By Dow Jones Business News, September 26, 2013, 04:50:00 PM EDT
By Michael Calia
Nike Inc.'s ( NKE ) fiscal first-quarter earnings rose 38% as the athletic-gear giant's namesake brand posted revenue
growth and wider margins.
Shares were up 6.1% at $74.66 in after-hours trading as Nike's earnings beat Wall Street estimates expectations.
Nike, whose stock debuted on the Dow Jones Industrial Average this week, has benefited from strong demand for athletic
gear in the U.S. and many markets abroad. In the most recent period, the key basketball and running categories performed
well, as did soccer and men's training. Strength in those segments offset a slight decline in sportswear, according to
Overall, revenue for the Nike brand rose 7% in the period, excluding currency fluctations. The company now includes
results for the Hurley and Nike Golf brands in the overall results for the namesake brand. Converse, likewise, will be
reported as a separate segment, the company said.
The athletic-gear maker continued to report meager results in its greater China operations, which it has been trying
to turn around as consumers in the country scale back their spending.
Nike said sales in greater China fell by 0.52% and by 3% excluding currency impacts. The company in June said it
expected lower China revenue in the first half of the fiscal year, with stabilization coming in the second half.
Sales in the bigger Western Europe segment grew by 11%, however.
World-wide Nike brand future orders--an indicator of future growth--rose 8%, compared with growth of 6% in the year-
ago period. For the heavily scrutinized greater China segment, Nike reported 3% growth in future orders, but excluding
currency impacts, they were 2%.
For the quarter ended Aug. 31, Nike reported a profit of $780 million, or 86 cents a share, up from $567 million, or
63 cents a share, a year earlier. Analysts recently polled by Thomson Reuters expected 78 cents a share.
Revenue increased 7.7% to $6.97 billion. Nike in June said it expected revenue growth at a mid- to high-single-digit
Gross margin widened to 44.9% from 43.7%, above the company's June prediction of margins remaining flat.
During the period, Nike said it repurchased a total of 8.4 million shares for approximately $526 million as part of
the four-year, $8 billion program. As of the end of the quarter, the company had bought back a total of 23.7 million
shares under the program at a total cost of about $1.3 billion.
Write to Michael Calia at firstname.lastname@example.org
Order free Annual Report for NIKE, Inc.
Visit http://djnweurope.ar.wilink.com/?ticker=US6541061031 or call +44 (0)208 391 6028
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
Copyright (c) 2013 Dow Jones & Company, Inc.