<PAGE>   1
================================================================================

 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
 
                            ------------------------
 
                                   FORM 10-Q
                            ------------------------
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
   SECURITIES EXCHANGE ACT OF 1934
 
                  FOR THE QUARTERLY PERIOD ENDED APRIL 3, 1999
 
                                       OR
 
[ ] 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 1-8941
                                        
                            FRUIT OF THE LOOM, INC.
             (Exact name of registrant as specified in its charter)
 
<TABLE>
<S>                                              <C>
                  DELAWARE                                        36-3361804
       (State or other jurisdiction of                         (I.R.S. Employer
       incorporation or organization)                         Identification No.)
</TABLE>
 
                                5000 SEARS TOWER
                             233 SOUTH WACKER DRIVE
                            CHICAGO, ILLINOIS 60606
          (Address of principal executive offices, including Zip Code)
 
                                 (312) 876-1724
              (Registrant's telephone number, including area code)
 
                            ------------------------
 
     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 [ ]
 
     Common shares outstanding at April 30, 1999: 66,905,348 Class A Common
Shares, $.01 par value.
 
================================================================================
<PAGE>   2
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                                     INDEX
 
<TABLE>
<CAPTION>
                                                                                PAGE NO.
                                                                                --------
<S>                                                                              <C>
PART I.  FINANCIAL INFORMATION
         Item 1.  Financial Statements
                  Condensed Consolidated Balance Sheet --
                    April 3, 1999 (Unaudited) and January 2, 1999.............      2
                  Condensed Consolidated Statement of Operations (Unaudited)
                    for the Three Months Ended April 3, 1999 and March 28,
                    1998......................................................      3
                  Condensed Consolidated Statement of Common Stockholders'
                    Equity (Unaudited) for the Three Months Ended April 3,
                    1999 and March 28, 1998...................................      4
                  Condensed Consolidated Statement of Cash Flows (Unaudited)
                    for the Three Months Ended April 3, 1999 and March 28,
                    1998......................................................      5
                  Notes to Condensed Consolidated Financial Statements
                    (Unaudited)...............................................      6
         Item 2.  Management's Discussion and Analysis of Financial Condition
                    and Results of Operations.................................     11
PART II. OTHER INFORMATION
         Item 6.  Exhibits and Reports on Form 8-K............................     17
</TABLE>
 
                                        1
<PAGE>   3
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                      CONDENSED CONSOLIDATED BALANCE SHEET
                           (IN THOUSANDS OF DOLLARS)
 
<TABLE>
<CAPTION>
                                                               APRIL 3,     JANUARY 2,
                                                                 1999          1999
                                                              -----------   ----------
                                                              (UNAUDITED)
<S>                                                           <C>           <C>
ASSETS
Current Assets
  Cash and cash equivalents (including restricted cash).....  $   20,400    $    1,400
  Notes and accounts receivable (less allowance for possible
     losses of $10,000 and $12,000, respectively)...........     107,100       109,700
  Inventories
     Finished goods.........................................     533,900       500,700
     Work in process........................................     209,800       183,100
     Materials and supplies.................................      73,800        58,200
                                                              ----------    ----------
          Total inventories.................................     817,500       742,000
  Other.....................................................      52,200        41,100
                                                              ----------    ----------
          Total current assets..............................     997,200       894,200
                                                              ----------    ----------
Property, Plant and Equipment...............................   1,260,100     1,192,100
  Less accumulated depreciation.............................     766,600       758,200
                                                              ----------    ----------
          Net property, plant and equipment.................     493,500       433,900
                                                              ----------    ----------
Other Assets
  Goodwill (less accumulated amortization of $342,800 and
     $336,200, respectively)................................     679,600       686,300
  Deferred income taxes.....................................      35,000        36,700
  Other.....................................................     168,900       238,700
                                                              ----------    ----------
          Total other assets................................     883,500       961,700
                                                              ----------    ----------
                                                              $2,374,200    $2,289,800
                                                              ==========    ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
  Current maturities of long-term debt......................  $  270,500    $  270,500
  Trade accounts payable....................................      66,800       119,700
  Other accounts payable and accrued expenses...............     261,500       226,700
                                                              ----------    ----------
          Total current liabilities.........................     598,800       616,900
                                                              ----------    ----------
Noncurrent Liabilities
  Long-term debt............................................     979,000       856,600
  Other.....................................................     267,500       267,400
                                                              ----------    ----------
          Total noncurrent liabilities......................   1,246,500     1,124,000
                                                              ----------    ----------
Preferred Stock.............................................      71,700            --
                                                              ----------    ----------
Common Stockholders' Equity.................................     457,200       548,900
                                                              ----------    ----------
                                                              $2,374,200    $2,289,800
                                                              ==========    ==========
</TABLE>
 
                            See accompanying notes.
                                        2
<PAGE>   4
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
           CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
                     (IN THOUSANDS, EXCEPT PER SHARE DATA)
 
<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED
                                                                ---------------------
                                                                APRIL 3,    MARCH 28,
                                                                  1999        1998
                                                                --------    ---------
<S>                                                             <C>         <C>
 
Net sales...................................................    $408,700    $457,200
Cost of sales...............................................     314,300     309,500
                                                                --------    --------
          Gross earnings....................................      94,400     147,700
Selling, general and administrative expenses................      80,900      83,100
Goodwill amortization.......................................       6,600       6,600
                                                                --------    --------
          Operating earnings................................       6,900      58,000
Interest expense............................................     (21,600)    (24,700)
Other income -- net.........................................       5,500       4,300
                                                                --------    --------
          Earnings (loss) before income tax provision.......      (9,200)     37,600
Income tax provision........................................        (500)      6,400
                                                                --------    --------
          Net earnings (loss)...............................      (8,700)     31,200
Preferred stock dividends...................................         300          --
                                                                --------    --------
          Earnings (loss) applicable to common stock........    $ (9,000)   $ 31,200
                                                                ========    ========
Earnings (loss) per common share............................    $  (0.13)   $    .43
                                                                ========    ========
Earnings (loss) per common share -- assuming dilution.......    $  (0.13)   $    .43
                                                                ========    ========
Average common shares.......................................      70,400      71,800
                                                                ========    ========
Average common shares -- assuming dilution..................      70,400      72,300
                                                                ========    ========
</TABLE>
 
