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Provision for income taxes at the U.S. federal statutory rate
|
|
$
|
384
|
|
|
$
|
381
|
|
|
$
|
355
|
|
Increase (decrease) due to:
|
|
|
|
|
|
|
||||||
State and local income taxes, net of federal benefit
|
|
29
|
|
|
28
|
|
|
28
|
|
|||
Foreign income taxed at different rates, net of U.S. foreign tax credits
|
|
(89
|
)
|
|
(75
|
)
|
|
(56
|
)
|
|||
Unrecognized tax benefits and settlements of tax examinations
|
|
(5
|
)
|
|
6
|
|
|
12
|
|
|||
Other
|
|
1
|
|
|
(1
|
)
|
|
(5
|
)
|
|||
Total provision for income taxes
|
|
$
|
320
|
|
|
$
|
339
|
|
|
$
|
334
|
|
Effective tax rate
(a)
|
|
29.2
|
%
|
|
31.1
|
%
|
|
32.9
|
%
|
|
(a)
|
Effective tax rate is calculated by dividing the provision for income taxes by income before provision for income taxes.
|
|
F-23
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Current deferred tax assets:
|
|
|
|
|
||||
Receivable allowances and reserves
|
|
$
|
70
|
|
|
$
|
69
|
|
Deferred compensation
|
|
31
|
|
|
21
|
|
||
Inventory basis difference
|
|
30
|
|
|
19
|
|
||
Other
|
|
20
|
|
|
11
|
|
||
Valuation allowance
|
|
(1
|
)
|
|
(1
|
)
|
||
Net current deferred tax assets
(a)
|
|
150
|
|
|
119
|
|
||
|
|
|
|
|
||||
Non-current deferred tax assets (liabilities):
|
|
|
|
|
||||
Goodwill and other intangible assets
|
|
(219
|
)
|
|
(211
|
)
|
||
Property and equipment
|
|
(90
|
)
|
|
27
|
|
||
Cumulative translation adjustment and hedges
|
|
(8
|
)
|
|
(4
|
)
|
||
Lease obligations
|
|
92
|
|
|
—
|
|
||
Deferred compensation
|
|
79
|
|
|
68
|
|
||
Unrecognized tax benefits
|
|
46
|
|
|
35
|
|
||
Deferred rent
|
|
19
|
|
|
20
|
|
||
Deferred income
|
|
18
|
|
|
33
|
|
||
Net operating loss carryforwards
|
|
17
|
|
|
16
|
|
||
Transfer pricing
|
|
16
|
|
|
20
|
|
||
Other
|
|
(1
|
)
|
|
—
|
|
||
Valuation allowance
|
|
(11
|
)
|
|
(12
|
)
|
||
Net non-current deferred tax liabilities
(b)
|
|
(42
|
)
|
|
(8
|
)
|
||
Net deferred tax assets
|
|
$
|
108
|
|
|
$
|
111
|
|
|
(a)
|
The net current deferred tax balance as of
March 30, 2013
included current deferred tax liabilities of
$1 million
recorded within accrued expenses and other current liabilities in the consolidated balance sheets.
|
(b)
|
The net non-current deferred tax balances as of
March 29, 2014
and
March 30, 2013
were comprised of non-current deferred tax assets of
$39 million
and
$22 million
, respectively, recorded within deferred tax assets, and non-current deferred tax liabilities of
$81 million
and
$30 million
, respectively, recorded within other non-current liabilities in the consolidated balance sheets.
|
|
F-24
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Unrecognized tax benefits beginning balance
|
|
$
|
100
|
|
|
$
|
129
|
|
|
$
|
125
|
|
Additions related to current period tax positions
|
|
6
|
|
|
4
|
|
|
4
|
|
|||
Additions related to prior period tax positions
|
|
12
|
|
|
12
|
|
|
8
|
|
|||
Reductions related to prior period tax positions
|
|
(13
|
)
|
(a)
|
(32
|
)
|
(b)
|
(4
|
)
|
|||
Reductions related to expiration of statutes of limitations
|
|
(2
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|||
Reductions related to settlements with taxing authorities
|
|
(23
|
)
|
(a)
|
(10
|
)
|
(b)
|
—
|
|
|||
Additions (reductions) related to foreign currency translation
|
|
3
|
|
|
(2
|
)
|
|
(2
|
)
|
|||
Unrecognized tax benefits ending balance
|
|
$
|
83
|
|
|
$
|
100
|
|
|
$
|
129
|
|
|
(a)
|
Includes a $
29 million
decline in unrecognized tax benefits as a result of the Company's tax settlement agreement reached in Fiscal 2014 for the taxable years ended April 3, 2004 and April 2, 2005.
|
(b)
|
Includes a
$34 million
decline in unrecognized tax benefits as a result of the Company's tax settlement agreement reached in Fiscal 2013 in connection with a tax examination for the taxable years ended March 29, 2008 through April 3, 2010.
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Accrued interest and penalties beginning balance
|
|
$
|
50
|
|
|
$
|
39
|
|
|
$
|
31
|
|
Net additions charged to expense
|
|
6
|
|
|
22
|
|
(a)
|
8
|
|
|||
Reductions related to prior period tax positions
|
|
(4
|
)
|
|
(10
|
)
|
|
—
|
|
|||
Reductions related to settlements with taxing authorities
|
|
(5
|
)
|
|
(1
|
)
|
|
—
|
|
|||
Additions related to foreign currency translation
|
|
2
|
|
|
—
|
|
|
—
|
|
|||
Accrued interest and penalties ending balance
|
|
$
|
49
|
|
|
$
|
50
|
|
|
$
|
39
|
|
|
F-25
|
|
(a)
|
Includes a reserve of
$17 million
for an interest assessment on a prior year withholding tax. No underlying tax exposure exists. The interest assessed was not material to the Company's consolidated financial statements in any period.
|
14.
|
Debt
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
2.125% Senior Notes due September 26, 2018
|
|
$
|
300
|
|
|
$
|
—
|
|
4.5% Euro-denominated notes due October 4, 2013
(a)
|
|
—
|
|
|
267
|
|
||
Total debt
|
|
300
|
|
|
267
|
|
||
Less: current portion of long-term debt
|
|
—
|
|
|
267
|
|
||
Long-term debt
|
|
$
|
300
|
|
|
$
|
—
|
|
|
|
F-26
|
|
•
|
China Credit Facility
- provides Ralph Lauren Trading (Shanghai) Co., Ltd. with a revolving line of credit of up to
100 million
Chinese Renminbi (approximately
$16 million
) through
April 8, 2015
, and may also be used to support bank guarantees.
|
|
F-27
|
|
•
|
Malaysia Credit Facility
- provides Ralph Lauren (Malaysia) Sdn Bhd with a revolving line of credit of up to
16 million
Malaysian Ringgit (approximately
$5 million
) through
September 17, 2014
.
|
•
|
South Korea Credit Facility
- provides Ralph Lauren (Korea) Ltd. with a revolving line of credit of up to
11 billion
South Korean Won (approximately
$10 million
) through
October 31, 2014
.
|
•
|
Taiwan Credit Facility
-
provides Ralph Lauren (Hong Kong) Retail Company Limited, Taiwan Branch with a revolving line of credit of up to
59 million
New Taiwan Dollars (approximately
$2 million
) through
October 15, 2014
.
|
15.
|
Fair Value Measurements
|
•
|
Level 1
— inputs to the valuation methodology based on quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
•
|
Level 2
— inputs to the valuation methodology based on quoted prices for similar assets and liabilities in active markets for substantially the full term of the financial instrument; quoted prices for identical or similar instruments in markets that are not active for substantially the full term of the financial instrument; and model-derived valuations whose inputs or significant value drivers are observable.
|
•
|
Level 3
— inputs to the valuation methodology based on unobservable prices or valuation techniques that are significant to the fair value measurement.
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Financial assets recorded at fair value
(a)
:
|
|
|
|
|
||||
Government bonds — U.S.
|
|
$
|
1
|
|
|
$
|
29
|
|
Government bonds — non-U.S.
|
|
—
|
|
|
92
|
|
||
Corporate bonds — non-U.S.
|
|
—
|
|
|
82
|
|
||
Variable rate municipal securities — U.S.
|
|
—
|
|
|
17
|
|
||
Auction rate securities
|
|
2
|
|
|
2
|
|
||
Derivative financial instruments
|
|
8
|
|
|
15
|
|
||
Total
|
|
$
|
11
|
|
|
$
|
237
|
|
Financial liabilities recorded at fair value
(b)
:
|
|
|
|
|
||||
Derivative financial instruments
|
|
$
|
7
|
|
|
$
|
5
|
|
Total
|
|
$
|
7
|
|
|
$
|
5
|
|
|
(a)
|
Based on Level 1 measurements, except for auction rate securities and derivative financial instruments, which are based on Level 2 measurements.
|
(b)
|
Based on Level 2 measurements.
|
|
F-28
|
|
|
|
March 29, 2014
|
|
March 30, 2013
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
(a)
|
|
Carrying Value
|
|
Fair Value
(a)
|
||||||||
|
|
(millions)
|
||||||||||||||
2.125% Senior Notes
|
|
$
|
300
|
|
|
$
|
300
|
|
|
N/A
|
|
|
N/A
|
|
||
Euro Debt
|
|
N/A
|
|
|
N/A
|
|
|
$
|
267
|
|
|
$
|
272
|
|
|
(a)
|
Based on Level 2 measurements.
|
|
F-29
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Aggregate carrying value of long-lived assets written down to fair value
|
|
$
|
1
|
|
|
$
|
19
|
|
|
$
|
3
|
|
Impairment charges
(a)
|
|
(1
|
)
|
|
(19
|
)
|
|
(2
|
)
|
|
(a)
|
See
Note 11
for details of impairment charges recorded in
Fiscal 2014
,
Fiscal 2013
, and
Fiscal 2012
.
|
16.
