Back to GetFilings.com

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

Commission File Number: 0-23214

SAMSONITE CORPORATION
(Exact name of registrant as specified in its charter)

        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 and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

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

        Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. 224,705,324 shares of common stock, par value $0.01 per share, as of December 12, 2003.

FORM 10-Q
CONTENTS

Important Notice:

        This Quarterly Report on Form 10-Q (including documents incorporated by reference herein) contains statements with respect to the Company's expectations or beliefs as to future events. These types of statements are "forward-looking" and are subject to uncertainties. See "Forward-Looking Statements" at page 25.

PART I—FINANCIAL INFORMATION

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Balance Sheets
as of October 31, 2003 and January 31, 2003
(In thousands)

See accompanying notes to consolidated financial statements

2

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Balance Sheets
as of October 31, 2003 and January 31, 2003
(In thousands, except share data)

See accompanying notes to consolidated financial statements

3

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Statements of Operations
for the three months ended October 31, 2003 and 2002
(In thousands, except per share data)

See accompanying notes to consolidated financial statements

4

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Statements of Operations
for the nine months ended October 31, 2003 and 2002
(In thousands, except per share data)

See accompanying notes to consolidated financial statements

5

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Statement of Stockholders' Equity (Deficit)
and Comprehensive Loss for the nine months ended October 31, 2003
(In thousands, except share amounts)

See accompanying notes to consolidated financial statements

6

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Statements of Cash Flows
for the nine months ended October 31, 2003 and 2002
(In thousands)

See accompanying notes to consolidated financial statements

7

SAMSONITE CORPORATION AND SUBSIDIARIES

Unaudited Consolidated Statements of Cash Flows
for the nine months ended October 31, 2003 and 2002
(In thousands)

See accompanying notes to consolidated financial statements

8

SAMSONITE CORPORATION AND SUBSIDIARIES
Unaudited Notes to Consolidated Financial Statements

1. General

A. Business

        The principal activity of Samsonite Corporation and subsidiaries (the "Company") is the manufacture and distribution of luggage, casual bags, business cases and travel related products throughout the world, primarily under the Samsonite® and American Tourister® brand names and other owned and licensed brand names. The principal customers of the Company are department/specialty retail stores, mass merchants, catalog showrooms, warehouse clubs and office superstores. The Company also sells its luggage and other travel related products through its Company-owned stores. In addition, the Company designs and sells or licenses fashion oriented clothing and footwear in Europe, Asia and the United States.

B. Interim Financial Statements

        The accompanying unaudited consolidated financial statements reflect all adjustments, which are normal and recurring in nature, and which, in the opinion of management, are necessary for a fair statement of the financial position as of October 31, 2003 and results of operations for the three and nine month periods ended October 31, 2003 and 2002. These unaudited consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2003.

C. Use of Estimates

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

D. Per Share Data

        The Company computes earnings (loss) per share in accordance with the requirements of Statement of Financial Accounting Standards No. 128, Earnings Per Share ("SFAS 128"). SFAS 128 requires the disclosure of "basic" earnings per share and "diluted" earnings per share. Basic earnings per share is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding increased for potentially dilutive common shares outstanding during the period. The dilutive effect of stock options, warrants, convertible preferred stock and their equivalents is calculated using the treasury stock method.

        Net loss per share for the three months ended October 31, 2003 and 2002 and the nine months ended October 31, 2003 and 2002 is computed based on a weighted average number of shares of common stock outstanding during the period of 224,705,324 and 19,865,573, and 88,887,663 and 19,861,690, respectively. Basic loss per share and loss per share—assuming dilution are the same for the three and nine month periods ended October 31, 2003 and 2002 because of the antidilutive effect of common stock equivalents when there is a net loss to common stockholders. There are options to purchase 1,787,711 and 1,829,918 shares outstanding at October 31, 2003 and 2002, respectively.

9

E. Royalty Revenues

        The Company licenses its brand names to certain unrelated third parties as well as to certain of its foreign subsidiaries and joint ventures. Net sales include royalties earned of $15,833,000 and $14,234,000 for the nine months ended October 31, 2003 and 2002, respectively, and $6,831,000 and $5,073,000 for the three months ended October 31, 2003 and 2002, respectively.

F. Reclassifications

        Certain reclassifications were made to the consolidated financial statements for prior periods to conform to the October 31, 2003 presentation.

G. Derivative Financial Instruments

        The Company accounts for derivative financial instruments in accordance with the requirements of Statement of Financial Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), and its corresponding amendments under SFAS No. 138 and SFAS No. 149. SFAS 133 requires the Company to measure all derivatives at fair value and to recognize them in the consolidated balance sheet as an asset or liability, depending on the Company's rights or obligations under the applicable derivative contract. For derivatives designated as fair value hedges, the changes in the fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of changes in fair value of the derivative are reported in other comprehensive income and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedging instruments and ineffective portions of hedges are recognized in earnings in the current period.

        From time to time, the Company enters into derivative transactions to hedge interest rates on floating rate debt obligations and forecasted foreign currency transactions. These derivatives are classified as cash flow hedges. From time to time, the Company also enters into derivative transactions to reduce exposure to the effect of exchange rates on the earnings results of foreign operations (primarily the effect of changes in the euro exchange rate on the results of the Company's significant European operations). These transactions are not allowed hedge accounting treatment under SFAS 133; the Company records these instruments at fair market value and records realized and unrealized gains in Other Income—Expense—Net.

        Net gains or losses on interest rate hedges are recorded in interest expense when reclassified to earnings. Net gains or losses on hedges of forecasted foreign currency transactions are reclassified to revenues or cost of sales depending on the type of transaction being hedged. Net gains or losses on cash flow hedges are reclassified from other comprehensive income as the underlying hedged transactions occur. At October 31, 2003, cash flow hedges for forecasted foreign currency transactions extend until August 2004. The estimated amount of net gains from foreign currency hedges expected to be reclassified into earnings within the next 12 months is $1.3 million, net of taxes. The amount ultimately reclassified into earnings will be dependent on the effect of changes in currency exchange rates over the next 12 months.

