Leading shirt manufacturer Phillips-Van Heusen Corp on Tuesday posted a 12 per cent slide in fourth quarter sales compared to the year-ago period and attributed the fall to the economic slowdown.

The clothing firm, which sells apparel under its Van Heusen, Bass and Izod brands, as well as labels such as DKNY, Geoffrey Beene and Kenneth Cole, posted earnings before charges of $3.9m, or 14 cents a share, compared with $6.6m, or 24 cents, in the year prior.

After restructuring and other charges of $13.4m, it reported a net loss of $9.5m, or 34 cents per share, while fourth quarter sales fell to $325.6m from $374m in 2001.

In a statement, the New York-based business attributed the drop in profits to "the events of September 11 and a general slowdown in the economy," which contributed to a weak retail environment.

It added it sees 2002 sales as being flat, with sales down in the first-quarter 6-8 per cent, but up 3-4 per cent in the second half. "Despite the difficult retail environment, our results for the fourth quarter exceeded plan," chairman and chief executive officer, Bruce Klatsky, said.

"Our ability to respond quickly to the weakened economy allowed us to adjust our sourcing and inventory intake plans and end the year with a 14 per cent reduction in total inventory from the prior year."

Mr Klatsky said the fall in quarterly sales was mainly due to a 15 per cent drop in apparel sales, but added its footwear division did well with a 35 per cent rise in operating earnings thanks to higher gross margins driven by significantly less promotional selling.