|
Financial Instruments
|
|
|
Notional Amounts
|
|
Derivative Assets
|
|
Derivative Liabilities
|
|
||||||||||||||||||||||||||
Derivative Instrument
(a)
|
|
March 29, 2014
|
|
March 30, 2013
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 29,
2014 |
|
March 30,
2013 |
|
||||||||||||||||||||
|
|
|
|
|
|
Balance
Sheet
Line
(b)
|
|
Fair
Value
|
|
Balance
Sheet
Line
(b)
|
|
Fair
Value
|
|
Balance
Sheet
Line
(b)
|
|
Fair
Value
|
|
Balance
Sheet
Line
(b)
|
|
Fair
Value
|
|
||||||||||||
|
|
(millions)
|
|
||||||||||||||||||||||||||||||
Designated Hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FC — Inventory purchases
|
|
$
|
476
|
|
|
$
|
366
|
|
|
(c)
|
|
$
|
2
|
|
|
PP
|
|
$
|
14
|
|
|
AE
|
|
$
|
(5
|
)
|
|
AE
|
|
$
|
(2
|
)
|
|
FC — Other
(d)
|
|
223
|
|
|
25
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
AE
|
|
(2
|
)
|
|
AE
|
|
(1
|
)
|
|
||||||
NI — Euro Debt
|
|
—
|
|
|
140
|
|
|
—
|
|
N/A
|
|
|
—
|
|
(e)
|
|
—
|
|
N/A
|
|
|
—
|
|
(e)
|
|
||||||||
Total Designated Hedges
|
|
$
|
699
|
|
|
$
|
531
|
|
|
|
|
$
|
2
|
|
|
|
|
$
|
14
|
|
|
|
|
$
|
(7
|
)
|
|
|
|
$
|
(3
|
)
|
|
Undesignated Hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FC — Other
(f)
|
|
$
|
280
|
|
|
$
|
270
|
|
|
(g)
|
|
$
|
6
|
|
|
PP
|
|
$
|
1
|
|
|
—
|
|
$
|
—
|
|
|
AE
|
|
$
|
(2
|
)
|
|
Total Hedges
|
|
$
|
979
|
|
|
$
|
801
|
|
|
|
|
$
|
8
|
|
|
|
|
$
|
15
|
|
|
|
|
$
|
(7
|
)
|
|
|
|
$
|
(5
|
)
|
|
|
(a)
|
FC = Forward foreign currency exchange contracts; NI = Net Investment Hedge; Euro Debt = Euro-denominated
4.5%
notes that matured on
October 4, 2013
.
|
(b)
|
PP = Prepaid expenses and other current assets; AE = Accrued expenses and other current liabilities.
|
(c)
|
$1 million
included within prepaid expenses and other current assets and
$1 million
included within other non-current assets.
|
|
F-30
|
|
(d)
|
Primarily designated hedges of foreign currency-denominated intercompany royalty payments, marketing contributions, and other net operational exposures.
|
(e)
|
As of March 30, 2013, a portion of the previously outstanding Euro Debt's
€209 million
principal amount was designated as a hedge of the Company's net investment in certain of its European subsidiaries. The entire principal amount of this hedge was de-designated prior to the Euro Debt's maturity on
October 4, 2013
. See
Note 15
for a summary of the carrying value and the estimated fair value of the Euro Debt as of March 30, 2013.
|
(f)
|
Primarily undesignated hedges of foreign currency-denominated intercompany loans.
|
(g)
|
$2 million
included within prepaid expenses and other current assets and
$4 million
included within other non-current assets.
|
|
|
March 29, 2014
|
|
March 30, 2013
|
||||||||||||||||||||
Derivative Instrument
|
|
Gross Amounts Presented in the Consolidated Balance Sheet
|
|
Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
|
|
Net
Amount |
|
Gross Amounts Presented in the Consolidated Balance Sheet
|
|
Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
|
|
Net
Amount |
||||||||||||
|
|
(millions)
|
||||||||||||||||||||||
FC — Derivative assets
|
|
$
|
8
|
|
|
$
|
(1
|
)
|
|
$
|
7
|
|
|
$
|
15
|
|
|
$
|
(3
|
)
|
|
$
|
12
|
|
FC — Derivative liabilities
|
|
$
|
(7
|
)
|
|
$
|
1
|
|
|
$
|
(6
|
)
|
|
$
|
(5
|
)
|
|
$
|
3
|
|
|
$
|
(2
|
)
|
|
|
Gains (Losses)
Recognized in OCI
|
|
Gains (Losses) Reclassified
from AOCI to Earnings
|
|
Location of Gains (Losses) Reclassified from
AOCI to Earnings
|
||||||||||||||||||||
|
|
Fiscal Years Ended
|
|
Fiscal Years Ended
|
|
|||||||||||||||||||||
Derivative Instrument
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
|
|||||||||||||
|
|
(millions)
|
|
|
||||||||||||||||||||||
Designated Cash Flow Hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FC — Inventory purchases
|
|
$
|
(10
|
)
|
|
$
|
21
|
|
|
$
|
29
|
|
|
$
|
10
|
|
|
$
|
32
|
|
|
$
|
(2
|
)
|
|
Cost of goods sold
|
FC — Other
|
|
—
|
|
|
(1
|
)
|
|
5
|
|
|
—
|
|
|
4
|
|
|
(3
|
)
|
|
Foreign currency gains (losses)
|
||||||
|
|
$
|
(10
|
)
|
|
$
|
20
|
|
|
$
|
34
|
|
|
$
|
10
|
|
|
$
|
36
|
|
|
$
|
(5
|
)
|
|
|
Designated Hedge of Net Investment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Euro Debt
(a)
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Total Designated Hedges
|
|
$
|
(10
|
)
|
|
$
|
31
|
|
|
$
|
50
|
|
|
$
|
10
|
|
|
$
|
36
|
|
|
$
|
(5
|
)
|
|
|
|
(a)
|
Amounts recognized in OCI relate to remeasurement of the Euro Debt, which was repaid in October 2013, and would be recognized in earnings only upon the sale or liquidation of the hedged net investment.
|
|
F-31
|
|
|
|
Gains (Losses)
Recognized in Earnings
|
|
Location of Gains (Losses)
Recognized in Earnings
|
||||||||||
|
|
Fiscal Years Ended
|
|
|||||||||||
Derivative Instrument
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
|
|||||||
|
|
(millions)
|
|
|
||||||||||
Undesignated Hedges:
|
|
|
|
|
|
|
|
|
||||||
FC — Other
|
|
$
|
20
|
|
|
$
|
(4
|
)
|
|
$
|
1
|
|
|
Foreign currency gains (losses)
|
Total Undesignated Hedges
|
|
$
|
20
|
|
|
$
|
(4
|
)
|
|
$
|
1
|
|
|
|
|
F-32
|
|
|
|
March 29, 2014
|
|
March 30, 2013
|
||||||||||||||||||||
Type of Investment
|
|
Short-term
< 1 year
|
|
Non-current
1 - 3 years
|
|
Total
|
|
Short-term
< 1 year
|
|
Non-current
1 - 3 years
|
|
Total
|
||||||||||||
|
|
|
|
|
|
(millions)
|
|
|
|
|
||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Government bonds — U.S.
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
21
|
|
|
$
|
8
|
|
|
$
|
29
|
|
Government bonds — non-U.S.
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67
|
|
|
25
|
|
|
92
|
|
||||||
Corporate bonds — non-U.S.
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36
|
|
|
46
|
|
|
82
|
|
||||||
Variable rate municipal securities — U.S.
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
||||||
Auction rate securities
(a)
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||||
Total available-for-sale investments
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
141
|
|
|
$
|
81
|
|
|
$
|
222
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Time deposits
|
|
$
|
487
|
|
|
$
|
—
|
|
|
$
|
487
|
|
|
$
|
184
|
|
|
$
|
—
|
|
|
$
|
184
|
|
Total investments
|
|
$
|
488
|
|
|
$
|
2
|
|
|
$
|
490
|
|
|
$
|
325
|
|
|
$
|
81
|
|
|
$
|
406
|
|
|
(a)
|
Auction rate securities have characteristics similar to short-term investments. However, the Company has classified these securities as non-current investments in its consolidated balance sheets as current market conditions call into question its ability to redeem these investments for cash within the next twelve months.
|
17.
|
Commitments and Contingencies
|
|
F-33
|
|
|
|
Minimum Operating
Lease Payments
(a)(b)
|
||
|
|
(millions)
|
||
Fiscal 2015
|
|
$
|
336
|
|
Fiscal 2016
|
|
315
|
|
|
Fiscal 2017
|
|
290
|
|
|
Fiscal 2018
|
|
271
|
|
|
Fiscal 2019
|
|
247
|
|
|
Fiscal 2020 and thereafter
|
|
927
|
|
|
Total minimum rental payments
|
|
$
|
2,386
|
|
|
(a)
|
Net of sublease income, which is not significant in any period.
|
(b)
|
Includes a
$74 million
operating lease obligation related to the land portion of the build-to-suit lease agreement for a new Polo flagship store on Fifth Avenue in New York City entered into in Fiscal 2014, as further described below.
|
|
|
Minimum Capital
Lease Payments
(a)(b)
|
||
|
|
(millions)
|
||
Fiscal 2015
|
|
$
|
24
|
|
Fiscal 2016
|
|
24
|
|
|
Fiscal 2017
|
|
24
|
|
|
Fiscal 2018
|
|
23
|
|
|
Fiscal 2019
|
|
23
|
|
|
Fiscal 2020 and thereafter
|
|
98
|
|
|
Total
|
|
216
|
|
|
Less: amount representing interest
|
|
(46
|
)
|
|
Present value of net minimum rental payments
|
|
$
|
170
|
|
|
(a)
|
Net of sublease income, which is not significant in any period.
|
(b)
|
Includes lease payments related to the Company's build-to-suit lease agreement for a new Polo flagship store on Fifth Avenue in New York City entered into in Fiscal 2014. The total commitment related to this lease is
$235 million
, comprised of a
$74 million
operating lease obligation related to the land portion of the lease (included in the minimum operating lease payments table above) and a
$161 million
obligation related to the building portion of the lease (included in the minimum capital lease payments table above).
|
|
F-34
|
|
18.
|
Equity
|
|
F-35
|
|
|
Fiscal Years Ended
|
||||||||||
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
(in millions)
|
||||||||||
Cost of shares repurchased
|
$
|
548
|
|
(a)
|
$
|
450
|
|
|
$
|
395
|
|
Number of shares repurchased
|
3.2
|
|
(a)
|
3.0
|
|
|
3.2
|
|
|
(a)
|
Includes a
$50 million
payment made in March 2013 under a share repurchase program with a third-party financial institution, in exchange for the right to receive shares of the Company's Class A common stock at the conclusion of the
93
-day repurchase term. The
$50 million
prepayment was recorded as a reduction to additional paid-in capital in the Company's consolidated balance sheet as of March 30, 2013. The related
0.3 million
shares were delivered to the Company during
Fiscal 2014
, based on the volume-weighted average market price of the Company's Class A common stock over the
93
-day repurchase term, less a discount.
|
|
F-36
|
|
19.
