Nike reported that its second quarter earnings were "in
line" with analysts' estimates, as the company earned
$119.4M, or $0.44 cents per share for the quarter ended
November 30, according to the WALL STREET JOURNAL. Earnings
increased 11% from the same quarter last year "thanks to a
recovery in Asia and strong sales in its equipment
business," including balls, eyewear and watches. Sales from
other brands, such as Cole Haan and Bauer rose 7%, to $116M.
But Nike said it "continues to struggle against a weak
currency in Europe and that world-wide futures orders fell
from last year" (WALL STREET JOURNAL, 12/20). Nike's total
revenues increased 7%, to $2.2B. Nike CFO Don Blair said
the company expects "our international regions and U.S.
apparel and equipment businesses to continue to grow.
However, U.S. footwear will continue to put pressure on our
top line (revenue) growth" (REUTERS, 12/19). CNBC's Pat
Bolland reported that Nike's futures orders for North
America are down 4%, "that's not bad news though, ...
because last month, futures orders were down 9%. So it
seems as though we're getting more buying power coming into
the stock. The company did reiterate that they do see
December to April futures orders down about 1% overall"
(CNBC, 12/19). The AP reported that Nike's strong int'l
sales "made up for a weak shoe market" in the U.S. (AP,
12/20). BRIDGE NEWS' Jennifer Allen wrote that "despite
successful rollouts for its Presto and Shox athletic
footwear," Nike's U.S. shoe business "still lags, hurt by
slow sales in the mid-priced category" (BRIDGE NEWS, 12/19).
CNBC's Jane Wells reported the "biggest concern at Nike [is]
the U.S. market." Wells: "Athletic shoe sales were down,
but apparel sales more than made up for that." Dreyfus
Portfolio Manager Tim Ghriskey: "The U.S. business has still
been a bit dicey, but it seems to be stabilizing here. We
want to see more evidence that that's stabilizing and
perhaps even turning" ("Business Center," CNBC, 12/19).
LOOKING AHEAD: CNBC's Wells: "It's starting to look
like athletic shoes are making a comeback, even in this
economy." First Security Van Kasper's John Shanley: "This
is the first time in the 25 or so years that I've followed
this industry where we have seen simultaneous strong
consumer demand for both brown shoes and athletic shoes."
Wells: "Most analysts expect [Nike] to show steady,
continued growth in the mid-single digits for the quarter."
Ghriskey: "[Nike] is a growth stock that really fell out of
bed, a broken-down growth stock, and therefore its ability
to surprise in the upside ... is significant" (CNBC, 12/19).
JOB CUTS AT BAUER: In Montreal, Francois Shalom reports
that Bauer/Nike President Gary Kiedaisch said that Bauer
"will close" its Montreal office this spring and cut ten
jobs. Bauer has "slashed 900 jobs" at its plant in Saint-
Jerome over the last four years (Montreal GAZETTE, 12/20).
