##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period endedApril 3, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number 1-9548
 The Timberland Company
 
  Delaware
    
    02-0312554(State or Other Jurisdiction of
    
    (I.R.S. Employer Identification No.)Incorporation or Organization)200 Domain Drive, Stratham, New Hampshire
    
    03885(Address of Principal Executive Offices)
    
    (Zip Code)
 (603) 772-9500
  þ o
  o o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer  o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
  o þ




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##### 



THE TIMBERLAND COMPANY
 FORM 10-Q
 TABLE OF CONTENTS
 Page(s)Part I  Financial InformationItem 1. Financial StatementsUnaudited Condensed Consolidated Balance Sheets -
April 3, 2009, December 31, 2008 and March 28, 2008
    
    
    3Unaudited Condensed Consolidated Statements of Operations -
For the Quarters Ended April 3, 2009 and March 28, 2008
    
    
    4Unaudited Condensed Consolidated Statements of Cash Flows -
For the Quarters Ended April 3, 2009 and March 28, 2008
    
    
    5Notes to Unaudited Condensed Consolidated Financial Statements
    
    
    6-16Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    16-24Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    24Item 4. Controls and Procedures
    
    
    25Part II  Other InformationItem 1A. Risk Factors
    
    
    25Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    26Item 6. Exhibits
    
    
    27Signatures
    
    
    28Exhibit Index
    
    
    29Exhibits
    
    
    30-54EX-10.1 THE TIMBERLAND COMPANY LONG TERM INCENTIVE PROGRAMEX-10.2 FORM OF PERFORMANCE STOCK UNIT AGREEMENTEX-10.3 FORM OF PERFORMANCE VESTED STOCK OPTION AGREEMENTEX-10.4 FORM OF NON-QUALIFIED STOCK OPTION AGREEMENTEX-10.5 FORM OF RESTRICTED STOCK UNIT AGREEMENTEX-10.6 FORM OF RESTRICTED STOCK AWARD AGREEMENTEX-10.7 SUMMARY OF NON-EMPLOYEE DIRECTOR COMPENSATIONEX-31.1 SECTION 302 CERTIFICATION OF PEOEX-31.2 SECTION 302 CERTIFICATION OF PFOEX-32.1 SECTION 906 CERTIFICATION OF CEOEX-32.2 SECTION 906 CERTIFICATION OF CFO




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Cautionary Note Regarding Forward-Looking Statements




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##### Table of Contents



Part I  FINANCIAL INFORMATION
 
 Item 1. FINANCIAL STATEMENTS
 THE TIMBERLAND COMPANY
 
 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
  April 3,
    
    
    December 31,
    
    
    March 28,2009
    
    
    2008
    
    
    2008AssetsCurrent assetsCash and equivalents
    
    $
    159,195
    
    
    $
    217,189
    
    
    $
    134,829Accounts receivable, net of allowance for doubtful accounts of $13,239
at April 3, 2009, $14,482 at December 31, 2008 and $16,717 at March 28,
2008
    
    
    172,280
    
    
    
    168,666
    
    
    
    201,786Inventory, net
    
    
    162,783
    
    
    
    179,688
    
    
    
    180,177Prepaid expense
    
    
    37,576
    
    
    
    37,139
    
    
    
    42,019Prepaid income taxes
    
    
    16,752
    
    
    
    16,687
    
    
    
    20,196Deferred income taxes
    
    
    21,974
    
    
    
    23,425
    
    
    
    22,749Derivative assets
    
    
    4,886
    
    
    
    7,109
    
    
    
    Total current assets
    
    
    575,446
    
    
    
    649,903
    
    
    
    601,756Property, plant and equipment, net
    
    
    74,576
    
    
    
    78,526
    
    
    
    86,461Deferred income taxes
    
    
    17,204
    
    
    
    18,528
    
    
    
    19,075Goodwill
    
    
    43,870
    
    
    
    43,870
    
    
    
    44,840Intangible assets, net
    
    
    46,512
    
    
    
    47,996
    
    
    
    53,588Other assets, net
    
    
    10,423
    
    
    
    10,576
    
    
    
    10,453Total assets
    
    $
    768,031
    
    
    $
    849,399
    
    
    $
    816,173Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable
    
    $
    56,159
    
    
    $
    96,901
    
    
    $
    63,427Accrued expensePayroll and related
    
    
    18,966
    
    
    