                            See accompanying notes.
                                        3
<PAGE>   5
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
  CONDENSED CONSOLIDATED STATEMENT OF COMMON STOCKHOLDERS' EQUITY (UNAUDITED)
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                     COMMON STOCK                ACCUMULATED
                                                    AND CAPITAL IN                  OTHER
                                           COMMON     EXCESS OF      RETAINED   COMPREHENSIVE
                                           SHARES     PAR VALUE      EARNINGS      INCOME        TOTAL
                                           ------   --------------   --------   -------------   --------
<S>                                        <C>      <C>              <C>        <C>             <C>
BALANCE, DECEMBER 31, 1997..............   71,901      $319,000      $140,700     $(37,600)     $422,100
                                                                                                --------
  Class A shares issued upon exercise of
     options............................      62          1,700                                    1,700
                                                                                                --------
  Restricted stock --
     Compensation earned................                    400                                      400
                                                                                                --------
  Class A shares repurchased............    (121)        (3,000)                                  (3,000)
                                                                                                --------
  Net earnings..........................                               31,200                     31,200
  Foreign currency translation
     adjustments -- net.................                                           (11,900)      (11,900)
                                                                                                --------
  Comprehensive earnings................                                                          19,300
                                           ------      --------      --------     --------      --------
BALANCE, MARCH 28, 1998.................   71,842      $318,100      $171,900     $(49,500)     $440,500
                                           ======      ========      ========     ========      ========
 
BALANCE, JANUARY 2, 1999................   72,150      $326,700      $276,600     $(54,400)     $548,900
                                                                                                --------
  Restricted stock --
     Compensation earned................                    500                                      500
                                                                                                --------
     Shares forfeited...................     (16)
  Class B shares exchanged for
     exchangeable participating
     preferred stock of the Company.....   (5,229)      (71,700)                                 (71,700)
                                                                                                --------
  Net loss..............................                               (8,700)                    (8,700)
  Foreign currency translation
     adjustments -- net.................                                           (11,500)      (11,500)
                                                                                                --------
  Comprehensive loss....................                                                         (20,200)
                                                                                                --------
  Preferred stock dividends.............                                 (300)                      (300)
                                           ------      --------      --------     --------      --------
BALANCE, APRIL 3, 1999..................   66,905      $255,500      $267,600     $(65,900)     $457,200
                                           ======      ========      ========     ========      ========
</TABLE>
 
                            See accompanying notes.
                                        4
<PAGE>   6
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
           CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
                           (IN THOUSANDS OF DOLLARS)
 
<TABLE>
<CAPTION>
                                                               THREE MONTHS ENDED
                                                              ---------------------
                                                              APRIL 3,    MARCH 28,
                                                                1999        1998
                                                              ---------   ---------
<S>                                                           <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net earnings (loss).......................................  $  (8,700)  $  31,200
  Adjustments to reconcile to net cash used for operating
     activities:
     Preferred stock dividends..............................       (300)         --
     Depreciation and amortization..........................     30,800      32,000
     Deferred income tax provision..........................      1,700        (100)
     Increase in working capital............................    (77,700)   (231,300)
     Other -- net...........................................    (21,400)    (23,300)
                                                              ---------   ---------
          Net cash used for operating activities............    (75,600)   (191,500)
                                                              ---------   ---------
CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures......................................     (6,700)     (6,400)
  Proceeds from asset sales.................................      5,700      21,600
  Other -- net..............................................    (21,200)     (1,200)
                                                              ---------   ---------
          Net cash provided by (used for) investing
            activities......................................    (22,200)     14,000
                                                              ---------   ---------
CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from issuance of long-term debt..................    239,700          --
  Proceeds under line-of-credit agreements..................    189,700     284,100
  Payments under line-of-credit agreements..................   (302,500)    (96,400)
  Principal payments on long-term debt and capital leases...    (10,100)     (8,400)
  Common stock issued.......................................         --       1,400
  Common stock repurchased..................................         --      (3,000)
                                                              ---------   ---------
          Net cash provided by financing activities.........    116,800     177,700
                                                              ---------   ---------
Net increase in Cash and cash equivalents (including
  restricted cash)..........................................     19,000         200
Cash and cash equivalents (including restricted cash) at
  beginning of period.......................................      1,400      16,100
                                                              ---------   ---------
Cash and cash equivalents (including restricted cash) at end
  of period.................................................  $  20,400   $  16,300
                                                              =========   =========
</TABLE>
 
                            See accompanying notes.
                                        5
<PAGE>   7
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)
 
1. On March 4, 1999 Fruit of the Loom, LTD. ("FTL, Ltd."), a Cayman Islands
   company, became the parent holding company of Fruit of the Loom, Inc. ("FTL,
   Inc." or the "Company") pursuant to a reorganization (the "Reorganization")
   approved by the stockholders of FTL, Inc. on November 12, 1998. Ownership of
   essentially all of the businesses or subsidiaries of the Company located
   outside the United States, other than certain interests of the Company in
   Canada and Mexico and the beneficial ownership of certain trademarks, will be
   transferred to FTL, Ltd. when the Reorganization is fully implemented.
 
   The condensed consolidated financial statements contained herein should be
   read in conjunction with the consolidated financial statements and related
   notes contained in the Company's Annual Report on Form 10-K for the year
   ended January 2, 1999. The information furnished herein reflects all
   adjustments (consisting of normal recurring adjustments) which are, in the
   opinion of management, necessary for a fair presentation of the results of
   operations of the interim periods. Operating results for the three months
   ended April 3, 1999 are not necessarily indicative of results that may be
   expected for the full year.
 
   In connection with the Reorganization, all outstanding shares of Class A
   common stock of FTL, Inc. were automatically converted into Class A ordinary
   shares of FTL, Ltd., and all outstanding shares of Class B common stock of
   FTL, Inc. were automatically converted into shares of exchangeable
   participating preferred stock of FTL, Inc. (the "FTL, Inc. Preferred Stock").
   The FTL, Inc. Preferred Stock (5,229,000 shares outstanding) in the aggregate
   (i) has a liquidation value of $71,700,000, which is equal to the fair market
   value of the FTL, Inc. Class B common stock based upon the $13.71 average
   closing price of FTL, Inc. Class A common stock on the New York Stock
   Exchange for the 20 trading days prior to March 4, 1999, (ii) is entitled to
   receive cumulative cash dividends of 4.5% per annum of the liquidation value,
   payable quarterly, (iii) is exchangeable at the option of the holder, in
   whole or from time to time in part, at any time for 4,981,000 FTL, Ltd. Class
   A ordinary shares, (iv) is convertible at the option of the holder, in whole
   or from time to time in part, at any time for 4,981,000 shares of FTL, Inc.
   common stock, (v) participates with the holders of FTL, Inc. common stock in
   all dividends and liquidation payments in addition to its preference payments
   on an as converted basis, (vi) is redeemable by FTL, Inc., at its option,
   after three years at a redemption price equal to the then fair market value
   of FTL, Inc. Preferred Stock as determined by a nationally recognized
   investment banking firm, and (vii) has the right to vote on all matters put
   to a vote of the holders of FTL, Inc. common stock, voting together with such
   holders as a single class, and is entitled to the number of votes which such
   holder would have on an as converted basis.
 
