As filed with the Securities and Exchange Commission on July 17, 2003



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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549



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FORM 10-K/A

(Amendment No. 1)



|x |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- |  | ------------------------------------------------------------------------------------



For the fiscal year ended March 31, 2003.



| ̈ |  | 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 1-11226.



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TOMMY HILFIGER CORPORATION

(Exact name of registrant as specified in its charter)



|British Virgin Islands                                         |  | 98-0372112                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



|9/F, Novel Industrial Building, 850-870 Lai Chi Kok Road Cheung Sha Wan, Kowloon, Hong Kong |  | Not Applicable
|------------------------------------------------------------------------------------------- |  | --------------
|(Address of principal executive offices)                                                    |  | (Zip Code)    



Registrants
telephone number, including area code 852-2216-0668



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Securities registered pursuant to Section 12(b) of the Act:



|Title of each class                                     |  | Name of each exchange on which registered
|------------------------------------------------------- |  | -----------------------------------------
|Ordinary Shares, $.01 par value per share               |  | New York Stock Exchange                  
|Tommy Hilfiger U.S.A., Inc. 6.85% Notes due 2008        |  | New York Stock Exchange                  
|Tommy Hilfiger U.S.A., Inc. 9.00% Senior Bonds due 2031 |  | New York Stock Exchange                  



Securities
registered pursuant to Section 12(g) of the Act:



None

(Title of class)



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Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes x     No ̈



Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form
10-K. x



Indicate by check
mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes x     No ̈



The aggregate market value of
the voting stock held by non-affiliates of the registrant based upon the closing price on September 30, 2002: Ordinary Shares, $.01 Par Value  $804,978,732



The number of shares outstanding of the registrants stock as of May 31, 2003: Ordinary Shares, $.01 Par Value
 90,578,712 shares.



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---

EXPLANATORY NOTE



Tommy Hilfiger Corporation (the Company) hereby amends and restates in its entirety Item 8 of its Annual Report
on Form 10-K for the fiscal year ended March 31, 2003 (the 10-K). PricewaterhouseCoopers LLP informed the Company that they had omitted the following sentence from their Report of Independent Accountants in Item 8: As discussed in
Note 6 to the consolidated financial statements, effective April 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets. The Company is amending its 10-K to include
this additional sentence in the Report of Independent Accountants, which is the only change in the 10-K.



Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995



This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended (the Exchange Act). Such statements are indicated by words or phrases such as anticipate, estimate, project, expect, believe and
similar words or phrases. Such statements are based on current expectations and are subject to certain risks and uncertainties, including, but not limited to, the overall level of consumer spending on apparel, the financial strength of the retail
industry generally and the Companys customers, distributors, licensees and franchisees in particular, changes in trends in the market segments and geographic areas in which the Company competes, the level of demand for the Companys
products, actions by our major customers or existing or new competitors, changes in currency and interest rates, changes in applicable tax laws, regulations and treaties and changes in economic or political conditions or trade regulations in the
markets where the Company sells or sources its products, as well as other risks and uncertainties set forth in the Companys publicly-filed documents, including its Annual Report on Form 10-K for the fiscal year ended March 31, 2003. Should one
or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. The Company disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information, future events or otherwise.





2



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ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



Index to Consolidated Financial Statements



Report of Independent Accountants



Consolidated Statements of Operations for the fiscal years ended March 31, 2003, 2002 and 2001



Consolidated Balance Sheets as of March 31, 2003 and 2002



Consolidated Statements of Cash Flows for the
fiscal years ended March 31, 2003, 2002 and 2001



Consolidated Statements of Changes in Shareholders Equity for the fiscal years ended March 31, 2003, 2002 and 2001



Notes to Consolidated Financial Statements



3



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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



|                                                                                                                    |  | Page
|------------------------------------------------------------------------------------------------------------------- |  | ----
|                                                                                                                    | 
|Report of Independent Accountants                                                                                   |  | F-2 
|                                                                                                                    | 
|Consolidated Statements of Operations for the fiscal years ended March 31, 2003, 2002 and 2001                      |  | F-3 
|                                                                                                                    | 
|Consolidated Balance Sheets as of March 31, 2003 and 2002                                                           |  | F-4 
|                                                                                                                    | 
|Consolidated Statements of Cash Flows for the fiscal years ended March 31, 2003, 2002 and 2001                      |  | F-5 
|                                                                                                                    | 
|Consolidated Statements of Changes in Shareholders Equity for the fiscal years ended March 31, 2003, 2002 and 2001 |  | F-6 
|                                                                                                                    | 
|Notes to Consolidated Financial Statements                                                                          |  | F-7 



F-1



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REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors and Shareholders of

Tommy Hilfiger Corporation



In our opinion, the accompanying consolidated balance sheets and the related consolidated
statements of operations, shareholders equity and cash flows present fairly, in all material respects, the financial position of Tommy Hilfiger Corporation and its subsidiaries (the Company) at March 31, 2003 and 2002, and the
results of their operations and their cash flows for each of the three years in the period ended March 31, 2003 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the
responsibility of the Companys management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in
the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.



As discussed in Note 6 to the consolidated
financial statements, effective April 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets.



|                                 
|---------------------------------
|/s/    PRICEWATERHOUSECOOPERS LLP
|PricewaterhouseCoopers LLP       



New
York, New York

May 16, 2003



F-2



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TOMMY HILFIGER CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, expect per share amounts)



|                                                                                          |  | For the Fiscal Year Ended March 31,
|----------------------------------------------------------------------------------------- |  | -----------------------------------
|                                                                                          |  | 2003                               
|Net revenue                                                                               |  | $                                  
|Cost of goods sold                                                                        |  |                                    
|                                                                                          |  |                                    
|Gross profit                                                                              |  |                                    
|                                                                                          |  |                                    
|Depreciation and amortization                                                             |  |                                    
|Goodwill impairment                                                                       |  |                                    
|Special charges                                                                           |  |                                    
|Other selling, general and administrative expenses                                        |  |                                    
|                                                                                          |  |                                    
|Total operating expenses                                                                  |  |                                    
|                                                                                          |  |                                    
|Income (loss) from operations                                                             |  |                                    
|Interest and other expense                                                                |  |                                    
|Interest income                                                                           |  |                                    
|                                                                                          |  |                                    
|                                                                                          |  |                                    
|Income (loss) before income taxes and cumulative effect of change in accounting principle |  |                                    
|Provision for income taxes                                                                |  |                                    
|                                                                                          |  |                                    
|Income (loss) before cumulative effect of change in accounting principle                  |  |                                    
|Cumulative effect of change in accounting principle.                                      |  |                                    
|                                                                                          |  |                                    
|Net income (loss)                                                                         |  | $                                  
|                                                                                          |  |                                    
|Basic earnings (loss) per share:                                                          |  |                                    
|                                                                                          |  |                                    
|Income (loss) before cumulative effect of change in accounting principle                  |  | $                                  
|                                                                                          |  |                                    
|Cumulative effect of change in accounting principle per share                             |  | $                                  
|                                                                                          |  |                                    
|Net income (loss) per share                                                               |  | $                                  
|                                                                                          |  |                                    
|Weighted average shares outstanding                                                       |  |                                    
|                                                                                          |  |                                    
|Diluted earnings (loss) per share:                                                        |  |                                    
|Income (loss) before cumulative effect of change in accounting principle                  |  | $                                  
|                                                                                          |  |                                    
|Cumulative effect of change in accounting principle per share                             |  | $                                  
|                                                                                          |  |                                    
|Net income (loss) per share                                                               |  | $                                  
|                                                                                          |  |                                    
|Weighted average shares and share equivalents outstanding                                 |  |                                    
|                                                                                          |  |                                    



See Accompanying Notes
to Consolidated Financial Statements.



F-3



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TOMMY HILFIGER CORPORATION

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)



|                                                                                                              |  | March 31, |          
|------------------------------------------------------------------------------------------------------------- |  | --------- | ---------
|                                                                                                              |  | 2003      |          
|Assets                                                                                                        |  |           |          
|Current assets                                                                                                |  |           |          
|Cash and cash equivalents                                                                                     |  | $         | 420,826  
|Accounts receivable                                                                                           |  |           | 185,039  
|Inventories                                                                                                   |  |           | 229,654  
|Deferred tax assets                                                                                           |  |           | 51,830   
|Other current assets                                                                                          |  |           | 28,183   
|                                                                                                              |  |           |          
|Total current assets                                                                                          |  |           | 915,532  
|Property and equipment, at cost, net of accumulated depreciation and amortization                             |  |           | 248,290  
|Intangible assets, subject to amortization                                                                    |  |           | 8,744    
|Intangible assets, not subject to amortization                                                                |  |           | 625,205  
|Goodwill                                                                                                      |  |           | 219,153  
|Other assets                                                                                                  |  |           | 11,227   
|                                                                                                              |  |           |          
|Total Assets                                                                                                  |  | $         | 2,028,151
|                                                                                                              |  |           |          
|Liabilities and Shareholders' Equity                                                                          |  |           |          
|Current liabilities                                                                                           |  |           |          
|Short-term borrowings                                                                                         |  | $         | 19,380   
|Current portion of long-term debt                                                                             |  |           | 151,866  
|Accounts payable                                                                                              |  |           | 47,753   
|Accrued expenses and other current liabilities                                                                |  |           | 194,023  
|                                                                                                              |  |           |          
|Total current liabilities                                                                                     |  |           | 413,022  
|Long-term debt                                                                                                |  |           | 350,280  
|Deferred tax liability                                                                                        |  |           | 214,825  
|Other liabilities                                                                                             |  |           | 6,649    
|Commitments and contingencies                                                                                 |  |           |          
|Shareholders' equity                                                                                          |  |           |          
|Preference Shares, $.01 par value-shares authorized 5,000,000; none issued                                    |  |           |         
|Ordinary Shares, $.01 par value-shares authorized 150,000,000; issued 96,771,312 and 96,031,167, respectively |  |           | 968      
|Capital in excess of par value                                                                                |  |           | 606,836  
|Retained earnings                                                                                             |  |           | 443,171  
|Accumulated other comprehensive income                                                                        |  |           | 53,631   
|Treasury shares, at cost: 6,192,600 Ordinary Shares                                                           |  |           | (61,231  
|                                                                                                              |  |           |          
|Total shareholders' equity                                                                                    |  |           | 1,043,375
|                                                                                                              |  |           |          
|Total Liabilities and Shareholders' Equity                                                                    |  | $         | 2,028,151
|                                                                                                              |  |           |          



See Accompanying Notes
to Consolidated Financial Statements.



F-4



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TOMMY HILFIGER CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)



|                                                                                 |  | For the Fiscal Year Ended March 31, |         
|-------------------------------------------------------------------------------- |  | ----------------------------------- | --------
|                                                                                 |  | 2003                                |         
|Cash flows from operating activities                                             |  |                                     |         
|Net income (loss)                                                                |  | $                                   | (513,605
|Adjustments to reconcile net income to net cash provided by operating activities |  |                                     |         
|Cumulative effect of change in accounting principle                              |  |                                     | 430,026 
|Goodwill impairment                                                              |  |                                     | 150,612 
|Depreciation and amortization                                                    |  |                                     | 87,944  
|Deferred taxes                                                                   |  |                                     | (2,037  
|Provision for special chargesnon cash                                           |  |                                     | 49,978  
|Changes in operating assets and liabilities                                      |  |                                     |         
|Decrease (increase) in assets                                                    |  |                                     |         
|Accounts receivable                                                              |  |                                     | 50,271  
|Inventories                                                                      |  |                                     | (32,150 
|Other assets                                                                     |  |                                     | (1,230  
|Increase (decrease) in liabilities                                               |  |                                     |         
|Accounts payable                                                                 |  |                                     | 18,773  
|Accrued expenses and other liabilities                                           |  |                                     | (8,477  
|                                                                                 |  |                                     |         
|Net cash provided by operating activities                                        |  |                                     | 230,105 
|                                                                                 |  |                                     |         
|Cash flows from investing activities                                             |  |                                     |         
|Purchases of property and equipment                                              |  |                                     | (71,903 
|Acquisition of businesses, net of cash acquired                                  |  |                                     |        
|                                                                                 |  |                                     |         
|Net cash used in investing activities                                            |  |                                     | (71,903 
|                                                                                 |  |                                     |         
|Cash flows from financing activities                                             |  |                                     |         
|Proceeds of long-term debt                                                       |  |                                     |        
|Payments on long-term debt                                                       |  |                                     | (74,234 
|Proceeds from the exercise of stock options                                      |  |                                     | 7,177   
|Purchase of treasury shares                                                      |  |                                     |        
|Short-term bank borrowings (repayments), net                                     |  |                                     | (57,566 
|                                                                                 |  |                                     |         
|Net cash provided by (used in) financing activities                              |  |                                     | (124,623
|                                                                                 |  |                                     |         
|Net increase in cash                                                             |  |                                     | 33,579  
|Cash and cash equivalents, beginning of period                                   |  |                                     | 387,247 
|                                                                                 |  |                                     |         
|Cash and cash equivalents, end of period                                         |  | $                                   | 420,826 
|                                                                                 |  |                                     |         



See Accompanying Notes
to Consolidated Financial Statements.