    32,587
    
    
    
    30,085Other
    
    
    61,309
    
    
    
    79,503
    
    
    
    65,250Income taxes payable
    
    
    17,841
    
    
    
    20,697
    
    
    
    15,321Deferred income taxes
    
    
    184
    
    
    
    
    
    
    
    Derivative liabilities
    
    
    1,212
    
    
    
    2,386
    
    
    
    9,257Total current liabilities
    
    
    155,671
    
    
    
    232,074
    
    
    
    183,340Other long-term liabilities
    
    
    33,398
    
    
    
    40,787
    
    
    
    40,431Commitments and contingenciesStockholders equityPreferred Stock, $.01 par value; 2,000,000 shares authorized; none issued
    
    
    
    
    
    
    
    
    
    
    Class A Common Stock, $.01 par value (1 vote per share); 120,000,000
shares authorized; 73,997,343 shares issued at April 3, 2009, 73,806,026
shares issued at December 31, 2008 and 73,471,161 shares issued at March
28, 2008
    
    
    740
    
    
    
    738
    
    
    
    735Class B Common Stock, $.01 par value (10 votes per share); convertible
into Class A shares on a one-for-one basis; 20,000,000 shares
authorized; 11,529,160 shares issued and outstanding at April 3, 2009
and December 31, 2008 and 11,743,660 shares issued and outstanding at
March 28, 2008
    
    
    115
    
    
    
    115
    
    
    
    117Additional paid-in capital
    
    
    261,901
    
    
    
    260,267
    
    
    
    253,210Retained earnings
    
    
    933,916
    
    
    
    918,039
    
    
    
    893,172Accumulated other comprehensive income
    
    
    7,635
    
    
    
    12,543
    
    
    
    24,808Treasury Stock at cost; 28,685,386 Class A shares at April 3, 2009,
27,766,651 Class A shares at December 31, 2008 and 25,692,294 Class A
shares at March 28, 2008
    
    
    (625,345
    )
    
    
    (615,164
    )
    
    
    (579,640
    )Total stockholders equity
    
    
    578,962
    
    
    
    576,538
    
    
    
    592,402Total liabilities and stockholders equity
    
    $
    768,031
    
    
    $
    849,399
    
    
    $
    816,173
 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.




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##### Table of Contents



THE TIMBERLAND COMPANY
 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
  For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Revenue
    
    $
    296,648
    
    
    $
    340,402Cost of goods sold
    
    
    159,959
    
    
    
    182,798Gross profit
    
    
    136,689
    
    
    
    157,604Operating expenseSelling
    
    
    92,268
    
    
    
    106,122General and administrative
    
    
    25,417
    
    
    
    27,688Impairment of intangible asset
    
    
    925
    
    
    
    Restructuring and related (credits)/costs
    
    
    (104
    )
    
    
    552Total operating expense
    
    
    118,506
    
    
    
    134,362Operating income
    
    
    18,183
    
    
    
    23,242Other income/(expense)Interest income
    
    
    440
    
    
    
    854Interest expense
    
    
    (121
    )
    
    
    (286
    )Other income/(expense), net
    
    
    (663
    )
    
    
    5,762Total other income/(expense), net
    
    
    (344
    )
    
    
    6,330Income before provision for income taxes
    
    
    17,839
    
    
    
    29,572Provision for income taxes
    
    
    1,962
    
    
    
    11,533Net income
    
    $
    15,877
    
    
    $
    18,039Earnings per shareBasic
    
    $
    .28
    
    
    $
    .30Diluted
    
    $
    .27
    
    
    $
    .30Weighted-average shares outstandingBasic
    
    
    57,108
    
    
    
    59,618Diluted
    
    
    57,802
    
    
    
    60,016
 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.