   The fixed dividend on the FTL, Inc. Preferred Stock of 4.5% of the
   liquidation preference of $71,700,000 equals $3,200,000 on an annual basis.
   In addition, preferred stockholders participate in FTL, Inc.'s earnings after
   provision for the fixed preferred stock dividend. Participation in earnings
   is determined as the ratio of preferred shares outstanding to the total of
   preferred and common shares outstanding (7.2% at April 3, 1999). Preferred
   stockholder participation in losses is limited to the preferred stockholders'
   prior participation in earnings. Because FTL, Inc. had a loss in the three
   months ended April 3, 1999, the minority interest participation is limited to
   the fixed preferred dividend of $300,000 for the period.
 
   Effective January 1, 1998, the Company changed its year end from December 31
   to a 52 or 53 week year ending on the Saturday nearest December 31. All
   quarterly reporting periods are prepared on a 4-4-5 accounting cycle with
   each quarter ending on the Saturday nearest the calendar quarter end.
 
2. No dividends were declared on the Company's common stock for the three-month
   periods ended April 3, 1999 and March 28, 1998.
 
3. The Company's effective income tax rate of 5.0% for the first three months of
   1999 differed from the Federal statutory rate of 35% primarily due to the
   impact of foreign earnings, certain of which are taxed at lower rates than in
   the United States, partially offset by goodwill amortization, a portion of
   which is not deductible for Federal income taxes, and a provision for
   interest on prior years' taxes.
 
                                        6
<PAGE>   8
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED
                                  (UNAUDITED)
 
   The Company's effective income tax rate of 17% for the first three months of
   1998 differed from the Federal statutory rate of 35% primarily due to the
   impact of foreign earnings, certain of which are taxed at lower rates than in
   the United States, partially offset by goodwill amortization, a portion of
   which is not deductible for Federal income taxes, and state income taxes.
 
4. In 1995, management announced plans to close certain manufacturing operations
   and to take other actions to reduce costs and improve operations. As a
   result, the Company recorded charges of approximately $372,900,000
   ($287,400,000 after tax) related to impairment write-downs of goodwill, costs
   associated with the closing or realignment of certain domestic manufacturing
   facilities and attendant personnel reductions and charges related to
   inventory write-downs and valuations, foreign operations and other corporate
   issues.
 
   A rollforward of the 1995 special charges from January 2, 1999 through April
   3, 1999 is presented below (in thousands of dollars):
 
<TABLE>
<CAPTION>
                                            RESERVE                                       RESERVE
                                            BALANCE                                       BALANCE
                                           JANUARY 2,     CASH      INCOME      OTHER     APRIL 3,
                                              1999      PAYMENTS   (EXPENSE)   ACTIVITY     1999
                                           ----------   --------   ---------   --------   --------
<S>                                        <C>          <C>        <C>         <C>        <C>
Impairment write down of goodwill........   $    --      $   --       $--         $--     $    --
Closing or realignment of manufacturing
  operations
  Loss on disposal of closed facilities,
     improvements and equipment..........        --          --       --          --           --
  Changes in estimates of insurance
     liabilities.........................     9,500       2,300       --          --        7,200
  Costs related to expected increases in
     workers' compensation and health
     and welfare costs...................        --          --       --          --           --
  Costs related to termination of certain
     lease obligations...................        --          --       --          --           --
  Costs related to severance of the
     hourly workforce....................        --          --       --          --           --
  Other..................................       200          --       --          --          200
                                            -------      ------       --          --      -------
                                              9,700       2,300       --          --        7,400
Severance................................        --          --       --          --           --
Other asset write downs, valuation
  reserves and other reserves............        --          --       --          --           --
Changes in estimates of certain retained
  liabilities of former subsidiaries.....    10,500       3,500       --          --        7,000
Termination of management agreement......        --          --       --          --           --
                                            -------      ------       --          --      -------
                                            $20,200      $5,800       $--         $--     $14,400
                                            =======      ======       ==          ==      =======
</TABLE>
 
   In the fourth quarter of 1997, the Company recorded charges for costs related
   to the closing and disposal of a number of domestic manufacturing and
   distribution facilities, impairment of manufacturing equipment and other
   assets and certain European manufacturing and distribution facilities, and
   other costs associated with the Company's world-wide restructuring of
   manufacturing and distribution facilities. These and other special charges
   totalled $441,700,000 ($372,200,000 after tax).
 
                                        7
<PAGE>   9
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED
                                  (UNAUDITED)
 
   A rollforward of the 1997 special charges from January 2, 1999 through April
   3, 1999 is presented below (in thousands of dollars):
 
<TABLE>
<CAPTION>
                                          RESERVE                                       RESERVE
                                          BALANCE                                       BALANCE
                                         JANUARY 2,     CASH      INCOME      OTHER     APRIL 3,
                                            1999      PAYMENTS   (EXPENSE)   ACTIVITY     1999
                                         ----------   --------   ---------   --------   --------
<S>                                      <C>          <C>        <C>         <C>        <C>
Closing and disposal of U.S.
  manufacturing and distribution
  facilities
  Loss on sale of facilities,
     improvements and equipment:
     Sewing, finishing and distribution
       facilities......................   $ 60,100     $   --     $   --      $   --    $ 60,100
     Impairment of mills to be sold....     75,400         --         --          --      75,400
     Lease residual guarantees.........     61,000      8,400         --          --      52,600
     Other equipment...................      6,200         --         --          --       6,200
                                          --------     ------     ------      ------    --------
                                           202,700      8,400         --          --     194,300
  Severance costs......................        200         --         --          --         200
  Other accruals.......................      2,400         --         --          --       2,400
                                          --------     ------     ------      ------    --------
                                           205,300      8,400         --          --     196,900
                                          --------     ------     ------      ------    --------
Impairment of European manufacturing
  and distribution facilities
  Impairment of long lived assets......         --         --         --          --          --
  Other accruals.......................      1,100         --         --         100       1,000
                                          --------     ------     ------      ------    --------
                                             1,100         --         --         100       1,000
                                          --------     ------     ------      ------    --------
Pro Player incentive compensation
  agreement............................         --         --         --          --          --
                                          --------     ------     ------      ------    --------
Other asset write-downs and reserves
  Inventory valuation provisions.......         --         --         --          --          --
  Other accruals.......................     11,300        200         --       1,800       9,300
                                          --------     ------     ------      ------    --------
                                            11,300        200         --       1,800       9,300
                                          --------     ------     ------      ------    --------
Changes in estimates of certain
  retained liabilities of former
  subsidiaries.........................     10,600         --         --          --      10,600
                                          --------     ------     ------      ------    --------
          Total pretax charges.........   $228,300     $8,600     $   --      $1,900    $217,800
                                          ========     ======     ======      ======    ========
</TABLE>
 