|
Accumulated Other Comprehensive Income
|
|
|
Foreign Currency Translation Gains (Losses)
|
|
Net Unrealized Gains (Losses) on Derivative Financial Instruments
(a)
|
|
Net Unrealized Gains (Losses) on Available-for-Sale Investments
(b)
|
|
Net Unrealized Gains (Losses) on Defined Benefit Plans
(b)
|
|
Total Accumulated Other Comprehensive Income (Loss)
|
||||||||||
|
|
(millions)
|
||||||||||||||||||
Balance at April 2, 2011
|
|
$
|
216
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
216
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OCI before reclassifications
|
|
(50
|
)
|
(c)
|
29
|
|
|
1
|
|
|
(2
|
)
|
|
(22
|
)
|
|||||
Amounts reclassified from AOCI to earnings
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Other comprehensive income (loss), net of tax
|
|
(50
|
)
|
|
32
|
|
|
1
|
|
|
(2
|
)
|
|
(19
|
)
|
|||||
Balance at March 31, 2012
|
|
166
|
|
|
36
|
|
|
1
|
|
|
(6
|
)
|
|
197
|
|
|||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OCI before reclassifications
|
|
(93
|
)
|
(c)
|
19
|
|
|
4
|
|
|
(1
|
)
|
|
(71
|
)
|
|||||
Amounts reclassified from AOCI to earnings
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|||||
Other comprehensive income (loss), net of tax
|
|
(93
|
)
|
|
(13
|
)
|
|
4
|
|
|
(1
|
)
|
|
(103
|
)
|
|||||
Balance at March 30, 2013
|
|
73
|
|
|
23
|
|
|
5
|
|
|
(7
|
)
|
|
94
|
|
|||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OCI before reclassifications
|
|
52
|
|
(c)
|
(20
|
)
|
|
(4
|
)
|
|
—
|
|
|
28
|
|
|||||
Amounts reclassified from AOCI to earnings
|
|
—
|
|
|
(7
|
)
|
|
(1
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Other comprehensive income (loss), net of tax
|
|
52
|
|
|
(27
|
)
|
|
(5
|
)
|
|
—
|
|
|
20
|
|
|||||
Balance at March 29, 2014
|
|
$
|
125
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
114
|
|
|
(a)
|
OCI before reclassifications to earnings for Fiscal 2013 and Fiscal 2012 are net of tax provisions of
$1 million
and
$5 million
, respectively. The tax effect for Fiscal 2014 activity was not material. The tax effects on amounts reclassified to earnings are presented in a table below.
|
(b)
|
All amounts are presented net of taxes, which are not material.
|
(c)
|
Foreign currency translation gains (losses) include tax provisions of
$2 million
,
$3 million
, and
$4 million
for Fiscal 2014, Fiscal 2013, and Fiscal 2012, respectively.
|
|
F-37
|
|
|
|
Fiscal Year Ended
|
|
|
||||||||||
|
|
March 29, 2014
|
|
March 30, 2013
|
|
March 31, 2012
|
|
Location of Gains (Losses)
Reclassified from AOCI
to Earnings
|
||||||
|
|
(millions)
|
|
|
||||||||||
Gains (losses) on derivative financial instruments
(a)
:
|
|
|
|
|
|
|
|
|
||||||
FC — Inventory purchases
|
|
$
|
10
|
|
|
$
|
32
|
|
|
$
|
(2
|
)
|
|
Cost of goods sold
|
FC — Other
|
|
—
|
|
|
4
|
|
|
(3
|
)
|
|
Foreign currency gains (losses)
|
|||
Tax effect
|
|
(3
|
)
|
|
(4
|
)
|
|
2
|
|
|
Provision for income taxes
|
|||
Net of tax
|
|
$
|
7
|
|
|
$
|
32
|
|
|
$
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gains on available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||
Sales of available-for-sale securities
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Interest and other income, net
|
Tax effect
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Provision for income taxes
|
|||
Net of tax
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
(a)
|
FC = Forward foreign currency exchange contracts.
|
20.
|
Stock-based Compensation
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Compensation expense
|
|
$
|
93
|
|
(a)
|
$
|
88
|
|
|
$
|
78
|
|
Income tax benefit
|
|
$
|
(34
|
)
|
|
$
|
(29
|
)
|
|
$
|
(26
|
)
|
|
(a)
|
Includes approximately
$10 million
of accelerated stock-based compensation expense recorded within restructuring and other charges in the consolidated statement of income for Fiscal 2014 (see
Note 12
). All other stock-based compensation expense is recorded within SG&A expenses.
|
|
F-38
|
|
|
|
Fiscal Years Ended
|
|||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
|||
Expected term (years)
|
|
4.2
|
|
|
4.5
|
|
|
4.7
|
|
Expected volatility
|
|
32.9
|
%
|
|
44.3
|
%
|
|
44.7
|
%
|
Expected dividend yield
|
|
0.98
|
%
|
|
1.05
|
%
|
|
0.72
|
%
|
Risk-free interest rate
|
|
1.1
|
%
|
|
0.6
|
%
|
|
1.3
|
%
|
Weighted-average option grant date fair value
|
|
$45.83
|
|
|
$47.89
|
|
|
$49.13
|
|
|
|
Number of
Shares
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value
(a)
|
|||||
|
|
(thousands)
|
|
|
|
(years)
|
|
(millions)
|
|||||
Options outstanding at March 30, 2013
|
|
2,954
|
|
|
$
|
91.26
|
|
|
4.1
|
|
$
|
231
|
|
Granted
|
|
840
|
|
|
179.45
|
|
|
|
|
|
|||
Exercised
|
|
(673
|
)
|
|
78.18
|
|
|
|
|
|
|||
Cancelled/Forfeited
|
|
(95
|
)
|
|
155.44
|
|
|
|
|
|
|||
Options outstanding at March 29, 2014
|
|
3,026
|
|
|
$
|
116.66
|
|
|
4.1
|
|
$
|
143
|
|
|
|
|
|
|
|
|
|
|
|||||
Options vested and expected to vest at March 29, 2014
(b)
|
|
2,965
|
|
|
$
|
115.49
|
|
|
4.1
|
|
$
|
143
|
|
Options exercisable at March 29, 2014
|
|
1,804
|
|
|
$
|
85.06
|
|
|
3.0
|
|
$
|
134
|
|
|
(a)
|
Aggregate intrinsic value is the amount by which the market price of Class A common stock at the end of the period exceeds the exercise price of the stock option, multiplied by the number of options.
|
(b)
|
The number of options expected to vest takes into consideration expected forfeitures.
|
|
F-39
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Aggregate intrinsic value of stock options exercised
(a)
|
|
$
|
63
|
|
|
$
|
76
|
|
|
$
|
101
|
|
Cash received from the exercise of stock options
|
|
52
|
|
|
49
|
|
|
61
|
|
|||
Tax benefits realized on exercise
|
|
24
|
|
|
29
|
|
|
36
|
|
|
(a)
|
Aggregate intrinsic value is the amount by which the market price of Class A common stock exceeded the stock option's exercise price when exercised, multiplied by the number of options.
|
|
|
Restricted
Stock
|
|
Service-
based RSUs
|
||||||||||
|
|
Number of
Shares
|
|
Weighted-Average Grant Date Fair Value
|
|
Number of
Shares
|
|
Weighted-Average Grant Date Fair Value
|
||||||
|
|
(thousands)
|
|
|
|
(thousands)
|
|
|
||||||
Nonvested at March 30, 2013
|
|
5
|
|
|
$
|
134.28
|
|
|
98
|
|
|
$
|
79.52
|
|
Granted
|
|
3
|
|
|
164.76
|
|
|
—
|
|
|
—
|
|
||
Vested
|
|
(3
|
)
|
|
118.57
|
|
|
(88
|
)
|
|
71.07
|
|
||
Forfeited
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
154.55
|
|
||
Nonvested at March 29, 2014
|
|
5
|
|
|
$
|
159.71
|
|
|
7
|
|
|
$
|
145.88
|
|
|
|
Restricted
Stock
|
|
Service-
based RSUs
|
||||
Total unrecognized compensation at March 29, 2014 (millions)
|
|
$
|
0.2
|
|
|
$
|
0.3
|
|
Weighted-average period expected to be recognized over (years)
|
|
1.5
|
|
|
1.3
|
|
|
F-40
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
Restricted Stock:
|
|
|
|
|
|
|
||||||
Weighted-average grant date fair value of awards granted
|
|
$
|
164.76
|
|
|
$
|
173.33
|
|
|
N/A
|
|
|
Total fair value of awards vested (millions)
|
|
$
|
1
|
|
|
$
|
1
|
|
|
N/A
|
|
|
Service-based RSUs:
|
|
|
|
|
|
|
||||||
Weighted-average grant date fair value of awards granted
|
|
N/A
|
|
|
$
|
150.17
|
|
|
$
|
140.86
|
|
|
Total fair value of awards vested (millions)
|
|
$
|
16
|
|
|
$
|
22
|
|
|
$
|
15
|
|
|
|
Fiscal Year Ended
|
||||
|
|
March 29,
2014 |
|
March 30,
2013 |
||
Expected term (years)
|
|
2.9
|
|
|
3.0
|
|
Expected volatility
|
|
32.6
|
%
|
|
34.0
|
%
|
Expected dividend yield
|
|
0.98
|
%
|
|
1.13
|
%
|
Risk-free interest rate
|
|
0.4
|
%
|
|
0.3
|
%
|
Weighted-average grant date fair value
|
|
$169.14
|
|
|
$136.16
|
|
|
F-41
|
|
|
|
Performance-based
RSUs — without TSR Modifier
|
|
Performance-based
RSUs — with TSR Modifier
|
||||||||||
|
|
Number of
Shares
|
|
Weighted-Average Grant Date Fair Value
|
|
Number of
Shares
|
|
Weighted-Average Grant Date Fair Value
|
||||||
|
|
(thousands)
|
|
|
|
(thousands)
|
|
|
||||||
Nonvested at March 30, 2013
|
|
1,015
|
|
|
$
|
112.80
|
|
|
73
|
|
|
$
|
136.16
|
|
Granted
|
|
307
|
|
|
171.93
|
|
|
78
|
|
|
169.14
|
|
||
Change due to performance/market condition achievement
|
|
141
|
|
|
76.33
|
|
|
—
|
|
|
—
|
|
||
Vested
|
|
(627
|
)
|
|
85.79
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
(38
|
)
|
|
141.80
|
|
|
(6
|
)
|
|
150.32
|
|
||
Nonvested at March 29, 2014
|
|
798
|
|
|
$
|
148.93
|
|
|
145
|
|
|
$
|
153.29
|
|
|
|
Performance-based
RSUs — without TSR Modifier
|
|
Performance-based
RSUs — with TSR Modifier
|
||||
Total unrecognized compensation at March 29, 2014 (millions)
|
|
$
|
41
|
|
|
$
|
9
|
|
Weighted-average period expected to be recognized over (years)
|
|
1.5
|
|
|
1.9
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
Performance-based RSUs — without TSR Modifier:
|
|
|
|
|
|
|
||||||
Weighted-average grant date fair value of awards granted
|
|
$
|
171.93
|
|
|
$
|
137.45
|
|
|
$
|
124.43
|
|
Total fair value of awards vested (millions)
|
|
$
|
109
|
|
|
$
|
106
|
|
|
$
|
56
|
|
Performance-based RSUs — with TSR Modifier:
|
|
|
|
|
|
|
||||||
Weighted-average grant date fair value of awards granted
|
|
$
|
169.14
|
|
|
$
|
136.16
|
|
|
N/A
|
|
|
Total fair value of awards vested (millions)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
N/A
|
|
21.