10

2. Inventories

        Inventories consisted of the following:

3. Property, Plant and Equipment

        Property, plant and equipment consisted of the following:

4. Intangible Assets

        Goodwill with a gross book value of $6.5 million ($3.3 million net of accumulated amortization) and the Samsonite and American Tourister tradenames with a gross book value of $107.0 million ($84.1 million net of accumulated amortization) are no longer amortized beginning February 1, 2002. Additionally, as of October 31, 2003, the Company has $2.4 million of goodwill recorded in connection with an adjustment of the Company's minimum pension liability, which is not subject to amortization. All of the Company's other intangible assets are subject to amortization. There were no significant acquisitions of intangible assets during the nine months ended October 31, 2003. Changes in the exchange rate between the U.S. dollar and other foreign currencies, primarily the euro, affect the reported gross and net book value of the Company's intangible assets. The components of intangible assets, which continue to be amortized, were as follows (in thousands):

11

        Amortization expense for the net carrying amount of intangible assets at October 31, 2003 is estimated to be $1.3 million in fiscal 2004, $1.3 million in fiscal 2005, $1.2 million in fiscal 2006, $1.0 million in fiscal 2007 and $0.9 million in fiscal 2008.

5. Debt

        Debt consisted of the following:

(a)

On July 31, 2003, the Company closed a recapitalization transaction discussed in Note 11 (the "Recapitalization"). As part of the Recapitalization, the Company repaid all amounts due under the then existing Senior Credit Facility and replaced the then existing Senior Credit Facility with a $60 million new revolving credit agreement ("New Revolving Credit Facility"). The New Revolving Credit Facility consists of a U.S. revolving facility of $35 million (the "U.S. Revolving Credit Facility") and a European revolving credit facility of 22 million euros ($25 million as of July 31, 2003) (the "European Revolving Credit Facility"). The New Revolving Credit Facility matures on July 31, 2007.

The U.S. Revolving Credit Facility is a borrowing base facility under which borrowings are limited to a percentage of eligible U.S. inventory and accounts receivable up to a maximum of $35 million. At October 31, 2003, the entire facility of $35 million was available. At October 31, 2003, the Company had borrowed $8.0 million under the U.S. Revolving Credit Facility and had $4.6 million in letters of credit outstanding under the U.S. Revolving Credit Facility. Borrowing availability under the European Revolving Credit Facility is determined monthly based upon a ratio of European debt to European earnings before interest, taxes, depreciation and amortization. At October 31, 2003, the entire facility of 22 million euros was available.

Borrowings under the New Revolving Credit Facility accrue interest at rates adjusted periodically depending on the Company's financial performance as measured each fiscal quarter and interest rate market conditions. Additionally, the Company is required to pay a commitment fee of from

12

0.25% to 0.50% (depending on the Company's financial performance) on the unused portion of the New Revolving Credit Facility.

The obligations under the U.S. Revolving Credit Facility are secured by, among other things, the Company's domestic real and personal property, guaranties from certain of its domestic subsidiaries, pledges of 100% of the capital stock of certain of its domestic subsidiaries, pledges of 66% of the capital stock of certain of its foreign subsidiaries and the personal property of certain of its domestic subsidiaries. The obligations under the European Revolving Credit Facility are secured by, among other things, the collateral and guaranties securing the U.S. Revolving Credit Facility and pledges of 100% of the capital stock of the Company's European affiliates, S.C. Denmark ApS and SC International Holdings C.V., respectively.

The New Revolving Credit Facility contains financial and other covenants that, among other things, limit the Company's ability to draw down the full amount of the New Revolving Credit Facility, engage in transactions with its affiliates, make acquisitions, participate in certain mergers, or make distributions or dividend cash payments to its equity holders or with respect to its subordinated debt.

(b)

The Senior Subordinated Notes (the "Notes") bear interest at 10³/4% and mature on June 15, 2008. The Notes are redeemable at the option of the Company at various redemption prices specified in the Notes. The indenture under which the Notes were issued contains certain covenants that, among other things, restrict the ability of the Company and its restricted subsidiaries (as defined in the indenture) to incur additional indebtedness, pay dividends and make certain other distributions, issue capital stock of restricted subsidiaries, make certain investments, repurchase stock, create liens, enter into defined transactions with affiliates, create dividend or other payment restrictions affecting restricted subsidiaries, merge or consolidate, and transfer or sell assets. The covenants are subject to a number of important exceptions.

(c)

Other obligations consist of various notes payable (including short-term notes) to banks by foreign subsidiaries.

(d)

The Series B Senior Subordinated Notes bear interest at 11⁷/8% and have a maturity date of July 15, 2005.

13

6. Other Income (Expense)—Net

        Other income (expense)—net consisted of the following:

7. Employee Stock Options

        The Company has authorized 2,550,000 shares for the granting of options under its 1995 Stock Option and Award Plan and 75,000,000 shares for the granting of options under its FY 1999 Stock Option and Incentive Award Plan. See Note 10 to the consolidated financial statements included in the January 31, 2003 Form 10-K for a description of such plans.

        At October 31, 2003, the Company had outstanding options for a total of 1,787,711 shares at exercise prices ranging from $2.62 to $10.00 per share. Options for 1,154,668 shares were exercisable at October 31, 2003 at a weighted average exercise price of $7.01 per share.

8. Segment Information

        The Company's operations consist of the manufacture and distribution of luggage and other travel-related products, licensing of the Company's brand names, and the design and sale or license of clothing and footwear. Management of the business and evaluation of operating results is organized primarily along geographic lines dividing responsibility for the Company's operations as follows: The Americas, which include the United States comprised of wholesale and retail operations and "Other Americas" which include Canada and Latin America; Europe; Asia, which includes India, China, Singapore, South Korea, Taiwan, Malaysia and Hong Kong; and Other which primarily includes licensing revenues from luggage and non-luggage brand names owned by the Company and corporate overhead.

        The Company evaluates the performance of its segments based on operating income of the respective business units. Intersegment sales prices are market based. Because the operations of the U.S. Wholesale and Retail segments are closely related, certain inter-company expense allocations between the two segments are not representative of actual costs to operate those segments. Additionally, certain overhead expenses which benefit the U.S. Wholesale and Retail segments are included in Other operations.