F-5



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TOMMY HILFIGER CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY

(dollar amounts in thousands)



|                                            |  | Ordinary Shares |   | Capital inexcess ofpar value |        | Retainedearnings |  |   | Accumulatedothercomprehensiveincome (loss) |  |   | Treasuryshares |   |  | Totalshareholders'equity |       
|------------------------------------------- |  | --------------- | - | ---------------------------- | ------ | ---------------- |  | - | ------------------------------------------ |  | - | -------------- | - |  | ------------------------ | ------
|                                            |  | Outstanding     |   |                              | Amount |                  |  |   |                                            | 
|Balance, March 31, 2000                     |  | 94,830,638      |   |                              | $      | 948              |  | $ | 584,920                                    |  | $ | 691,270        |   |  | $                        | 576   
|Net income                                  |  |                |   |                              |        |                 |  |   |                                           |  |   | 130,961        |   |  |                          |      
|Foreign currency translation                |  |                |   |                              |        |                 |  |   |                                           |  |   |               |   |  |                          | (3,119
|Exercise of stock options                   |  | 338,764         |   |                              |        | 4                |  |   | 3,706                                      |  |   |               |   |  |                          |      
|Tax benefits from exercise of stock options |  |                |   |                              |        |                 |  |   | 558                                        |  |   |               |   |  |                          |      
|Purchase of treasury shares                 |  | (6,192,600      | ) |                              |        |                 |  |   |                                           |  |   |               |   |  |                          |      
|                                            |  |                 |   |                              |        |                  |  |   |                                            |  |   |                |   |  |                          |       
|Balance, March 31, 2001                     |  | 88,976,802      |   |                              |        | 952              |  |   | 589,184                                    |  |   | 822,231        |   |  |                          | (2,543
|Net income                                  |  |                |   |                              |        |                 |  |   |                                           |  |   | 134,545        |   |  |                          |      
|Foreign currency translation                |  |                |   |                              |        |                 |  |   |                                           |  |   |               |   |  |                          | 4,901 
|Change in fair value of hedging instruments |  |                |   |                              |        |                 |  |   |                                           |  |   |               |   |  |                          | 72    
|Exercise of stock options                   |  | 861,765         |   |                              |        | 8                |  |   | 7,989                                      |  |   |               |   |  |                          |      
|Tax benefits from exercise of stock options |  |                |   |                              |        |                 |  |   | 1,354                                      |  |   |               |   |  |                          |      
|                                            |  |                 |   |                              |        |                  |  |   |                                            |  |   |                |   |  |                          |       
|Balance, March 31, 2002                     |  | 89,838,567      |   |                              |        | 960              |  |   | 598,527                                    |  |   | 956,776        |   |  |                          | 2,430 
|Net income (loss)                           |  |                |   |                              |        |                 |  |   |                                           |  |   | (513,605       | ) |  |                          |      
|Foreign currency translation                |  |                |   |                              |        |                 |  |   |                                           |  |   |               |   |  |                          | 52,453
|Change in fair value of hedging instruments |  |                |   |                              |        |                 |  |   |                                           |  |   |               |   |  |                          | (1,252
|Exercise of stock options                   |  | 740,145         |   |                              |        | 8                |  |   | 7,169                                      |  |   |               |   |  |                          |      
|Tax benefits from exercise of stock options |  |                |   |                              |        |                 |  |   | 1,140                                      |  |   |               |   |  |                          |      
|                                            |  |                 |   |                              |        |                  |  |   |                                            |  |   |                |   |  |                          |       
|Balance, March 31, 2003                     |  | 90,578,712      |   |                              | $      | 968              |  | $ | 606,836                                    |  | $ | 443,171        |   |  | $                        | 53,631
|                                            |  |                 |   |                              |        |                  |  |   |                                            |  |   |                |   |  |                          |       



Comprehensive income
consists of net income (loss), foreign currency translation and unrealized gains and losses on hedging instruments and totaled $(462,404), $139,518 and $127,842 in fiscal 2003, 2002 and 2001, respectively.



See Accompanying Notes to Consolidated Financial Statements.



F-6



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TOMMY HILFIGER CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollar amounts in thousands, except per share amounts)



Note 1Summary of Significant Accounting Policies



(a) Basis of Consolidation



The consolidated financial statements include the accounts of Tommy Hilfiger
Corporation (THC or the Company; unless the context indicates otherwise, all references to the Company include THC and its subsidiaries) and all majority-owned subsidiaries. All significant intercompany balances
and transactions have been eliminated.



(b) Organization and Business



THC, through its subsidiaries, designs, sources and
markets mens and womens sportswear, jeanswear and childrenswear under the Tommy Hilfiger trademarks. Through a range of strategic licensing agreements, the Company also offers a broad array of related apparel, accessories, footwear,
fragrance and home furnishings. The Companys products can be found in leading department and specialty stores throughout the United States, Canada, Europe, Mexico, Central and South America, Japan, Hong Kong and other countries in the Far
East, as well as the Companys own network of specialty and outlet stores in the United States, Canada and Europe. THC was incorporated as an International Business Company in the British Virgin Islands (the BVI) in 1992 and is also
registered and licensed as an external International Business Company in Barbados.



(c) Cash and Cash Equivalents



The Company
considers all financial instruments purchased with original maturities of three months or less to be cash equivalents.



(d) Inventories



Inventories are valued at the lower of cost (weighted average method) or market. Substantially all inventories are comprised of finished goods.



(e) Property and Equipment



Property and equipment are stated at cost. Depreciation is calculated using
the straight-line method over the following estimated useful lives of the assets: furniture and fixturesthree to five years; buildingstwenty-five years; machinery and equipmentthree to five years. Leasehold improvements are
amortized using the straight-line method over the lesser of the terms of the leases or the estimated useful lives of the assets. Major additions and betterments are capitalized and repairs and maintenance are charged to operations in the period
incurred. The Companys share of the cost of constructing in-store shop displays, which is principally paid directly to third party suppliers, is capitalized and included in furniture and fixtures and amortized in other selling, general and
administrative expenses using the straight-line method over their estimated useful lives.



F-7



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(f) Intangible Assets



Intangible assets are comprised principally of goodwill and other intangibles of $219,153 and $633,949, respectively. The principal intangible assets are
acquired trademark rights associated with the licenses between Pepe Jeans USA, Inc., Tommy Hilfiger Canada Inc. and TH Europe and the Company.



On an annual basis, the Company evaluates goodwill and indefinite-lived intangibles, for possible impairment, under Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangible Assets (SFAS 142) using fair value techniques and market comparables. Goodwill impairment is determined using a two-step process. The first step of the impairment test is used
to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not
impaired and the second step of the impairment test is not required. If the carrying amount of a reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss, if any. The second
step of the impairment test compares the implied fair value of the reporting units goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting units goodwill exceeds the implied fair value of that
goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination.



(g) Other Long-Lived Assets



The Company continually evaluates whether events and circumstances have
occurred that indicate the remaining estimated useful life of other long-lived assets may warrant revision or that the remaining balance may not be recoverable. When factors indicate that an asset should be evaluated for possible impairment, the
Company reviews long lived assets to assess recoverability from future operations using undiscounted cash flows. Impairments would be recognized in earnings to the extent that carrying value exceeds fair value.



(h) Income Taxes



The Company has recorded its provision for income taxes under the asset and liability method. Under this method, deferred
tax assets and liabilities are recognized based on differences between the financial statement and tax bases of assets and liabilities using enacted tax rates that will be in effect at the time such differences are expected to reverse. Deferred tax
assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.



(i) Earnings Per Share and Authorized Shares



Basic earnings per share were computed by dividing net income by the average number of the Companys Ordinary Shares,
par value $.01 per share (the Ordinary Shares), outstanding during the respective period. Diluted earnings per share reflect the potentially dilutive effect of Ordinary Shares issuable under the Companys stock option plans. Diluted
earnings per share have been computed by dividing net income by the average number of Ordinary Shares outstanding plus the incremental shares that would have been outstanding assuming the exercise of stock options.



F-8



---

A reconciliation of shares used for basic earnings per share and those used for diluted earnings per
share is as follows:



|                                                                                                   |  | Fiscal Year Ended March 31,
|-------------------------------------------------------------------------------------------------- |  | ---------------------------
|                                                                                                   |  | 2003                       
|Weighted average shares outstanding                                                                |  | 90,387,000                 
|Net effect of dilutive stock options based on the treasury stock method using average market price |  |                           
|                                                                                                   |  |                            
|Weighted average shares and share equivalents outstanding                                          |  | 90,387,000                 
|                                                                                                   |  |                            



Ordinary Shares
issuable on assumed exercise of stock options amounting to 311,000 shares for the twelve months ended March 31, 2003 were not included in the computation of diluted earnings per share since they would be anti-dilutive. Options to purchase 6,465,607,
3,640,340 and 7,368,940 shares at March 31, 2003, 2002 and 2001, respectively, were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the
Companys Ordinary Shares.



(j) Revenue Recognition



Net revenue from wholesale product sales is recognized upon the transfer of
title and risk of ownership to customers. Revenue is recorded net of discounts, as well as provisions for estimated returns, allowances and doubtful accounts. Retail store revenue is recognized at the time of sale. Licensing royalties and buying
agency fees are recognized as earned.



On a seasonal basis, the
Company negotiates price adjustments with its retail customers as sales incentives or to partially reimburse them for the cost of certain promotions. The Company estimates the cost of such adjustments on an ongoing basis considering historical
trends, projected seasonal results and an evaluation of current economic conditions. These costs are recorded as a reduction to net revenue.



Net wholesale revenue from major customers as a percentage of consolidated net revenue was as follows:



|           |  | Fiscal Year Ended March 31, |  
|---------- |  | --------------------------- | -
|           |  | 2003                        |  
|Customer A |  | 13                          | %
|Customer B |  | 10                          | %
|Customer C |  | 10                          | %



(k) Costs of Goods Sold and
Selling, General and Administrative Expense



The Company
includes in cost of goods sold all costs and expenses incurred prior to the receipt of finished goods at the Companys distribution facilities. These costs include, but are not limited to, product cost, inbound freight charges, purchasing and
receiving costs, inspection costs, warehousing costs and internal transfer costs, as well as insurance, duty, brokers fees and consolidators fees. In addition, certain costs in the Companys Retail segment distribution network, such
as the costs of shipping merchandise to Company-owned retail stores, are charged to cost of goods sold. The Company includes in selling, general and administrative expenses



F-9



---

costs incurred subsequent to the receipt of finished goods in the distribution centers, such as the cost of picking and
packing goods for delivery to customers. In addition, selling, general and administrative expenses include product design costs, selling and store service costs, marketing expenses and general and administrative expenses.



The Companys gross margins may not be directly comparable to those of
its competitors, as income statement classifications of certain expenses may vary by Company.



(l) Foreign Currency Translation



The consolidated financial statements of the Company are prepared in United States dollars as this is the currency of the primary economic environment in which the Company operates, and the vast majority of its
revenue is received and expenses are disbursed in United States dollars. Adjustments resulting from translating the financial statements of those non-United States subsidiaries which do not use the United States dollar as their functional currency
are recorded in shareholders equity.



(m) Advertising Costs



Advertising costs are charged to operations when incurred
and totaled $43,513, $44,841and $56,329 during the years ended March 31, 2003, 2002 and 2001, respectively. Also, included in other current assets is $8,945 and $6,832 of prepaid advertising costs at March 31, 2003 and 2002, respectively.



The Company has no long-term commitments for cooperative
advertising. On a seasonal basis, the Company makes certain arrangements with retailers to share the cost of specified advertising programs. The Company classifies such costs in SG&A expenses.



(n) Shipping and Handling Costs



The Company reflects shipping and handling costs as a component of selling,
general and administrative expenses in its consolidated statements of operations. Shipping and handling costs approximated $53,532, $51,026 and $47,381 for the years ended March 31, 2003, 2002 and 2001, respectively. Amounts billed to customers that
relate to shipping and handling on related sales transactions are de minimus.



(o) Use of Estimates



The preparation of
financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.



(p) Segments and Foreign Operations



The Companys operations are reported on the basis of three segments: Wholesale, Retail, and Licensing, as further discussed in Note 11.



Substantially all of the Companys net revenue and income from
operations as well as identifiable assets constitute foreign operations in that THC is incorporated in the BVI.



F-10



---

(q) Stock Options



The Company uses the intrinsic value method to account for stock-based compensation in accordance with Accounting Principles Board (APB)
Opinion No. 25, Accounting for Stock Issued to Employees and has adopted the disclosure-only provisions of SFAS No. 123, Accounting for Stock-Based Compensation (SFAS 123) as amended by SFAS No. 148
Accounting for Stock-Based CompensationTransition and Disclosure.