|
Employee Benefit Plans
|
|
F-42
|
|
|
F-43
|
|
22.
|
Segment Information
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Net revenues:
|
|
|
|
|
|
|
||||||
Wholesale
|
|
$
|
3,486
|
|
|
$
|
3,138
|
|
|
$
|
3,247
|
|
Retail
|
|
3,798
|
|
|
3,625
|
|
|
3,432
|
|
|||
Licensing
|
|
166
|
|
|
182
|
|
|
181
|
|
|||
Total net revenues
(a)
|
|
$
|
7,450
|
|
|
$
|
6,945
|
|
|
$
|
6,860
|
|
|
(a)
|
The Company's sales to its largest wholesale customer, Macy's, accounted for approximately
12%
of its total net revenues in Fiscal 2014 and Fiscal 2013, and approximately
10%
of its total net revenues in Fiscal 2012.
|
|
F-44
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Operating income:
|
|
|
|
|
|
|
||||||
Wholesale
(a)
|
|
$
|
963
|
|
|
$
|
903
|
|
|
$
|
835
|
|
Retail
(b)
|
|
572
|
|
|
615
|
|
|
553
|
|
|||
Licensing
(c)
|
|
150
|
|
|
152
|
|
|
149
|
|
|||
|
|
1,685
|
|
|
1,670
|
|
|
1,537
|
|
|||
Unallocated corporate expenses
|
|
(553
|
)
|
|
(531
|
)
|
|
(486
|
)
|
|||
Gain on acquisition of Chaps
(d)
|
|
16
|
|
|
—
|
|
|
—
|
|
|||
Unallocated restructuring and other charges, net
(e)
|
|
(18
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|||
Total operating income
|
|
$
|
1,130
|
|
|
$
|
1,127
|
|
|
$
|
1,039
|
|
|
(a)
|
During Fiscal 2014 and Fiscal 2013, the Company recorded non-cash impairment charges of approximately
$1 million
and
$2 million
, respectively, to write-off certain fixed assets related to its European wholesale operations. See
Note 11
for additional information.
|
(b)
|
During Fiscal 2013, the Company recorded non-cash asset impairment charges of
$15 million
to write down certain long-lived assets, primarily in connection with the Rugby Closure Plan and certain underperforming stores in Europe. Fiscal 2012 included asset impairment charges of
$2 million
primarily to reduce the net carrying values of certain retail stores' long-lived assets to their estimated fair values. See Notes 11 and 12 for additional information.
|
(c)
|
During Fiscal 2013, the Company recorded non-cash asset impairment charges of
$2 million
related to the write-off of certain intangible assets in connection with the Rugby Closure Plan. See Notes 11 and 12 for additional information.
|
(d)
|
See
Note 5
for further discussion of the gain on acquisition of Chaps.
|
(e)
|
The fiscal years presented included certain unallocated restructuring and other charges (See
Note 12
), which are detailed below:
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Restructuring and other charges, net:
|
|
|
|
|
|
|
||||||
Restructuring charges, net:
|
|
|
|
|
|
|
||||||
Wholesale-related
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(5
|
)
|
Retail-related
|
|
—
|
|
|
(10
|
)
|
|
(6
|
)
|
|||
Corporate operations-related
|
|
(8
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
Unallocated restructuring charges, net
|
|
(8
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|||
Other charges
(a)
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|||
Total unallocated restructuring and other charges, net
|
|
$
|
(18
|
)
|
|
$
|
(12
|
)
|
|
$
|
(12
|
)
|
|
(a)
|
See
Note 12
for a description of accelerated stock-based compensation expense recorded during Fiscal 2014.
|
|
F-45
|
|
|
|
Three Months Ended
|
|||||||
|
|
June 29,
2013 |
|
September 28,
2013 |
|
December 28,
2013 |
|||
|
|
(millions)
|
|||||||
Operating income:
|
|
|
|
|
|
|
|||
Wholesale
|
|
207
|
|
|
243
|
|
|
217
|
|
Retail
|
|
165
|
|
|
135
|
|
|
221
|
|
Licensing
|
|
35
|
|
|
40
|
|
|
40
|
|
|
|
407
|
|
|
418
|
|
|
478
|
|
Unallocated corporate expenses
|
|
(147
|
)
|
|
(121
|
)
|
|
(130
|
)
|
Gain on acquisition of Chaps
(a)
|
|
16
|
|
|
—
|
|
|
—
|
|
Unallocated restructuring and other charges, net
(b)
|
|
—
|
|
|
(2
|
)
|
|
(14
|
)
|
Total operating income
|
|
276
|
|
|
295
|
|
|
334
|
|
|
(a)
|
See
Note 5
for further discussion of the gain on acquisition of Chaps.
|
(b)
|
Primarily includes severance and benefit costs associated with restructuring of the Company's corporate operations, as well as
$10 million
of accelerated stock-based compensation expense recorded during the three months ended December 28, 2013 (see
Note 12
).
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Depreciation and amortization:
|
|
|
|
|
|
|
||||||
Wholesale
|
|
$
|
66
|
|
|
$
|
67
|
|
|
$
|
64
|
|
Retail
|
|
125
|
|
|
116
|
|
|
115
|
|
|||
Licensing
|
|
—
|
|
|
2
|
|
|
1
|
|
|||
Unallocated corporate
|
|
67
|
|
|
48
|
|
|
45
|
|
|||
Total depreciation and amortization
|
|
$
|
258
|
|
|
$
|
233
|
|
|
$
|
225
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Capital expenditures:
|
|
|
|
|
|
|
||||||
Wholesale
|
|
$
|
53
|
|
|
$
|
39
|
|
|
$
|
83
|
|
Retail
|
|
252
|
|
|
158
|
|
|
135
|
|
|||
Licensing
|
|
1
|
|
|
—
|
|
|
—
|
|
|||
Unallocated corporate
|
|
84
|
|
|
79
|
|
|
54
|
|
|||
Total capital expenditures
|
|
$
|
390
|
|
|
$
|
276
|
|
|
$
|
272
|
|
|
F-46
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Total assets:
|
|
|
|
|
||||
Wholesale
|
|
$
|
2,663
|
|
|
$
|
2,166
|
|
Retail
|
|
2,334
|
|
|
1,921
|
|
||
Licensing
|
|
198
|
|
|
229
|
|
||
Corporate
|
|
895
|
|
|
1,102
|
|
||
Total assets
|
|
$
|
6,090
|
|
|
$
|
5,418
|
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Net revenues:
|
|
|
|
|
|
|
||||||
The Americas
(a),(b)
|
|
$
|
4,983
|
|
|
$
|
4,586
|
|
|
$
|
4,403
|
|
Europe
(a)
|
|
1,580
|
|
|
1,447
|
|
|
1,487
|
|
|||
Asia
(c)
|
|
887
|
|
|
912
|
|
|
970
|
|
|||
Total net revenues
|
|
$
|
7,450
|
|
|
$
|
6,945
|
|
|
$
|
6,860
|
|
|
|
March 29,
2014 |
|
March 30,
2013 |
||||
|
|
(millions)
|
||||||
Long-lived assets:
|
|
|
|
|
||||
The Americas
(a),(b)
|
|
$
|
966
|
|
|
$
|
582
|
|
Europe
(a)
|
|
172
|
|
|
182
|
|
||
Asia
(c)
|
|
184
|
|
|
168
|
|
||
Total long-lived assets
|
|
$
|
1,322
|
|
|
$
|
932
|
|
|
(a)
|
Net revenues and long-lived assets for certain of the Company's licensed operations are included within the geographic location of the reporting subsidiary which holds the respective license.
|
(b)
|
Includes the U.S., Canada, and Latin America. Net revenues earned in the U.S. during
Fiscal 2014
,
Fiscal 2013
, and
Fiscal 2012
were
$4.744 billion
,
$4.388 billion
, and
$4.273 billion
, respectively. Long-lived assets located in the U.S. were
$948 million
and
$567 million
as of
March 29, 2014
and
March 30, 2013
, respectively.
|
(c)
|
Includes Australia, China, Hong Kong, Japan, Macau, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam.
|
|
F-47
|
|
23.
|
Additional Financial Information
|
|
|
Fiscal Years Ended
|
||||||||||
|
|
March 29,
2014 |
|
March 30,
2013 |
|
March 31,
2012 |
||||||
|
|
(millions)
|
||||||||||
Cash paid for interest
|
|
$
|
20
|
|
|
$
|
18
|
|
|
$
|
24
|
|
Cash paid for income taxes
|
|
$
|
302
|
|
|
$
|
339
|
|
|
$
|
189
|
|
|
F-48
|
|
/S/ RALPH LAUREN
|
|
/S/ CHRISTOPHER H. PETERSON
|
Ralph Lauren
|
|
Christopher H. Peterson
|
Chairman and Chief Executive Officer
|
|
Executive Vice President, Chief Administrative Officer and Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
|
F-49
|
|
|
F-50
|
|
|
F-51
|
|
|
|
Fiscal Years Ended
(a)
|
||||||||||||||||||
|
|
March 29, 2014
(b)
|
|
March 30, 2013
(c)
|
|
March 31, 2012
|
|
April 2, 2011
(d)
|
|
April 3, 2010
(e)
|
||||||||||
|
|
(millions, except per share data)
|
||||||||||||||||||
Statement of Income Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
7,284
|
|
|
$
|
6,763
|
|
|
$
|
6,679
|
|
|
$
|
5,482
|
|
|
$
|
4,796
|
|
Licensing revenues
|
|
166
|
|
|
182
|
|
|
181
|
|
|
178
|
|
|
183
|
|
|||||
Net revenues
|
|
7,450
|
|
|
6,945
|
|
|
6,860
|
|
|
5,660
|
|
|
4,979
|
|
|||||
Gross profit
|
|
4,310
|
|
|
4,156
|
|
|
3,998
|
|
|
3,318
|
|
|
2,899
|
|
|||||
Depreciation and amortization expense
|
|
(258
|
)
|
|
(233
|
)
|
|
(225
|
)
|
|
(194
|
)
|
|
(181
|
)
|
|||||
Impairments of assets
|
|
(1
|
)
|
|
(19
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
(7
|
)
|
|||||
Restructuring and other charges
|
|
(18
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|
(3
|
)
|
|
(7
|
)
|
|||||
Operating income
|
|
1,130
|
|
|
1,127
|
|
|
1,039
|
|
|
845
|
|
|
707
|
|
|||||
Interest expense, net
|
|
(17
|
)
|
|
(16
|
)
|
|
(13
|
)
|
|
(11
|
)
|
|
(10
|
)
|
|||||
Net income
|
|
$
|
776
|
|
|
$
|
750
|
|
|
$
|
681
|
|
|
$
|
568
|
|
|
$
|
480
|
|
Net income per common share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
8.55
|
|
|
$
|
8.21
|
|
|
$
|
7.35
|
|
|
$
|
5.91
|
|
|
$
|
4.85
|
|
Diluted
|
|
$
|
8.43
|
|
|
$
|
8.00
|
|
|
$
|
7.13
|
|
|
$
|
5.75
|
|
|
$
|
4.73
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
90.7
|
|
|
91.3
|
|
|
92.7
|
|
|
96.0
|
|
|
98.9
|
|
|||||
Diluted
|
|
92.0
|
|
|
93.7
|
|
|
95.5
|
|
|
98.7
|
|
|
101.3
|
|
|||||
Dividends declared per common share
|
|
$
|
1.70
|
|
|
$
|
1.60
|
|
|
$
|
0.80
|
|
|
$
|
0.50
|
|
|
$
|
0.30
|
|
|
(a)
|
The fiscal year ended April 3, 2010 consisted of 53 weeks. All other fiscal years presented consisted of 52 weeks.
