NILKE 3RD-QUARTER PROFITS TAKE DIVE
NEW YORK — Nike Inc.’s third-quarter profits plummeted 33 percent on flat sales, but the footwear and apparel manufacturer said it was still striding toward its fourth-quarter goals.
Net income was $97.4 million, or 35 cents a diluted share, compared to $145.3 million, or 52 cents, a year ago. Wall Street had penciled in earnings of 35 cents a share, in line with a late-February profit warning reducing projections to 34 cents to 38 cents.
Revenues inched up 0.4 percent to $2.17 billion compared to $2.16 billion a year ago.
The closely watched measure of future orders was flat at $3.8 billion. On a constant dollar basis, future orders grew 3 percent for the quarter. Philip Knight, chairman and chief executive, emphasized in a statement that businesses such as equipment and Nike retail, which account for one-third of the firm’s total revenue, are not included in future orders.
Domestic revenues fell 6 percent to $1.1 billion on the weakness of footwear sales which were down 15 percent to $734 million. Apparel revenues jumped 11 percent to $279 million.
Sales for the European region, which includes Africa, increased 7 percent to $610 million on a 7 percent increase in apparel. The Asia Pacific region saw sales increase 8 percent to $275 million with a 9 perct increase in apparel. Revenues in the Americas region were up 12 percent to $109 million on a 14 percent increase in apparel sales.
Profits fared better for the nine months, though still down 5.8 percent to $427 million, or $1.56 a diluted share. This compares to $453.1 million, or $1.61, a year ago.
Revenues rose 4.2 percent to $7 billion from $6.72 billion a year ago. The Beaverton, Ore.-based company also reaffirmed earnings per share of 60 cents to 65 cents for the fourth quarter.