Dec 20, 2013
Nike profit rises and advance orders jump
Dec 20, 2013
Nike Inc's quarterly profit rose as higher margin products made up a bigger share of its sales, and the sportswear maker said global orders for merchandise for delivery by April increased 13 percent.
Nike shares rose 0.6 percent to $78.75 in extended trading.
Total revenue rose 8 percent to $6.43 billion in the second quarter ended Nov. 30, just below the $6.44 billion Wall Street analysts had forecast on average.
But so-called futures orders, of shoes or clothes for delivery between December and April, rose to $10.4 billion.
In Western Europe, where Nike is whittling away at German brand Adidas AG's No. 1 position, sales rose 12 percent, while futures orders were up 26 percent.
In China, where Nike had overstock problems earlier this year and faced aggressive discounting by local rivals, sales grew 5 percent, a new sign of improvement.
Nike commands 14.6 percent of the global sporting goods market, compared with to 11.4 percent by Adidas, according to Euromonitor data.
Nike earned $537 million, or 59 cents a share, up 40 percent from the year-ago quarter. Excluding discontinued operations, profit was up 3 percent. Analysts had expected 58 cents per share according to Thomson Reuters I/B/E/S.
Gross margin rose 1.4 percentage points to 43.9 percent as Nike sold more goods at higher average prices.
Nike's profit was dented by a 13 percent increase in advertising and promotion connected to marketing and product launches for the upcoming Winter Olympics in Sochi, Russia and World Cup in Brazil next summer.
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