By  on June 27, 2013

Nike Inc. sprinted to the finish line as it ended the 2013 fiscal year with stronger-than-expected fourth-quarter earnings and signs of stabilization in its challenged Chinese business.A 21.4 percent increase in Nike brand’s North American apparel business in the fourth quarter, to $748 million, lifted the brand’s apparel volume on the continent for the full year to more than $3 billion as its North American sales overall crossed the $10 billion milestone.Nike’s closely watched future orders metric, reflecting business booked from June through November, rose 8 percent, with the figure for the Greater China market trending up 3 percent for the period, although flat when adjusted for currency fluctuations. Future orders in North America stood at 12 percent.RELATED CONTENT: WWD EARNINGS TRACKER >>In the three months ended May 31, net income rose 21.7 percent to $668 million, or 73 cents a diluted share, from $549 million, or 59 cents. Excluding discontinued operations such as the divested Cole Haan and Umbro brands, adjusted EPS was 76 cents, 2 cents above the mark expected, on average, by analysts.Revenues were up 7.4 percent, to $6.7 billion, from $6.24 billion a year ago, while gross margin was up 110 basis points to 43.9 percent of revenues. Analysts expected slightly lower revenues of about $6.64 billion.In his final conference call as president of Nike brand before his July 1 retirement, Charlie Denson described North America as the company’s “MVP” for both the quarter and the year. Operating profit in North America during the quarter rose 28.6 percent to $723 million on a 12 percent increase in revenues to $2.71 billion.Sales ticked up slightly in China during the quarter, up 0.3 percent to $669 million, blunting a sales decline for the year that came in at 3.4 percent, to $2.45 billion. Similarly, a 2 percent decline in quarterly operating profit in China, to $242 million, was better than the 11.2 percent decline for the year, to $809 million.Donald Blair, chief financial officer, pointed out that revenue in China on a currency-neutral basis was down 1 percent in the quarter “as double-digit growth in performance running and basketball was offset by declines in other categories,” including sportswear. “The most critical step in returning this market to health is creating a more compelling, productive and profitable retail marketplace,” he added. “As Charlie noted, we’re seeing some encouraging signs.”For the full year, net income was up 11.8 percent to $2.49 billion, or $2.71 a diluted share, while revenues expanded 8.5 percent to $25.31 billion.

To continue reading this article...

load comments
blog comments powered by Disqus