A year after Nike execs projected revenue of $27B by '15, they have "significantly upped their expectations" to $28-30B, according to a front-page piece by Allan Brettman of the Portland OREGONIAN. Nike President & CEO Mark Parker, speaking at yesterday's investor meeting at company HQs, said, "We're ahead of schedule." Without offering details, Nike "cited the past year's performance and 'growth opportunities' for the revised figure." Parker said Q4 results reported on Monday, highlighted by a 14% increase in revenues over the same period last year, "demonstrate that Nike has made substantial progress to deliver our 2015 global growth strategy and objectives." Brettman notes Nike in '10 projected FY '15 revenue of $23B, but yesterday "announced a revised target" of $24-25B. Nike Brand President Charlie Denson said, "Nearly every Nike Brand category was up in 2011, and we're building even more momentum as we enter fiscal 2012." The running category recorded $2.8B in sales in the past FY, "by far the biggest growth segment of eight categories in the Nike Brand." Basketball, which experienced 11% growth to $1.9B in sales, "followed the running category for growth." The "only category that did not grow was Nike Golf," and Denson attributed the 4% sales decline "to the overall decrease in sales in earthquake and tsunami-ravaged Japan." Nike Affiliate Brands President Roger Wyatt "singled out Converse for the greatest growth" among the four Nike subsidiaries, with 15% growth to $1.1B in sales in the past FY. Globally, Denson said that Nike is "targeting market growth in Brazil," host of the '14 FIFA World Cup in '16 Summer Olympics. Company officials said that "potential disruptions ... include higher costs for labor, materials and transportation around the world." In addition, Nike execs said that they "have come up with a Plan B in the event of disruptive labor stoppages" in the NFL and/or NBA (Portland OREGONIAN, 6/29).
THE COST OF DOING BUSINESS: Nike CFO Don Blair yesterday addressed increasing costs and said, "As we've come out of the recession, there's been a lot of inflation in different parts of the world economy. ... But this is something we have anticipated. We’ve got the brand strength to continue to drive our revenue growth and we’ve started to take some pricing. We think we’ll be doing a little bit more in the second half of the year. So in the long run, we're confident we’re going to continue to raise our margins." Blair said inventories were up but added, “We're really not that concerned about inventory." Blair: "What we do believe is that the industry is going to have to be very careful as we go forward. But we feel fantastic about our ability to manage our inventories and our factory outlet stores have done a phenomenal job keeping the markets clean" ("Street Signs," CNBC, 6/28).
STAR SEARCH: Denson talked about the status of two of Nike's most polarizing endorsers, Heat F LeBron James and Tiger Woods. CNBC's Darren Rovell noted Nike this year “sold more than 500,000 pairs of LeBron’s signature shoes this year.” Denson said, "The game is healthier than it's ever been, the ratings are as high as they’ve ever been, and a lot of it is attributed to LeBron. ... We’re still very, very excited about the future for him.” He added of Woods, "What we want from Tiger is to get healthy and get him back on a golf course. Some of the things that have happened while he's ... been off the golf course is actually going to make his return even more compelling” ("Closing Bell," CNBC, 6/28).
