Poor apparel sales pushed shirt maker Phillips-Van Heusen Corporation into a first quarter loss of $0.8 million, against a net income of $0.6 million in the same period last year.

First quarter sales were $349.4 million, or 4.8 per cent below last year's $366.9 million.

Apparel sales were down 6.5 per cent, but the company - which makes clothing under its Van Heusen, Bass and Izod brands as well as licensed labels such as DKNY, Geoffrey Beene and Kenneth Cole - said gross margins improved due to more regular price selling and the reconfiguration of its sourcing operations.

Modest sales growth helped the footwear segment deliver a 27 per cent operating earnings increase in the first quarter.

Commenting on the results, Bruce J Klatsky, chairman and chief executive officer, said: "We are estimating sales in the second quarter to be down 1- 2 per cent compared with last year.

"Sales are expected to be flat for the year, as sales increases of 3- 4 per cent in the second half of the year are expected to offset the first half sales decline.

"We are increasing our 2002 earnings per share forecast to a range of $1.00 to $1.05, a 16- 22 per cent improvement over 2001 earnings."