At March 31, 2003 the Company had three stock-based employee compensation plans, which are described more fully in Note 14. No stock-based employee compensation expense is reflected in net income, as all options
granted under those plans had an exercise price equal to the market value of the underlying common stock on the date of grant. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value
recognition provisions of SFAS 123 to stock-based employee compensation.



|                                                                                                                                          |  | Fiscal Year Ended March 31, |         
|----------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------- | --------
|                                                                                                                                          |  | 2003                        |         
|Net income (loss), as reported                                                                                                            |  | $                           | (513,605
|Deduct: Total stock-based employee compensation expense determined under the fair value method for all awards, net of related tax
effects |  |                             | (8,187  
|                                                                                                                                          |  |                             |         
|Pro forma net income (loss)                                                                                                               |  | $                           | (521,792
|                                                                                                                                          |  |                             |         
|Earnings (loss) per share:                                                                                                                |  |                             |         
|Basicas reported                                                                                                                         |  | $                           | (5.68   
|Basicpro forma                                                                                                                           |  | $                           | (5.77   
|Dilutedas reported                                                                                                                       |  | $                           | (5.68   
|Dilutedpro forma                                                                                                                         |  | $                           | (5.77   



(r) Reclassification of Prior Year
Balances



Certain prior year balances have been
reclassified to conform to current year presentation.



Note
2Acquisition of European Licensee



On July 5,
2001, the Company acquired all of the issued and outstanding shares of capital stock of T.H. International N.V., the owner of Tommy Hilfiger Europe B.V. (TH Europe), the Companys European licensee, for a purchase price of $200,000
plus acquisition related costs of $6,789 and assumed debt of $42,629 (such transaction being referred to herein as the TH Europe Acquisition). The TH Europe Acquisition was funded using available cash.



The TH Europe Acquisition is expected to create long-term value for the
Companys shareholders through TH Europes expected contribution to revenue and net income beginning with the year of the acquisition. The acquisition is also expected to further the Companys evolution as a premier global lifestyle
brand and to provide the Company with distribution



F-11



---

channel as well as geographic diversification. The purchase price paid reflected the current profitability and cash flow
generation of TH Europe, as well as the rapid rate of projected growth in revenue, net income and cash flows.



The TH Europe Acquisition has been accounted for under the purchase method of accounting and, accordingly, the operating results of the acquired companies
are included in the consolidated results of the Company from the date of the acquisition. The purchase price, including transaction costs, has been allocated as follows:



|Cash                                                   |  | $ | 1,728   |  
|------------------------------------------------------ |  | - | ------- | -
|Accounts receivable                                    |  |   | 16,944  |  
|Inventories                                            |  |   | 30,540  |  
|Other current assets                                   |  |   | 6,769   |  
|Property, plant and equipment                          |  |   | 15,508  |  
|Indefinite lived intangible assets, including goodwill |  |   | 211,839 |  
|Other assets                                           |  |   | 94      |  
|Short-term bank borrowings                             |  |   | (42,629 | )
|Accounts payable                                       |  |   | (5,965  | )
|Accrued expenses and other current liabilities         |  |   | (12,891 | )
|Long-term debt                                         |  |   | (1,273  | )
|Deferred tax liability                                 |  |   | (11,925 | )
|Other liabilities                                      |  |   | (1,950  | )
|                                                       |  |   |         |  
|Total purchase price                                   |  | $ | 206,789 |  
|                                                       |  |   |         |  



The Company has
applied the provisions of Statement Financial Accounting Standards No. 141, Business Combinations and certain provisions of SFAS 142 to the TH Europe Acquisition.



Note 3Cash Equivalents



As of March 31, 2003, the balance in Cash and Cash Equivalents was comprised of short-term money market funds and overnight deposits at several major
international financial institutions earning interest at a weighted average interest rate of 1.20%. As part of its ongoing control procedures, the Company monitors its concentration of deposits with various financial institutions in order to avoid
any undue exposure.



Note 4Financial Instruments



Accounts Receivable



The Company owns all of its customer accounts receivable and collects the majority of its receivables through a credit
company subsidiary of a large financial institution pursuant to an agreement whereby the credit company pays the Company after the credit company receives payment from the Companys customer. The credit company establishes maximum credit limits
for each customer account. If the receivable becomes 120 days past due, or the customer becomes bankrupt or insolvent, the full amount of the receivable is paid by the credit company. The Company has a similar arrangement with another large
financial institution for credit services to its Canadian subsidiary.



F-12



---

The Companys European subsidiary has an agreement with a European credit insurance company from
whom it obtains credit insurance on an individual customer basis. At March 31, 2003, approximately 75% of its total receivables were covered by credit insurance, bank guarantees or other means. In all cases the Company believes that the credit risk
associated with such financial institutions is minimal.



The
Company also grants credit directly to certain select customers in the normal course of business without participation by a credit company. In such cases the Company monitors its credit exposure limits to avoid any significant concentration of risk.
Bad debts have been minimal.



Foreign Currency Risk Management



The Company records all derivative instruments (including
certain derivative instruments embedded in other contracts) in the balance sheet as either an asset or liability measured at its fair value. Changes in the derivatives fair value are recognized currently in either income (loss) from continuing
operations or accumulated other comprehensive income (loss), depending on the timing and designated purpose of the derivative.



The Company uses foreign currency forward contracts with maturities generally up to fifteen months to mitigate the risks associated with adverse movements
in foreign currency which might affect certain firm commitments or transactions, including the purchase of inventory, capital expenditures, the collection of foreign royalty payments and certain intercompany transactions. These instruments are
designated as cash flow hedges and, accordingly, any unrealized gains or losses are included in accumulated other comprehensive income (loss), net of related tax effects, with the corresponding asset or liability recorded in the balance sheet. Any
portion of a cash flow hedge that is deemed to be ineffective is recognized in current-period earnings. Other comprehensive income (loss) is reclassified to current-period earnings when the hedged transaction is recognized in earnings.



The Company does not use financial instruments for speculative or trading
purposes.



At March 31, 2003, the Company had contracts to
exchange foreign currencies, principally, the Japanese yen, the Euro and Canadian dollar having a total notional amount of $118,118. No significant gains or losses are expected to be released from other comprehensive income in fiscal year 2004.



Fair Value of Other Financial Instruments



The fair value of the Companys cash and cash equivalents is equal to
their carrying value at March 31, 2003. The fair value of the Companys 2003 and 2008 Notes and the 2031 Bonds, having a face value of $501,901, is approximately $477,591 based on quoted market prices as of March 31, 2003. The fair value of the
Companys other monetary assets and liabilities approximate carrying value due to the relatively short-term nature of these items.



F-13



---

Note 5Property and Equipment



Property and equipment consists of the following:



|                                                |  | March 31,
|----------------------------------------------- |  | ---------
|                                                |  | 2003     
|Furniture and fixtures                          |  | $        
|Buildings and land                              |  |          
|Leasehold improvements                          |  |          
|Machinery and equipment                         |  |          
|                                                |  |          
|                                                |  |          
|Less: accumulated depreciation and amortization |  |          
|                                                |  |          
|                                                |  | $        
|                                                |  |          



Depreciation and
amortization expense on fixed assets was $82,421, $80,194, and $70,183 for the years ended March 31, 2003, 2002 and 2001, respectively.



Note 6Goodwill and Intangible Assets



On April 1, 2002, the Company adopted SFAS 142. SFAS 142 requires that goodwill, including previously existing goodwill, and intangible assets with
indefinite useful lives not be amortized but that they be tested for impairment at adoption and at least annually thereafter. The Company performed its initial test upon adoption and performed its annual impairment review during the fourth quarter
of fiscal year 2003.



SFAS 142 provides criteria for performing
impairment tests on goodwill and intangible assets with indefinite useful lives, which differs from the Companys previous policy, as permitted under accounting standards existing before the adoption of SFAS 142, of using undiscounted cash
flows on a Company-wide basis to determine if these assets are recoverable.



Upon adoption of SFAS 142 in the first quarter of fiscal year 2003, the Company recorded a non-cash, non-operating charge of $430,026 to reduce the carrying value of its goodwill to fair value. Such charge is
reflected as a cumulative effect of a change in accounting principle in the Consolidated Statements of Operations. As mentioned above, the Company performed its first annual impairment review of goodwill and intangible assets under SFAS 142 during
the fourth quarter of fiscal year 2003. As a result of this review, the Company recorded a non-cash charge of $150,612 in operating expenses for the impairment of goodwill, principally in its U.S. wholesale component. The charge had no effect on the
Companys credit facilities, financial covenants or cash flows.



Prior to April 1, 2002, the Company recorded deferred tax liabilities relating to the difference in the book and tax basis of intangible assets, principally trademark rights. As a result of adopting SFAS 142, these deferred tax liabilities
will no longer be used to support the realization of certain deferred tax assets. Accordingly, the Company recorded a one-time, non-cash, deferred tax charge totaling $11,358 in order to establish a valuation allowance against those deferred tax
assets. This charge was included in the Companys provision for income taxes for the first quarter of fiscal year 2003.



F-14



---

SFAS 142 required that, prior to performing the review for the impairment, all of the Companys
recorded goodwill be assigned to the Companys reporting units deemed to benefit from any acquisitions that it had made, including the reporting units that the Company owned prior to such acquisitions. This differs from the previous accounting
rules under which goodwill was assigned only to the businesses acquired. The balance of goodwill as of March 31, 2002 in the table below reflects the assignment of goodwill as required by SFAS 142.



A summary of changes in the Companys goodwill during fiscal year 2003,
by reporting segment is as follows:



|                             |  | Wholesale |          |   | Retail |   | Licensing |  |   | Total    |  
|---------------------------- |  | --------- | -------- | - | ------ | - | --------- |  | - | -------- | -
|Balance at April 1, 2002     |  | $         | 187,857  |   |        | $ | 55,969    |  | $ | 525,449  |  
|Impairment loss              |  |           | (150,612 | ) |        |   |          |  |   | (430,026 | )
|Foreign currency translation |  |           | 30,516   |   |        |   |          |  |   |         |  
|                             |  |           |          |   |        |   |           |  |   |          |  
|Balance at March 31, 2003    |  | $         | 67,761   |   |        | $ | 55,969    |  | $ | 95,423   |  
|                             |  |           |          |   |        |   |           |  |   |          |  



As of March 31, 2003,
and March 31, 2002, the Companys intangible assets and related accumulated amortization consisted of the following:



|                                    |  | March 31, 2003 |         | March 31, 2002          
|----------------------------------- |  | -------------- | ------- | ------------------------
|                                    |  | Gross          |         | Accumulated Amortization
|Amortizable intangible assets:      |  |                |         |                         
|Retailer relationship               |  | $              | 5,400   |                         
|Supplier relationship               |  |                | 4,000   |                         
|Financing costs                     |  |                | 6,300   |                         
|Software and other                  |  |                | 3,820   |                         
|                                    |  |                |         |                         
|Total amortizable intangible assets |  | $              | 19,520  |                         
|                                    |  |                |         |                         
|Indefinite-lived intangible assets: |  |                |         |                         
|Trademark rights                    |  | $              | 625,205 |                         
|                                    |  |                |         |                         



The increase in the
carrying value of the Companys trademark rights from March 31, 2002 to March 31, 2003, which is included in other comprehensive income, was due to the changes in foreign currency exchange rates used to translate certain of these assets.



F-15



---

The Company recorded amortization expense of $1,875 on intangible assets during fiscal year 2003 compared
to $2,122 and $2,080 during fiscal years 2002 and 2001, respectively, assuming the adoption of SFAS 142 as of April 1, 2000. Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the
succeeding five years and thereafter is as follows:



Estimated Amortization Expense



|Fiscal year 2004 |  | $ | 995  
|---------------- |  | - | -----
|Fiscal year 2005 |  |   | 848  
|Fiscal year 2006 |  |   | 612  
|Fiscal year 2007 |  |   | 550  
|Fiscal year 2008 |  |   | 521  
|Subsequent years |  |   | 5,218
|                 |  |   |      
|                 |  | $ | 8,744
|                 |  |   |      



If acquisitions or
dispositions occur in the future the above amounts may vary.