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##### Table of Contents



THE TIMBERLAND COMPANY
 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Cash flows from operating activities:Net income
    
    $
    15,877
    
    
    $
    18,039Adjustments to reconcile net income to net cash
(used)/provided by operating activities:Deferred income taxes
    
    
    2,215
    
    
    
    2,554Share-based compensation
    
    
    811
    
    
    
    1,539Depreciation and other amortization
    
    
    7,141
    
    
    
    8,046Provision for losses on accounts receivable
    
    
    1,912
    
    
    
    1,389Provision for intangible asset impairment
    
    
    925
    
    
    
    Tax benefit/(expense) from share-based compensation, net of
excess benefit
    
    
    (295
    )
    
    
    151Unrealized (gain)/loss on derivatives
    
    
    34
    
    
    
    (21
    )Other non-cash charges, net
    
    
    828
    
    
    
    520Increase/(decrease) in cash from changes in working capital:Accounts receivable
    
    
    (7,925
    )
    
    
    (6,539
    )Inventory
    
    
    16,656
    
    
    
    24,086Prepaid expense
    
    
    (1,652
    )
    
    
    1,617Accounts payable
    
    
    (40,269
    )
    
    
    (23,644
    )Accrued expense
    
    
    (31,261
    )
    
    
    (18,023
    )Prepaid income taxes
    
    
    (65
    )
    
    
    (2,835
    )Income taxes payable
    
    
    (9,040
    )
    
    
    (2,544
    )Other liabilities
    
    
    (201
    )
    
    
    (1,572
    )Net cash (used)/provided by operating activities
    
    
    (44,309
    )
    
    
    2,763Cash flows from investing activities:Acquisition of business, net of cash acquired
    
    
    (1,516
    )
    
    
    Additions to property, plant and equipment
    
    
    (2,838
    )
    
    
    (4,116
    )Other
    
    
    (61
    )
    
    
    2,170Net cash used by investing activities
    
    
    (4,415
    )
    
    
    (1,946
    )Cash flows from financing activities:Common stock repurchases
    
    
    (9,127
    )
    
    
    (10,152
    )Issuance of common stock
    
    
    670
    
    
    
    453Excess tax benefit from share-based compensation
    
    
    99
    
    
    
    122Other
    
    
    (170
    )
    
    
    Net cash used by financing activities
    
    
    (8,528
    )
    
    
    (9,577
    )Effect of exchange rate changes on cash and equivalents
    
    
    (742
    )
    
    
    315Net decrease in cash and equivalents
    
    
    (57,994
    )
    
    
    (8,445
    )Cash and equivalents at beginning of period
    
    
    217,189
    
    
    
    143,274Cash and equivalents at end of period
    
    $
    159,195
    
    
    $
    134,829Supplemental disclosures of cash flow information:Interest paid
    
    $
    156
    
    
    $
    81Income taxes paid
    
    $
    8,311
    
    
    $
    14,484
 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.




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##### Table of Contents



THE TIMBERLAND COMPANY
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  Note 1. Summary of Significant Accounting Policies
 Basis of Presentation
    New Accounting Pronouncements
   Note 2. Fair Value Measurements




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##### Table of Contents



Description
    
    Level 1
    
    Level 2
    
    Level 3
    
    Impact of Netting
    
    April 3, 2009Assets:Derivative contracts:Derivative assets
    
    $
    
    
    
    $
    4,973
    
    
    $
    
    
    
    $
    (87
    )
    
    $
    4,886Cash surrender value
of life insurance
    
    $
    
    
    
    $
    5,963
    
    
    $
    
    
    
    $
    
    
    
    $
    5,963Liabilities:Derivative contracts:Derivative liabilities
    
    $
    
    
    
    $
    1,299
    
    
    $
    
    
    
    $
    (87
    )
    
    $
    1,212




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##### Table of Contents



Note 3. Derivatives
   Cash Flow Hedges




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##### Table of Contents



ContractAmount(U.S.$
    
    
    MaturityCurrency
    
    Equivalent)
    
    
    DatePounds Sterling
    
    $
    17,264
    
    
    
    2009Pounds Sterling
    
    
    1,934
    
    
    
    2010Euro
    
    
    59,777
    
    
    
    2009Euro
    
    
    4,047
    
    
    
    2010Japanese Yen
    
    
    17,397
    
    
    
    2009Japanese Yen
    
    
    4,113
    
    
    
    2010$
    104,532
 Other Derivative Contracts
   ContractAmount(U.S.$
    
    
    MaturityCurrency
    
    Equivalent)
    
    
    DatePounds Sterling
    
    $
    (15,985
    )
    
    
    2009Euro
    
    
    13,053
    
    
    
    2009Japanese Yen
    
    
    17,071
    
    
    
    2009Canadian Dollar
    
    
    6,661
    
    
    
    2009Norwegian Kroner
    
    
    1,971
    
    
    
    2009Swedish Krona
    
    
    2,120
    
    
    