14

        Segment information for the nine-month and three-month periods ended October 31, 2003 and 2002 is as follows:

(a)

Operating income (loss) represents net sales less operating expenses. In computing operating income (loss) none of the following items have been added or deducted: interest income, interest expense, other income—net, income taxes, minority interest and extraordinary items. General corporate expenses and amortization of intangible assets are included in other operations.

9. Litigation, Commitments and Contingencies

       The Company is a party to various legal proceedings and claims in the ordinary course of business. The Company believes that the outcome of these matters will not have a material adverse effect on its consolidated financial position, results of operations or liquidity.

10. Asset Impairment Charge and Provision for Restructuring Operations

        In the first quarter of fiscal 2003, the Company implemented a plan adopted in the fourth quarter of fiscal 2002 to restructure its Mexico City operations. The Mexico City restructuring plan provides for the elimination of softside manufacturing in the Company's Mexico City facility. The Company determined that it could more cost effectively import its softside luggage products from China for distribution by the Mexico operations. A restructuring provision of $2.2 million was recorded during the

15

nine months ended October 31, 2002 in connection with the Mexico restructuring, relating primarily to termination and severance costs for approximately 322 positions, which have been eliminated. In connection with these activities, the Company recorded a $0.5 million asset impairment to the carrying amount of machinery and equipment, which are no longer used in Mexico City.

11. Recapitalization and Senior Preferred Stock

        On July 31, 2003, the Company closed a Recapitalization transaction, which reduced the Company's indebtedness and eliminated the Company's then existing senior redeemable preferred stock. As part of the Recapitalization, new investors purchased 106,000 shares of a new series of the Company's convertible preferred stock with an initial dividend rate of 8% and a liquidation preference of $106.0 million for $106.0 million. Additionally, the Company's then existing bank credit facility was replaced with a new $60 million revolving credit agreement and all outstanding amounts owed under the old senior bank credit facility were repaid. As part of the Recapitalization, all of the 281,131 outstanding shares of 13⁷/8% senior redeemable preferred stock, which had an aggregate liquidation preference of $352.0 million on July 31, 2003, were converted into 53,982 shares of new convertible preferred stock with an aggregate liquidation preference of approximately $54.0 million, approximately 204.8 million shares of common stock and warrants to purchase approximately 15.5 million shares of common stock at an exercise price of $0.75 per share. Additionally, as of October 31, 2003, previously issued warrants to purchase 828,356 shares of common stock at an exercise price of $13.02 per share remain outstanding. The Company used the proceeds from the sale of the new preferred stock and borrowings under the new senior credit facility to repay all amounts outstanding under the old senior credit facility and to pay fees and expenses incurred in connection with the Recapitalization.

        The 159,982 shares of new convertible preferred stock outstanding on October 31, 2003 are initially convertible into an aggregate of approximately 381 million shares of common stock, representing approximately 61% of the Company's outstanding voting stock, and have an aggregate liquidation preference of $163.3 million. The dividend rate of the new convertible preferred stock may increase or decline on or after July 31, 2008 under certain circumstances. The new convertible preferred stock votes with the common stock on an as-converted basis on all matters submitted to a vote of common stockholders.

16

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

Three Months Ended October 31, 2003 ("fiscal 2004" or "current year") Compared to Three Months Ended October 31, 2002 ("fiscal 2003" or "prior year")

        General.    The Company analyzes its net sales and operations by the following divisions: (i) "European operations" which include its European sales, manufacturing and distribution operations whose reporting currency is the euro; (ii) "the Americas operations" which include sales and distribution operations and corporate headquarters in the United States, and "Other Americas" which includes operations in Canada and Latin America; (iii) "Asian operations" which include the sales, manufacturing and distribution operations in India, China, Singapore, South Korea, Hong Kong, Taiwan and Malaysia; and (iv) licensing operations.

        Results of European operations were translated from euros to U.S. dollars in fiscal 2004 and fiscal 2003 at average rates of approximately 1.129 and .984 U.S. dollars to the euro, respectively. This increase in the value of the euro of approximately 14.8% resulted in increases in reported European operations sales, cost of sales and operating expenses in fiscal 2004 compared to fiscal 2003. The most significant effects from the difference in exchange rates from last year to the current year are noted in the following analysis and are referred to as an "exchange rate difference." From time to time, the Company enters into forward foreign exchange contracts and option contracts to reduce its economic exposure to fluctuations in currency exchange rates (and their effect on translated U.S. dollar reported earnings) for the euro and other foreign currencies. Such instruments are recorded at fair value at the end of each accounting period; realized and unrealized gains and losses are recorded in Other Income (Expense)—Net.

        Net sales.    Consolidated net sales increased from $201.9 million in fiscal 2003 to $202.4 million in fiscal 2004, an increase of $0.5 million, or less than 1%. Fiscal 2004 sales include $1.8 million in royalty revenues received by the Company related to the settlement of a patent infringement claim. Additionally, fiscal 2004 sales were favorably impacted by the increase in the value of the euro compared to the U.S. dollar. Without the effect of the exchange rate difference, fiscal 2004 sales would have declined by $10.7 million, or approximately 5.3%.

        Sales from European operations increased from $80.5 million in fiscal 2003 to $87.1 million in fiscal 2004, an increase of $6.6 million, or 8.2%. Without the effect of the exchange rate difference, Europe's fiscal 2004 sales would have declined by $4.6 million, or 5.7%. The local currency sales decline in Europe is due primarily to a continuing difficult economic climate in Europe, increasing unemployment levels in Europe and a shift in consumer purchases towards lower priced luggage and casual bags. Local currency sales of luggage products (which comprise over 60% of European sales in fiscal 2004) declined 12.2%, sales of business cases (which comprise approximately 11% of European sales in fiscal 2004) declined 3.8% and sales of Samsonite black label products (which comprise approximately 3.2% of European sales in fiscal 2004) declined 31.4%. Partially offsetting these sales declines was a 33.4% increase in sales of casual bags. Sales from Samsonite's company-owned retail stores in Europe increased 14.7% due to a 2.4% increase in comparable store sales and an increase in the number of stores open.