Fiscal year 2002 and 2001 historical results do not reflect the provisions of SFAS 142. Had the Company adopted SFAS 142 on April 1, 2000, the historical net income and basic and diluted earnings per share (before the cumulative effect of
the change in accounting principle) would have been changed as follows:



|                              |  | Fiscal Year Ended March 31, 2002 |        
|----------------------------- |  | -------------------------------- | -------
|                              |  | Net Income                       |        
|Reported net income           |  | $                                | 134,545
|Goodwill amortization         |  |                                  | 17,388 
|Trademark rights amortization |  |                                  | 15,200 
|Income tax impact             |  |                                  | (6,292 
|                              |  |                                  |        
|Adjusted net income           |  | $                                | 160,841
|                              |  |                                  |        







|                              |  | Fiscal Year Ended March 31, 2001 |        
|----------------------------- |  | -------------------------------- | -------
|                              |  | Net Income                       |        
|Reported net income           |  | $                                | 130,961
|Goodwill amortization         |  |                                  | 17,388 
|Trademark rights amortization |  |                                  | 15,200 
|Income tax impact             |  |                                  | (6,292 
|                              |  |                                  |        
|Adjusted net income           |  | $                                | 157,257
|                              |  |                                  |        



F-16



---

Note 7Accrued Expenses and Other Current Liabilities



Accrued expenses and other current liabilities are comprised of the
following:



|                          |  | March 31,
|------------------------- |  | ---------
|                          |  | 2003     
|Letters of credit payable |  | $        
|Accrued compensation      |  |          
|Merchandise payable       |  |          
|Accrued interest          |  |          
|Other accrued liabilities |  |          
|                          |  |          
|                          |  | $        
|                          |  |          



Note 8Long-Term Debt



Long-term debt consists of the following:



|                                                                                            |  | March 31, |         
|------------------------------------------------------------------------------------------- |  | --------- | --------
|                                                                                            |  | 2003      |         
|Unsecured 9.00% bonds due December 1, 2031                                                  |  | $         | 150,000 
|Unsecured 6.85% notes due June 1, 2008, less unamortized discount of $249 at March 31, 2003 |  |           | 199,751 
|Unsecured 6.50% notes due June 1, 2003, less unamortized discount of $8 at March 31, 2003   |  |           | 151,083 
|Obligation under capital lease                                                              |  |           | 1,312   
|                                                                                            |  |           |         
|                                                                                            |  |           | 502,146 
|Less current maturities                                                                     |  |           | (151,866
|                                                                                            |  |           |         
|                                                                                            |  | $         | 350,280 
|                                                                                            |  |           |         



The 6.50% notes which
matured on June 1, 2003 (the 2003 Notes), the 6.85% notes maturing on June 1, 2008 and the 9.00% bonds maturing on December 1, 2031 (collectively, the Notes) were issued by Tommy Hilfiger U.S.A., Inc., a subsidiary of THC
(TH USA), and are fully and unconditionally guaranteed by THC. The indenture under which the Notes were issued contains covenants that, among other things, restrict the ability of subsidiaries of THC to incur additional indebtedness,
restrict the ability of THC and its subsidiaries to incur indebtedness secured by liens or enter into sale and leaseback transactions and restrict the ability of THC and TH USA to engage in mergers or consolidations.



During fiscal 2003, the Company repurchased $73,909 principal amount of the
2003 Notes in open market transactions. In June, 2003, upon maturity, the Company repaid the remaining $151,091 principal amount of the 2003 Notes, using available cash.



The Companys scheduled repayment of long-term debt for fiscal year 2004 is $151,866. The Company has no other
scheduled debt repayments in fiscal years 2005 through 2008.



F-17



---

The revolving credit facility (the Credit Facility), which was entered into on June 28, 2002
and which is guaranteed by THC, consists of an unsecured $300,000 TH USA three-year revolving credit facility, of which up to $175,000 may be used for direct borrowings. The Credit Facility is available for letters of credit, working capital and
other general corporate purposes. The Credit Facility replaced the $250,000 TH USA revolving credit facility which was scheduled to expire on March 31, 2003. As of March 31, 2003, there were no direct borrowings outstanding under the Credit
Facility, and $103,629 of the available borrowings under the Credit Facility had been used to open letters of credit.



The Credit Facility contains a number of covenants that, among other things, restrict the ability of subsidiaries of THC to dispose of assets, incur
additional indebtedness, create liens on assets, pay dividends or make other payments in respect of capital stock, make investments, loans and advances, engage in transactions with affiliates, enter into certain sale and leaseback transactions,
engage in mergers or consolidations or change the businesses conducted by them. The Credit Facility also restricts the ability of THC to create liens on assets or enter into sale and leaseback transactions. Under the Credit Facility, subsidiaries of
THC may not pay dividends or make other payments in respect of capital stock to THC that in the aggregate exceed 33% of the Companys cumulative consolidated net income, commencing with the fiscal year ended March 31, 2002 plus $125,000, less
certain deductions. In addition, under the Credit Facility, THC and TH USA are required to comply with and maintain specified financial ratios and meet certain tests (based on the Companys consolidated financial results excluding the effects
of changes in accounting principles generally accepted in the United States), including, without limitation, a minimum fixed charge coverage ratio, a maximum leverage ratio and a minimum consolidated net worth test.



The Company was in compliance with all covenants in respect of the Notes and
the Credit Facility as of March 31, 2003.



Certain of the
Companys non-U.S. subsidiaries have separate credit facilities for working capital or trade financing purposes. In addition to short-term borrowings of $19,380, as of March 31, 2003, $23,562 of available borrowings under these facilities had
been used to open letters of credit, including $3,240 for inventory purchased that is included in current liabilities and $20,322 related to commitments to purchase inventory and bank guarantees of $2,413. Borrowings under these credit facilities
bear interest at variable rates which, on a weighted average annual basis, amounted to 4.31% and 4.41% as of, and for the fiscal year ended, March 31, 2003, respectively.



F-18



---

Note 9Commitments and Contingencies



Leases



The Company leases office, warehouse and showroom space, retail stores and office equipment under operating leases, which
expire not later than 2022. The Company normalizes fixed escalations in rental expense under its operating leases. Minimum annual rentals under non-cancelable operating leases, excluding operating cost escalations and contingent rental amounts based
upon retail sales, are payable as follows:



|Fiscal Year Ending March 31,
|----------------------------
|2004                        
|2005                        
|2006                        
|2007                        
|2008                        
|Thereafter                  



Rent expense,
including operating cost escalations and contingent rental amounts based upon retail sales, was $46,306, $34,781 and $22,561 for the years ended March 31, 2003, 2002 and 2001, respectively.



Amounts in the table above are net of sublease income of $426 per year for
each of the next five fiscal years and $3,018 thereafter, related to a lease on one of its former specialty stores.



The table above does not include $3,064 in lease termination payments made in April 2003, in conjunction with the Companys U.S. specialty store
closures.



Letters of credit



The Company was contingently liable at March 31, 2003 for unexpired bank
letters of credit of $91,886 related to commitments for the purchase of inventories and bank guarantees of $2,413.



Legal matters



Saipan Litigation. On January 13, 1999, two actions were filed against the Company and other garment manufacturers and retailers asserting claims
that garment factories located on the island of Saipan engaged in unlawful practices relating to the recruitment and employment of foreign workers. One action, brought in San Francisco Superior Court, was filed by a union and three public interest
groups alleging unfair competition and false advertising. The other, an action seeking class action status filed in Federal Court for the Central District of California and subsequently transferred to the Federal Court in Saipan, was brought on
behalf of an alleged class consisting of the Saipanese factory workers. The Company has entered into settlement agreements with the plaintiffs in both actions. As part of these agreements, the Company specifically denies any wrongdoing or liability
with regard to the claims made in the actions. The settlement provides for a monetary payment, in an amount that is not material to the Companys financial position, results of operations or cash flows, to a class of plaintiffs in the Federal
action. On April 23, 2003, the Court issued an order and final judgment approving the settlement and dismissing the actions with prejudice.



The Company and its subsidiaries are from time to time involved in routine legal matters incidental to their businesses.



In the opinion of the Companys management, based on advice of
counsel, the resolution of the foregoing matters will not have a material effect on the Companys financial position, results of operations or cash flows.



F-19



---

Note 10Income Taxes



The components of the provision for income taxes are as follows:



|                           |  | Fiscal Year Ended March 31, |        
|-------------------------- |  | --------------------------- | -------
|                           |  | 2003                        |        
|Current:                   |  |                             |        
|U.S. Federal               |  | $                           | (9,862 
|State and Local            |  |                             | 3,999  
|Non-U.S                    |  |                             | 22,044 
|                           |  |                             |        
|                           |  |                             | 16,181 
|                           |  |                             |        
|Deferred:                  |  |                             |        
|U.S. Federal               |  |                             | (13,395
|State and Local            |  |                             | 11,358 
|Non-U.S                    |  |                             |       
|                           |  |                             |        
|                           |  |                             | (2,037 
|                           |  |                             |        
|Provision for income taxes |  | $                           | 14,144 
|                           |  |                             |        



Significant components
of the Companys deferred tax assets and liabilities are summarized as follows:



|                                                    |  | March 31, |         
|--------------------------------------------------- |  | --------- | --------
|                                                    |  | 2003      |         
|Deferred tax assetscurrent:                        |  |           |         
|Inventory costs                                     |  | $         | 6,218   
|Non-deductible accruals                             |  |           | 44,159  
|Accrued compensation                                |  |           | 6,251   
|Other items, net                                    |  |           | 4,660   
|                                                    |  |           |         
|Subtotal                                            |  |           | 61,288  
|Valuation allowance                                 |  |           | (9,458  
|                                                    |  |           |         
|                                                    |  |           | 51,830  
|                                                    |  |           |         
|Deferred tax assets (liabilities)non-current:      |  |           |         
|Depreciation and amortization                       |  |           | 25,870  
|Intangible assets, other than goodwill              |  |           | (245,885
|Net operating loss carry forwards                   |  |           | 30,063  
|Other, net                                          |  |           | 13,683  
|                                                    |  |           |         
|Subtotal                                            |  |           | (176,269
|Valuation allowance                                 |  |           | (38,556 
|                                                    |  |           |         
|Total deferred tax assets (liabilities)non-current |  |           | (214,825
|                                                    |  |           |         
|Total net deferred tax liabilities                  |  | $         | (162,995
|                                                    |  |           |         



As of March 31, 2003,
the Company had state net operating loss carryforwards of approximately $30,063 which begin to expire in 2008. As of March 31, 2003, the Company has recorded valuation allowances of $30,063 against these carryforwards in jurisdictions where
management believes it is more likely than not that certain of the assets will not be used to reduce future tax payments.



F-20



---

Prior to April 1, 2002, the Company recorded deferred tax liabilities relating to the difference in the
book and tax basis of intangible assets, principally trademark rights. As a result of adapting SFAS 142, these liabilities will no longer be used to support the realization of certain deferred tax assets. Consequently, in the first quarter of fiscal
2003, this Company recorded an $11,358 deferred tax charge to establish a valuation allowance against those deferred tax assets.



The U.S. and non-U.S. components of income (loss) before income taxes and the cumulative effect of a change in accounting principle are as follows:



|         |  | Fiscal Year Ended March 31,
|-------- |  | ---------------------------
|         |  | 2003                       
|U.S.     |  | $                          
|Non-U.S. |  |                            
|         |  |                            
|         |  | $                          
|         |  |                            



The provision for
income taxes differs from the amounts computed by applying the applicable U.S. federal statutory rate to income before taxes as follows:



|                                                                             |  | Fiscal Year Ended March 31, |        
|---------------------------------------------------------------------------- |  | --------------------------- | -------
|                                                                             |  | 2003                        |        
|Provision for (benefit from) income taxes at the U.S. federal statutory rate |  | $                           | (24,303
|State and local income taxes, net of federal benefits                        |  |                             | (20,220
|Non-U.S. income taxed at different rates                                     |  |                             | (33,498
|Valuation allowance                                                          |  |                             | 37,014 
|Goodwill amortization                                                        |  |                             |       
|Goodwill impairment                                                          |  |                             | 52,714 
|Other                                                                        |  |                             | 2,437  
|                                                                             |  |                             |        
|Provision for income taxes                                                   |  | $                           | 14,144 
|                                                                             |  |                             |        



THC is not taxed on
income in the BVI, where it is incorporated. THC and its subsidiaries are subject to taxation in the jurisdictions in which they operate.



Note 11Segment Reporting



The Company has three reportable segments: Wholesale, Retail and Licensing. The Companys reportable segments are business units that offer different
products and services or similar products through different distribution channels. The Wholesale segment consists of the design and sourcing of mens sportswear and jeanswear, womens casualwear and jeanswear and childrenswear for
wholesale distribution. The Retail segment reflects the operations of the Companys outlet and specialty stores. The Licensing segment consists of the operations of licensing the Companys trademarks for specified products in specified
geographic areas and the operations of the Companys Far East buying offices. The Company evaluates performance and allocates resources based on segment profits. The accounting policies of the reportable segments are the same as those described
in Note 1. Segment profits are comprised of segment net revenue less cost of goods sold and selling, general and administrative expenses.