   During the first quarter of 1998, the Company sold certain inventory which
   had been written down as part of the 1997 special charges. Amounts received
   for the inventory sold were in excess of amounts estimated, resulting in
   reductions in cost of sales and increases to earnings before income tax
   expense of $4,900,000 in the first quarter of 1998.
 
5. The Company and its subsidiaries are involved in certain legal proceedings
   and have retained liabilities, including certain environmental liabilities,
   such as those under the Comprehensive Environmental Response, Compensation
   and Liability Act of 1980, as amended ("CERCLA"), its regulations and similar
   state statutes ("Superfund Legislation"), in connection with the sale of
   certain discontinued operations, some of which were significant generators of
   hazardous waste. The Company and its subsidiaries have also retained certain
   liabilities related to the sale of products in connection with the sale of
   certain discontinued operations. The Company's retained liability reserves at
   April 3, 1999 related to discontinued operations consist primarily of certain
   environmental reserves of approximately $30,900,000 and product liability
   reserves of approximately $4,000,000. During 1998, the Company purchased
   insurance coverage for potential cleanup cost expenditures from approximately
   the level of current environmental reserves up to $100,000,000 for certain
   sites with on-going remediation, pollution liability
                                        8
<PAGE>   10
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED
                                  (UNAUDITED)
 
   coverage for claims arising out of pollution conditions at owned locations
   including continuing operations, sold facilities and non-owned sites and
   product liability coverage for claims arising out of products manufactured by
   the sold operations. Management believes that adequate reserves have been
   established to cover potential claims based on facts currently available and
   current Superfund and CERCLA Legislation.
 
   Generators of hazardous wastes which were disposed of at offsite locations
   which are now superfund sites are subject to claims brought by state and
   Federal regulatory agencies under Superfund Legislation and by private
   citizens under Superfund Legislation and common law theories. Since 1982, the
   United States Environmental Protection Agency (the "EPA") has actively sought
   compensation for response costs and remedial action at offsite disposal
   locations from waste generators under the Superfund Legislation, which
   authorizes such action by the EPA regardless of fault, legality of original
   disposal or ownership of a disposal site. The EPA's activities under the
   Superfund Legislation can be expected to continue during the remainder of
   1999 and future years.
 
   On February 24, 1999, the Board of Directors, excluding Mr. Farley,
   authorized the Company to guarantee a bank loan of $65,000,000 to Mr. Farley
   in connection with Mr. Farley's refinancing and retirement of his $26,000,000
   and $12,000,000 loans previously guaranteed by the Company and other
   indebtedness of Mr. Farley. The Company's obligations under the guarantee are
   secured by 2,507,512 shares of FTL, Inc. Preferred Stock and all of Mr.
   Farley's assets. In consideration of the guarantee, which is scheduled to
   expire in September 2000, Mr. Farley pays an annual guarantee fee equal to 2%
   of the outstanding principal balance of the loan. The Board of Directors
   received an opinion from an independent financial advisor that the terms of
   the transaction are commercially reasonable. In addition, in October 1998,
   the Company advanced $3,500,000 to Mr. Farley which was repaid in March 1999.
 
   The Company has negotiated grants from the governments of the Republic of
   Ireland, Northern Ireland and Germany. The grants are being used for employee
   training, the acquisition of property and equipment and other governmental
   business incentives such as general employment. At April 3, 1999, the Company
   had a contingent liability to repay, in whole or in part, grants received of
   approximately $28,200,000 in the event that the Company does not meet defined
   average employment levels or terminates operations in the Republic of
   Ireland, Northern Ireland and Germany.
 
   On July 1, 1998, the New England Health Care Employees Pension Fund filed a
   purported class action on behalf of all those who purchased Fruit of the
   Loom, Inc. Class A Common Stock and publicly traded options between July 24,
   1996 and September 5, 1997 (the "Class Period") against the Company and
   William Farley, Bernhard Hansen, Richard C. Lappin, G. William Newton,
   Burgess D. Ridge, Larry K. Switzer and John D. Wigodsky, each of whom are
   current or former officers of the Company, in the United States District
   Court for the Western District of Kentucky ("New England Action"). The
   plaintiff claims that the defendants engaged in conduct violating Section
   10(b) of the Securities Exchange Act of 1934, as amended (the "Act"), and
   that the Company and Mr. Farley are also liable under Section 20(a) of the
   Act. According to the plaintiff, the Company, with the knowledge and
   assistance of the individual defendants, made certain material
   misrepresentations and failed to disclose certain material facts about the
   Company's condition and prospects during the Class Period, causing the
   plaintiff and the class to buy Company stock or options at artificially
   inflated prices. The plaintiff also alleges that during the Class Period, the
   individual defendants sold stock of the Company while possessing material
   non-public information. The plaintiff asks for unspecified amounts as
   damages, interest and costs and ancillary relief. The defendants filed a
   motion to dismiss the action, which is fully briefed and awaiting court
   action. The defendants filed a motion to change venue from Bowling Green,
   Kentucky, and such motion is not yet fully briefed.
 
                                        9
<PAGE>   11
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED
                                  (UNAUDITED)
 
   Management believes that the suit is without merit, and management and the
   Company intend to defend it vigorously. Management believes, based on
   information currently available, that the ultimate resolution of this
   litigation will not have a material adverse effect on the financial condition
   or results of the operations of the Company, but the ultimate resolution of
   the suit, if unfavorable, could be material to the results of operations of a
   particular future period.
 
