TPG Takes 53% Majority Stake In CAA Overseas Group Launching Bid To Buy Reebok Converse Suing Over Chuck Taylor Copycats Nike Sees 3D Printing As Innovative Tool Adidas Makes Waves With Shoe Hires Nike Golf President Cindy Davis Steps Down ISC's Q3 Revenues Jump 11% Oyo Sports Gets $11M Equity Infusion Adidas Struggling In U.S. Market Nike Leaving Snowboarding, Freeskiing Industry
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SBD/June 28, 2013/Finance
Nike Q4 Profits Jump 22%; Leaders Expect World Cup To Boost '14 Sales
Published June 28, 2013
MAKING PREDICTIONS: Nike VP & CFO Don Blair said, "Our reported results for China won’t always follow a smooth trajectory. It’s difficult to predict how quickly we’ll return to sustained growth.” In Portland, Allan Brettman notes the "unaudited figures show Nike was" a $25.3B company in FY '13, with revenues up 8% from last year’s $23.3B. Nike President & CEO Mark Parker on a conference call said that looking "forward to 2014, a year with the Winter Olympics as well as soccer’s World Cup, should prove as bountiful for Nike." Parker: “We’re set to grow, to explore, refine and leverage our leadership position” as the world’s largest sports footwear and apparel company. He added, “We have scale, power and passion, and we’re not shy about using them.” Several parts of the "hour-long conference call were spent paying homage" to Nike Brand President Charlie Denson, who announced last week he was retiring. Parker said Denson is a "brilliant and affable man, easy to respect and easy to like." Parker: "Charlie has showed the next generation what it takes -- and what it means -- to be a Nike leader" (Portland OREGONIAN, 6/28).
VIEW FROM THE STREET: CNBC contributor Jon Najarian said of Nike stock, "I would say, 'Just buy it,' and the reason is, well, LeBron James. That didn't hurt to have that (NBA Finals) series do as well as it did with viewers." Najarian also noted Nike is also moving into yogawear "in an aggressive fashion." Najarian: "As they move more and more into apparel, in particular this very lucrative yogawear, I think Nike is really going to hit. That's going to move margins up rather than compress them down." However, Fusion Analytics Chief Investment Officer Josh Brown said Nike is "relying on emerging markets to deliver the boost in sales that they're certainly not going to be able to get in developed markets and right now, that's not a bet that anyone on the Street wants to make" ("Fast Money Halftime Report," CNBC, 6/27).
CYBER SALES: In Baltimore, Lorraine Mirabella noted cited recent data from NPD Group that showed athletic shoe sales "are soaring, at least on the Internet." Sales grew 21% to $5B "in the year ending in April compared with the previous year." The company said that "even with the rapid growth, e-commerce sales make up less than one-fifth" of the $28B U.S. athletic footwear market, in which sales grew 5% year over year. NPD data also showed that online shoe shoppers "care more about brand, style and price than in-store shoppers." In-store shoppers "put more emphasis on comfort." A "higher percentage" of the footwear bought online was on sale -- 53% -- compared with the "share of on-sale footwear bought in stores," 47% (BALTIMORESUN.com, 6/27).
I'VE GOT A FEVER: In Miami, Mor & Castillo write the fact that the Air Jordan 1 shoes never went on sale is "just an example of how companies like Nike and Adidas fuel sneaker fever." They make special sneakers in "limited runs, and the fewer made, the more valuable they can become." Lifted by the popularity of the Heat and especially F LeBron James, Miami has become a "city that rivals Los Angeles and New York as a place where sneakerheads come to find the rarest limited edition shoes." For the "first crack at limited edition shoes, they flock to sneaker boutiques including SoleFly near South Miami." The shoes are a "big business for Heat players." James, G Dwyane Wade and F Chris Bosh are "prominently followed on sneaker blogs for their choice of footwear, and their endorsements of shoes carry significant weight" (MIAMI HERALD, 6/28).