F-21



---

Excluded from segment profits, however, are the vast majority of executive compensation, certain
marketing costs, amortization of intangibles (including goodwill and indefinite-lived intangibles through March 31, 2002), special charges, interest costs and other corporate overhead. Financial information for the Companys reportable segments
is as follows:



|                                                          |  | Wholesale |           | Retail |   | Licensing |  | Total
|--------------------------------------------------------- |  | --------- | --------- | ------ | - | --------- |  | -----
|Fiscal year ended March 31, 2003                          |  |           |           |        |   |           |  |      
|Total segment revenue                                     |  | $         | 1,420,233 |        | $ | 405,099   |  | $    
|Segment profits                                           |  |           | 117,775   |        |   | 29,301    |  |      
|Depreciation and amortization included in segment profits |  |           | 52,935    |        |   | 12,985    |  |      
|                                                          |  |           |           |       
|Fiscal year ended March 31, 2002                          |  |           |           |        |   |           |  |      
|Total segment revenue                                     |  | $         | 1,440,888 |        | $ | 379,781   |  | $    
|Segment profits                                           |  |           | 139,490   |        |   | 50,480    |  |      
|Depreciation and amortization included in segment profits |  |           | 51,758    |        |   | 12,239    |  |      
|                                                          |  |           |           |       
|Fiscal year ended March 31, 2001                          |  |           |           |        |   |           |  |      
|Total segment revenue                                     |  | $         | 1,484,544 |        | $ | 330,965   |  | $    
|Segment profits                                           |  |           | 153,362   |        |   | 59,452    |  |      
|Depreciation and amortization included in segment profits |  |           | 54,317    |        |   | 7,332     |  |      



A reconciliation of
total segment revenue to consolidated net revenue is as follows:



|                         |  | Fiscal Year Ended March 31, |          
|------------------------ |  | --------------------------- | ---------
|                         |  | 2003                        |          
|Total segment revenue    |  | $                           | 1,948,060
|Intercompany revenue     |  |                             | (60,005  
|                         |  |                             |          
|Consolidated net revenue |  | $                           | 1,888,055
|                         |  |                             |          



Intercompany revenue
represents buying agency commissions from consolidated subsidiaries, which is classified under Licensing for segment reporting purposes.



A reconciliation of total segment profits to consolidated income before income taxes is as follows:



|                                                                                                       |  | Fiscal Year Ended March 31,
|------------------------------------------------------------------------------------------------------ |  | ---------------------------
|                                                                                                       |  | 2003                       
|Segment profits                                                                                        |  | $                          
|Corporate expenses not allocated                                                                       |  |                            
|Special charges                                                                                        |  |                            
|Interest expense, net                                                                                  |  |                            
|                                                                                                       |  |                            
|Consolidated income (loss) before income taxes and cumulative effect of change in accounting principle |  | $                          
|                                                                                                       |  |                            





F-22



---

The Company was incorporated in the BVI; accordingly all sales outside the BVI are considered foreign.
Countries representing 5% or more of consolidated net revenue are as follows:



|                         |  | Fiscal Year Ended March 31,
|------------------------ |  | ---------------------------
|                         |  | 2003                       
|United States            |  | $                          
|Europe                   |  |                            
|Canada                   |  |                            
|Other                    |  |                            
|                         |  |                            
|Consolidated net revenue |  | $                          
|                         |  |                            



The Companys
long-lived assets by country are as follows:



|              |  | March 31,
|------------- |  | ---------
|              |  | 2003     
|United States |  | $        
|Europe        |  |          
|Canada        |  |          
|Other         |  |          
|              |  |          
|Total         |  | $        
|              |  |          



The Company does not
desegregate assets on a segment basis for internal management reporting and, therefore, such information is not presented.



Note 12Related Parties



See related disclosures in Note 2.



Prior to the TH Europe Acquisition, the Company was party to a third-party geographic license agreement for Europe and certain other countries with TH
Europe, a related party. Under this agreement, the licensee paid Tommy Hilfiger Licensing, Inc., a subsidiary of THC (THLI), a royalty based on a percentage of the value of licensed products sold by the licensee. Subject to certain
exceptions, all products sold by or through the licensee had to be purchased through Tommy Hilfiger (Eastern Hemisphere) Limited, a subsidiary of THC (THEH), or TH USA pursuant to buying agency agreements. Under these agreements, THEH
and TH USA were paid a buying agency commission based on a percentage of the cost of products sourced through them. The distribution of products under this arrangement began in fiscal 1998. Results of operations include $2,129, for the three months
ended June 30, 2001, and $9,554 for the year ended March 31, 2001 of royalties and commissions under this arrangement. In addition, TH Europe subleases certain office space in Amsterdam from a related party for annual rent of approximately $128. In
fiscal year 2001, TH Europe also purchased certain fixtures and inventory from the Company for an aggregate purchase price of $358.



The Company is party to a geographic license agreement for Japan with a related party. Subject to certain exceptions, all products sold by or through the
licensee must be purchased through THEH or TH USA pursuant to buying agency agreements. Under these agreements, THEH and TH USA are paid a buying agency commission based on a percentage of the cost of products sourced through them. Pursuant to these
arrangements, royalties and commissions totaled $3,668, $2,616 and $3,562 in fiscal 2003, 2002 and 2001, respectively.



Affiliates of the Company hold an indirect 45% equity interest in Macauniter Malhas E Confeccoes Lda., a company which serves as TH Europes
distributor in Portugal and also



F-23



---

operates a Tommy Hilfiger store under a franchise arrangement with TH Europe. In fiscal year 2003 and fiscal year 2002,
with respect to the period after the closing of the TH Europe Acquisition, TH Europe sold $3,821 and $1,349, respectively, of merchandise to this company pursuant to such arrangements.



An affiliate of the Company holds an indirect 25% equity interest in Pepe Jeans SL, which serves as TH Europes sales
and collection agent in Spain. In the fiscal year ended March 31, 2003 and fiscal year 2002, with respect to the period after the closing of the TH Europe Acquisition, commissions and fees paid by TH Europe pursuant to these arrangements totaled
$4,366 and $2,946, respectively.



TH USA purchases finished
goods in the ordinary course of business from other affiliated companies. Such purchases amounted to $73,552, $90,408 and $63,245 during the fiscal years ended March 31, 2003, 2002 and 2001, respectively. In addition, contractors of the Company
purchase raw materials in the ordinary course of business from affiliates of the Company. Such purchases amounted to $9,955, $9,796 and $5,168 during the fiscal years ended March 31, 2003, 2002 and 2001, respectively.



TH USA sells merchandise in the ordinary course of business to a retail store
that is owned by a relative of a director and executive officer of the Company. Sales to this customer amounted to approximately $197, $338 and $690 during the years ended March 31, 2003, 2002 and 2001, respectively.



THEH has two consulting agreements with affiliates. THEH paid fees of $458,
$1,000 and $1,000 under these agreements during each of the fiscal years ended March 31, 2003, 2002 and 2001, respectively.



Under the terms of an agreement with an affiliate, Tommy Hilfiger (HK) Limited, a subsidiary of THC (THHK), reimburses an affiliate for
certain general and administrative expenses, including rent for office space, incurred by the affiliate on behalf of THHK. Payments made to the affiliate for the years ended March 31, 2003, 2002 and 2001 were $512, $394 and $318,
respectively.



The son-in-law of an executive
officer of the Company has become a partner at a law firm that has provided the Company with various legal services since 1989. Fees paid by the Company to the law firm for the fiscal years ended March 31, 2003, 2002 and 2001 for services rendered
were $2,549, $3,742 and $3,507, respectively.



Note 13Retirement Plans



The Company maintains employee savings plans for eligible
U.S. employees. The Companys contributions to the plans are discretionary with matching contributions of up to 50% of employee contributions up to a maximum of 6% of an employees compensation. For the years ended March 31, 2003, 2002 and
2001, the Company made plan contributions of $2,043, $1,871 and $1,753 respectively.



The Company also operates a collective pension plan, through its European subsidiary, for employees who have been employed with TH Europe for at least one year, provided they meet certain criteria. The pension plan is
a defined contribution plan and TH Europe pays 50% of the pension contribution for the employee which can range between 3% to 5% depending on



F-24



---

the employees age. TH Europe contributed approximately $259 and $101 for the fiscal years ended March 31, 2003 and
2002, respectively.



The Company maintains a supplemental
executive retirement plan which provides certain members of senior management with a supplemental pension. The supplemental executive retirement plan is an unfunded plan for purposes of both the Internal Revenue Code of 1986 and the Employee
Retirement Income Security Act of 1974.



The following provides
a reconciliation of the benefit obligation and funded status of the supplemental executive retirement plan:



|                                                                                                                 |  | March 31, |        
|---------------------------------------------------------------------------------------------------------------- |  | --------- | -------
|                                                                                                                 |  | 2003      |        
|Change in benefit obligation:                                                                                    |  |           |        
|Benefit obligation at beginning of year                                                                          |  | $         | 7,496  
|Service cost                                                                                                     |  |           | 811    
|Interest cost                                                                                                    |  |           | 582    
|Benefits paid                                                                                                    |  |           |       
|Actuarial (gain) or loss                                                                                         |  |           | 2,676  
|                                                                                                                 |  |           |        
|Benefit obligation at end of year                                                                                |  | $         | 11,565 
|                                                                                                                 |  |           |        
|Reconciliation of funded status:                                                                                 |  |           |        
|Funded status                                                                                                    |  | $         | (11,565
|Unrecognized actuarial (gain) or loss                                                                            |  |           | 1,752  
|Unrecognized prior service cost                                                                                  |  |           | 2,141  
|                                                                                                                 |  |           |        
|Net amount recognized at year-end                                                                                |  | $         | (7,672 
|                                                                                                                 |  |           |        
|Amounts recognized in the Consolidated Balance Sheets consist of:                                                |  |           |        
|Accrued benefit liability                                                                                        |  | $         | (8,315 
|Intangible asset                                                                                                 |  |           | 643    
|                                                                                                                 |  |           |        
|Net amount recognized at year-end                                                                                |  | $         | (7,672 
|                                                                                                                 |  |           |        
|Additional year-end information for pension plans with accumulated benefit obligations in excess of plan assets: |  |           |        
|Projected benefit obligation                                                                                     |  | $         | 11,565 
|Accumulated benefit obligation                                                                                   |  |           | 8,315  
|Unfunded accumulated benefit obligation                                                                          |  |           | 8,315  







F-25



---

The components of net periodic benefit cost for the last three fiscal years is as follows:



|                                         |  | Fiscal Year Ended March 31, |      
|---------------------------------------- |  | --------------------------- | -----
|                                         |  | 2003                        |      
|Service cost                             |  | $                           | 811  
|Interest cost                            |  |                             | 583  
|Amortization of prior service cost       |  |                             | 309  
|Amortization of actuarial (gain) or loss |  |                             |     
|                                         |  |                             |      
|Net periodic benefits cost               |  | $                           | 1,703
|                                         |  |                             |      



Actuarial assumptions
used to determine costs and benefit obligations for the supplemental executive retirement plan are as follows:



|                                                 |  | Fiscal Year Ended March 31, |  
|------------------------------------------------ |  | --------------------------- | -
|                                                 |  | 2003                        |  
|Discount rate                                    |  | 6.25                        | %
|Expected long-term rate of return on plan assets |  | N/A                         |  
|Rate of compensation increase                    |  | 5.00                        | %



The Company maintains
a voluntary deferred compensation plan which provides certain members of senior management with an opportunity to defer a portion of base salary or bonus pursuant to the terms of the plan. The voluntary deferred compensation plan is an unfunded plan
for purposes of both the Internal Revenue Code of 1986 and the Employee Retirement Income Security Act of 1974. Included in accrued expenses and other current liabilities is $604 and $629 at March 31, 2003 and 2002, respectively, related to this
plan.



Note 14Stock-Based Plans



In September 1992, the Company and its subsidiaries adopted the Tommy
Hilfiger U.S.A. and Tommy Hilfiger (Eastern Hemisphere) Limited 1992 Stock Incentive Plans (the 1992 Stock Incentive Plans) authorizing the issuance of up to 5,940,000 Ordinary Shares to directors, officers and employees of the Company
and its subsidiaries. Through October 2001, a total of 13,500,000 additional Ordinary Shares of THC were authorized and reserved for issuance under the 1992 Stock Incentive Plans.



In October 2001, the Companys shareholders approved the Tommy Hilfiger Corporation 2001 Stock Incentive Plan (together
with the 1992 Stock Incentive Plans, the Employee Stock Incentive Plans), authorizing the issuance of up to 3,500,000 Ordinary Shares. Following such approval, no further grants may be made under the 1992 Stock Incentive Plans, but
grants previously made under such plans remain outstanding in accordance with their terms.



In August 1994, the shareholders of the Company approved the Tommy Hilfiger Corporation Non-Employee Directors Stock Option Plan (the Directors Option Plan). Under



F-26



---

the Directors Option Plan, directors who are not officers or employees of the Company are eligible to receive stock
option grants. The total number of Ordinary Shares for which options may be granted under the Directors Option Plan may not exceed 400,000, subject to certain adjustments.



Options granted under the Employee Stock Incentive Plans and the Directors Option Plan vest over periods ranging from 1-6
years with a maximum term of 10 years. The exercise price of all options granted under the Employee Stock Incentive Plans and the Directors Option Plan is the market price on the dates of grant.