        Sales from the Americas operations decreased from $98.7 million in fiscal 2003 to $92.1 million in fiscal 2004, a decrease of $6.6 million, or 6.7%. U.S. Wholesale sales for the third quarter declined by $8.4 million, or 14.1% from the prior year, U.S. Retail division sales increased by $3.1 million, or 11.9% from the prior year, and sales in the Other Americas operations declined by $1.3 million, or 10.1% from the prior year. U.S. Wholesale sales decreased from $59.9 million in the prior year to $51.4 million in fiscal 2004. The decline in U.S. Wholesale sales is due primarily to a decline in sales to

17

warehouse clubs and premium channel customers. Fiscal 2003 sales include $7.1 million in sales to the premium channel as part of a co-branded sales promotion with a tire company; these sales did not recur in fiscal 2004. These sales declines were partially offset by an increase in sales to the traditional and the office superstore channels. Sales in the U.S. Retail division increased from $26.3 million in the prior year to $29.5 million in fiscal 2004 due to an increase in the number of stores. The number of stores operated increased by 23 stores compared to the prior year through the acquisition of 22 retail stores from a national specialty luggage retailer in the fourth quarter of fiscal 2003. Same store U.S. Retail division sales for fiscal 2004 declined less than 1%. The decline in sales of the Other Americas is due primarily to a $1.7 million decline in sales in Canada. Prior year sales of Canada include $2.0 million in revenues from the molding operation, which was sold in the fourth quarter of fiscal 2003.

        Third quarter sales for the Asian operations were $0.5 million lower than the prior year at $17.5 million, which is a decline of 2.7% from the prior year third quarter. The effects of the SARS outbreak and the war in Iraq on luggage and travel goods sales in Asia are subsiding and sales volumes are reaching more normal levels, particularly in India, Taiwan, Malaysia and the Samasia distribution operation (which include direct market sales in Hong Kong and sales to distributors in the Philippines, Thailand, Australia, New Zealand and Vietnam) which exceeded third quarter prior year sales for those regions. However, continued difficult political and economic conditions in North Korea contributed to a 14.2% decline in sales of Korea. Additionally, sales in China, which was most severely impacted by the SARS epidemic, were 10.2% lower in the third quarter.

        Revenues from U.S. licensing operations increased from $4.7 million in the prior year to $5.7 million in fiscal 2004, an increase of $1.0 million due to an increase in revenues from the Japanese licensee of the Samsonite and American Tourister trade names and the portion of the $1.8 million previously discussed patent infringement settlement recorded in U.S. licensing. This increase was partially offset by a decline in royalty revenues from licensees of Samsonite, American Tourister and other brand names owned by the Company and licensed elsewhere in the world.

        Gross profit.    Consolidated gross profit for fiscal 2004 increased from fiscal 2003 by $4.3 million. Consolidated gross margin as a percentage of sales increased by 2.0 percentage points, from 42.0% in fiscal 2003 to 44.0% in fiscal 2004.

        Gross margins from European operations were 42.5% in fiscal 2004, compared with 40.3% in fiscal 2003, an increase of 2.2 percentage points. Higher European gross margin percentage is due primarily to lower raw material and finished goods purchase costs due to the strengthening of the euro relative to the U.S. dollar and a change in product mix favoring higher gross margin products.

        Gross margins for the Americas improved by 1.7 percentage points, from 39.3% in fiscal 2003 to 41.0% in fiscal 2004. U.S. Wholesale gross profit margins increased slightly from 33.2% in the prior year to 33.3% in the current year. U.S. Retail gross profit margins for the quarter were approximately equal to the prior year at 53.8%. Other Americas gross margins increased from 38.4% in fiscal 2003 to 43.2% in fiscal 2004 due primarily to an increase in gross margins for Canada. The increase in Canada's gross margin is due primarily to the sale of the custom injection molding operation in fiscal 2003. The Canadian molding operation carried significantly lower margins compared to Canada's existing operation of the distribution of travel products. Gross margins for Asia were approximately equal to the prior year at 49.5%.

        Selling, general and administrative expenses ("SG&A").    Consolidated SG&A increased by $9.1 million from fiscal 2004 to fiscal 2003. SG&A expense increased by $4.0 million due to the exchange rate effect. As a percent of sales, SG&A increased from 30.9% in fiscal 2003 to 35.4% in fiscal 2004 due primarily to higher SG&A for the Americas, including Corporate and Europe.

18

        SG&A for the Americas, including the Corporate division, increased by $2.2 million. Within the Americas, SG&A for U.S. Retail increased by $1.9 million due primarily to increasing occupancy costs. SG&A for Corporate and U.S. Wholesale increased $0.2 million due primarily to higher pension and consulting costs, partially offset by lower marketing, freight, dealer and national advertising costs. SG&A for Other Americas operations was approximately equal to the prior year. European SG&A increased by $7.1 million. Excluding the effect of exchange rate changes, Europe's SG&A increased by $3.1 million, or 13.4% in local currency due primarily to higher advertising costs associated with a global media campaign. SG&A for Asia was $0.1 million lower than the prior year and SG&A for U.S. licensing was $0.1 million lower than the prior year.

        Amortization of intangible assets.    Amortization of intangible assets was approximately equal to the prior year at $0.3 million in fiscal 2004.

        Asset impairment charge and provision for restructuring operations.    In connection with a restructuring of the Company's Mexico City operations activities, the Company recorded an additional $0.2 million asset impairment charge in the third quarter of fiscal 2003 to the carrying amount of machinery and equipment which is no longer used in production in Mexico City.

        Operating income.    Operating income declined from $21.8 million in fiscal 2003 to $17.2 million in fiscal 2004, a decline of $4.6 million. The decline is the result of higher SG&A costs, partially offset by higher sales revenues, higher gross profit margins and lower asset impairment charge.

        Interest income.    Interest income includes interest received from the temporary investment of excess cash balances. Fiscal 2004 interest income was $0.1 million lower than the prior year at $0.1 million.

        Interest expense and amortization of debt issue costs.    Interest expense and amortization of debt issue costs declined from $12.0 million in fiscal 2003 to $10.2 million in fiscal 2004. The decline in interest expense is due primarily to lower balances outstanding under the senior credit facility and lower interest rates on senior bank debt. Included in interest expense is the amortization of debt issue costs of $0.5 million in fiscal 2003 and $0.6 million in fiscal 2004.