    2009$
    24,891




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##### Table of Contents



Fair Values of Derivative Instruments
 Asset Derivatives
    
    
    Liability DerivativesAs of April 3, 2009
    
    Balance Sheet Location
    
    Fair Value
    
    
    Balance Sheet Location
    
    Fair ValueDerivatives designated as hedging
instruments under SFAS 133:Foreign exchange forward contracts
    
    Derivative assets
    
    $
    4,803
    
    
    Derivative liabilities
    
    $
    1,068Foreign exchange forward contracts
    
    Derivative liabilities
    
    
    
    
    
    Derivative assets
    
    
    75Total derivatives designated as
hedging instruments under SFAS 133
    
    
    
    $
    4,803
    
    
    
    
    $
    1,143Derivatives not designated as hedging
instruments under SFAS 133:Foreign exchange forward contracts
    
    Derivative assets
    
    $
    170
    
    
    Derivative liabilities
    
    $
    144Foreign exchange forward contracts
    
    Derivative liabilities
    
    
    
    
    
    Derivative assets
    
    
    12Total derivatives not designated as
hedging instruments under SFAS 133
    
    
    
    $
    170
    
    
    
    
    $
    156Total derivatives
    
    
    
    $
    4,973
    
    
    
    
    $
    1,299
 The Effect of Derivative Instruments on the Statement of Operations for the Quarters Ended
April 3, 2009 and March 28, 2008
 Amount of Gain/(Loss)Amount of Gain/(Loss)
    
    Location of Gain/(Loss)
    
    Reclassified fromRecognized in OCI on
    
    Reclassified from
    
    Accumulated OCI intoDerivatives in
    
    Derivatives
    
    Accumulated OCI into
    
    IncomeSFAS 133 Cash Flow
    
    (Effective Portion)
    
    Income
    
    (Effective Portion)Hedging Relationships
    
    2009
    
    2008
    
    (Effective Portion)
    
    2009
    
    2008Foreign exchange forward contracts
    
    $
    3,477
    
    
    $
    (8,815
    )
    
    Cost of goods sold
    
    $
    7,316
    
    
    $
    (4,223
    )




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##### Table of Contents



Location of Gain/(Loss)
    
    Amount of Gain/(Loss)Derivatives not Designated
    
    Recognized in
    
    Recognized inas Hedging Instruments
    
    Income on
    
    Income on DerivativeUnder SFAS 133
    
    Derivative
    
    2009
    
    2008Foreign exchange forward contracts
    
    Other income/(expense), net
    
    $
    2,424
    
    
    $
    653
 Note 4. Share-Based Compensation
  For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Cost of goods sold
    
    $
    89
    
    
    $
    202Selling expense
    
    
    468
    
    
    
    859General and administrative expense
    
    
    254
    
    
    
    478Total share-based compensation
    
    $
    811
    
    
    $
    1,539
 Performance-based Awards




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##### Table of Contents



For the QuarterEnded April 3,2009Expected volatility
    
    
    41.8
    %Risk-free interest rate
    
    
    1.9
    %Expected life (in years)
    
    
    6.5Expected dividends
    
    
    
  Stock Options
  For the Quarter EndedApril 3, 2009
    
    March 28, 2008Expected volatility
    
    
    42.4
    %
    
    
    32.0
    %Risk-free interest rate
    
    
    2.1
    %
    
    
    2.8
    %Expected life (in years)
    
    
    7.5
    
    
    
    5.3Expected dividends
    
    
    
    
    
    
    




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##### Table of Contents



Weighted-Weighted-
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicShares
    
    
    Price
    
    
    Term
    
    
    ValueOutstanding at January 1, 2009
    
    
    4,163,628
    
    
    $
    26.03Granted
    
    
    187,194
    
    
    
    9.34Exercised
    
    
    (81,800
    )
    
    
    8.19Expired or forfeited
    
    
    (149,255
    )
    
    
    27.47Outstanding at April 3, 2009
    
    
    4,119,767
    
    
    $
    25.57
    
    
    
    5.8
    
    
    $
    1,129Vested or expected to vest at
April 3, 2009
    
    
    3,966,690
    
    
    $
    25.96
    
    
    
    5.7
    
    
    $
    902Exercisable at April 3, 2009
    
    
    3,351,413
    
    
    $
    27.62
    
    
    