Transactions involving the Employee Stock Incentive Plans and the Directors
Option Plan are summarized as follows:



|                                 |  | Option Shares |   |  | Weighted AverageExercisePrice Per Share
|-------------------------------- |  | ------------- | - |  | ---------------------------------------
|Outstanding as of March 31, 2000 |  | 10,063,905    |   |  | $                                      
|                                 |  |              
|Granted                          |  | 1,175,000     |   |  | $                                      
|Exercised                        |  | (338,764      | ) |  | $                                      
|Canceled                         |  | (2,269,101    | ) |  | $                                      
|                                 |  |               |   |  |                                        
|Outstanding as of March 31, 2001 |  | 8,631,040     |   |  | $                                      
|                                 |  |              
|Granted                          |  | 1,748,543     |   |  | $                                      
|Exercised                        |  | (861,765      | ) |  | $                                      
|Canceled                         |  | (1,374,745    | ) |  | $                                      
|                                 |  |               |   |  |                                        
|Outstanding as of March 31, 2002 |  | 8,143,073     |   |  | $                                      
|                                 |  |              
|Granted                          |  | 1,653,273     |   |  | $                                      
|Exercised                        |  | (740,145      | ) |  | $                                      
|Canceled                         |  | (862,029      | ) |  | $                                      
|                                 |  |               |   |  |                                        
|Outstanding as of March 31, 2003 |  | 8,194,172     |   |  | $                                      



Options exercisable at
March 31, 2003, 2002 and 2001 were 4,259,036, 3,022,948 and 2,361,013, respectively, at weighted average exercise prices of $18.44, $19.53 and $18.75, respectively.



F-27



---

The following table summarizes information concerning currently outstanding and exercisable options:



|                         |  | Options Outstanding |  | Options Exercisable                        
|------------------------ |  | ------------------- |  | -------------------------------------------
|Range of Exercise Prices |  | Number Outstanding  |  | Weighted Average Remaining Contractual Life
|$  5.86$11.53           |  | 3,765,752           |  | 7.69                                       
|$11.77$23.00            |  | 2,298,000           |  | 6.78                                       
|$23.06$25.23            |  | 1,221,050           |  | 5.15                                       
|$25.88$40.06            |  | 909,370             |  | 5.32                                       
|                         |  |                     |  |                                            
|                         |  | 8,194,172           |  | 6.79                                       
|                         |  |                     |  |                                            



The Company applies
APB Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations in accounting for its stock option awards. Accordingly, no compensation expense has been recognized for stock options granted in 2003, 2002 and
2001. The fair values of options granted were estimated at $4.67 in 2003, $4.55 in 2002 and $3.17 in 2001 on the dates of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions for 2003, 2002 and 2001,
respectively: volatility of 65%, 66% and 53%; risk free interest rate of 2.7%, 4.0% and 6.3%; expected life of 2.7 years, 3.0 years and 3.2 years; and no future dividends.



Note 15Statements of Cash Flows



|                                                  |  | Fiscal Year Ended March 31,
|------------------------------------------------- |  | ---------------------------
|                                                  |  | 2003                       
|Supplemental disclosure of cash flow information: |  |                            
|Cash paid during the year:                        |  |                            
|Interest                                          |  | $                          
|                                                  |  |                            
|Income taxes                                      |  | $                          
|                                                  |  |                            



The impact of
exchange rate movements on cash balances was insignificant in fiscal years 2003, 2002 and 2001.



F-28



---

Note 16Special Charges



In the third quarter of fiscal year 2003, the Company recorded special charges of $87,510 before taxes related to the
closure of all but six of its U.S. specialty stores and the impairment of fixed assets of the six U.S. specialty stores that the Company will continue to operate. The special charges consist of $38,929 for the impairment of leasehold improvements,
store fixtures and other assets of stores that are being closed, $33,741 for estimated lease termination costs, $2,600 for the write down of inventory (included in cost of goods sold), $610 for other expenses, including employee costs, and $11,630
for an impairment charge to write down to fair value the fixed assets and leasehold improvements at the six stores that will remain open.



In the fourth quarter of fiscal year 2003, the Company closed 18 stores and by April 20, 2003, the Company had closed 37 of the 38 stores that it had
planned to exit at a cost below that which was originally expected. Accordingly, $9,324 on a pretax basis, which was previously charged against earnings as part of a special charge in the third quarter, was reported as income for the fourth quarter.



The following table summarizes the activity in the
Companys special charge accrual for specialty store closures:



|                       |  | LeaseTermination |         |   | Inventory |   |       | Other |  |   | Total  |  
|---------------------- |  | ---------------- | ------- | - | --------- | - | ----- | ----- |  | - | ------ | -
|Balance March 31, 2002 |  | $                |        |   |           | $ |      |       |  | $ |       |  
|Additions              |  |                  | 33,704  |   |           |   | 2,600 |       |  |   | 1,418  |  
|Reductions             |  |                  | (20,344 | ) |           |   | (962  | )     |  |   | (1,148 | )
|Reversals              |  |                  | (9,478  | ) |           |   |      |       |  |   | 154    |  
|                       |  |                  |         |   |           |   |       |       |  |   |        |  
|Balance March 31, 2003 |  | $                | 3,882   |   |           | $ | 1,638 |       |  | $ | 424    |  
|                       |  |                  |         |   |           |   |       |       |  |   |        |  



There was no activity
in the Companys special charge accrual for specialty store closures during fiscal year 2002 or fiscal year 2001.



The Company terminated and paid severance to approximately 440 employees related to the specialty store closures.



Note 17Condensed Consolidating Financial Information



The Notes discussed in Note 9 were issued by TH USA and are fully and
unconditionally guaranteed by THC. Accordingly, condensed consolidating balance sheets as of March 31, 2003 and 2002, and the related condensed consolidating statements of operations and cash flows for each of the three years in the period ended
March 31, 2003, are provided. The operations of TH USA, excluding its subsidiaries, consist of the U.S. operations of certain wholesale divisions, together with TH USA corporate overhead charges not allocated to subsidiaries. The non-guarantor
subsidiaries of TH USA consist of the Companys U.S. retail, licensing and other wholesale divisions, as well as the Companys Canadian operations. Such operations contributed net revenue of $1,149,388, $1,238,069 and $1,265,424 for the
fiscal years ended March 31, 2003, 2002 and 2001, respectively. The other non-guarantor subsidiaries of THC are



F-29



---

primarily those non-U.S. subsidiaries involved in investing and buying office operations as well as the Companys
European operations. These condensed consolidating financial statements have been prepared using the equity method of accounting in accordance with the requirements for presentation of such information under which TH USAs and THCs
results reflect 100% of the earnings of their respective subsidiaries in each of the years presented. See Note 9 for a description of certain restrictions on the ability of subsidiaries of THC to pay dividends to THC.



F-30



---

Condensed Consolidating Statements of Operations

Year Ended March 31, 2003



|                                                      |  | Subsidiary Issuer (TH USA) |          |   | Non-Guarantor Subsidiaries |   |           | Parent Company Guarantor (THC) |  |   | Eliminations |   |  | Total |          
|----------------------------------------------------- |  | -------------------------- | -------- | - | -------------------------- | - | --------- | ------------------------------ |  | - | ------------ | - |  | ----- | ---------
|Net revenue                                           |  | $                          | 472,598  |   |                            | $ | 1,450,581 |                                |  | $ |             |   |  | $     | (35,124  
|Cost of goods sold                                    |  |                            | 323,399  |   |                            |   | 751,353   |                                |  |   |             |   |  |       | (16,396  
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Gross profit                                          |  |                            | 149,199  |   |                            |   | 699,228   |                                |  |   |             |   |  |       | (18,728  
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Depreciation and amortization                         |  |                            | 20,687   |   |                            |   | 66,486    |                                |  |   |             |   |  |       |         
|Goodwill impairment                                   |  |                            |         |   |                            |   | 150,612   |                                |  |   |             |   |  |       |         
|Special charges                                       |  |                            |         |   |                            |   | 75,586    |                                |  |   |             |   |  |       |         
|Other operating expenses                              |  |                            | 138,673  |   |                            |   | 430,995   |                                |  |   | (5,430       | ) |  |       | (18,734  
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Total operating expenses                              |  |                            | 159,360  |   |                            |   | 723,679   |                                |  |   | (5,430       | ) |  |       | (18,734  
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Income (loss) from operations                         |  |                            | (10,161  | ) |                            |   | (24,451   | )                              |  |   | 5,430        |   |  |       | 6        
|Interest expense                                      |  |                            | 39,527   |   |                            |   | 7,449     |                                |  |   |             |   |  |       |         
|Interest income                                       |  |                            | 1,547    |   |                            |   | 2,824     |                                |  |   | 2,346        |   |  |       |         
|Intercompany interest expense (income)                |  |                            | 97,258   |   |                            |   | (23,697   | )                              |  |   | (73,561      | ) |  |       |         
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Income (loss) before taxes                            |  |                            | (145,399 | ) |                            |   | (5,379    | )                              |  |   | 81,337       |   |  |       | 6        
|Provision (benefit) for income taxes                  |  |                            | (38,784  | ) |                            |   | 46,048    |                                |  |   | 6,880        |   |  |       |         
|Cumulative effect of change in accounting principle   |  |                            |         |   |                            |   | (430,026  | )                              |  |   |             |   |  |       |         
|Equity in net earnings of unconsolidated subsidiaries |  |                            | (508,802 | ) |                            |   |          |                                |  |   | (588,062     | ) |  |       | 1,096,864
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          
|Net income (loss)                                     |  | $                          | (615,417 | ) |                            | $ | (481,453  | )                              |  | $ | (513,605     | ) |  | $     | 1,096,870
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |       |          



F-31



---

Condensed Consolidating Statements of Operations

Year Ended March 31, 2002



|                                                      |  | Subsidiary Issuer (TH USA) |          |   | Non-Guarantor Subsidiaries |   |           | Parent Company Guarantor (THC) |  |   | Eliminations |   |  | Total
|----------------------------------------------------- |  | -------------------------- | -------- | - | -------------------------- | - | --------- | ------------------------------ |  | - | ------------ | - |  | -----
|Net revenue                                           |  | $                          | 552,711  |   |                            | $ | 1,374,300 |                                |  | $ |             |   |  | $    
|Cost of goods sold                                    |  |                            | 385,943  |   |                            |   | 713,554   |                                |  |   |             |   |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Gross profit                                          |  |                            | 166,768  |   |                            |   | 660,746   |                                |  |   |             |   |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Depreciation and amortization                         |  |                            | 30,585   |   |                            |   | 83,544    |                                |  |   |             |   |  |      
|Other operating expenses                              |  |                            | 153,463  |   |                            |   | 384,657   |                                |  |   | (6,263       | ) |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Total operating expenses                              |  |                            | 184,048  |   |                            |   | 468,201   |                                |  |   | (6,263       | ) |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Income (loss) from operations                         |  |                            | (17,280  | ) |                            |   | 192,545   |                                |  |   | 6,263        |   |  |      
|Interest expense                                      |  |                            | 38,501   |   |                            |   | 2,676     |                                |  |   |             |   |  |      
|Interest income                                       |  |                            | 3,724    |   |                            |   | 4,606     |                                |  |   | 1,732        |   |  |      
|Intercompany interest expense (income)                |  |                            | 94,396   |   |                            |   | (18,158   | )                              |  |   | (76,238      | ) |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Income (loss) before taxes                            |  |                            | (146,453 | ) |                            |   | 212,633   |                                |  |   | 84,233       |   |  |      
|Provision (benefit) for income taxes                  |  |                            | (55,479  | ) |                            |   | 68,376    |                                |  |   | 7,172        |   |  |      
|Equity in net earnings of unconsolidated subsidiaries |  |                            | 126,297  |   |                            |   |          |                                |  |   | 57,484       |   |  |      
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      
|Net income (loss)                                     |  | $                          | 35,323   |   |                            | $ | 144,257   |                                |  | $ | 134,545      |   |  | $    
|                                                      |  |                            |          |   |                            |   |           |                                |  |   |              |   |  |      