|
(b)
|
Reflects the Chaps Menswear License Acquisition effective in April 2013, which resulted in the recognition of a $16 million gain on acquisition, as well as the Australia and New Zealand Licensed Operations Acquisition effective in July 2013 (see Note 5 to the accompanying audited consolidated financial statements).
|
(c)
|
Reflects the acquisition of the Ralph Lauren-branded business in Latin America effective in June 2012, the discontinuance of the majority of products sold under the American Living brand effective with the Fall 2012 wholesale selling season, and the wind down of the Rugby brand operations during the second half of the fiscal year.
|
(d)
|
Reflects the South Korea Licensed Operations Acquisition effective in January 2011.
|
(e)
|
Reflects the Asia-Pacific Licensed Operations Acquisition effective in January 2010.
|
|
F-52
|
|
|
|
March 29, 2014
|
|
March 30, 2013
|
|
March 31, 2012
|
|
April 2, 2011
|
|
April 3, 2010
|
||||||||||
|
|
(millions)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
797
|
|
|
$
|
974
|
|
|
$
|
672
|
|
|
$
|
453
|
|
|
$
|
563
|
|
Investments
|
|
490
|
|
|
406
|
|
|
616
|
|
|
678
|
|
|
660
|
|
|||||
Working capital
|
|
2,359
|
|
|
1,842
|
|
|
1,954
|
|
|
1,646
|
|
|
1,529
|
|
|||||
Total assets
|
|
6,090
|
|
|
5,418
|
|
|
5,416
|
|
|
4,981
|
|
|
4,649
|
|
|||||
Total debt (including current maturities of debt)
|
|
300
|
|
|
267
|
|
|
274
|
|
|
292
|
|
|
282
|
|
|||||
Equity
|
|
4,034
|
|
|
3,785
|
|
|
3,653
|
|
|
3,305
|
|
|
3,117
|
|
|
F-53
|
|
|
|
Quarterly Periods Ended
(a)
|
||||||||||||||
|
|
June 29,
2013 |
|
September 28,
2013 |
|
December 28,
2013 |
|
March 29,
2014 |
||||||||
|
|
(millions, except per share data)
|
||||||||||||||
Net revenues
|
|
$
|
1,653
|
|
|
$
|
1,915
|
|
|
$
|
2,015
|
|
|
$
|
1,867
|
|
Gross profit
|
|
1,004
|
|
|
1,084
|
|
|
1,172
|
|
|
1,050
|
|
||||
Net income
|
|
181
|
|
|
205
|
|
|
237
|
|
|
153
|
|
||||
Net income per common share:
(b)
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
1.98
|
|
|
$
|
2.26
|
|
|
$
|
2.61
|
|
|
$
|
1.70
|
|
Diluted
|
|
$
|
1.94
|
|
|
$
|
2.23
|
|
|
$
|
2.57
|
|
|
$
|
1.68
|
|
Dividends declared per common share
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.45
|
|
|
$
|
0.45
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Quarterly Periods Ended
(a)
|
||||||||||||||
|
|
June 30,
2012 |
|
September 29,
2012 |
|
December 29,
2012 |
|
March 30,
2013 |
||||||||
|
|
(millions, except per share data)
|
||||||||||||||
Net revenues
|
|
$
|
1,593
|
|
|
$
|
1,862
|
|
|
$
|
1,846
|
|
|
$
|
1,644
|
|
Gross profit
|
|
992
|
|
|
1,095
|
|
|
1,094
|
|
|
975
|
|
||||
Net income
|
|
193
|
|
|
214
|
|
|
216
|
|
|
127
|
|
||||
Net income per common share:
(b)
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
2.10
|
|
|
$
|
2.34
|
|
|
$
|
2.37
|
|
|
$
|
1.40
|
|
Diluted
|
|
$
|
2.03
|
|
|
$
|
2.29
|
|
|
$
|
2.31
|
|
|
$
|
1.37
|
|
Dividends declared per common share
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
(a)
|
All fiscal quarters presented consisted of 13 weeks.
|
(b)
|
Per common share amounts for the quarters and full years have been calculated separately. Accordingly, quarterly amounts may not add to the annual amount because of differences in the average number of common shares outstanding during each period.
|
|
F-54
|
|
1.
|
The first sentence of Section 2.4(a)(i) of the Employment Agreement is amended to read as follows, effective as of the date set forth above:
|
|
RALPH LAUREN CORPORATION
|
|
|
|
|
|
|
|
|
By:
|
/s/ Ralph Lauren
|
|
|
Ralph Lauren
|
|
|
Title: Chairman and Chief Executive Officer
|
|
|
|
|
Date: March 26, 2014
|
|
|
|
|
|
|
|
|
EXECUTIVE
|
|
|
|
|
|
/s/ Jackwyn Nemerov
|
|
|
Jackwyn Nemerov
|
|
|
|
|
|
Date: March 27, 2014
|
|
RALPH LAUREN CORPORATION
|
|
|
|
|
|
|
|
|
By:
|
/s/ Mitchell Kosh
|
|
|
Mitchell Kosh
|
|
|
Title: Executive Vice President, Human Resources
|
|
|
|
|
Date: March 27, 2014
|
|
|
|
|
|
|
|
|
EXECUTIVE
|
|
|
|
|
|
/s/ Christopher Peterson
|
|
|
Christopher Peterson
|
|
|
|
|
|
Date: March 25, 2014
|
1.
|
Attract and retain exceptional individuals of superior talent
|
2.
|
Motivate such individuals to achieve longer-range performance goals
|
3.
|
Enable such individuals to participate in the long-term growth and financial success of the Company
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
2
|
An eligible employee who receives a Below Expectations (B) or Unsatisfactory (U) rating
on his or her annual performance appraisal is not eligible for an equity award in the fiscal year following that performance appraisal period. |
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
3
|
▪
|
Net Earnings or Net Income (before or after taxes)
|
▪
|
Basic or Diluted Earnings Per Share (before or after taxes)
|
▪
|
Net Operating Profit (before or after taxes)
|
▪
|
Net Revenue or Net Revenue Growth
|
▪
|
Gross Profit or Gross Profit Growth
|
▪
|
Return Measures (including but not limited to Return on Assets, Investments, Capital)
|
▪
|
Other measures of economic value added or other value creation metrics
|
Performance Level
|
% of Goal
Achieved
|
% of Target
Cliff RPSUs Vested
|
Threshold
|
70%
|
75%
|
Target
|
100%
|
100%
|
Maximum
|
110%
|
150%
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
4
|
|
# Cliff
RPSUs Granted
|
Performance
Period
|
Performance Level
1
|
Vested
Percentage
1
|
Vesting Date
2
|
# Shares Vested
|
|
|
|
|
|
|
|
FY13
(July 2012)
|
1,000
|
FY13 - FY15
|
110%
|
150%
|
FY16
(June 2015)
|
1,500
|
FY14
(April 2013)
|
1,000
|
FY14 - FY16
|
100%
|
100%
|
FY17
(June 2016)
|
1,000
|
FY15
(April 2014)
|
1,000
|
FY15 - FY17
|
70%
|
75%
|
FY18
(June 2017)
|
750
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
5
|
▪
|
Receive shares of RL Class A Common Stock without paying any exercise price
|
▪
|
The number of Cliff RPSUs vesting can range from 75% (Threshold) to 150% (Maximum) of the target shares granted
|
▪
|
Any increases in the Company’s Class A Common Stock price above the price on the grant date increases the value of the award
|
|
|
If Stock Price Reaches:
|
|||
Value At:
|
# of Shares
|
$150
|
$175
|
$200
|
$225
|
Threshold Performance
|
750
|
$112,500
|
$131,250
|
$150,000
|
$168,750
|
Target Performance
|
1,000
|
$150,000
|
$175,000
|
$200,000
|
$225,000
|
Maximum Performance
|
1,500
|
$225,000
|
$262,500
|
$300,000
|
$337,500
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
6
|
Event
|
Status of Cliff RPSU Awards
|
Normal Retirement
(Age 65)
Early Retirement
(Age 55 through age 64
with 7 or more years of service
Long-Term Disability (LTD)
Death
|
• In the case of retirement, LTD or death, a pro-rated
1
target number of outstanding Cliff RPSU grants will be determined
• These pro-rated Cliff RPSUs will vest
2
after the end of the applicable performance period based on the actual degree of achievement.
If performance against the cumulative performance goal does not reach the Threshold level, then the pro-rated Cliff RPSUs will be forfeited.
• All remaining Cliff RPSUs are forfeited
|
Voluntary Resignation
|
• All unvested Cliff RPSUs are forfeited
|
Involuntary Termination
(Without Cause)
|
• All unvested Cliff RPSUs are forfeited
|
Dismissal for Cause
(As defined by the Company or,
if applicable, the participant’s employment agreement)
|
• All vested Cliff RPSUs not yet distributed into shares of the Company’s Class A Common Stock are forfeited
• All unvested Cliff RPSUs are forfeited
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
7
|
•
|
Earnings or other financial information
|
•
|
Changes in dividend policy
|
•
|
Stock splits
|
•
|
Mergers and acquisitions
|
•
|
Major new contracts or product-line introductions
|
•
|
Litigation involving substantial amounts of money
|
•
|
Changes in management
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
8
|
•
|
“In and out” trading in securities of the Company.