    5.1
    
    
    $
    222
  Nonvested Shares and Restricted Stock Units
  Weighted-
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    AverageStock
    
    
    Grant Date
    
    
    Stock
    
    
    Grant DateAwards
    
    
    Fair Value
    
    
    Units
    
    
    Fair ValueNonvested at January 1, 2009
    
    
    278,553
    
    
    $
    25.39
    
    
    
    182,600
    
    
    $
    14.45Awarded
    
    
    62,399
    
    
    
    9.34
    
    
    
    
    
    
    
    Vested
    
    
    (11,904
    )
    
    
    14.70
    
    
    
    (47,118
    )
    
    
    14.70Forfeited
    
    
    
    
    
    
    
    
    
    
    (2,364
    )
    
    
    14.70Nonvested at April 3, 2009
    
    
    329,048
    
    
    $
    22.73
    
    
    
    133,118
    
    
    $
    14.36
  Note 5. Earnings Per Share (EPS)




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##### Table of Contents



For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Weighted
    
    
    Per-
    
    
    
    
    
    
    Weighted
    
    
    Per-Net
    
    
    -Average
    
    
    Share
    
    
    Net
    
    
    -Average
    
    
    ShareIncome
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    AmountBasic EPS
    
    $
    15,877
    
    
    
    57,108
    
    
    $
    .28
    
    
    $
    18,039
    
    
    
    59,618
    
    
    $
    .30Effect of dilutive
securities:Stock options and
employee stock
purchase plan
shares
    
    
    
    
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    55
    
    
    
    Nonvested shares
    
    
    
    
    
    
    678
    
    
    
    (.01
    )
    
    
    
    
    
    
    343
    
    
    
    Diluted EPS
    
    $
    15,877
    
    
    
    57,802
    
    
    $
    .27
    
    
    $
    18,039
    
    
    
    60,016
    
    
    $
    .30
  For the Quarter EndedApril 3, 2009
    
    March 28, 2008Anti-dilutive securities
    
    
    4,031
    
    
    
    4,351
 Note 6. Comprehensive Income
  For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Net income
    
    $
    15,877
    
    
    $
    18,039Change in cumulative translation adjustment
    
    
    (3,770
    )
    
    
    9,892Change in fair value of cash flow hedges,
net of taxes
    
    
    (1,138
    )
    
    
    (5,190
    )Comprehensive income
    
    $
    10,969
    
    
    $
    22,741
  April 3, 2009
    
    
    December 31, 2008
    
    
    March 28, 2008Cumulative translation adjustment
    
    $
    4,006
    
    
    $
    7,776
    
    
    $
    33,623Fair value of cash flow hedges, net of taxes of $183
at April 3, 2009, $244 at December 31, 2008 and $(442)
at March 28, 2008
    
    
    3,491
    
    
    
    4,629
    
    
    
    (8,815
    )Other adjustments, net of taxes of $7 at April 3, 2009 and
December 31, 2008
    
    
    138
    
    
    
    138
    
    
    
    Total
    
    $
    7,635
    
    
    $
    12,543
    
    
    $
    24,808
 Note 7. Business Segments and Geographic Information




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##### Table of Contents



For the Quarters Ended April 3, 2009 and March 28, 2008
 UnallocatedNorth America
    
    Europe
    
    Asia
    
    Corporate
    
    Consolidated2009Revenue
    
    $
    119,858
    
    
    $
    139,988
    
    
    $
    36,802
    
    
    $
    
    
    
    $
    296,648Operating income/(loss)
    
    
    15,045
    
    
    
    30,113
    
    
    
    1,830
    
    
    
    (28,805
    )
    
    
    18,183Income/(loss) before income taxes
    
    
    15,045
    
    
    
    30,113
    
    
    
    1,830
    
    
    
    (29,149
    )
    
    
    17,839Total assets
    
    
    239,796
    
    
    
    273,040
    
    
    
    72,989
    
    
    
    182,206
    
    
    
    768,031Goodwill
    
    
    36,876
    
    
    
    6,994
    
    
    
    
    
    
    
    
    
    
    
    43,8702008Revenue
    
    $
    137,730
    
    
    $
    164,751
    
    
    $
    37,921
    
    
    $
    
    
    
    $
    340,402Operating income/(loss)
    
    
    21,353
    
    
    
    33,121
    
    
    
