STRONG SALES BOOST NIKE PROFITS BY 30%
Byline: Vicki M. Young
NEW YORK — Nike Inc. on Thursday posted stellar third-quarter earnings that spiked up nearly 30 percent over year-ago results, on a revenue gain of more than 4 percent.
For the three months ended Feb. 28, income was $126.3 million, or 46 cents a diluted share, 29.7 percent above the $97.4 million, or 35 cents, reported in the year-ago quarter. Revenues rose 4.2 percent to $2.26 billion from $2.17 billion.
Philip H. Knight, chairman and chief executive officer, said in a statement that the company was “pleased by the significant improvements in our business over the past 12 months. In that time, we have managed the turnaround of our largest business, U.S. footwear; reduced global inventories by 5 percent, and sustained the momentum of our brand at retail during a challenging environment.”
Knight said in a conference call to Wall Street analysts after the market closed that global marketing played a key role in the company’s success in the quarter. He highlighted the Winter Olympics last month in Salt Lake City and the recent Nike ads. In addition, Knight noted that Europe and Asia continue to be important growth regions for the company, the former due to continued participation in sports among Europeans and the latter due to continued brand recognition throughout Asia. Supporting growth in Asia is its status as a global sports stage for this summer’s World Cup. The soccer event will be cohosted by South Korea and Japan, with venues in 22 host cities.
The firm said worldwide future orders for athletic footwear and apparel, scheduled for delivery between March and July 2002 and totaling $4 billion, are 6 percent higher than similar orders in the year-ago period.
U.S. revenues grew 5 percent to $1.2 billion from $1.1 billion. U.S. athletic footwear revenues climbed 7 percent to $748 million, while apparel revenues rose 1 percent to $282 million. Equipment revenues grew 7 percent to $81 million.
In Europe, quarterly revenues including Africa dipped 1 percent to $606 million from $610 million in the year-ago period. Footwear grew 2 percent to $340 million, but apparel fell 3 percent to $228 million. Equipment revenues declined 5 percent to $38 million.
The Asia Pacific region grew 10 percent to $303 million from $275 million. Revenue in all three product categories grew: footwear, 3 percent to $164 million; apparel, 22 percent to $107 million, and equipment, 12 percent to $32 million.
In the Americas, business in the region grew 2 percent to $112 million from $109 million. Footwear revenues rose 3 percent to $69 million, while apparel increased slightly at 1 percent to $34 million. Equipment revenues climbed 2 percent to $10 million.
The company also posted a 7 percent increase to $93 million from $87 million in its other businesses that include Bauer Nike Hockey Inc. and Cole Haan.
For the nine months, income was up 6.5 percent to $454.9 million, or $1.67 a diluted share, from $427 million, or $1.56, in the comparable year-ago period. Revenues inched up 2.9 percent to $7.21 billion from $7.01 billion.
The Beaverton, Ore.-based firm also spent $12 million to repurchase 210,000 shares of Class B common stock. Shares of Nike on Thursday closed at $63.20, down 79 cents, in trading on the New York Stock Exchange. The company posted earnings results after the market closed.