        Other income (expense)—net.    See Note 6 to the consolidated financial statements included elsewhere herein for a comparative analysis of other income (expense)—net.

        Other income (expense) increased from expense of $0.5 million in fiscal 2003, to expense of $2.3 million in fiscal 2004. The increase in other expense from the prior year is due primarily to an increase in pension costs for assumed plans of $0.4 million, an increase in foreign currency transaction and translation losses of $0.5 million, an increase in the write-off of deferred financing costs of $0.2 million and an increase in other miscellaneous expenses of $0.7 million.

        From time to time, the Company enters into derivative transactions to reduce exposure to the effect of exchange rates on the earnings results of foreign operations (primarily the effect of changes in the euro exchange rate on the results of the Company's significant European operations). During the third quarter of fiscal 2004, the Company did not have any such contracts outstanding and had no realized gains or losses. Net realized and unrealized gains from foreign exchange contracts which are included in other income (expense)—net were not significant during fiscal 2003; realized losses on contracts closed during the third quarter of fiscal 2003 were $1.3 million.

        Income tax expense.    Income tax expense increased from $1.2 million in fiscal 2003 to $1.4 million in fiscal 2004. The increase in income taxes is caused by lower than expected taxes in the prior year because of a $0.4 million tax refund in the U.S., offset by lower tax expense on lower taxable income in Europe in the current year. The relationship between the expected income tax expense computed by applying the U.S. statutory rate to the pretax income and recognized actual income tax expense results

19

primarily because of (i) foreign income tax expense on foreign earnings, and (ii) state and local income taxes.

        Net income.    The Company had net income in fiscal 2004 of $2.6 million compared to a net income in fiscal 2003 of $7.6 million. The decrease in the net income from the prior year of $5.0 million is caused by the effect of the decline in operating and interest income and the increase in other expense and income tax expense, offset by the decline in interest expense and minority interest in earnings of subsidiaries.

        Preferred stock dividends and accretion of preferred stock discount.    This item represents the accrual of cumulative dividends on the senior redeemable preferred stock and convertible preferred stock and the accretion of the original issue discount over the original twelve-year term of the senior redeemable preferred stock. Effective with the closing of the recapitalization on July 31, 2003 (see "Liquidity and Capital Resources"), the then existing senior redeemable preferred stock with a dividend rate of 13⁷/8% was converted into a combination of shares of convertible preferred stock with an initial 8% dividend rate, shares of common stock and warrants to purchase common stock.

        Net loss to common stockholders.    This amount represents net income reduced for dividends payable and the accretion of discount on the senior redeemable preferred stock and the convertible preferred stock and is the amount used to calculate net loss per common share. The net loss to common stockholders declined from $3.3 million to $0.6 million; the net loss per common share declined from $0.17 per share to less than $0.01 per share.

Nine Months Ended October 31, 2003 ("fiscal 2004" or "current year") Compared to Nine Months Ended October 31, 2002 ("fiscal 2003" or "prior year")

        General.    Results of European operations were translated from euros to U.S. dollars in fiscal 2004 and fiscal 2003 at average rates of approximately 1.12 and .927 U.S. dollars to the euro, respectively. This increase in the value of the euro of approximately 20.5% resulted in increases in reported European operations sales, cost of sales and other expenses in fiscal 2004 compared to fiscal 2003. The most significant effects from the difference in exchange rates from last year to this year are noted in the following analysis and are referred to as an "exchange rate difference". From time to time, the Company enters into forward foreign exchange contracts and option contracts to reduce its economic exposure to fluctuations in currency exchange rates (and their effect on translated U.S. dollar reported earnings) for the euro and other foreign currencies. Such instruments are recorded at fair value at the end of each accounting period; realized and unrealized gains and losses are recorded in Other Income (Expense)—Net.

        Net sales.    Consolidated net sales increased from $549.5 million in fiscal 2003 to $556.5 million in fiscal 2004, an increase of $7.0 million, or 1.3%. Fiscal 2004 sales include $1.8 million in royalty revenues received by the Company related to the settlement of a patent infringement claim. Additionally, fiscal 2004 sales were favorably impacted by the increase in the value of the euro compared to the U.S. dollar. Without the effect of the exchange rate difference, fiscal 2004 sales would have declined by $35.4 million, or approximately 6.4%.

        Sales from European operations increased from $223.5 million in fiscal 2003 to $249.5 million in fiscal 2004, an increase of $26.0 million. Expressed in the local European reporting currency (euro), fiscal 2004 sales declined by 7.3%, or the U.S. constant dollar equivalent of $16.4 million, compared to fiscal 2003. The local currency sales decline in Europe is due primarily to a continuing difficult economic climate, increasing unemployment levels in Europe and a shift in consumer purchases towards lower priced luggage and casual bags. Local currency sales of luggage products (which comprise over 60% of European sales in fiscal 2004) declined 7.6%, sales of business cases (which comprise approximately 11% of European sales in fiscal 2004) declined 5.6% and sales of Samsonite black label products (which comprise approximately 2.9% of European sales in fiscal 2004) declined

20

49.8%. The decline in Samsonite black label product sales is primarily due to a change in the Company's business strategy whereby apparel product sales are licensed to a third party distributor. Partially offsetting these sales declines was an 18.3% increase in sales of casual bags. Sales from Samsonite's company-owned retail stores in Europe increased 14.8% due to an increase in the number of stores open and 5.7% increase in comparable store sales.

