6-K 1 fila6k_11-07b.txt Securities and Exchange Commission Washington, D.C. 20549 FORM 6-K Report of Foreign Issuer Pursuant To Rule 13a-16 Or 15d-16 of the Securities Exchange Act of 1934 for the month of November 2002 FILA HOLDING S.p.A. ------------------- (Translation of Registrant's name into English) Viale Cesare Battisti 26 13900 Biella, Italy (Address of principal executive offices) (Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.) Form 20-F X Form 40-F --- --- (Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.) Yes No X --- --- Fila Logo For More Information, Contact: Fila Holding S.p.A. Citigate Dewe Rogerson Investor Relations Office: Lucia Domville +1 212 419 4166 Giulia Muzio (39.015) 3506 418 Elena Carrera (39.015) 3506 246 FILA* ANNOUNCES THIRD QUARTER 2002 RESULTS (Biella, Italy, November 6th, 2002) - Fila Holding S.p.A. (NYSE:FLH) today reported its unaudited results for the third quarter ended September 30, 2002. Key highlights for the quarter were the following: o Significant improvement ((euro)38.5 million) of the net result from a net loss of (euro)35.7 million in 2001 to a net income of (euro)2.8 million in this quarter. o Operating profit was (euro)17.7 million, now representing 6.7% of total net revenues compared to an operating loss of (euro)2.2 million in the third quarter of 2001. o Worldwide revenues were (euro)264.3 million, compared with (euro)286.7 million in the third quarter of 2001. Net direct sales in the quarter were strongly impacted by the overall negative exchange rate effect, net of which revenues would have been in line with those of the previous year despite the discontinuation of some markets. o Gross profit was 38.2% compared to 34.9% in 2001. o Total expenses as a percent of total net revenues decreased its incidence by 4% (now representing 31.6%) compared to the third quarter of 2001. o Achievements in working capital management that as of September 30th, 2002 decreased by (euro)127 million or 35% compared to the same date in 2001. o Net financial position decreased to (euro)326.9 million from (euro)375.7million in the same period of 2001. Backlog of customer orders** Total backlog as of September 30, 2002, scheduled for delivery from October 2002 through March 2003, was down by 14% (in Euro) compared to the corresponding period in 2001, with apparel and footwear reducing at the same pace. U.S. backlog increased by 17% in U.S. dollars (with apparel up by 12% and footwear up by 23%), with both the Enyce brand and the Fila brand up by 17%. Outside the U.S. and excluding the markets where Fila sells its products on a delivery basis (including Korea), backlog decreased by 28% (in Euro). Total Revenues and net direct sales Worldwide revenues for the third quarter were (euro)264.3 million, down 8% from (euro)286.7 million in the corresponding period of 2001. On a constant exchange basis, total revenues would have been in line with those of the previous year. Net direct sales in the third quarter of 2002 totaled (euro)257.3 million (or (euro)280.2 million on a constant exchange basis) compared to (euro)278.9 million in the corresponding period of 2001. In addition to the exchange rate, net direct sales have been impacted by the reduced business of several subsidiaries that are being discontinued. Apparel sales were (euro)159.6 million and footwear sales were (euro)97.7 million, up by 4% and down by 22% respectively compared with the third quarter of 2001. Sales in the U.S. were (euro)101.9 million in the quarter, increasing by 19% from (euro)85.6 million mainly thanks to Enyce (+44%); in Europe sales decreased by 22% to (euro)89.6 million. With regards to sales in the Rest of the World, the Korean market recorded a good performance (+11% in local currency in the quarter), but as a whole, sales of this area were down by 16%, affected by the discontinuation of the Australian and Brazilian subsidiaries and the sales decrease in Latin America. Royalty Income in the quarter was (euro)5.5 million, unchanged compared with the third quarter of 2001. Net Result In U.S. dollars, third quarter net income was U.S.$ 2.7 million compared with a net loss of U.S.$ 31.8 million in the third quarter of 2001. On a per ADS/per ordinary share basis, net income was U.S. $0.09 per ADS/share in the third quarter of 2002 compared with a net loss of U.S. $1.28 per ADS/share in the same period of 2001. The shares outstanding for the three months ended September 30, 2002 were 30,555,206 because of the 2 for 1 reverse stock split effective September 23 and for the three months ended September 30, 2001 were 24,782,842 restated to reflect the reverse stock split. The U.S. dollar depreciated by 10% against the Euro on a quarterly average basis; the average exchange rate was (euro)1= U.S.$ 0.984 in the third quarter of 2002 and(euro)1= U.S.