Annual report pursuant to Section 13 and 15(d)

Inventories

Inventories

12 Months Ended

Jun. 30, 2012

Inventories, net of reserves of $5.2 million and $3.7 million in fiscal years 2012 and 2011, respectively, consist of the following (in thousands):



	June 30, 2012		July 2, 2011
Raw materials	$	11,759	$	20,970
Work in process	18,986		34,599
Finished goods	130,888		103,640
	$	161,633	$	159,209

Raw materials include finished yarn and direct materials for the basics segment and include direct embellishment materials and undecorated garments and headwear for the branded segment. In fiscal year 2011, raw materials included $6.6 million of undecorated garments related to The Cotton Exchange. Upon the integration of The Cotton Exchange with Soffe in fiscal year 2012, these undecorated garments are being classified as finished goods. In fiscal year 2011, work in process included $9.6 million in products that were in-transit to our distribution centers. Beginning in fiscal year 2012, these products in-transit to our distribution centers are being classified as finished goods.

- Definition

The entire disclosure for inventory. This may include, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the major classes of inventory, and the nature of the cost elements included in inventory. If inventory is stated above cost, accrued net losses on firm purchase commitments for inventory and losses resulting from valuing inventory at the lower-of-cost-or-market may also be included. For LIFO inventory, may disclose the amount and basis for determining the excess of replacement or current cost over stated LIFO value and the effects of a LIFO quantities liquidation that impacts net income.

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