   On August 26, 1998, Carol Bradley filed a purported derivative action on
   behalf of the Company, against William Farley, Richard C. Lappin, Omar Z. Al
   Askari, Dennis S. Bookshester, Henry A. Johnson, Mark H. McCormack, Larry K.
   Switzer, A. Lorne Weil and Sir Brian Wolfson, each of whom is a current or
   former director of the Company, and the Company, as a nominal defendant, in
   the Warren Circuit Court of the State of Kentucky. The plaintiff asserts
   various common law claims against the individual defendants including, inter
   alia, breach of fiduciary duty, waste of corporate assets, breach of contract
   and constructive fraud claims. The plaintiff also asserts an insider trading
   claim against defendants Farley, Lappin and Switzer. The claims asserted
   against the individual defendants are based on the same alleged
   misrepresentations and omissions which form the basis of the claims asserted
   by the plaintiff in the New England Action as described above. The plaintiff
   seeks unspecified compensatory and punitive damages, attorneys' fees and
   costs and ancillary relief.
 
   On September 18, 1998, defendant Farley, with the consent of the Company,
   removed the action to the United States District Court for the Western
   District of Kentucky. Those defendants subsequently filed a motion to dismiss
   on the ground that the plaintiff failed to make an appropriate demand on the
   Company prior to filing the action. That motion is fully briefed and awaiting
   court action.
 
6. The following table sets forth the computation of basic and diluted earnings
   per common share (in thousands, except per share data):
 
<TABLE>
<CAPTION>
                                                               THREE MONTHS ENDED
                                                              --------------------
                                                              APRIL 3,   MARCH 28,
                                                                1999       1998
                                                              --------   ---------
<S>                                                           <C>        <C>
NUMERATOR
For basic earnings per share --
  Net earnings (loss) applicable to common stock............  $(9,000)    $31,200
  Add back dividends on exchangeable preferred assumed to be
     converted..............................................       --          --
                                                              -------     -------
For diluted earnings per share --
  Earnings (loss) applicable to common stock after assumed
     conversion.............................................  $(9,000)    $31,200
                                                              =======     =======
DENOMINATOR
For basic earnings per common share --
  weighted average shares outstanding.......................   70,400      71,800
Effect of dilutive employee stock options...................       --         500
Effect of dilutive exchangeable preferred...................       --          --
                                                              -------     -------
For diluted earnings per common share --
  weighted average shares outstanding and assumed
     conversions............................................   70,400      72,300
                                                              =======     =======
Earnings (loss) per common share............................  $ (0.13)    $  0.43
                                                              =======     =======
Earnings (loss) per common share -- assuming dilution.......  $ (0.13)    $  0.43
                                                              =======     =======
</TABLE>
 
   Because diluted EPS increases in the first quarter of 1999 from a loss of
   $(0.13) to a loss of $(0.12), the effect of the assumed conversion of
   exchangeable preferred stock (1,700,000 weighted average shares) is
   antidilutive and has been ignored in the computation of diluted EPS.
   Therefore, diluted EPS is reported as a loss of $(0.13) in the first quarter
   of 1999. The effect of employee stock options was not material in 1999. All
   employee stock options were converted to options to purchase FTL, Ltd. Class
   A ordinary shares effective March 4, 1999.
 
                                       10
<PAGE>   12
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                         PART I. FINANCIAL INFORMATION
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS
 
  Forward Looking Information
 
     The Company desires to provide investors with meaningful and useful
information. Therefore, this Quarterly Report on Form 10-Q contains certain
statements that describe the Company's beliefs concerning future business
conditions and the outlook for the Company, based on currently available
information. Wherever possible, the Company has identified these "forward
looking" statements (as defined in Section 21E of the Securities Exchange Act of
1934) by words such as "anticipates," "believes," "estimates," "expects" and
similar expressions. These forward looking statements are subject to risks,
uncertainties and other factors which could cause the Company's actual results,
performance or achievements to differ materially from those expressed in, or
implied by, these statements. These risks, uncertainties and other factors
include, but are not limited to, the following: the financial strength of the
retail industry (particularly the mass merchant channel), the level of consumer
spending for apparel, demand for the Company's activewear screenprint products,
the competitive pricing environment within the basic apparel segment of the
apparel industry, the Company's ability to develop, market and sell new
products, the Company's effective income tax rate, the success of planned
advertising, marketing and promotional campaigns, international activities and
the resolution of legal proceedings and other contingent liabilities. The
Company assumes no obligation to update publicly any forward looking statements,
whether as a result of new information, future events or otherwise.
 
  Results of Operations
 
     The following discussion should be read in conjunction with the
accompanying condensed consolidated financial statements and related notes for
the period ended April 3, 1999 and the Company's consolidated financial
statements and related notes contained in the Company's Annual Report on Form
10-K for the year ended January 2, 1999.
 
SPECIAL CHARGES
 
     During the first quarter of 1998, the Company sold certain inventory which
had been written down as part of the 1997 special charges. Amounts received for
the inventory sold were in excess of amounts estimated, resulting in reductions
in cost of sales and increases to earnings before income tax expense of
$4,900,000 in the first quarter of 1998.
 
     In connection with the transfer of substantially all of its sewing
operations to offshore locations, and the related increase in the use of foreign
contract manufacturers, the Company is in the process of completing enhanced
inventory control procedures. Until such time as such procedures are completed,
the Company remains subject to increased risks regarding the management of its
inventory. These risks, such as inventory shrinkage and obsolescence, could
result in the Company incurring additional write-downs; however, the Company
believes it has adequate reserves for these potential write-downs. Although the
Company is not currently aware of any facts that would require any substantial
write-down of its inventory, there can be no assurance that write-downs will not
be recognized in the future.
 
     The 1995 and 1997 restructuring activities are generally progressing as
expected, and management currently anticipates completion of these activities by
the end of 1999. There can be no assurance, however, that all activities will be
completed by the end of 1999.
 
                                       11
<PAGE>   13
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                   PART I. FINANCIAL INFORMATION (CONTINUED)
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS -- (CONTINUED)
FIRST QUARTER 1999 COMPARED WITH 1998
 
     The table below sets forth selected operating data (in millions of dollars
and as percentages of net sales).
 