$ 0.891 in the corresponding quarter of 2001. Income statement review Gross profit for the quarter was (euro)101.1 million, representing 38.2% of total net revenues, compared to (euro)99.9 million (34.9% of total net revenues) in the third quarter of 2001. The higher profitability came mainly from Korea and the United States (both Enyce and Fila brands), although both results were affected by currency depreciation, and from a lower incidence of obsolete sales. SG&A expenses for the quarter totaled (euro)83.4 million (representing 31.6% of net revenues), down by 18% versus (euro)102.1 million (or 35.6% of net revenues) in the previous year. The incidence of fixed costs on total net revenues decreased to only 28.2%. As a consequence of the above mentioned factors, income from operations in the quarter was (euro)17.7 million compared with an operating loss of (euro) 2.2 million in the third quarter of 2001. Other expenses for the quarter were (euro)10.1 million compared with (euro)24.6 million for the corresponding quarter of last year, when other expenses included provisions for high extraordinary costs. Income before income taxes in the third quarter of 2002 was (euro)7.6 million compared with a loss of (euro)26.8 million in the same quarter of 2001. Income taxes were (euro)4.8 million compared with (euro)8.9 million in the corresponding quarter of 2001; income taxes were related to Korea and Fila USA (for Enyce) and to the write-off of a deferred tax asset in Fila Deutschland. Net income for the quarter was (euro)2.8 million compared with a net loss of (euro)35.7 million in the third quarter of 2001. Marco Isaia, Chief Executive Officer of Fila, said: "I'm very pleased to inform that this quarter showed the results of two main streams of activities. On one side is the management's continued strong commitment to controlling costs. In this critical area, we are starting to consolidate the benefits of our restructuring and where necessary discontinuance of our direct presence in some of our markets. Also in this area, we are realizing the rewards of our "product complexity" reduction program, which has led the Company to a terrific rationalization of our product offering, significantly reducing product development and sample costs and focusing the offer to the consumers on fewer products. From a brand development stand point, we are gaining the first benefits of new projects. In the US market, we have been able to catch the momentum of the vintage basketball footwear trend with the relaunch of Fila's bestseller BB84. In Europe and Asia, we are consolidating a very positive first year of the Ferrari project that we believe will yield good sales results and will ease the reentry into the most desirable distribution channels". Balance sheet review Net working capital as of September 30th, 2002 was (euro)232.8 million compared with (euro)360.1 million as of September 30th, 2001 (a 35% decrease). As a result, the working capital turnover ratio went from 35.7% in September 2001 to 23.9% in September 2002. Inventory as of September 30th, 2002 was (euro)176.3 million, compared with (euro)240.1 million as of September 30th, 2001. Trade receivables as of September 30th, 2002 were (euro)204.0 million compared with (euro)259.2 million in the prior year. Net working capital items have been positively impacted by the discontinuation process of some subsidiaries started already some months ago. Net financial indebtedness as of September 30th, 2002 was (euro)326.9 million, a reduction of (euro)49 million compared to September 2001. Fila's results for the third quarter and its financial statements as of September 30, 2002 do not reflect the effect of the share capital increase in progress. Marco Isaia added: "Signals we are receiving from the Fila organization show that our strategic decisions and our managerial efforts have headed us in the right direction to achieve our objective of a more effective structure that reacts flexibly to market needs". Fila Holding S.p.A., headquartered in Biella (Italy), is a leading designer and marketer of athletic and casual footwear and of activewear, casualwear and sportswear. Fila has created strong brand recognition by marketing products with a high design and style content and by securing professional athletic endorsements. * Any reference to Fila is to Fila Holding S.p.A. and its subsidiaries. ** Backlog of customer orders is not necessarily indicative of total revenues for the respective periods, as the mix of future and "at once" orders may vary significantly from quarter to quarter and certain customer orders are cancelable. This press release includes forward-looking statements, including statements concerning Fila's current expectations about its financial results for future periods. Due to various risks and uncertainties, including those discussed in the reports filed from time to time by Fila with the Securities and Exchange Commission, actual events and results could differ materially from those described in this press release. Fila will not update any forward-looking statements in this press release to reflect future events or developments. FILA GROUP'S NET DIRECT SALES (Euro) THIRD QUARTER NINE MONTHS ended September 30 ended September 30 (unaudited) (unaudited) -------------------------------------------------------------------------------------------------- Euro million 2002 2001 2002 2001 ------------ ---- ---- ---- ---- UNITED STATES Apparel 67.0 49.3 +36% 136.3 111.3 +22% Footwear 34.9 36.3 -4% 115.2 99.6 +16% ----- ----- ----- ----- Total 101.9 85.6 +19% 251.4 211.0 +19% EUROPE Apparel 50.4 59.4 -3% 126.1 144.2 -13% Footwear 39.1 55.9 -30% 108.9 146.0 -25% ----- ----- ----- ----- Total 89.6 115.3 -22% 235.0 290.2 -19% REST OF WORLD Apparel 42.2 45.1 -6% 142.7 131.5 +8% Footwear 23.7 33.0 -28% 73.9 96.7 -24% ----- ----- ----- ----- Total 65.9 78.1 -16% 216.6 228.3 -5% TOTAL FILA GROUP Apparel 159.6 153.8 +4% 405.1 387.1 +5% Footwear 97.7 125.1 -22% 297.9 342.3 -13% ----- ----- ----- ----- Total 257.3 278.9 -8% 703.0 729.4 -4% -------------------------------------------------------------------------------------------------- Figures may not add due to rounding.