Any Company stock purchased in the market must be held for a minimum of six months, and ideally longer. Note that the Securities and Exchange Commission (SEC) has a “short-swing profit recapture” rule that effectively prohibits Executive Officers and members of the Board of Directors from selling any Company stock within six months of a purchase. The Company has extended this prohibition to all employees. The receipt of shares pursuant to the vesting of Cliff RPSU awards is not considered a purchase under the SEC’s rule.
|
•
|
Short sales
(i.e., selling stock one does not own and then borrowing the shares to make delivery)
|
•
|
Buying or selling “puts” or “calls”
(i.e., making commitments to buy or sell securities at a specified price for a fixed period of time)
|
For employees at the Corporate Vice President and Division Senior Vice President level or above (“Officers”) and for all employees in the Finance, Legal and Human Resources departments, all transactions in the Company’s securities (including, but not limited to purchases, sales, transfers, etc.) must be conducted during an open trading window and pre-cleared with the Corporate Counsel, or their designee. If contemplating a transaction, please provide a written request via e-mail to RLTrading@ralphlauren.com, specifying the number of Stock Options you wish to exercise and/or the number of shares you wish to purchase or sell
before
contacting Merrill Lynch or any other broker, or taking any other step to initiate a transaction.
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
9
|
April 1, 2014
|
Fiscal 2015 Cliff RPSU Overview
|
10
|
1.
|
Attract and retain exceptional individuals of superior talent
|
2.
|
Motivate such individuals to achieve longer-range performance
|
3.
|
Enable such individuals to participate in the long-term growth and financial success of the Company
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
2
|
An eligible employee who receives a Below Expectations (B) or Unsatisfactory (U) rating
on their annual performance appraisal is not eligible for an equity award in the fiscal year following that performance appraisal period. |
|
Fiscal 2014 Pro-Rata RPSU Overview
|
3
|
▪
|
Net Earnings or Net Income (before or after taxes)
|
▪
|
Basic or Diluted Earnings Per Share (before or after taxes)
|
▪
|
Net Operating Profit (before or after taxes)
|
▪
|
Net Revenue or Net Revenue Growth
|
▪
|
Gross Profit or Gross Profit Growth
|
▪
|
Return Measures (including but not limited to Return on Assets, Investments, Capital)
|
▪
|
Other measures of economic value added or value creation metrics
|
▪
|
One-third would vest and be paid out after the end of fiscal 2014 based on achievement of the fiscal 2014 Company performance goal and on the participant’s continuous service with the Company from the grant date to the vesting date
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
4
|
▪
|
One-third would vest and be paid out after the end of fiscal 2015 (participant must have continuous service with the Company from the grant date to the vesting date)
|
▪
|
One-third would vest and be paid out after the end of fiscal 2016 (participant must have continuous service with the Company from the grant date to the vesting date)
|
All three tranches of the fiscal 2014 Pro-Rata RPSU award will be forfeited if the fiscal 2014
performance goal (Corporate NIBT at Threshold or better) is not achieved. |
Performance
Period
|
# Pro-Rata RPSUs
Eligible to Vest
|
Performance
Level
1
|
# Pro-Rata RPSUs
Vested and Distributed if Vesting Criteria Met
2
|
Vesting
Date
3
|
FY14
|
70
|
Threshold
|
70
|
June 2014
|
FY15
|
70
|
N/A
|
70
|
June 2015
|
FY16
|
70
|
N/A
|
70
|
June 2016
|
Total
|
210
|
|
210
|
|
1
|
Threshold refers to attaining at least 80% of the fiscal 2014 Corporate NIBT goal. If Threshold or better performance
|
2
|
Vesting criteria includes a minimum of Threshold performance and the participant’s continuous service with the Company
|
3
|
The vesting date typically occurs in June of each year, but may be earlier or later
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
5
|
Year Granted
|
# of Pro-Rata RPSUs Granted
|
1/3 of Pro-Rata RPSUs Eligible to Vest
1
|
||
June 2014
|
June 2015
|
June 2016
|
||
FY12
(July 2011)
|
270
|
90
|
-
|
-
|
FY13
(July 2012)
|
300
|
100
|
100
|
-
|
FY14
(July 2013)
|
210
|
70
|
70
|
70
|
Total Pro-Rata RPSUs
|
780
|
260
|
170
|
70
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
6
|
|
|
If Stock Price Reaches:
|
|||
|
# of Shares
|
$160
|
$185
|
$210
|
$235
|
Value
(assumes shares vest)
|
210
|
$33,600
|
$38,850
|
$44,100
|
$49,350
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
7
|
Event
|
Status of RPSU Awards
|
Normal
Retirement
(Age 65)
1
Early Retirement
(Age 55 through age 64 with 7 or more years of service) 1
Long-Term Disability (LTD)
4
Death |
• RPSUs vesting during the fiscal year are pro-rated
2
as of the date of retirement
1
, LTD, or death. The pro-rated number of shares will be eligible to vest on their normal vesting date.
3
• All remaining Pro-Rata RPSUs (for that fiscal year and any other fiscal years remaining) are forfeited
|
Voluntary Resignation
|
• All unvested Pro-Rata RPSUs are forfeited
|
Involuntary Termination
(Without Cause)
|
• All unvested Pro-Rata RPSUs are forfeited
|
Dismissal for Cause
(As defined by the Company or,
if applicable, the participant’s employment agreement)
|
• All vested Pro-Rata RPSUs not yet distributed into shares of the Company’s Class A Common Stock are forfeited
• All unvested Pro-Rata RPSUs are forfeited
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
8
|
▪
|
Earnings or other financial information
|
▪
|
Changes in dividend policy
|
▪
|
Stock splits
|
▪
|
Mergers and acquisitions
|
▪
|
Major new contracts or product-line introductions
|
▪
|
Litigation involving substantial amounts of money
|
▪
|
Changes in management
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
9
|
▪
|
“In and out” trading in securities of the Company.
Any Company stock purchased in the market must be held for a minimum of six months and ideally longer. Note that the Securities and Exchange Commission (SEC) has a “short-swing profit recapture” rule that effectively prohibits Executive Officers and members of the Board of Directors from selling any Company stock within six months of a purchase. The Company has extended this prohibition to all employees. The receipt of shares pursuant to the vesting of Pro-Rata RPSU awards is not considered a purchase under the SEC’s rule.
|
▪
|
Short sales
(i.e., selling stock one does not own and then borrowing the shares to make delivery)
|
▪
|
Buying or selling “puts” or “calls”
(i.e., making commitments to buy or sell securities at a specified price for a fixed period of time)
|
For employees at the Corporate Vice President and Division Senior Vice President level or above (“Officers”) and for all employees in the Finance, Legal and Human Resources departments, all transactions in the Company’s securities (including, but not limited to purchases, sales, transfers, etc.) must be conducted during an open trading window and pre-cleared with the Corporate Counsel, or their designee. If contemplating a transaction, please provide a written request via e-mail to RLTrading@ralphlauren.com, specifying the number of Stock Options you wish to exercise and/or the number of shares you wish to purchase or sell
before
contacting Merrill Lynch or any other broker, or taking any other step to initiate a transaction.
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
10
|
|
Fiscal 2014 Pro-Rata RPSU Overview
|
11
|
▪
|
A Stock Option granted under the Plan provides a participant the opportunity to purchase, within a specified period of time, a stated number of shares of the Company’s Class A Common Stock (traded on the New York Stock Exchange under the symbol RL) at a fixed price (the Option grant price)
|
▪
|
The Option grant price equals the Fair Market Value (the average of the high and the low sales prices) of a share of the Company’s Class A Common Stock on the grant date
|
▪
|
Stock Options increase in value when the price of the Company’s Class A Common stock moves above the Option grant price
|
▪
|
Unlike actual share ownership, Stock Options do not provide voting rights or earn dividends
|
1.
|
Attract and retain exceptional individuals of superior talent
|
2.
|
Motivate such individuals to achieve longer-range performance
|
3.
|
Enable such individuals to participate in the long-term growth and financial success of the Company
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
2
|
An eligible employee who receives a Below Expectations (B) or Unsatisfactory (U) rating
on his or her annual performance appraisal is not eligible for an equity award in the fiscal year following that performance appraisal period. |
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
3
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
4
|
|
Grant Price
|
If Future Stock Price Reaches:
|
||
|
$165
|
$190
|
$215
|
$240
|
Gain per Share
(assumes all shares granted have vested and are exercised)
|
n/a
|
$25
|
$50
|
$75
|
Gain per Share x 600 Shares
|
n/a
|
$15,000
|
$30,000
|
$45,000
|
For employees at the Corporate Vice President and Division Senior Vice President level or above (“Officers”) and for all employees in the Finance, Legal and Human Resources departments, all transactions in the Company’s securities (including, but not limited to purchases, sales, transfers, etc.) must be conducted during an open trading window and pre-cleared with the Corporate Counsel, or their designee. If contemplating a transaction, please provide a written request via e-mail to RLTrading@ralphlauren.com, specifying the number of shares you wish to exercise and/or the number of shares you wish to purchase or sell
before
contacting Merrill Lynch or any other broker, or taking any other step to initiate a transaction.
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
5
|
▪
|
Once pre-clearance is received from the Corporate Counsel, or their designee, Officers and all employees in the Finance, Legal, and Human Resources departments must indicate their intent to exercise by contacting the Executive Advisory Team at Merrill Lynch at (800) 937-0526 between 8:30 a.m. and 6:00 p.m. (ET) on any day the New York Stock Exchange is open. Outside the U.S., Puerto Rico or Canada, call (212) 236-5574.
|
▪
|
All transactions in the Company’s securities, including cash or cashless exercise of Stock Options and sales and purchases of the Company’s Class A Common Stock as described below, are prohibited during a Company trading blackout period as defined in the Company’s Securities Trading policy which is included in this Overview beginning on page 8.
|
1.
|
Cash Exercise
: Paying cash for the shares exercised and retaining the shares
|
2.
|
Cashless Exercise
: Exercising a number of Stock Options and paying for the exercise by simultaneously selling the stock and retaining the net gain
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
6
|
Event
|
Vested Stock Options
|
Unvested Stock Options
|
Normal Retirement
(Age 65)
|
• Up to three years to exercise any vested Stock Options after retirement, provided they do not expire sooner.
If not exercised within the three years following retirement, the Options expire.
|
•
All unvested Stock Options are forfeited
|
Early Retirement
(Age 55 through Age 64 with 7 or more years of service)
|
• Up to one year to exercise any vested Stock Options after early retirement, provided they do not expire sooner. If not exercised within one year following retirement, the Options expire.
However, any vested Options are forfeited if a participant goes to work for a competitor
1
.
|
•
All unvested Stock Options are forfeited
|
Long-Term
Disability (LTD)
2
|
• Up to three years to exercise any vested Stock Options after LTD begins, provided they do not expire sooner.
The Options expire if not exercised within the three years following onset of LTD.
|
• Options continue to vest according to the original vesting schedule (1/3 each year for 3 years).
However, once Options vest, if they are not exercised within three years of the LTD date, the Options expire.
|
Death
|
• The optionee’s estate has up to three years to exercise any vested Stock Options, provided they do not expire sooner.
The
Options expire if not exercised within the three years.
|
• Options continue to vest according to the original vesting schedule (1/3 each year for 3 years).