        Sales from the Americas operations declined from $262.2 million in fiscal 2003 to $245.5 million in fiscal 2004, a decline of $16.7 million. U.S. Wholesale sales for the current year declined by $15.6 million from the prior year, U.S. Retail sales increased by $4.1 million, and sales in the Other Americas operations declined by $5.2 million from the prior year. U.S. Wholesale sales declined from $146.2 million in the prior year to $130.6 million in fiscal 2004. The decline in U.S. Wholesale sales is due primarily to a decline in sales to warehouse clubs and premium channel customers. Fiscal 2003 sales include $7.1 million in sales to the premium channel as part of a co-branded sales promotion with a tire company; these sales did not recur in fiscal 2004. These sales declines were partially offset by an increase in sales of computer bags to a computer manufacturer and seller and an increase in sales to the office superstore channel. Sales in the U.S. Retail division increased from $78.9 million in the prior year to $82.9 million in fiscal 2004 due to an increase in the number of stores, partially offset by a decline of 5.5% in same store U.S. Retail division sales. The number of stores operated increased by 23 from the prior year primarily through the acquisition of retail stores from a national specialty luggage retailer in the fourth quarter of fiscal 2003. The decline in sales of Other Americas is due primarily to a $4.9 million decline in sales in Canada. Prior year sales of Canada include $5.6 million in sales from the molding operation, which was sold in the fourth quarter of fiscal 2003.

        Current year sales from the Asian operations were $2.9 million lower than the prior year, which is a 5.8% decline. The decline in sales of Asian operations is due to the negative effects of the war in Iraq, the SARS outbreak and the North Korean political situation in fiscal 2004. The effects of the SARS outbreak and the war in Iraq on luggage and travel goods sales in Asia are subsiding and beginning in the second quarter sales volumes started to reach more normal levels.

        Royalty revenues from U.S. licensing operations increased $0.6 million to $14.2 million in fiscal 2004, a 4.4% increase over the prior year. The increase in royalty revenues is due to an increase in revenues from the Japanese licensee of the Samsonite and American Tourister trade names and the portion of the $1.8 million previously discussed patent infringement settlement recorded in U.S. licensing. This increase was partially offset by a decline in royalty revenues from licensees of Samsonite, American Tourister and other brand names owned by the Company and licensed elsewhere in the world.

        Gross profit.    Consolidated gross profit margin increased by 2.8 percentage points, from 41.3% in fiscal 2003 to 44.1% in fiscal 2004.

        Gross margins from European operations increased 1.7 percentage points from 39.9% in the prior year to 41.6% in fiscal 2004. Higher European gross margins are due primarily to lower raw material and finished goods purchase costs due to the strengthening of the euro relative to the U.S. dollar.

        Gross margins for the Americas increased by 4.2 percentage points, from 38.0% in fiscal 2003 to 42.2% in fiscal 2004. U.S. Wholesale gross profit margins increased from 30.0% in the prior year to 34.2% in the current year. Prior year U.S. Wholesale gross margin includes $2.1 million in restructuring related expenses, which reduced the gross margin percentage by 1.4 percentage points. The remaining improvement in gross profit margin as a percent of sales is primarily the result of lower product costs resulting from the fiscal 2002 restructuring of the Nogales manufacturing operation and the resulting shift from the manufacture of our own softside products in Nogales to purchasing products at lower cost from finished goods vendors in China. U.S. Retail gross margins were higher at 54.3% in fiscal 2004 compared to 53.5% in fiscal 2003 due primarily to higher than planned sales and a change in product sales mix.

21

        Gross margins for the Other Americas increased from 36.7% to 43.5% due primarily to an increase in gross profit margins of Canada and Mexico. The increase in Canada's gross profit margin percentage is due primarily to the sale of the custom injection molding operation in fiscal 2003. The Canadian molding operation carried significantly lower margins compared to the distribution of travel products. Mexico's gross profit margin percentage was higher due to the lowering of product costs by purchasing finished goods from Asian vendors after the elimination of softside manufacturing in Mexico in fiscal 2003. Asia's gross margins increased by 2.4 percentage points, to 51.1%.

        Selling, general and administrative expenses ("SG&A").    Consolidated SG&A increased by $19.9 million from fiscal 2003 to fiscal 2004. SG&A increased $13.5 million due to the exchange rate difference. Net of the exchange rate difference, SG&A increased by $6.4 million. As a percent of sales, SG&A was 35.7% in fiscal 2004 and 32.5% in fiscal 2003.

        The increase in SG&A is due primarily to the increase in SG&A for the Americas, including the corporate headquarters of $4.2 million, an increase in SG&A for Asia of $0.8 million, and a $1.4 million increase in SG&A for Europe, net of the exchange rate difference. Within the Americas, SG&A for corporate and U.S. Wholesale combined increased $1.5 million due primarily to an increase in pension and consulting fees and an increase in selling costs, partially offset by lower U.S. Wholesale dealer advertising, marketing and freight costs. SG&A for U.S. Retail increased from $40.1 million to $43.2 million, an increase of $3.1 million, due primarily to increasing occupancy costs. SG&A for the other Americas declined $0.4 million from the prior year. The local currency increase in SG&A for Europe is due primarily to higher advertising costs and higher costs associated with the opening of additional retail stores in fiscal 2003 and 2004.

        Amortization of intangible assets.    Amortization of intangible assets was approximately equal to the prior year at $1.0 million.

        Provision for restructuring operations and asset impairment charge.    The provision for restructuring operations of $2.2 million and the asset impairment charge of $0.5 million in the prior fiscal year relates to the restructuring of the Company's Mexico City manufacturing facility. The Company eliminated its softside manufacturing in Mexico City and shifted to sourcing softside products from the Far East.

        Operating income.    Operating income increased from $44.6 million in fiscal 2003 to $46.3 million in fiscal 2004, an increase of $1.7 million. The increase is the net result of an increase in gross profit, and lower provision for restructuring and asset impairment charge, partially offset by higher SG&A expense.

        Interest income.    Interest income includes interest received from the temporary investment of excess cash balances, and was $0.3 million lower than the prior year at $0.2 million.

        Interest expense and amortization of debt issue costs.    Interest expense and amortization of debt issue costs declined from $35.8 million in fiscal 2003 to $33.5 million in fiscal 2004 representing a decline of 6.4%. The decline in interest expense is due primarily to lower balances outstanding under the senior credit facility and lower interest rates on senior bank debt. Included in interest expense is amortization of debt issue costs of $1.6 million in both fiscal 2004 and 2003.

        Other income—net.    See Note 6 to the consolidated financial statements included elsewhere herein for a comparative analysis of other income—net.