F-32



---

Condensed Consolidating Statements of Operations

Year Ended March 31, 2001



|                                                      |  | SubsidiaryIssuer (TH USA) |          |   | Non-GuarantorSubsidiaries |   |           | ParentCompanyGuarantor(THC) |  |   | Eliminations |   |  | Total
|----------------------------------------------------- |  | ------------------------- | -------- | - | ------------------------- | - | --------- | --------------------------- |  | - | ------------ | - |  | -----
|Net revenue                                           |  | $                         | 693,132  |   |                           | $ | 1,249,300 |                             |  | $ |             |   |  | $    
|Cost of goods sold                                    |  |                           | 457,330  |   |                           |   | 690,458   |                             |  |   |             |   |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Gross profit                                          |  |                           | 235,802  |   |                           |   | 558,842   |                             |  |   |             |   |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Depreciation and amortization                         |  |                           | 39,307   |   |                           |   | 67,333    |                             |  |   |             |   |  |      
|Other operating expenses                              |  |                           | 172,257  |   |                           |   | 330,205   |                             |  |   | (7,271       | ) |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Total operating expenses                              |  |                           | 211,564  |   |                           |   | 397,538   |                             |  |   | (7,271       | ) |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Income (loss) from operations                         |  |                           | 24,238   |   |                           |   | 161,304   |                             |  |   | 7,271        |   |  |      
|Interest expense                                      |  |                           | 41,402   |   |                           |   | 10        |                             |  |   |             |   |  |      
|Interest income                                       |  |                           | 3,528    |   |                           |   | 7,823     |                             |  |   | 6,099        |   |  |      
|Intercompany interest expense (income)                |  |                           | 89,092   |   |                           |   | (10,365   | )                           |  |   | (78,727      | ) |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Income (loss) before taxes                            |  |                           | (102,728 | ) |                           |   | 179,482   |                             |  |   | 92,097       |   |  |      
|Provision (benefit) for income taxes                  |  |                           | (22,236  | ) |                           |   | 57,248    |                             |  |   | 7,485        |   |  |      
|Equity in net earnings of unconsolidated subsidiaries |  |                           | 109,763  |   |                           |   |          |                             |  |   | 46,349       |   |  |      
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      
|Net income (loss)                                     |  | $                         | 29,271   |   |                           | $ | 122,234   |                             |  | $ | 130,961      |   |  | $    
|                                                      |  |                           |          |   |                           |   |           |                             |  |   |              |   |  |      



F-33



---

Condensed Consolidating Balance Sheets

March 31, 2003



|                                               |  | SubsidiaryIssuer (TH USA) |           |   | Non-GuarantorSubsidiaries |   |           | ParentCompanyGuarantor(THC) |  |   | Eliminations |   |  | Total
|---------------------------------------------- |  | ------------------------- | --------- | - | ------------------------- | - | --------- | --------------------------- |  | - | ------------ | - |  | -----
|Assets                                         |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Current Assets                                 |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Cash and cash equivalents                      |  | $                         | 28,493    |   |                           | $ | 229,758   |                             |  | $ | 162,575      |   |  | $    
|Accounts receivable                            |  |                           | 13,929    |   |                           |   | 171,110   |                             |  |   |             |   |  |      
|Inventories                                    |  |                           | 42,128    |   |                           |   | 188,931   |                             |  |   |             |   |  |      
|Deferred tax assets                            |  |                           | 27,854    |   |                           |   | 23,976    |                             |  |   |             |   |  |      
|Other current assets                           |  |                           | 10,542    |   |                           |   | 16,299    |                             |  |   | 1,342        |   |  |      
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Total current assets                           |  |                           | 122,946   |   |                           |   | 630,074   |                             |  |   | 163,917      |   |  |      
|Property, plant and equipment, at cost, less   |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|accumulated depreciation and amortization      |  |                           | 130,136   |   |                           |   | 118,154   |                             |  |   |             |   |  |      
|Intangible assets, subject to amortization     |  |                           |          |   |                           |   | 8,744     |                             |  |   |             |   |  |      
|Intangible assets, not subject to amortization |  |                           |          |   |                           |   | 625,205   |                             |  |   |             |   |  |      
|Goodwill                                       |  |                           |          |   |                           |   | 219,153   |                             |  |   |             |   |  |      
|Investment in subsidiaries                     |  |                           | 969,025   |   |                           |   | 209,290   |                             |  |   | 66,527       |   |  |      
|Other assets                                   |  |                           | 6,318     |   |                           |   | 4,909     |                             |  |   |             |   |  |      
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Total Assets                                   |  | $                         | 1,228,425 |   |                           | $ | 1,815,529 |                             |  | $ | 230,444      |   |  | $    
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Liabilities and Shareholders' Equity           |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Current liabilities                            |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Short-term borrowings                          |  | $                         |          |   |                           | $ | 19,380    |                             |  | $ |             |   |  | $    
|Current portion of long-term debt              |  |                           | 151,249   |   |                           |   | 617       |                             |  |   |             |   |  |      
|Accounts payable                               |  |                           | 20,729    |   |                           |   | 27,024    |                             |  |   |             |   |  |      
|Accrued expenses and other current liabilities |  |                           | 74,625    |   |                           |   | 118,912   |                             |  |   | 512          |   |  |      
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Total current liabilities                      |  |                           | 246,603   |   |                           |   | 165,933   |                             |  |   | 512          |   |  |      
|Intercompany payable (receivable)              |  |                           | 1,042,234 |   |                           |   | (223,922  | )                           |  |   | (813,443     | ) |  |      
|Long-term debt                                 |  |                           | 349,958   |   |                           |   | 322       |                             |  |   |             |   |  |      
|Deferred tax liability                         |  |                           | (5,618    | ) |                           |   | 220,443   |                             |  |   |             |   |  |      
|Other liabilities                              |  |                           | 308       |   |                           |   | 6,341     |                             |  |   |             |   |  |      
|Shareholders' equity                           |  |                           | (405,060  | ) |                           |   | 1,646,412 |                             |  |   | 1,043,375    |   |  |      
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      
|Total Liabilities and Shareholders' Equity     |  | $                         | 1,228,425 |   |                           | $ | 1,815,529 |                             |  | $ | 230,444      |   |  | $    
|                                               |  |                           |           |   |                           |   |           |                             |  |   |              |   |  |      



F-34



---

Condensed Consolidating Balance Sheets

March 31, 2002



|                                                                                       |  | SubsidiaryIssuer(TH USA) |           |   | Non-GuarantorSubsidiaries |   |           | Parent CompanyGuarantor(THC) |  |   | Eliminations |   |  | Total
|-------------------------------------------------------------------------------------- |  | ------------------------ | --------- | - | ------------------------- | - | --------- | ---------------------------- |  | - | ------------ | - |  | -----
|Assets                                                                                 |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Current Assets                                                                         |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Cash and cash equivalents                                                              |  | $                        | 135,729   |   |                           | $ | 135,143   |                              |  | $ | 116,375      |   |  | $    
|Accounts receivable                                                                    |  |                          | 51,781    |   |                           |   | 172,614   |                              |  |   |             |   |  |      
|Inventories                                                                            |  |                          | 46,134    |   |                           |   | 140,248   |                              |  |   |             |   |  |      
|Deferred tax assets                                                                    |  |                          | 41,003    |   |                           |   | 20,463    |                              |  |   |             |   |  |      
|Other current assets                                                                   |  |                          | 11,668    |   |                           |   | 22,285    |                              |  |   | 1,883        |   |  |      
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Total current assets                                                                   |  |                          | 286,315   |   |                           |   | 490,753   |                              |  |   | 118,258      |   |  |      
|Property, plant and equipment, at cost, less accumulated depreciation and amortization |  |                          | 152,438   |   |                           |   | 150,499   |                              |  |   |             |   |  |      
|Intangible assets, subject to amortization                                             |  |                          |          |   |                           |   | 10,879    |                              |  |   |             |   |  |      
|Intangible assets, not subject to amortization                                         |  |                          |          |   |                           |   | 609,938   |                              |  |   |             |   |  |      
|Goodwill                                                                               |  |                          |          |   |                           |   | 769,275   |                              |  |   |             |   |  |      
|Investment in subsidiaries                                                             |  |                          | 1,477,827 |   |                           |   | 206,790   |                              |  |   | 595,071      |   |  |      
|Other assets                                                                           |  |                          | 5,560     |   |                           |   | 1,974     |                              |  |   |             |   |  |      
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Total Assets                                                                           |  | $                        | 1,922,140 |   |                           | $ | 2,240,108 |                              |  | $ | 713,329      |   |  | $    
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Liabilities and Shareholders' Equity                                                   |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Current liabilities                                                                    |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Short-term borrowings                                                                  |  | $                        |          |   |                           | $ | 62,749    |                              |  | $ |             |   |  | $    
|Current portion of long-term debt                                                      |  |                          |          |   |                           |   | 698       |                              |  |   |             |   |  |      
|Accounts payable                                                                       |  |                          | 6,879     |   |                           |   | 22,101    |                              |  |   |             |   |  |      
|Accrued expenses and other current liabilities                                         |  |                          | 113,321   |   |                           |   | 96,481    |                              |  |   | 493          |   |  |      
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Total current liabilities                                                              |  |                          | 120,200   |   |                           |   | 182,029   |                              |  |   | 493          |   |  |      
|Intercompany payable (receivable)                                                      |  |                          | 1,031,416 |   |                           |   | (251,570  | )                            |  |   | (784,626     | ) |  |      
|Long-term debt                                                                         |  |                          | 574,620   |   |                           |   | 667       |                              |  |   |             |   |  |      
|Deferred tax liability                                                                 |  |                          | (13,638   | ) |                           |   | 228,602   |                              |  |   |             |   |  |      
|Other liabilities                                                                      |  |                          | 325       |   |                           |   | 3,716     |                              |  |   |             |   |  |      
|Shareholders' equity                                                                   |  |                          | 209,217   |   |                           |   | 2,076,664 |                              |  |   | 1,497,462    |   |  |      
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      
|Total Liabilities and Shareholders' Equity                                             |  | $                        | 1,922,140 |   |                           | $ | 2,240,108 |                              |  | $ | 713,329      |   |  | $    
|                                                                                       |  |                          |           |   |                           |   |           |                              |  |   |              |   |  |      



F-35



---

Condensed Consolidating Statements of Cash Flows

Year Ended March 31, 2003



|                                                                                 |  | Subsidiary Issuer(TH USA) |          |   | Non-GuarantorSubsidiaries |   |          | Parent CompanyGuarantor(THC) |  |   | Eliminations |   |  | Total |           
|-------------------------------------------------------------------------------- |  | ------------------------- | -------- | - | ------------------------- | - | -------- | ---------------------------- |  | - | ------------ | - |  | ----- | ----------
|Cash flows from operating activities                                             |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Net income (loss)                                                                |  | $                         | (615,417 | ) |                           | $ | (481,453 | )                            |  | $ | (513,605     | ) |  | $     | 1,096,870 
|Adjustments to reconcile net income to net cash provided by operating activities |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Cumulative effect of change in accounting principle                              |  |                           |         |   |                           |   | 430,026  |                              |  |   |             |   |  |       |          
|Goodwill impairment                                                              |  |                           |         |   |                           |   | 150,612  |                              |  |   |             |   |  |       |          
|Depreciation and amortization                                                    |  |                           | 20,687   |   |                           |   | 67,257   |                              |  |   |             |   |  |       |          
|Deferred taxes                                                                   |  |                           | 22,295   |   |                           |   | (24,332  | )                            |  |   |             |   |  |       |          
|Provision for special charge-non cash                                            |  |                           |         |   |                           |   | 49,978   |                              |  |   |             |   |  |       |          
|Changes in operating assets and liabilities                                      |  |                           | 48,182   |   |                           |   | 14,445   |                              |  |   | (35,434      | ) |  |       | (6        
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Net cash provided by (used in) operating activities                              |  |                           | (524,253 | ) |                           |   | 206,533  |                              |  |   | (549,039     | ) |  |       | 1,096,864 
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Cash flows from investing activities                                             |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Purchases of property and equipment                                              |  |                           | (18,249  | ) |                           |   | (53,654  | )                            |  |   |             |   |  |       |          
|Net activity in equity in net earnings of unconsolidated subsidiaries            |  |                           | 508,802  |   |                           |   |         |                              |  |   | 588,062      |   |  |       | (1,096,864
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Net cash provided by (used in) investing activities                              |  |                           | 490,553  |   |                           |   | (53,654  | )                            |  |   | 588,062      |   |  |       | (1,096,864
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Cash flows from financing activities                                             |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Payments on long-term debt                                                       |  |                           | (73,536  | ) |                           |   | (698     | )                            |  |   |             |   |  |       |          
|Proceeds from the exercise of stock options                                      |  |                           |         |   |                           |   |         |                              |  |   | 7,177        |   |  |       |          
|Repayments of short-term bank borrowings, net                                    |  |                           |         |   |                           |   | (57,566  | )                            |  |   |             |   |  |       |          
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Net cash provided by (used in) financing activities                              |  |                           | (73,536  | ) |                           |   | (58,264  | )                            |  |   | 7,177        |   |  |       |          
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Net increase (decrease) in cash                                                  |  |                           | (107,236 | ) |                           |   | 94,615   |                              |  |   | 46,200       |   |  |       |           
|Cash and cash equivalents, beginning of period                                   |  |                           | 135,729  |   |                           |   | 135,143  |                              |  |   | 116,375      |   |  |       |          
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           
|Cash and cash equivalents, end of period                                         |  | $                         | 28,493   |   |                           | $ | 229,758  |                              |  | $ | 162,575      |   |  | $     |          
|                                                                                 |  |                           |          |   |                           |   |          |                              |  |   |              |   |  |       |           