However, once Options vest, if they are not exercised within three years of the date of death, the Options expire.
|
Voluntary Resignation
|
•
All vested Stock Options are forfeited as of the date of termination
|
•
All unvested Stock Options are forfeited
|
Involuntary Termination
3
(Without Cause)
|
•
Up to three months to exercise any vested Stock Options, provided they do not expire sooner
|
•
All unvested Stock Options are forfeited
|
Dismissal for Cause
(As defined by the Plan or, if applicable, the participant’s employment agreement)
|
•
All Vested Stock Options are forfeited as of the date of termination
|
•
All unvested Stock Options are forfeited
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
7
|
•
|
Earnings or other financial information
|
•
|
Changes in dividend policy
|
•
|
Stock splits
|
•
|
Mergers and acquisitions
|
•
|
Major new contracts or product-line introductions
|
•
|
Litigation involving substantial amounts of money
|
•
|
Changes in management
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
8
|
•
|
“In and out” trading in securities of the Company.
Any Company stock purchased in the market must be held for a minimum of six months, and ideally longer. (Note that the Securities and Exchange Commission (SEC) has a “short-swing profit recapture” rule that effectively prohibits Executive Officers and members of the Board of Directors from selling any Company stock within six months of a purchase. The Company has extended this prohibition to all employees. The receipt of shares pursuant to the exercise of Stock Options is not considered a purchase under the SEC’s rule.)
|
•
|
Short sales
(i.e., selling stock one does not own and then borrowing the shares to make delivery)
|
•
|
Buying or selling “puts” or “calls”
(i.e., making commitments to buy or sell securities at a specified price for a fixed period of time)
|
For employees at the Corporate Vice President and Division Senior Vice President level or above (“Officers”) and for all employees in the Finance, Legal and Human Resources departments, all transactions in the Company’s securities (including, but not limited to purchases, sales, transfers, etc.) must be conducted during an open trading window and pre-cleared with the Corporate Counsel, or their designee. If contemplating a transaction, please provide a written request via e-mail to RLTrading@ralphlauren.com, specifying the number of Stock Options you wish to exercise and/or the number of shares you wish to purchase or sell
before
contacting Merrill Lynch or any other broker, or taking any other step to initiate a transaction.
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
9
|
April 1, 2013
|
Fiscal 2014 Stock Option Overview
|
10
|
1.
|
Attract and retain exceptional individuals of superior talent
|
2.
|
Motivate such individuals to achieve longer-range performance goals
|
3.
|
Enable such individuals to participate in the long-term growth and financial success of the Company
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
2
|
An eligible employee who receives a Below Expectations (B) or Unsatisfactory (U) rating
on his or her annual performance appraisal is not eligible for an equity award in the fiscal year following that performance appraisal period. |
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
3
|
▪
|
Net Earnings or Net Income (before or after taxes)
|
▪
|
Basic or Diluted Earnings Per Share (before or after taxes)
|
▪
|
Net Operating Profit (before or after taxes)
|
▪
|
Net Revenue or Net Revenue Growth
|
▪
|
Gross Profit or Gross Profit Growth
|
▪
|
Return Measures (including but not limited to Return on Assets, Investments, Capital)
|
▪
|
Other measures of economic value added or other value creation metrics
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
4
|
Relative TSR Performance
|
TSR Modifier Payout Adjustment
|
>
80
th
Percentile
|
+25%
|
>
60
th
Percentile and < 80
th
Percentile
|
+12.5%
|
>
40
th
Percentile and < 60
th
Percentile
|
0%
|
>
30
th
Percentile and < 40
th
Percentile
|
-12.5%
|
< 30
th
Percentile
|
-25%
|
Performance Level
|
Performance as % of Target
|
Payout as % of Target
|
|
TSR Modifier
|
Total Payout as % of Target
|
Maximum
|
110%
|
150%
|
-25% to +25%
|
112.5% - 187.5%
|
|
Target
|
100%
|
100%
|
-25% to +25%
|
75% - 125%
|
|
Threshold
|
70%
|
75%
|
-25% to +25%
|
56.25% - 93.75%
|
Vesting is interpolated for performance between 70%-110% of target and then adjusted based on the TSR modifier. No payout will be earned for performance below Threshold.
|
|
Adjustment for TSR Modifier will not be interpolated between performance levels.
|
|||
|
|
|
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
5
|
# Cliff
RPSUs with TSR Modifier Granted
|
Net Income (NI) Performance Level
2
|
% of Target Award Earned Based on NI Performance
1
|
TSR Performance Level
2
|
TSR Modifier Adjustment
|
Vested Percentage
with TSR Modifier
|
# of Shares Vested
|
1,000
|
115%
|
150%
|
84
th
Percentile
|
+25%
|
187.5%
|
1,875
|
1,000
|
100%
|
100%
|
65
th
Percentile
|
+12.5%
|
112.5%
|
1,125
|
1,000
|
80%
|
83%
|
35
th
Percentile
|
-12.5%
|
72.6%
|
726
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
6
|
▪
|
Receive shares of RL Class A Common Stock without paying any exercise price
|
▪
|
The number of Cliff RPSUs with TSR Modifier vesting can range from 56.25% to 187.5% of the target shares granted
|
▪
|
Any increases in the Company’s Class A Common Stock price above the price on the grant date increases the value of the award
|
|
|
|
|
If Stock Price Reaches:
|
||||
Company Performance At:
|
Relative TSR Valued At:
|
Total Payment Modifier %
|
# of Shares
|
$150
|
$175
|
$200
|
$225
|
|
Threshold
|
< 30
th
Percentile
|
56.25%
|
562
|
$84,300
|
$98,350
|
$112,400
|
$126,450
|
|
Target
|
≥
40
th
and < 60
th
Percentile
|
100%
|
1,000
|
$150,000
|
$175,000
|
$200,000
|
$225,000
|
|
Maximum
|
> 80
th
Percentile
|
187.5%
|
1,875
|
$281,250
|
$328,125
|
$375,000
|
$421,875
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
7
|
Event
|
Status of Cliff RPSU with TSR Modifier Awards
|
Normal Retirement
(Age 65)
Early Retirement
(Age 55 through age 64
with 7 or more years of service)
Long-Term Disability (LTD)
Death
|
• In the case of retirement, LTD or death, a pro-rated
1
target number of outstanding Cliff RPSUs with TSR Modifier grants will be determined
• These pro-rated Cliff RPSUs with TSR Modifier will be eligible to vest
2
after the end of the applicable performance period based on the actual degree of achievement, and the number of shares paid out will be adjusted based on relative TSR performance.
If performance against the Company performance goal does not reach the Threshold level, then the pro-rated Cliff RPSUs with TSR Modifier will be forfeited.
•
All remaining Cliff RPSUs with TSR Modifier are forfeited
|
Voluntary Resignation
|
•
All unvested Cliff RPSUs with TSR Modifier are forfeited
|
Involuntary Termination
(Without Cause)
|
•
All unvested Cliff RPSUs with TSR Modifier are forfeited
|
Dismissal for Cause
(As defined by the Company or,
if applicable, the participant’s employment agreement)
|
•
All vested Cliff RPSUs with TSR Modifier not yet distributed into shares of the Company’s Class A Common Stock are forfeited
•
All unvested Cliff RPSUs with TSR Modifier are forfeited
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
8
|
•
|
Earnings or other financial information
|
•
|
Changes in dividend policy
|
•
|
Stock splits
|
•
|
Mergers and acquisitions
|
•
|
Major new contracts or product-line introductions
|
•
|
Litigation involving substantial amounts of money
|
•
|
Changes in management
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
9
|
•
|
“In and out” trading in securities of the Company.
Any Company stock purchased in the market must be held for a minimum of six months, and ideally longer. Note that the Securities and Exchange Commission (SEC) has a “short-swing profit recapture” rule that effectively prohibits Executive Officers and members of the Board of Directors from selling any Company stock within six months of a purchase. The Company has extended this prohibition to all employees. The receipt of shares pursuant to the vesting of Cliff RPSU awards is not considered a purchase under the SEC’s rule.
|
•
|
Short sales
(i.e., selling stock one does not own and then borrowing the shares to make delivery)
|
•
|
Buying or selling “puts” or “calls”
(i.e., making commitments to buy or sell securities at a specified price for a fixed period of time)
|
For employees at the Corporate Vice President and Division Senior Vice President level or above (“Officers”) and for all employees in the Finance, Legal and Human Resources departments, all transactions in the Company’s securities (including, but not limited to purchases, sales, transfers, etc.) must be conducted during an open trading window and pre-cleared with the Corporate Counsel, or their designee. If contemplating a transaction, please provide a written request via e-mail to RLTrading@ralphlauren.com, specifying the number of Stock Options you wish to exercise and/or the number of shares you wish to purchase or sell
before
contacting Merrill Lynch or any other broker, or taking any other step to initiate a transaction.
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
10
|
|
Fiscal 2015 Cliff RPSU with TSR Modifier Overview
|
11
|
|
|
Fiscal Years Ended
|
||||||||||||||||||
|
|
March 29, 2014
|
|
March 30, 2013
|
|
March 31, 2012
|
|
April 2, 2011
|
|
April 3, 2010
|
||||||||||
|
|
(millions)
|
||||||||||||||||||
Earnings, as defined:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before provision for income taxes
|
|
$
|
1,096
|
|
|
$
|
1,089
|
|
|
$
|
1,015
|
|
|
$
|
825
|
|
|
$
|
689
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity in losses of equity-method investees
|
|
9
|
|
|
10
|
|
|
9
|
|
|
8
|
|
|
6
|
|
|||||
Fixed charges
|
|
170
|
|
|
162
|
|
|
164
|
|
|
124
|
|
|
111
|
|
|||||
Subtract:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income attributable to noncontrolling interests
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Earnings available to cover fixed charges
|
|
$
|
1,275
|
|
|
$
|
1,260
|
|
|
$
|
1,188
|
|
|
$
|
957
|
|
|
$
|
806
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
22
|
|
|
$
|
18
|
|
|
$
|
22
|
|
Interest component of rent expense
|
|
151
|
|
|
143
|
|
|
142
|
|
|
106
|
|
|
89
|
|
|||||
Total fixed charges
|
|
$
|
170
|
|
|
$
|
162
|
|
|
$
|
164
|
|
|
$
|
124
|
|
|
$
|
111
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of earnings to fixed charges
(a)
|
|
7.5
|
|
|
7.8
|
|
|
7.3
|
|
|
7.7
|
|
|
7.2
|
|
|
(a)
|
All ratios shown in the above table have been calculated using unrounded numbers.
|
Entity Name
|
|
Jurisdiction of Formation
|
Acqui Polo CV
|
|
Netherlands
|
Acqui Polo Espana SL
|
|
Spain
|
Acqui Polo GP, LLC
|
|
Delaware
|
Acqui Polo SAS
|
|
France
|
Club Monaco (Hong Kong) Limited
|
|
Hong Kong
|
Club Monaco Corp.