KEY FIGURES IN U.S. DOLLARS for the third quarter ended September 30, 2002. We publish our financial statements in Euro. For convenience, however, certain key results are presented herein as translated into U.S. dollars at the average exchange rates in effect for the respective periods. Converting Fila's consolidated results from Euro into U.S. dollars at the average exchange rate for each period, rather than at the period-end rate, is consistent with Fila's practice of converting the income statements of its foreign subsidiaries into Euro at the respective average exchange rates during the applicable period. ----------------------------------------------------------------------------------------------------- THIRD QUARTER NINE MONTHS ended September 30 ended September 30 (unaudited) (unaudited) 2002 2001 2002 2001 ---- ---- ---- ---- Net Revenues (U.S.$/million) 260.1 255.4 675.0 675.2 Net Income/(Loss) (U.S.$/million) 2.7 (31.8) (59.5) (78.5) Net Income/(Loss) per ADS (*) 0.09 (1.28) (1.95) (4.47) (U.S.$/ADS) Number of ADSs outstanding (**): 30,555,206 24,782,842 30,555,206 17,560,006 Average exchange rate 0.984 0.891 0.926 0.896 (U.S. dollars per Euro) ----------------------------------------------------------------------------------------------------- * Income or Losses per ADS were calculated by dividing Net Income or Loss by the number of ADSs outstanding during the period (each ADS representing 1 ordinary share). **Reflecting the reverse stock split in accordance with the Shareholders' meeting resolution dated September 23, 2002

FILA HOLDING S.p.A. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE THREE MONTHS FOR THE NINE MONTHS ENDED SEPTEMBER 30, ENDED SEPTEMBER 30, 2002 2001 2002 2001 ---- ---- ---- ---- (in thousands of Euro, except for earnings per share) Net revenues: Net direct sales 257,272 278,926 703,025 729,421 Royalty income 5,553 5,485 17,832 16,991 Other revenues 1,492 2,262 8,072 7,167 ---------- ---------- ---------- ---------- 264,317 286,673 728,929 753,579 Cost of sales 163,240 186,766 454,844 479,151 ---------- ---------- ---------- ---------- Gross profit 101,077 99,907 274,085 274,428 Selling, general and administrative expenses 83,399 102,132 258,781 298,773 ---------- ---------- ---------- ---------- Income (loss) from operations 17,678 (2,225) 15,304 (24,345) Other income (expense): Interest income 442 260 1,491 1,861 Interest expense (5,947) (6,791) (18,405) (23,215) Foreign exchange losses (4,504) (2,698) (24,917) (3,489) Other expense, net (83) (15,391) (22,248) (20,734) ---------- ---------- ---------- ---------- (10,092) (24,620) (64,079) (45,577) ---------- ---------- ---------- ---------- Income (loss) before income taxes 7,586 (26,845) (48,775) (69,922) Income taxes expense 4,810 8,889 15,504 17,698 ---------- ---------- ---------- ---------- Net income (loss) 2,776 (35,734) (64,279) (87,620) ========== ========== ========== ========== Income (loss) per share (in Euro) 0.09 -1.44 -2.10 -4.99 average number of ordinary shares outstanding (1): 30,555,206 24,782,842 30,555,206 17,560,006 (1) reflecting the reverse stock split in accordance with the Shareholders' meeting resolution dated September 23, 2002

SIGNATURES 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. Dated: November 7, 2002 FILA HOLDING S.p.A. By: /s/ Marco Isaia ----------------------- Marco Isaia Chief Executive Officer

FILA HOLDING SPA 6-K