        Other income (expense)—net decreased from expense of $8.1 million in fiscal 2003 to expense of $7.8 million in fiscal 2004. The decrease in other income (expense)—net is due to the decline in net loss from foreign currency forward delivery contracts of $2.4 million, the decline in foreign currency translation and transaction losses of $2.1 million, and the increase in gain on disposition of fixed assets

22

of $2.2 million, partially offset by the increase in write-off of non-recoverable deferred financing costs of $3.6 million, the increase in bank loan amendment fees of $1.6 million and the increase in other miscellaneous expenses of $1.2 million.

        From time to time, the Company enters into derivative transactions to reduce exposure to the effect of exchange rates on the earnings results of foreign operations (primarily the effect of changes in the euro exchange rate on the results of the Company's significant European operations). The Company estimates the increase in operating income from the strengthening of the euro versus the U.S. dollar from the same period in the prior year to be approximately $4.1 million for the nine months ended October 31, 2003. Other income (expense)—net for fiscal 2004 includes net realized and unrealized losses from forward exchange contracts of $0.9 million. Realized losses on contracts closed during the nine-month period were $1.6 million. During fiscal 2003, net realized and unrealized losses from forward exchange contracts were $3.3 million. Realized losses on contracts closed during the nine-month period were $2.7 million.

        Income tax expense.    Income tax expense increased from $5.9 million in fiscal 2003 to $6.7 million in fiscal 2004. Prior year U.S. income tax expense includes a $0.4 million refund of taxes in the U.S. due to changes in U.S. tax law at that time. Additionally, fiscal 2004 income tax expense was increased $0.7 million due to the exchange rate difference. Offsetting these changes is a decline in taxes for Asia of $0.3 million and a local currency decline in income taxes for Europe due to lower pre-tax income due to lower pre-tax income in fiscal 2004. The relationship between the expected income tax benefit computed by applying the U.S. statutory rate to the pre-tax income (loss) and recognized actual income tax expense results primarily because of (i) foreign income tax expense provided on foreign earnings and (ii) state and local income taxes.

        Net loss.    The Company had a net loss in fiscal 2004 of $3.7 million compared to a net loss in fiscal 2003 of $5.6 million. The decrease in the net loss from the prior year of $1.9 million is caused by the effect of the increase in operating income and the decline in interest expense and other expense, partially offset by a decline in interest income, an increase in income tax expense and minority interest in earnings of subsidiaries during fiscal 2004.

        Preferred stock dividends and accretion of preferred stock discount.    This item represents the accrual of cumulative dividends on the senior redeemable preferred stock and convertible preferred stock and the accretion of the original issue discount over the original twelve-year term of the senior redeemable preferred stock. Effective with the closing of the recapitalization on July 31, 2003 (see "Liquidity and Capital Resources"), the then existing senior redeemable preferred stock with a dividend rate of 13⁷/8% was converted into a combination of shares of convertible preferred stock with an initial 8% dividend rate, shares of common stock and warrants to purchase common stock.

        Net loss to common stockholders.    This amount represents net loss increased for dividends payable and the accretion of discount on the senior redeemable preferred stock and convertible preferred stock and is the amount used to calculate net loss per common share. The net loss to common stockholders decreased from $37.2 million to $31.5 million; the net loss per common share decreased from $1.87 to $0.35 per share.

Liquidity and Capital Resources

        On July 31, 2003, the Company closed a recapitalization transaction, which reduced the Company's indebtedness and eliminated the Company's then existing senior redeemable preferred stock (the "Recapitalization"). As part of the Recapitalization, new investors purchased 106,000 shares of a new series of the Company's convertible preferred stock with an initial dividend rate of 8% for $106.0 million. Additionally, the Company's existing bank credit facility was replaced with a new $60 million revolving credit agreement and all outstanding amounts owed under the old senior bank

23

credit facility were repaid. As part of the Recapitalization, all of the 281,131 outstanding shares of 13⁷/8% senior redeemable preferred stock, which had an aggregate liquidation preference of $352.0 million on July 31, 2003, were converted into 53,982 shares of new convertible preferred stock, approximately 204.8 million shares of common stock and warrants to purchase approximately 15.5 million shares of common stock at an exercise price of $0.75 per share. The Company used the proceeds from the sale of the new preferred stock and borrowings under the new senior credit facility to repay all amounts outstanding under the old senior credit facility and to pay fees and expenses incurred in connection with the Recapitalization. Long-term obligations (including current installments) decreased from $423.2 million at January 31, 2003 to $335.8 million at October 31, 2003, a decrease of $87.4 million due primarily to repayments of debt from funds received as part of the Recapitalization. At October 31, 2003, the Company had available borrowings on its senior credit facility of approximately $47.4 million.

        As reflected in the consolidated statements of cash flows included elsewhere herein, cash flows provided by operating activities decreased by $11.6 million compared with the prior year. In the prior year, the Company had a net $9.8 million source of cash related to declines in inventory, accounts payable and accrued liabilities offset by increases in receivables as the Company returned to a more normal level of purchasing and sales activity following a period of slower business activity immediately after September 11, 2001. Fiscal 2004 cash flows include a $5.0 million contribution to the Company's pension plan made as part of the Recapitalization which is reflected in Other, net on the statement of cash flows in fiscal 2004. At October 31, 2003, the Company had current assets in excess of current liabilities of $141.9 million compared to $76.3 million at January 31, 2003, an increase of $65.6 million. Current assets increased by $12.5 million primarily due to the net effects of a decrease in cash of $3.7 million and an increase in receivables of $13.0 million, an increase in inventories of $3.1 million and an increase in deferred income taxes and other current assets of $0.1 million. The decline in current liabilities of $53.1 million is due primarily to the repayment of amounts due under the old senior credit facility in connection with the Recapitalization.

        The Company's cash flow from operations together with amounts available under its credit facilities and amounts provided by the Recapitalization were sufficient to fund fiscal 2004 operations through October 31, 2003, scheduled payments of principal and interest on indebtedness and capital expenditures. Management of the Company believes that cash flow from future operations and amounts available under its credit facilities will be adequate to fund operating requirements and expansion plans through the next twelve months.