|
|
Nova Scotia
|
Club Monaco S.A.M.
|
|
Principality of Monaco
|
Club Monaco U.S., LLC
|
|
Delaware
|
Fashion Development Corp.
|
|
Delaware
|
Ralph Lauren Retail, Inc. (f/k/a Fashions Outlet of America, Inc.)
|
|
Delaware
|
Mountain Rose (USA), LLC
|
|
Delaware
|
Ralph Lauren Jeans Company, LLC (f/k/a Polo Apparel, LLC, Polo Apparel of Texas, Ltd.)
|
|
Delaware
|
Polo Fin BV
|
|
Netherlands
|
Ralph Lauren Holding BV (f/k/a Polo Hold BV)
|
|
Netherlands
|
RL International Assignments, Inc. (f/k/a Polo International Assignments Service Corp.)
|
|
Delaware
|
Polo Jeans Company, LLC (f/k/a Polo Jeans Company of Texas, Inc.)
|
|
Delaware
|
Polo JP Acqui B.V.
|
|
Netherlands
|
Ralph Lauren Management Services, LLC (f/k/a Polo Management Services, LLC, Polo Management Services, Inc.)
|
|
Delaware
|
Polo Players, Ltd
|
|
Delaware
|
Ralph Lauren Asia Holding Company Limited (f/k/a Polo Ralph Lauren Asia Holding Company Limited)
|
|
Hong Kong
|
Ralph Lauren Asia Pacific Limited (f/k/a Polo Ralph Lauren Asia Pacific, Limited)
|
|
Hong Kong
|
Ralph Lauren Aviation, LLC (f/k/a Polo Ralph Lauren Aviation, LLC)
|
|
Delaware
|
Ralph Lauren Commerce & Trading (Shanghai) Co., Ltd (f/k/a Polo Ralph Lauren Commerce & Trading (Shanghai) Co., Ltd)
|
|
China
|
Ralph Lauren Europe Sàrl (f/k/a Polo Ralph Lauren Europe Sàrl)
|
|
Switzerland
|
Ralph Lauren Greece EPE (f/k/a PRL Greece EPE)
|
|
Greece
|
Ralph Lauren Garment Technology Consulting (Shenzhen) Co., Ltd (f/k/a Polo Ralph Lauren Garment Technology Consulting (Shenzhen) Co., Ltd)
|
|
China
|
Ralph Lauren Garment Technology Consulting (Shenzhen) Co., Ltd Shanghai Branch (f/k/a Polo Ralph Lauren Garment Technology Consulting (Shenzhen) Co., Ltd. Shanghai Branch)
|
|
China
|
Ralph Lauren Trading (Shanghai) Co., Ltd (f/k/a Polo Ralph Lauren Trading (Shanghai) Co., Ltd)
|
|
China
|
Ralph Lauren Home Collection Showroom, LLC (f/k/a Polo Ralph Lauren Home Collection Showroom, LLC)
|
|
Delaware
|
Ralph Lauren (Hong Kong) Retail Company Limited (f/k/a Polo Ralph Lauren (Hong Kong) Retail Company Limited)
|
|
Hong Kong
|
Ralph Lauren (Hong Kong) Retail Company Limited Taiwan Branch (f/k/a Polo Ralph Lauren (Hong Kong) Retail Company Limited Taiwan Branch)
|
|
Taiwan
|
Ralph Lauren Corporation India Branch (f/k/a Polo Ralph Lauren Corporation India Branch)
|
|
India
|
Ralph Lauren Korea Ltd. (f/k/a Polo Ralph Lauren Korea Ltd)
|
|
Korea
|
Ralph Lauren Milan S.r.l (f/k/a Polo Ralph Lauren Milan S.r.l)
|
|
Italy
|
Ralph Lauren (Macau) Limited (f/k/a Polo Ralph Lauren (Macau) Limited)
|
|
Macau
|
Ralph Lauren (Malaysia) Sdn Bhd (f/k/a Polo Ralph Lauren (Malaysia) Sdn Bhd)
|
|
Malaysia
|
Entity Name
|
|
Jurisdiction of Formation
|
Ralph Lauren (Singapore) Private Limited (f/k/a Polo Ralph Lauren (Singapore) Private Limited)
|
|
Singapore
|
Ralph Lauren Sourcing Americas, LLC (f/k/a Polo Ralph Lauren Sourcing Americas, LLC)
|
|
Delaware
|
Ralph Lauren Sourcing Company, Ltd (f/k/a Polo Ralph Lauren Sourcing Company, Ltd).
|
|
Hong Kong
|
Ralph Lauren Sourcing Italy S.r.l. (f/k/a Polo Ralph Lauren Sourcing Italy S.r.l.)
|
|
Italy
|
Ralph Lauren Womenswear, LLC (f/k/a Polo Ralph Lauren Womenswear, LLC)
|
|
Delaware
|
RL Retail Services Limited (f/k/a Polo Retail Europe Limited)
|
|
United Kingdom
|
RL Travel, Inc (f/k/a Polo Wings II, Inc)
|
|
Delaware
|
Ralph Lauren Scandinavia AB (f/k/a Poloco Scandinavia AB)
|
|
Sweden
|
Ralph Lauren Australia Pty Ltd (f/k/a PRL Australia Pty Ltd).
|
|
Australia
|
Poloco USA, Inc
|
|
New York
|
PRL CMI, LLC
|
|
Delaware
|
PRL Fashions Inc.
|
|
Delaware
|
RL Fashions of Europe S.r.l. (f/k/a PRL Fashions of Europe S.r.l.)
|
|
Italy
|
PRL International, Inc.
|
|
Delaware
|
Ralph Lauren Corporation Japan (f/k/a Polo Ralph Lauren Kabushiki Kaisha)
|
|
Japan
|
PRL Japan Kabushiki Kaisha
|
|
Japan
|
PRL Japan Partnership NK
|
|
Japan
|
PRL Netherlands Limited, LLC (f/k/a Acqui Polo Limited, LLC)
|
|
Delaware
|
Ralph Lauren Portugal, Unipessoal LDA (f/k/a PRL Portugal, Unipessoal LDA)
|
|
Portugal
|
Ralph Lauren Lifestyle Concepts LLC (f/k/a PRL Restaurant Concepts of Illinois, LLC)
|
|
Delaware
|
Ralph Lauren Lifestyle Concepts (NY) LLC
|
|
New York
|
RL Services Srl (f/k/a PRL Sample Development Center Srl)
|
|
Italy
|
PRL S.R.L.
|
|
Argentina
|
Ralph Lauren Austria GmbH (f/k/a PRL Textil Gmbh)
|
|
Austria
|
PRL USA Holdings, Inc.
|
|
Delaware
|
PRL USA, Inc.
|
|
Delaware
|
Ralph Lauren Americas, S.A
|
|
Panama
|
Ralph Lauren Belgium S.p.r.l. (f/k/a Poloco Belgium S.p.r.l.)
|
|
Belgium
|
Ralph Lauren Brasil Participacoes Ltda.
|
|
Brazil
|
Ralph Lauren Canada Corporation
|
|
Canada
|
Ralph Lauren Canada LP
|
|
Canada
|
Ralph Lauren Denmark ApS (f/k/a Polo Ralph Lauren Denmark ApS)
|
|
Denmark
|
Ralph Lauren Espana SL (f/k/a Poloco Espana SL)
|
|
Spain
|
Ralph Lauren Footwear Co., Inc.
|
|
Massachusetts
|
Ralph Lauren France S.A.S. (f/k/a Poloco S.A.S.)
|
|
France
|
Ralph Lauren Germany Gmbh (f/k/a Polo Moden Gmbh)
|
|
Germany
|
Ralph Lauren Home Collection, Inc.
|
|
Delaware
|
Ralph Lauren Ireland Limited
|
|
Ireland
|
Ralph Lauren Italy S.r.L.
|
|
Italy
|
Ralph Lauren Latin American Services, S. de R.L.
|
|
Panama
|
Ralph Lauren London Ltd. (f/k/a Ralph Lauren Limited)
|
|
United Kingdom
|
Ralph Lauren Madrid SL (f/k/a Ralph Lauren Spain SL)
|
|
Spain
|
Ralph Lauren Mağazacilik ve Ticaret Limited Sirketi
|
|
Turkey
|
Ralph Lauren Media, LLC
|
|
Delaware
|
Ralph Lauren Netherlands BV (f/k/a Poloco Netherlands BV)
|
|
Netherlands
|
Entity Name
|
|
Jurisdiction of Formation
|
Ralph Lauren New Zealand Limited
|
|
New Zealand
|
Ralph Lauren Paris S.A.S. (f/k/a PRL France S.A.S.)
|
|
France
|
Ralph Lauren Saint Barth S.A.S. (f/k/a Polo Ralph Lauren S.A.S. (St. Barthelemy)
|
|
France
|
Ralph Lauren Switzerland Sagl
|
|
Switzerland
|
Ralph Lauren UK Ltd. (f/k/a Polo UK Ltd.)
|
|
United Kingdom
|
Ralph Lauren Vietnam Limited Liability Company
|
|
Vietnam
|
Ralph Lauren Vietnam Limited Liability Company, Ho Chi Minh City Branch
|
|
Vietnam
|
Ralph Lauren Watch and Jewelry Company Sàrl (50% ownership)
|
|
Switzerland
|
Rodeo Girl Productions, Inc.
|
|
New York
|
RL Fragrances, LLC
|
|
Delaware
|
RL Hellas Resorts EPE
|
|
Greece
|
RLPR, Inc.
|
|
Delaware
|
RL Retail France S.A.S. (f/k/a PFO Retail Management S.A.S.)
|
|
France
|
RLWW, LLC (f/k/a RLWW, Inc.)
|
|
Delaware
|
Sun Apparel, LLC (f/k/a Sun Apparel, Inc.)
|
|
Delaware
|
The Polo/Lauren Company L.P.
|
|
New York
|
The Ralph Lauren Womenswear Company, L.P.
|
|
Delaware
|
Ralph Lauren Company West, LLC (f/k/a Western Polo Retailers, LLC)
|
|
Delaware
|
WSH, LLC
|
|
Delaware
|
The RL Trading Company Ltd.
|
|
United Kingdom
|
|
/s/ RALPH LAUREN
|
|
Ralph Lauren
|
|
Chairman of the Board and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
Date: May 15, 2014
|
|
|
/s/ CHRISTOPHER H. PETERSON
|
|
Christopher H. Peterson
|
|
Executive Vice President, Chief Administrative Officer and Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|
|
|
Date: May 15, 2014
|
|
|
/s/ RALPH LAUREN
|
|
Ralph Lauren
|
|
|
May 15, 2014
|
|
|
/s/ CHRISTOPHER H. PETERSON
|
|
Christopher H. Peterson
|
|
|
May 15, 2014
|
|