    696
    
    
    
    (31,928
    )
    
    
    23,242Income/(loss) before income taxes
    
    
    21,353
    
    
    
    33,121
    
    
    
    696
    
    
    
    (25,598
    )
    
    
    29,572Total assets
    
    
    257,815
    
    
    
    291,016
    
    
    
    81,892
    
    
    
    185,450
    
    
    
    816,173Goodwill
    
    
    37,846
    
    
    
    6,994
    
    
    
    
    
    
    
    
    
    
    
    44,840
  For the Quarter EndedApril 3, 2009
    
    
    March 28, 2008Footwear
    
    $
    211,641
    
    
    $
    236,598Apparel and accessories
    
    
    78,664
    
    
    
    97,942Royalty and other
    
    
    6,343
    
    
    
    5,862Total
    
    $
    296,648
    
    
    $
    340,402




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##### Table of Contents



Note 8. Inventory, net
  April 3, 2009
    
    
    December 31, 2008
    
    
    March 28, 2008Materials
    
    $
    7,978
    
    
    $
    7,708
    
    
    $
    7,116Work-in-process
    
    
    1,189
    
    
    
    825
    
    
    
    924Finished goods
    
    
    153,616
    
    
    
    171,155
    
    
    
    172,137Total
    
    $
    162,783
    
    
    $
    179,688
    
    
    $
    180,177
 Note 9. Acquisition
  Note 10. Income Taxes
  Note 11. Share Repurchase
   Note 12. Litigation
  
 Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS




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Critical Accounting Policies
  Overview
 â




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##### Table of Contents




    
    First quarter revenue decreased 12.9%, or 6.5% on a constant dollar basis, to $296.6
million, compared to $340.4 million in the prior year period.
    
    Gross margin decreased from 46.3% to 46.1%.
    
    Operating expenses were $118.5 million, down 11.8% from $134.4 million in the prior year
period.
    
    We recorded operating income of $18.2 million in the first quarter of 2009, compared to
$23.2 million in the prior year period.
    
    Net income was $15.9 million in the first quarter of 2009, compared to $18.0 million in
the first quarter of 2008.
    
    Diluted earnings per share decreased from $0.30 in the first quarter of 2008 to $0.27 in
the first quarter of 2009.
    
    Cash at the end of the quarter was $159.2 million with no debt outstanding.
  Results of Operations for the Quarter Ended April 3, 2009 as Compared to the Quarter Ended March 28, 2008
 Revenue
 ®
 Segments Review
  ®




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##### Table of Contents



®
  Products
 ® ®
 Channels
 ®
  Gross Profit
   Operating Expense




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##### Table of Contents



Operating Income/(Loss)




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##### Table of Contents



Other Income/(Expense) and Taxes




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##### Table of Contents



Reconciliation of Total Company, Europe and Asia Revenue Increases/(Decreases) To Constant Dollar Revenue Increases/(Decreases)
  For the QuarterEnded April 3, 2009$ MillionsChange
    
    % ChangeRevenue decrease (GAAP)
    
    $
    (43.8
    )
    
    
    -12.9
    %Decrease due to foreign exchange rate changes
    
    
    (21.6
    )
    
    
    -6.4
    %Revenue decrease in constant dollars
    
    $
    (22.2
    )
    
    
    -6.5
    %
  For the QuarterEnded April 3, 2009$ MillionsChange
    
    % ChangeRevenue decrease (GAAP)
    
    $
    (24.7
    )
    
    
    -15.0
    %Decrease due to foreign exchange rate changes
    
    
    (21.9
    )
    
    
    -13.3
    %Revenue decrease in constant dollars
    
    $
    ( 2.8
    )
    
    
    -1.7
    %
  For the QuarterEnded April 3, 2009$ MillionsChange
    
    % ChangeRevenue decrease (GAAP)
    
    $
    (1.1
    )
    
    
    -2.9
    %Increase due to foreign exchange rate changes
    
    
    1.3
    
    
    
    3.3
    %Revenue decrease in constant dollars
    
    $
    (2.4
    )
    
    
    -6.2
    %
  Accounts Receivable and Inventory
   Liquidity and Capital Resources




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##### Table of Contents








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##### Table of Contents



Off-Balance Sheet Arrangements
 Letters of Credit
   New Accounting Pronouncements
  
 Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




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##### Table of Contents



Item 4. CONTROLS AND PROCEDURES
    
 Part II  OTHER INFORMATION
 
 Item 1A. RISK FACTORS




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##### Table of Contents



Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 ISSUER PURCHASES OF EQUITY SECURITIES(1)
 For the Three Fiscal Months Ended April 3, 2009
 Total Number
    
    
    Maximum Numberof Shares
    
    
    of SharesPurchased as Part
    
    
    That May YetTotal Number
    
    
    
    
    
    
    of Publicly
    
    
    be Purchasedof Shares
    
    
    Average Price
    
    
    Announced
    
    
    Under the PlansPeriod*
    
    Purchased **
    
    
    Paid per Share
    
    
    Plans or Programs
    
    
or ProgramsJanuary 1  January 30





$








4,568,902January 31  February 27


233,264



11.36



233,264



4,335,638February 28  April 3


667,245



11.03



667,245



3,668,393Q1 Total


900,509


$
11.12



900,509
 Footnote (1)
 ApprovedAnnouncement

Program

ExpirationDate

Size (Shares)

DateProgram 1


03/10/2008



6,000,000


None
 No existing programs expired or were terminated during the reporting period.*

Fiscal month**

Based on trade date  not settlement date




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Item 6. EXHIBITS
 Exhibits.Exhibit 10.1 
    
    The Timberland Company 2009 Executive Long Term Incentive Program, filed
herewith.Exhibit 10.2 
    
    Form of Performance Stock Unit Agreement under The Timberland Company 2007
Incentive Plan (2007 IP), filed herewith.Exhibit 10.3 
    
    Form of Performance Vested Stock Option Agreement under 2007 IP, filed
herewith.Exhibit 10.4 
    
    Form of Non-Qualified Stock Option Agreement under 2007 IP, filed herewith.Exhibit 10.5 
    
    Form of Restricted Stock Unit Agreement under 2007 IP, filed herewith.Exhibit 10.6 
    
    Form of Restricted Stock Award Agreement under 2007 IP, filed herewith.Exhibit 10.7 
    
    Summary of Non-Employee Director Compensation, filed herewith.Exhibit 31.1 
    
    Principal Executive Officer Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, filed herewith.Exhibit 31.2 
    
    Principal Financial Officer Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, filed herewith.Exhibit 32.1 
    
    Chief Executive Officer Certification Pursuant to Section 1350, Chapter 63
of Title 18, United States Code, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, furnished herewith.Exhibit 32.2 
    
    Chief Financial Officer Certification Pursuant to Section 1350, Chapter 63
of Title 18, United States Code, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, furnished herewith.




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##### Table of Contents



SIGNATURES
  THE TIMBERLAND COMPANY
(Registrant)Date: May 8, 2009
    By:
    /s/ JEFFREY B. SWARTZJeffrey B. SwartzChief Executive OfficerDate: May 8, 2009
    By:
    /s/ JOHN D. CRIMMINS, IIIJohn D. Crimmins, IIIChief Financial Officer




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##### Table of Contents



EXHIBIT INDEX
 Exhibit
    
    DescriptionExhibit 10.1
    
    The Timberland Company 2009 Executive Long Term Incentive Program, filed
herewith.Exhibit 10.2
    
    Form of Performance Stock Unit Agreement under The Timberland Company 2007
Incentive Plan (2007 IP), filed herewith.Exhibit 10.3
    
    Form of Performance Vested Stock Option Agreement under 2007 IP, filed
herewith.Exhibit 10.4
    
    Form of Non-Qualified Stock Option Agreement under 2007 IP, filed herewith.Exhibit 10.5
    
    Form of Restricted Stock Unit Agreement under 2007 IP, filed herewith.Exhibit 10.6
    
    Form of Restricted Stock Award Agreement under 2007 IP, filed herewith.Exhibit 10.7
    
    Summary of Non-Employee Director Compensation, filed herewith.Exhibit 31.1
    
    Principal Executive Officer Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, filed herewith.Exhibit 31.2
    
    Principal Financial Officer Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, filed herewith.Exhibit 32.1
    
    Chief Executive Officer Certification Pursuant to Section 1350, Chapter 63
of Title 18, United States Code, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, furnished herewith.Exhibit 32.2
    
    Chief Financial Officer Certification Pursuant to Section 1350, Chapter 63
of Title 18, United States Code, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, furnished herewith.