<TABLE>
<CAPTION>
                                                               THREE MONTHS ENDED
                                                              --------------------
                                                              APRIL 3,   MARCH 28,
                                                                1999       1998
                                                              --------   ---------
<S>                                                           <C>        <C>
Net sales...................................................   $408.7     $457.2
Gross earnings..............................................     94.4      147.7
Gross margin................................................     23.1%      32.3%
Operating earnings..........................................      6.9       58.0
Operating margin............................................      1.7%      12.7%
</TABLE>
 
     First quarter net sales were $48,500,000 or 10.6% lower than the same
period last year. Fourth quarter 1998 production disruptions, including
Hurricane Mitch and the warm fall weather that impaired fleece sales, had a
greater than anticipated impact on product availability in Retail Products and
Activewear in the first quarter of 1999. Revenues were reduced by approximately
$40,000,000 because production could not be increased quickly enough to meet
demand. The increased demand was expected to offset a one-time decline in sales
of approximately $35,000,000 from lower Gitano sales due to customer mix, the
elimination of Winnie the Pooh licensed products and lower Activewear pricing.
Men's and boys' underwear sales grew 11.5% compared with the first quarter of
1998. Activewear sales declined 25.9% due to price competition and product
availability. Sales of sports licensed products were impacted by the NBA strike
and soft demand in the sports licensed market. In Europe, sales were down on
lower retail volume and unfavorable currency effects.
 
     Segment net sales were as follows (in millions of dollars).
 
<TABLE>
<CAPTION>
                                                               THREE MONTHS ENDED
                                                              --------------------
                                                              APRIL 3,   MARCH 28,
                                                                1999       1998
                                                              --------   ---------
<S>                                                           <C>        <C>
NET SALES
  Retail Products...........................................   $191.1     $196.7
  Activewear................................................    110.1      148.6
  Sports & Licensing........................................     32.2       42.7
  Europe....................................................     64.9       69.2
  Other.....................................................     10.4         --
                                                               ------     ------
                                                               $408.7     $457.2
                                                               ======     ======
</TABLE>
 
     Gross earnings decreased $53,300,000 or 36.1% compared with the first
quarter of 1998. Gross margin decreased 9.2 percentage points to 23.1% of sales
for the quarter. Product availability and sales of higher cost inventory
manufactured in 1998 impacted Retail Products and Activewear gross earnings and
margin. Activewear results were further impacted by unfavorable pricing compared
with the first quarter of last year. Sports & Licensing and European results
were affected by lower volume.
 
     Operating earnings decreased $51,100,000 or 88.1% in the first quarter
compared with 1998, and operating margin decreased 11.0 percentage points to
1.7% of sales. The unfavorable comparison was due to the gross earnings and
margin decline noted above. Selling, general and administrative expense declined
$2,200,000 or 2.6% reflecting lower advertising which more than offset
additional Year 2000 remediation costs. Selling, general and administrative
expense as a percent of net sales increased 1.6 percentage points to 19.8%.
 
                                       12
<PAGE>   14
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                   PART I. FINANCIAL INFORMATION (CONTINUED)
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS -- (CONTINUED)
     Segment operating earnings were as follows (in millions of dollars).
 
<TABLE>
<CAPTION>
                                                                  THREE MONTHS ENDED
                                                                -----------------------
                                                                APRIL 3,      MARCH 28,
                                                                  1999          1998
                                                                --------      ---------
<S>                                                             <C>           <C>
OPERATING EARNINGS (LOSS)
  Retail Products...........................................     $ 6.5          $23.9
  Activewear................................................      (3.3)          26.6
  Sports & Licensing........................................      (2.6)           1.4
  Europe....................................................       7.7            8.4
  Other.....................................................       5.2            4.3
  Goodwill amortization.....................................      (6.6)          (6.6)
                                                                 -----          -----
                                                                 $ 6.9          $58.0
                                                                 =====          =====
</TABLE>
 
     Interest expense decreased $3,100,000 or 12.6% in the first quarter
compared with the same period last year. The decrease largely reflected a lower
average debt level, resulting from the positive cash flow from operations in the
twelve months ended April 3, 1999. Average borrowing rates were also favorable
compared with the first quarter of last year.
 
     Other income--net in the first quarter increased $1,200,000 over 1998. Net
other income in the 1999 period included a recovery on previously settled
litigation ($3,900,000) and gains on asset sales ($2,200,000) and other
investments ($3,500,000). Receivable securitization costs totalled $2,400,000 in
the first quarter of 1999. Net other income in the 1998 period included gains on
asset sales ($6,400,000) and currency translation ($1,400,000). Receivable
securitization costs totalled $3,100,000 in the first quarter of 1998.
 
     The Company's effective income tax rate of 5.0% for the first three months
of 1999 differed from the Federal statutory rate of 35% primarily due to the
impact of foreign earnings, certain of which are taxed at lower rates than in
the United States, partially offset by goodwill amortization, a portion of which
is not deductible for Federal income taxes, and a provision for interest on
prior years' taxes.
 
     The Company's effective income tax rate of 17% for the first three months
of 1998 differed from the Federal statutory rate of 35% primarily due to the
impact of foreign earnings, certain of which are taxed at lower rates than in
the United States, partially offset by goodwill amortization, a portion of which
is not deductible for Federal income taxes, and state income taxes.
 
     Earnings (loss) per common share, basic and diluted, consisted of a loss of
$(0.13) in 1999 and earnings of $0.43 in 1998. The effects of employee stock
options were immaterial in 1999, while the effect of the assumed conversion of
the FTL, Inc. Preferred Stock was antidilutive and has been ignored in the 1999
period. Average common shares were lower in 1999 due to the Reorganization.
 
Liquidity and Capital Resources
 
     Funds generated from the Company's operations are its major source of
liquidity and are supplemented by funds obtained from capital markets, including
bank facilities. The Company has available for the funding of its operations
approximately $615,000,000 of revolving lines of credit. As of May 11, 1999,
approximately $291,500,000 was available and unused under these facilities.
 
     Operating activities used a net of $75,600,000 in cash in the first quarter
of 1999, compared with a net use of $191,500,000 by operations in the same 1998
period. In reconciling from net earnings (loss) to net operating cash flows, the
year-to-year change reflected a reduction of $153,600,000 in the first quarter
working
 
                                       13
<PAGE>   15
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                   PART I. FINANCIAL INFORMATION (CONTINUED)
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS -- (CONTINUED)

capital increase compared with 1998. Net earnings (loss) plus depreciation and
amortization, however, was $41,100,000 lower than the same period last year.
 
     Investing activities used $22,200,000 in 1999, compared with $14,000,000
provided in the 1998 period. Proceeds from asset sales were $15,900,000 lower,
and the 1999 period included a payment of $8,400,000 under the minimum value
guarantee provision of the Company's synthetic lease agreement and a repayment
of $6,800,000 of employment grants under agreement with the Republic of Ireland.
Capital spending, primarily to support offshore assembly operations, is
anticipated to approximate $40,000,000 in 1999.
 
