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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the Quarterly Period Ended May 3, 2003

Commission File Number 333-26999

ANVIL HOLDINGS, INC.
(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 (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  ý    No  o

        At June 12, 2003, there were 290,000 shares of Class A Common Stock, $0.01 par value (the "Class A Common") and 3,605,000 shares of Class B Common Stock, $0.01 par value (the "Class B Common") of the registrant outstanding.

Form 10-Q

        ANVIL HOLDINGS, INC.

TABLE OF CONTENTS

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

ANVIL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)

ASSETS

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

See notes to consolidated financial statements.

*

Derived from audited financial statements.

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ANVIL HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Share Data)

See notes to consolidated financial statements.

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ANVIL HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY
FOR THE FISCAL QUARTER ENDED MAY 3, 2003
(In Thousands)

See notes to consolidated financial statements.

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ANVIL HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands, Except Share Data)

See notes to consolidated financial statements.

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Form 10-Q

ANVIL HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in Thousands, Except Share Data)

NOTE 1—General

        Basis of Presentation:    The accompanying consolidated financial statements have been prepared in accordance with accounting principles which are generally accepted in the United States of America ("Generally Accepted Accounting Principles" or "GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. In the opinion of Management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the fiscal period ended May 3, 2003 are not necessarily indicative of the results that may be expected for the fiscal year ending January 31, 2004, or any other period. The balance sheet at February 1, 2003 has been derived from the audited financial statements at that date. For further information, refer to the financial statements for the fiscal year ended February 1, 2003 included in the Company's annual report on Form 10-K filed with the Securities and Exchange Commission.

        As used herein, the "Company" refers to Anvil Holdings, Inc. ("Holdings"), including, in some instances, its wholly owned subsidiary, Anvil Knitwear, Inc., a Delaware corporation ("Anvil"), and its other subsidiaries, as appropriate to the context. The Company is engaged in the business of designing, manufacturing and marketing high quality activewear for men, women and children, supplemented with caps, towels, robes and bags. The Company markets and distributes its products, under its brand names and private labels, primarily to wholesalers and screen printers, principally in the United States.

        The Company reports its operations in one segment in accordance with Statement of Financial Accounting Standards No. 131, Disclosures About Segments of an Enterprise and Related Information.

        The Company's operations are on a "52/53-week" fiscal year ending on the Saturday closest to January 31. The accompanying consolidated financial statements include the accounts of the Company, after elimination of significant intercompany accounts and transactions.

        Litigation:    The Company is party to various litigation matters incidental to the conduct of its business. The Company does not believe that the outcome of any of the matters in which it is currently involved will have a material adverse effect on the financial condition, liquidity, business or results of operations of the Company.

NOTE 2—Credit Agreements, etc.

        Anvil's Loan and Security Agreement, as amended on May 28, 2002 (the "Loan Agreement"), provides for a maximum credit facility of $50,000 consisting of a term loan (the "Term Loan") and a revolving credit facility (the "Revolving Credit Facility"). The Loan Agreement is for an original term of three years with automatic one year renewals unless contrary notice is given by either party at least 60 days prior to the expiration date. The Loan Agreement (as currently extended) expires March 11, 2004. The Term Loan was in the original principal amount of $11,725, repayable in quarterly principal installments of $586 through April 2004, subject to extension of the Loan Agreement. Amounts due under the Loan Agreement are secured by substantially all the inventory, receivables and property, plant and equipment of Anvil. Holdings and Cottontops, Inc., a Delaware corporation ("Cottontops") guaranty amounts due under the Loan Agreement. Interest on the Term Loan and the Revolving Credit Facility are at prime plus one-quarter percent or LIBOR plus 2¹/4%, at the Company's option.

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At May 3, 2003, there was $8,563 outstanding under the Revolving Credit Facility bearing interest at 4.5%.

        As required by the Company's Certificate of Designations relating to the 13% Senior Exchangeable Preferred Stock (the "Preferred Stock"), the Company has paid stock dividends aggregating 1,075,782 shares ($26,895 liquidation value). This amount includes all dividends declared and paid through the March 15, 2002 quarterly dividend payment date. Dividends subsequent to that date are required to be paid in cash. The Board of Directors of Holdings has not declared any quarterly dividends since the March 15, 2002 dividend, and such dividends have not been paid. To date, the accrued dividends amount to $5,360, excluding dividends on preferred shares held by the Company. The Certificate of Designations relating to the Preferred Stock provides that if the Company fails to make cash dividend payments for four consecutive quarters, the holders of the Preferred Stock may call for a special meeting of stockholders at which they, voting together as a class, are entitled to elect two additional directors to the Company's Board of Directors. At the request of certain shareholder representatives, a meeting has been called for June 26, 2003 at the Company's headquarters.

NOTE 3—Inventories

        Inventories at May 3, 2003 and February 1, 2003 consisted of the following:

NOTE 4—Goodwill and Other Intangible Assets—Adoption of SFAS No. 142

        Effective at the beginning of the fiscal year ended February 1, 2003, the Company adopted the provisions of SFAS No. 142, "Goodwill and Other Intangible Assets." The adoption of SFAS No. 142 did not require any adjustments to the carrying value of goodwill or other intangible assets, but did result in the Company's ceasing to amortize existing goodwill. Previously recorded amortization had amounted to $719 annually. Goodwill at May 3, 2003 (net of amortization recorded through the fiscal year ended February 2, 2002) amounted to $19,416.

        Intangible assets being amortized consist of the following:

        Amortization expense relating to the above intangible assets will be as follows for each of the next five fiscal years, beginning with the year ending January 31, 2004: $313 (including $102 for the quarter ended May 3, 2003) and $286 for each year thereafter.

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NOTE 5—Income (Loss) per Share

        Net income (loss) per share as presented in the accompanying statements of operations is computed by dividing net income (loss) applicable to each class of Common Stock by the average number of shares of such stock outstanding, excluding anti-dilutive options. Dividends and accretion on the Company's redeemable preferred stock (net of treasury shares) are deducted, and gains on repurchase of preferred stock (credited directly to the stockholders' deficiency) are added in arriving at income (loss) attributable to the Company's two classes of common stock. The 12.5% liquidation preference relating to the Company's Class A Common Stock is considered as per share earnings of that class only.

NOTE 6—Summarized Financial Data of Certain Wholly-Owned Subsidiaries

        Holdings has no independent operations apart from its wholly-owned subsidiary, Anvil, and its sole asset is the capital stock of Anvil. Anvil is Holdings' only direct subsidiary. Holdings and Cottontops fully and unconditionally, jointly and severally guarantee the Senior Notes of Anvil. In addition to Cottontops, Anvil has five other direct subsidiaries (the "Non-U.S. Subsidiaries") which do not guarantee the Senior Notes: A.K.H., S.A., Estrella Mfg. Ltda. and Star, S.A., organized in Honduras; Livna, Limitada, organized in El Salvador; and CDC GmbH, organized in Germany. There are no other direct or indirect subsidiaries of the Company. The following information presents certain condensed consolidating financial data for Holdings, Anvil, Cottontops and the Non-U.S. Subsidiaries. Complete financial statements and other disclosures concerning Anvil, Cottontops and the Non-U.S. Subsidiaries are not presented because Management has determined they are not material to investors.

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