F-36



---

Condensed Consolidating Statements of Cash Flows

Year Ended March 31, 2002



|                                                                                 |  | SubsidiaryIssuer(TH USA) |          |   | Non-GuarantorSubsidiaries |   |          | Parent CompanyGuarantor(THC) |  |   | Eliminations |   |  | Total |         
|-------------------------------------------------------------------------------- |  | ------------------------ | -------- | - | ------------------------- | - | -------- | ---------------------------- |  | - | ------------ | - |  | ----- | --------
|Cash flows from operating activities                                             |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Net income (loss)                                                                |  | $                        | 35,323   |   |                           | $ | 144,257  |                              |  | $ | 134,545      |   |  | $     | (179,580
|Adjustments to reconcile net income to net cash provided by operating activities |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Depreciation and amortization                                                    |  |                          | 30,585   |   |                           |   | 86,741   |                              |  |   |             |   |  |       |        
|Deferred taxes                                                                   |  |                          | (18,731  | ) |                           |   | 11,960   |                              |  |   |             |   |  |       |        
|Changes in operating assets and liabilities                                      |  |                          | 207,171  |   |                           |   | (25,828  | )                            |  |   | (68,942      | ) |  |       | (4,201  
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Net cash provided by (used in) operating activities                              |  |                          | 254,348  |   |                           |   | 217,130  |                              |  |   | 65,603       |   |  |       | (183,781
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Cash flows from investing activities                                             |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Purchases of property and equipment                                              |  |                          | (27,244  | ) |                           |   | (69,679  | )                            |  |   |             |   |  |       |        
|Acquisition of businesses, net of cash acquired                                  |  |                          |         |   |                           |   | (205,061 | )                            |  |   |             |   |  |       |        
|Net activity in equity in net earnings of unconsolidated subsidiaries            |  |                          | (126,297 | ) |                           |   |         |                              |  |   | (57,484      | ) |  |       | 183,781 
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Net cash provided by (used in) investing activities                              |  |                          | (153,541 | ) |                           |   | (274,740 | )                            |  |   | (57,484      | ) |  |       | 183,781 
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Cash flows from financing activities                                             |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Proceeds of long-term debt                                                       |  |                          | 144,921  |   |                           |   |         |                              |  |   |             |   |  |       |        
|Payments on long-term debt                                                       |  |                          | (155,000 | ) |                           |   | (538     | )                            |  |   |             |   |  |       |        
|Proceeds from the exercise of stock options                                      |  |                          |         |   |                           |   |         |                              |  |   | 7,997        |   |  |       |        
|Repayments of short-term bank borrowings, net                                    |  |                          |         |   |                           |   | 20,120   |                              |  |   |             |   |  |       |        
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Net cash provided by (used in) financing activities                              |  |                          | (10,079  | ) |                           |   | 19,582   |                              |  |   | 7,997        |   |  |       |        
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Net increase (decrease) in cash                                                  |  |                          | 90,728   |   |                           |   | (38,028  | )                            |  |   | 16,116       |   |  |       |        
|Cash and cash equivalents, beginning of period                                   |  |                          | 45,001   |   |                           |   | 173,171  |                              |  |   | 100,259      |   |  |       |        
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         
|Cash and cash equivalents, end of period                                         |  | $                        | 135,729  |   |                           | $ | 135,143  |                              |  | $ | 116,375      |   |  | $     |        
|                                                                                 |  |                          |          |   |                           |   |          |                              |  |   |              |   |  |       |         



F-37



---

Condensed Consolidating Statements of Cash Flows

Year Ended March 31, 2001



|                                                                                 |  | SubsidiaryIssuer(TH USA) |          |   | Non-Guarantor Subsidiaries |   |          | Parent Company Guarantor(THC) |  |   | Eliminations |   |  | Total |         
|-------------------------------------------------------------------------------- |  | ------------------------ | -------- | - | -------------------------- | - | -------- | ----------------------------- |  | - | ------------ | - |  | ----- | --------
|Cash flows from operating activities                                             |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Net income (loss)                                                                |  | $                        | 29,271   |   |                            | $ | 122,234  |                               |  | $ | 130,961      |   |  | $     | (151,505
|Adjustments to reconcile net income to net cash provided by operating activities |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Depreciation and amortization                                                    |  |                          | 39,307   |   |                            |   | 68,928   |                               |  |   |             |   |  |       |        
|Deferred taxes                                                                   |  |                          | (14,039  | ) |                            |   | 23,122   |                               |  |   |             |   |  |       |        
|Changes in operating assets and liabilities                                      |  |                          | 61,681   |   |                            |   | (109,412 | )                             |  |   | (4,973       | ) |  |       | (4,607  
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Net cash provided by (used in) operating activities                              |  |                          | 116,220  |   |                            |   | 104,872  |                               |  |   | 125,988      |   |  |       | (156,112
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Cash flows from investing activities                                             |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Purchases of property and equipment                                              |  |                          | (26,956  | ) |                            |   | (46,934  | )                             |  |   |             |   |  |       |        
|Net activity in equity in net earnings of unconsolidated subsidiaries            |  |                          | (109,763 | ) |                            |   |         |                               |  |   | (46,349      | ) |  |       | 156,112 
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Net cash provided by (used in) investing activities                              |  |                          | (136,719 | ) |                            |   | (46,934  | )                             |  |   | (46,349      | ) |  |       | 156,112 
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Cash flows from financing activities                                             |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Payments on long-term debt                                                       |  |                          | (50,000  | ) |                            |   |         |                               |  |   |             |   |  |       |        
|Proceeds from the exercise of stock options                                      |  |                          |         |   |                            |   |         |                               |  |   | 3,710        |   |  |       |        
|Purchase of treasury shares                                                      |  |                          |         |   |                            |   |         |                               |  |   | (61,231      | ) |  |       |        
|Repayments of short-term bank borrowings, net                                    |  |                          |         |   |                            |   | (523     | )                             |  |   |             |   |  |       |        
|Capital contribution                                                             |  |                          | 90,000   |   |                            |   |         |                               |  |   | (90,000      | ) |  |       |        
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Net cash provided by (used in) financing activities                              |  |                          | 40,000   |   |                            |   | (523     | )                             |  |   | (147,521     | ) |  |       |        
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Net increase (decrease) in cash                                                  |  |                          | 19,501   |   |                            |   | 57,415   |                               |  |   | (67,882      | ) |  |       |        
|Cash and cash equivalents, beginning of period                                   |  |                          | 25,500   |   |                            |   | 115,756  |                               |  |   | 168,141      |   |  |       |        
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         
|Cash and cash equivalents, end of period                                         |  | $                        | 45,001   |   |                            | $ | 173,171  |                               |  | $ | 100,259      |   |  | $     |        
|                                                                                 |  |                          |          |   |                            |   |          |                               |  |   |              |   |  |       |         



F-38



---

Note 18Quarterly Financial Data (Unaudited)



|                                  |  | FirstQuarter |          |   | SecondQuarter |   | ThirdQuarter |  |   | FourthQuarter |  
|--------------------------------- |  | ------------ | -------- | - | ------------- | - | ------------ |  | - | ------------- | -
|2003                              |  |              |          |   |               |   |              |  |   |               |  
|Net revenue                       |  | $            | 366,330  |   |               | $ | 546,479      |  | $ | 477,259       |  
|Gross profit                      |  |              | 163,273  |   |               |   | 248,406      |  |   | 205,777       |  
|Net income (loss)                 |  |              | (438,758 | ) |               |   | 60,994       |  |   | (22,075       | )
|Basic earnings (loss) per share   |  |              | (4.88    | ) |               |   | 0.67         |  |   | (0.24         | )
|Diluted earnings (loss) per share |  |              | (4.88    | ) |               |   | 0.67         |  |   | (0.24         | )
|                                  |  |              |          |  
|2002                              |  |              |          |   |               |   |              |  |   |               |  
|Net revenue                       |  | $            | 355,688  |   |               | $ | 546,442      |  | $ | 474,793       |  
|Gross profit                      |  |              | 151,742  |   |               |   | 238,484      |  |   | 201,349       |  
|Net income                        |  |              | 9,013    |   |               |   | 47,875       |  |   | 36,958        |  
|Basic earnings per share          |  |              | 0.10     |   |               |   | 0.54         |  |   | 0.41          |  
|Diluted earnings per share        |  |              | 0.10     |   |               |   | 0.53         |  |   | 0.41          |  



Fiscal 2003 first
quarter financial data reflects a non-cash charge of $430,026 or $4.78 per diluted share which resulted from the adoption of SFAS 142. This charge was recorded as a cumulative effect of change in accounting principle. In conjunction with adopting
SFAS 142, the Company recorded a one-time, non cash, deferred tax charge of $11,358, or $0.13 per diluted share, in the first quarter of fiscal year 2003.



Fiscal 2003 third quarter financial data reflects special charges of $87,510 before taxes or $0.62 per diluted share.



Fiscal 2003 fourth quarter data reflects the reversal of special charges of
$9,324 before taxes, or $0.07 per share after taxes, and the goodwill impairment of $150,612, or $1.67 per share.



The quarterly financial data for the years ended March 31, 2003 and 2002 are unaudited; however, in the opinion of the Company, the interim data includes
all adjustments, consisting only of normal recurring adjustments, necessary to present such data fairly.



F-39



---

Note 19Share Repurchase Program



On April 7, 2000 the Company announced that its Board of Directors authorized the repurchase of up to $150,000 of its
outstanding Ordinary Shares over a period of up to 18 months using available cash. Under this share repurchase program, the Company repurchased 6,192,600 Ordinary Shares at an aggregate cost of $61,231 during fiscal year 2001. In connection with the
TH Europe Acquisition, the Companys Board of Directors terminated the remaining portion of the share repurchase program, effective June 28, 2001.



F-40



---

ITEM 15.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K



Index to Financial Statements and Financial Statement Schedules



(a) 1. Financial Statements



The following consolidated financial statements of the Company are included in Item 8:



Consolidated Statements of Operations for the fiscal years ended March 31, 2003, 2002 and 2001



Consolidated Balance Sheets as of March 31, 2003 and 2002



Consolidated Statements of Cash Flows for the fiscal years ended March 31,
2003, 2002 and 2001



Consolidated Statements of Changes in
Shareholders Equity for the fiscal years ended March 31, 2003, 2002 and 2001



Notes to Consolidated Financial Statements



(a) 2. Financial Statement Schedules



All schedules have been omitted because of the absence of the conditions under which they are required or because the required information is included in the Consolidated Financial Statements or Notes thereto.



(a) 3. Exhibits



|ExhibitNumber |  |   |  | Description                          
|------------- |  | - |  | -------------------------------------
|23*           |  |  |  | Consent of PricewaterhouseCoopers LLP

---

*  Filed herewith.



(b) Reports on Form 8-K



The Company did not file any Current Reports on Form 8-K during the three
months ended March 31, 2003.



4



---

SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Amendment No. 1 on Form
10-K/A to its Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.



TOMMY HILFIGER CORPORATION/s/    JOEL J.
HOROWITZJoel J. Horowitz Chairman of the Board, Chief Executive Officer and President (Principal Executive Officer)






July 17, 2003





---

CERTIFICATIONS



I, Joel J. Horowitz, certify that:



|1. |  | I have reviewed this annual report on Form 10-K, as amended, of Tommy Hilfiger Corporation;
|-- |  | -------------------------------------------------------------------------------------------



|2. |  | Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|3. |  | Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition,
results of operation and cash flows of the registrant as of, and for, the periods presented in this annual report;
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|4. |  | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14
and 15d-14) for the registrant and have:
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this annual report is being prepared;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) |  | Evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the
Evaluation Date); and
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) |  | Presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|5. |  | The registrants other certifying officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and the audit committee of
registrants board of directors (or persons performing the equivalent functions):
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | All significant deficiencies in the design or operation of internal controls which could adversely affect the registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) |  | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal controls; and
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------



|6. |  | The registrants other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Date: July 17, 2003



/s/    JOEL J.
HOROWITZJoel J. Horowitz Chief Executive Officer and President (principal executive officer)




---

I, Joseph Scirocco, certify that:



|1. |  | I have reviewed this annual report on Form 10-K, as amended, of Tommy Hilfiger Corporation;
|-- |  | -------------------------------------------------------------------------------------------



|2. |  | Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|3. |  | Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition,
results of operation and cash flows of the registrant as of, and for, the periods presented in this annual report;
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|4. |  | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14
and 15d-14) for the registrant and have:
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this annual report is being prepared;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) |  | Evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the
Evaluation Date); and
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) |  | Presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|5. |  | The registrants other certifying officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and the audit committee of
registrants board of directors (or persons performing the equivalent functions):
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | All significant deficiencies in the design or operation of internal controls which could adversely affect the registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) |  | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal controls; and
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------



|6. |  | The registrants other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Date: July 17, 2003



/s/    JOSEPH
SCIROCCOJoseph Scirocco Chief Financial Officer, Senior Vice President and Treasurer (principal financial
officer)




---

EXHIBIT INDEX



|Exhibit Number |   |  |   |  | Description                          
|-------------- | - |  | - |  | -------------------------------------
|               |   | 
|23.            | * |  |  |  | Consent of PricewaterhouseCoopers LLP

---

|* |  | Filed herewith.
|- |  | ---------------