     Net proceeds from financing activities were $116,800,000 in 1999, down from
$177,700,000 in 1998 due to the favorable comparison in operating cash flows. On
March 25, 1999, the Company issued $250,000,000 of its 8 7/8% Senior Notes due
April 2006 (the "8 7/8% Senior Notes"). Net proceeds of approximately
$239,700,000 were initially used to repay outstanding borrowings under the
Company's Credit Agreement.
 
     In order to satisfy its repurchase obligation arising from the
Reorganization, the Company commenced an offer on April 5, 1999 to repurchase
all $250,000,000 of its 7 7/8% Senior Notes due October 15, 1999 (the "7 7/8%
Senior Notes") at a price equal to 101% of the principal amount thereof plus
accrued and unpaid interest. If all holders of the 7 7/8% Senior Notes accept
the purchase offer, the aggregate purchase price would be $252,500,000 plus
accrued and unpaid interest. The availability under the Bank Credit Agreement
created by the issuance of the 8 7/8% Senior Notes is expected to be used to
satisfy the Company's repurchase obligations with respect to the 7 7/8% Senior
Notes or to repay the 7 7/8% Senior Notes at maturity.
 
     In November 1996, the Company's Board of Directors authorized the purchase
of up to $200,000,000 of the Company's common stock in open market and privately
negotiated transactions. Total purchases under the program through January 1998
were 5,890,000 shares at an aggregate cost of $193,200,000.
 
     In December 1996, the Company entered into a three-year receivables
purchase agreement whereby it can currently sell to a third party up to a
$250,000,000 undivided interest in a defined pool of its trade accounts
receivable. The maximum amount outstanding as defined under the agreement varies
based upon the level of eligible receivables. Under the agreement, approximately
$205,300,000 of eligible receivables at April 3, 1999 and $220,700,000 of
eligible receivables at January 2, 1999 were sold to the Company's
unconsolidated receivable financing subsidiary, reducing consolidated notes and
accounts receivable. Proceeds of approximately $175,000,000 and $208,800,000
from the ultimate purchaser at the respective balance sheet dates were used to
reduce borrowings outstanding under the Company's revolving lines of credit.
Such proceeds as of January 2, 1999, included advances from the ultimate
purchaser totalling $55,900,000 which were included in trade accounts payable.
 
     Management believes the funding available to the Company is sufficient to
meet anticipated requirements for capital expenditures, working capital and
other needs. The Company's debt instruments, principally its bank agreements,
contain covenants restricting the Company's ability to sell assets, incur debt,
pay dividends and make investments and require the Company to maintain certain
financial ratios.
 
The Euro
 
     The adoption of a common currency by countries of the European Economic
Community beginning January 1, 1999 may ultimately expose the Company's European
operations to certain risk factors such as the resulting cross-border
transparency of pricing differences. Certain system conversion costs will also
necessarily be incurred. Because the Company already competes throughout Western
Europe, however, the emergence of a single market in this region would not
immediately expose the Company to increased competition and may present
opportunities for further economies of scale. Management has not completed its
study of the impact
 
                                       14
<PAGE>   16
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                   PART I. FINANCIAL INFORMATION (CONTINUED)
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS -- (CONTINUED)

on the Company but anticipates no material adverse effect on the Company's
financial position or results of operations. Sales in the affected countries
totalled less than 10% of consolidated net sales in 1999 and 1998.
 
Accounting Standards
 
     In June 1998, the Financial Accounting Standards Board issued FAS 133,
Accounting for Derivative Instruments and Hedging Activities. The new Statement
requires all derivatives to be recorded on the balance sheet at fair value and
establishes "special accounting" for the following three different types of
hedges: hedges of changes in the fair value of assets, liabilities, or firm
commitments (referred to as fair value hedges); hedges of the variable cash
flows of forecasted transactions (cash flow hedges); and hedges of foreign
currency exposures of net investments in foreign operations. Though the
accounting treatment and criteria for each of the three types of hedges are
unique, they all result in offsetting changes in fair values or cash flows of
both the hedge and the hedged item being recognized in earnings in the same
period. Changes in fair value of derivatives that do not meet the criteria of
one of these three categories of hedges are included in income. The Statement is
effective for years beginning after June 15, 1999, but companies can early adopt
as of the beginning of any fiscal quarter that begins after June 1998.
Management has not completed its review of FAS 133.
 
Year 2000
 
     The Year 2000 Issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Any of the Company's
computer programs or hardware that have date-sensitive software or embedded
chips may recognize a date using "00" as the year 1900 rather than the year
2000. This could result in a system failure or miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process transactions, send invoices, or engage in similar normal business
activities.
 
     The Company presently believes that with modifications or replacements of
existing software and certain hardware, the Year 2000 Issue can be mitigated.
However, if such modifications and replacements are not made, or are not
completed timely, the Year 2000 Issue could have a material impact on the
operations of the Company.
 
     The Company's plan to resolve the Year 2000 Issue involves the following
four phases: inventory/assessment, remediation, testing, and implementation. To
date, the Company has completed its assessment of mission-critical systems that
could be affected by the Year 2000 date. The completed assessment indicated that
most of the Company's significant information technology systems could be
affected, particularly the order, billing, and inventory systems. That
assessment also indicated that software and hardware (embedded chips) used in
production and manufacturing systems (hereafter also referred to as operating
equipment) also are at risk. Affected systems include technologies used in
various aspects of the manufacturing/distribution process. In addition, the
Company is gathering information about the Year 2000 compliance status of its
significant customers, suppliers and subcontractors, and continues to monitor
their compliance.
 
     For its information technology exposures of mission critical systems,
through April 3, 1999, the Company is 75% complete on the remediation phase and
expects to complete software testing and deployment no later than September
1999. The Company is 50% complete on the remediation phase of less critical
systems, with completion of testing and redeployment phases for those systems by
September 1999.
 
     The assessment phase of the operating equipment continued through December
1998. Remediation and replacement efforts are now underway for mission critical
and higher priority equipment that is not currently

                                       15
<PAGE>   17
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
 
                   PART I. FINANCIAL INFORMATION (CONTINUED)
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS -- (CONTINUED)

Year 2000 compliant. Remediation, testing and implementation for these systems
are on schedule to finish by September 1999. Non-compliant equipment that is
deemed of lesser importance will be remediated or replaced by December 1999.
 
     The Company's order entry system interfaces directly with significant
customers. The Company is in the process of working with customers to ensure
that the Company's systems that interface directly with third parties are Year
2000 compliant by September 1999. The Company has completed its assessment and
remediation of these systems. Testing and implementation has begun and is
expected to be complete by September 1999.
 