        The Company's principal foreign operations are located in Western Europe, the economies of which are not considered to be highly inflationary. From time to time, the Company has entered into forward foreign exchange contracts in order to reduce exposure to the effect of exchange rates on the earnings of foreign operations (primarily the effect of changes in the euro exchange rate on the results of the Company's significant European operations). As of October 31, 2003, the Company did not have any such contracts outstanding. During the past several years, the Company's most effective reduction to exposure against foreign currency changes has been the foreign currency denominated debt balances maintained in respect to its foreign operations. No assurance can be given that the Company will be able to offset future losses in sales and operating income from negative exchange rate fluctuations through foreign currency forward exchange contracts, options or other instruments which may be available to reduce economic exposure to currency fluctuations. Geographic concentrations of credit risk with respect to trade receivables are not significant as a result of the diverse geographic areas covered by the Company's operations.

Critical Accounting Policies

        The Company's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and its significant accounting policies

24

are summarized in Note 1 to the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2003. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates.

        The Company's accounting for inventory at the lower of cost or market value, accruals for allowances for doubtful accounts, impairment of long-lived assets, impairment of intangible assets not being amortized, accruals for restructuring activities and U.S. defined benefit pension plan involve accounting policies which are most affected by management's judgment and the use of estimates. These critical accounting policies are discussed in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2003.

Effect of Recently Issued Accounting Standards

        In April 2003, the Financial Accounting Standards Board ("FASB") issued SFAS No. 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities." SFAS No. 149 clarifies certain requirements of SFAS No. 133 and amends certain definitions under SFAS No. 133 and other existing pronouncements. The effect of adopting SFAS No. 149 on the Company's financial statements was not material.

        In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity." SFAS No. 150 requires that certain financial instruments that have characteristics of both liabilities and equity that have been presented either entirely as equity or between the liabilities section and the equity section of the balance sheet to be classified as liabilities. SFAS No. 150 requires that any amounts paid or to be paid to holders of such instruments in excess of their initial measurement amount be classified as interest expense. SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003. The effect of adopting SFAS No. 150 on the Company's financial statements is not material.

Forward Looking Statements

        Certain statements under "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk" and other places in this report constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can often be recognized by words such as "may," "will," "anticipate," "believe," "estimate," "intend," "plan," "expect" and similar expressions. Variations on those or similar words, or the negative of those words, also may indicate forward-looking statements. These forward-looking statements involve numerous assumptions, known and unknown risks, uncertainties and other factors that may cause our actual and future results, performance or achievements of the Company to be materially different from any future estimated results, performance or achievements expressed or implied by such forward-looking statements. These factors include, among others, the impact of the September 11, 2001 events on economic, political and public safety conditions that impact consumer confidence and spending and the possibility of additional terrorist attacks or related events; the spread of the SARS disease or other events which affect travel levels; armed conflicts in the Middle East and other regions; general economic and business conditions, including foreign currency fluctuations; industry capacity; changes in consumer preferences; demographic changes; competition; changes in methods of distribution and technology; changes in political, social and economic conditions and local regulations; general levels of economic growth in emerging market countries; the loss of significant customers; completion of new product developments within anticipated time frames; changes in interest rates; and other factors that are beyond our control.

25

        We undertake no obligation to update or revise these forward-looking statements as conditions change.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk

        The Company's primary market risks include changes in foreign currency exchange rates and interest rates. Market risk is the potential loss arising from adverse changes in market rates and prices, such as foreign currency exchange and interest rates. The Company's strategies to address market risks and the types of financial instruments entered into to reduce market risks have not changed from those described in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2003.

        At October 31, 2003, the Company and its European subsidiary had forward foreign exchange contracts outstanding having a total contract amount of approximately $24.8 million compared to approximately $44.7 million at January 31, 2003. Contracts outstanding at October 31, 2003 are primarily for the purpose of reducing the Company's exposure to fluctuations in exchange rates on the cost of goods purchased by the European operations using U.S. dollars.

        If there were a ten percent adverse change in foreign currency exchange rates relative to all outstanding forward exchange contracts, the loss in earnings from the amount included in results of operations for the nine month period ended October 31, 2003 would be approximately $2.0 million, before the effect of income taxes. Any hypothetical loss in earnings would be offset by changes in the underlying value of translated earnings or royalty income, to the extent such earnings or income is equal to the amount of currency exposed, or for product purchases by exchange gains.

        The amount of fixed rate long-term debt outstanding has not changed materially from the amount outstanding at January 31, 2003 and continues to be comprised primarily of the Company's outstanding publicly traded senior subordinated notes having a face amount of $322.9 million. At January 31, 2003, the quoted market price of these notes was $84.50 per $100 of principal; at October 31, 2003, the quoted market price of these notes was $104.50 per $100 of principal.

ITEM 4. CONTROLS AND PROCEDURES

(a)

Evaluation of Disclosure Controls and Procedures.

        The Company's Chief Executive Officer and Chief Financial Officer, with the participation of the Company's management, have evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company's Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company's disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports it files or submits under the Exchange Act.

(b)

Changes in Internal Control.

        There have not been any changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

26

SAMSONITE CORPORATION

PART II—OTHER INFORMATION

Item 1—Legal Proceedings

The Company is a party to various legal proceedings and claims in the ordinary course of business. The Company believes that the outcome of these matters will not have a material adverse effect on its consolidated financial position, results of operations or liquidity.

Item 2—Changes in Securities and Use of Proceeds

None.

Item 3—Defaults Upon Senior Securities

None.

Item 4—Submission of Matters to a Vote of Security Holders

None.

Item 5—Other Information

None.

Item 6—Exhibits and Reports on Form 8-K

(a)

See Exhibit Index.



(b)

Reports on Form 8-K.

Report dated September 10, 2003
Item 12. Results of Operations and Financial Condition

Report dated October 16, 2003
Item 5. Other Events

27

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.

Date: December 15, 2003

28

INDEX TO EXHIBITS

(1)

Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 1997 (File No. 0-23214).

(2)

Incorporated by reference from the Registration Statement on Form S-4 (Registration No. 33-95642).

(3)

Incorporated by reference from the Registration Statement on Form S-4 (Registration No. 333-61521).

(4)

Incorporated by reference from the Company's Definitive Proxy Statement filed June 30, 2003.

(5)

Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 31, 2003 (File No. 0-23214).

29

QuickLinks