Nike's Strong U.S. Shoe Sales Helps Land 28% Earnings Growth

Nike reported Q4 earnings yesterday, stating that profit rose 28% due to "increased shoe sales in the U.S." and selling "more products at full price by holding down inventory," according to Andria Cheng of BLOOMBERG NEWS. The company reported net income of $208.4M, or $0.77 a share, up from $162.7M, or $0.60, for the same quarter a year earlier. Sales for the quarter ending May 31 rose 8% to $2.68B. Worldwide orders for delivery June-November rose 7% from FY '01 to $4.2B. U.S. orders rose 3%, "the fourth quarterly increase in a row after 14 quarters of declines." Sales rose 14% to $783M in Europe and Africa, while revenue increased 6% in Asia to $321M (BLOOMBERG NEWS, 6/27). The $0.77 per share earnings "beat by two cents the mean of 14 analysts polled by" Thompson Financial/First Call. Nike CFO Don Blair said that he expects "high single-digit percentage growth in revenue during the coming fiscal year," and added that "non-U.S. sales would exceed domestic sales for the first time in fiscal 2003" (WALL STREET JOURNAL, 6/28). For FY '02, Nike earned $663.3M, or $2.46 per share, a 12% increase (Portland OREGONIAN, 6/28). Meanwhile, Nike Chair & CEO Phil Knight said that he will "no longer regularly appear on Nike's conference calls with analysts. He added that there was nothing to `read into' the change, and that he will keep his position at the helm of Nike" (DOW JONES NEWSWIRES, 6/27). Shares of Nike closed yesterday at $51.42, up $2.34, or 4.8%. At presstime, Nike shares were trading at $55.43, up 8% (THE DAILY).

FOOT IN THE DOOR: During yesterday's announcement, Nike execs said that CA-based skateboard clothing manufacturer Hurley Int'l, which Nike purchased in February, "will launch a footwear line in the next six months." In CA, Tiffany Montgomery notes the move "heats up competition with Quiksilver" (ORANGE COUNTY REGISTER, 6/28).