     The Company has queried its significant suppliers and subcontractors, none
of which share information systems with the Company (external agents). The
Company will continue to solicit Year 2000 compliance responses from suppliers
in an effort to reduce risk. To date, the Company is not aware of any external
agent with a Year 2000 issue that would materially impact the Company's results
of operations, liquidity, or capital resources. However, the Company has no
means of ensuring that external agents will be Year 2000 ready. The inability of
external agents to complete their Year 2000 resolution process in a timely
fashion could materially impact the Company. The effect of non-compliance by
external agents is not determinable.
 
     The Company is utilizing both internal and external resources to reprogram
or replace, test, and implement the software, hardware and operating equipment
for Year 2000 modifications. The total cost of the Year 2000 project is
estimated at $18,400,000 and is being funded through operating cash flows.
Through April 3, 1999, the Company has incurred costs, related to all phases of
the Year 2000 project, totaling approximately $12,200,000 all of which has been
expensed, including $3,000,000 in the three months ended April 3, 1999. All
remaining expenditures related to repair of hardware and software will be
expensed as incurred.
 
     Management believes the Company has an effective program in place to
resolve the Year 2000 Issue in a timely manner. As noted above, the Company has
not yet completed all necessary phases of the Year 2000 program. In the event
that the Company does not complete any additional phases, the Company would
consider implementing remediated programs that have not been fully tested, thus
putting order/invoicing systems and other mission critical programs in jeopardy.
Additionally, the Company would be unable to fully manufacture or ship product
if no further Year 2000 effort were expended. Finally, disruptions in the
economy generally resulting from Year 2000 issues could also materially
adversely affect the Company. The Company could be subject to litigation for
computer systems product failure, for example equipment shutdown or failure to
properly date business records. The amount of potential liability and lost
revenue cannot be reasonably estimated at this time.
 
     The Company has determined a need for contingency plans to cover loss or
disruption of critical applications, vendors, communication/community systems,
and equipment. These plans were drafted in the first quarter of 1999 and will be
finished/approved in the second quarter of 1999. Continuous updates will be made
thereafter as more information is made available by external agents and the
Company can better assess its risks.
 
                                       16
<PAGE>   18
 
                    FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
                           PART II. OTHER INFORMATION
 
ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K
 
A. EXHIBITS
 
<TABLE>
<S>      <C>
  4(a)*  $900,000,000 Credit Agreement dated as of September 19, 1997
         (the "Credit Agreement"), among the several banks and other
         financial institutions from time to time parties thereto
         (the "Lenders"), NationsBank, N.A., as administrative agent
         for the Lenders thereunder, Chase Manhattan Bank, Bankers
         Trust Company, The Bank of New York and the Bank of Nova
         Scotia, as co-agents (incorporated herein by reference to
         Exhibit 4(a) to the Company's Quarterly Report on Form 10-Q
         for the quarter ended September 30, 1997).
  4(b)*  First Amendment to Credit Agreement dated March 26, 1998;
         Second Amendment to Credit Agreement dated July 2, 1998;
         Third Amendment to Credit Agreement date December 31, 1998;
         Fourth Amendment to Credit Agreement dated March 10, 1999;
         Second Amended and Restated Pledge Agreement dated March 10,
         1999 related to the Credit Agreement; and Bond Pledge
         Agreement dated March 10, 1999 related to the Credit
         Agreement (incorporated herein by reference to Exhibit 4(c)
         to the Company's Annual Report on Form 10-K for the year
         ended January 2, 1999).
  4(c)   Indenture dated as of March 25, 1999, among Fruit of the
         Loom, Inc., as issuer, Fruit of the Loom, Ltd., as
         guarantor, certain subsidiaries of Fruit of the Loom, Inc.,
         as guarantors, and The Bank of New York, as trustee of the
         8 7/8% Senior Notes due 2006.
 27      Financial Data Schedule.
</TABLE>
 
---------------
* Document is available at the Public Reference Section of the Securities and
  Exchange Commission, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.
  C. 20549 (Commission file No. 1-8941).
 
     The Registrant has not listed nor filed as an Exhibit to this Quarterly
Report certain instruments with respect to long-term debt representing
indebtedness of the Registrant and its subsidiaries which do not individually
exceed 10% of the total assets of the Registrant and its subsidiaries on a
consolidated basis. Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the
Registrant agrees to furnish such instruments to the Securities and Exchange
Commission upon request.
 
B. REPORTS ON FORM 8-K
 
     In February 1999, the Company filed a Current Report on Form 8-K dated
February 17, 1999 reporting the Company's February 17, 1999 press release
announcing its earnings for the three months and years ended January 2, 1999 and
December 31, 1998. The financial statements attached to the press release
consisted of a condensed consolidated balance sheet as of January 2, 1999 and
December 31, 1998, a condensed consolidated statement of operations for the
three months and years ended January 2, 1999 and December 31, 1998 and a
condensed consolidated statement of cash flows for the years ended January 2,
1999 and December 31, 1998.
 
     In March 1999, the Company filed a Current Report on Form 8-K dated March
4, 1999, reporting the Company's press release dated March 4, 1999, announcing
that as a result of the reorganization transaction completed March 4, 1999,
Fruit of the Loom, Ltd., a Cayman Islands company, became the successor
corporation to its subsidiary, Fruit of the Loom, Inc., a Delaware corporation,
under the Securities Exchange Act of 1934, as amended, with respect to its
common stock, and will succeed to Fruit of the Loom, Inc.'s reporting
obligations thereunder.
 
     In March 1999, the Company filed a Current Report on Form 8-K dated March
24, 1999, reporting (i) the Company's press release dated March 1, 1999,
announcing its intention to raise approximately $250,000,000 through an offering
of senior notes to be placed privately with institutional investors, and (ii)
the Company's press release dated March 18, 1999, announcing its agreement to
sell $250,000,000 of its 8 7/8% Senior Notes due April 15, 2006.
 
                                       17
<PAGE>   19
 
                                   SIGNATURE
 
     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
 
                                                 FRUIT OF THE LOOM, INC.
                                                 -----------------------      
                                                       (Registrant)
 
                                                    G. WILLIAM NEWTON 
                                            ---------------------------------- 
                                                    G. William Newton
                                                  Vice President Finance
                                            and Acting Chief Financial Officer
                                               (Principal Financial Officer
                                               and duly authorized to sign
                                                 on behalf of Registrant)
 
Date: May 18, 1999
 
                                       18