NIKE, Inc. Reports Fiscal 2013 Third Quarter Results
NIKE, Inc. (NYSE:NKE) today reported financial results for its fiscal
2013 third quarter ended February 28, 2013. For continuing operations,
strong demand for NIKE, Inc. brands propelled double-digit revenue
growth on a currency neutral basis, and diluted earnings per share grew
faster than revenue due to gross margin expansion, a lower tax rate and
a lower average share count.
"Our team delivered strong results in Q3. We did it with a relentless
flow of innovation into our key categories," said Mark Parker, President
and CEO of NIKE, Inc. "Given the diversity of our portfolio, we're able
to capture big opportunities that drive sustainable, profitable growth.
At the same time we continue to invest in new ways to enhance athletic
performance, build strong consumer communities, and improve how we
design and manufacture our products. That’s how we increase our
potential and drive shareholder value."*
Third Quarter Continuing Operations Income Statement Review
-
Revenues for NIKE, Inc. increased 9 percent to
$6.2 billion, up 10 percent on a currency-neutral basis. Excluding the
impact of changes in foreign currency, NIKE Brand revenues rose 10
percent, with growth in all geographies except Greater China and Japan
and in all key categories except Sportswear and Action Sports.
Revenues for Other Businesses increased 9 percent as growth at
Converse and NIKE Golf more than offset lower revenues at Hurley.
-
Gross margin increased 30 basis points to 44.2 percent.
Gross margin benefitted from the combination of pricing actions and
easing material costs, which more than offset higher labor costs. This
benefit was partially offset by higher discounts, particularly in
Greater China as the Company continues work to manage marketplace
inventory. Additionally gross margin was impacted by unfavorable
changes in foreign exchange rates and a shift in the mix of the
Company’s revenues to lower margin geographies.
-
Selling and administrative expense grew at the same rate
as revenue, up 9 percent to $1.9 billion. Demand creation expense was
$619 million, up 5 percent from the prior year driven by sports
marketing expense, and marketing support for key product initiatives
and brand events. Operating overhead expense increased 11 percent to
$1.2 billion due to additional investments made in the wholesale
business to support growth initiatives, and higher Direct to Consumer
costs as a result of higher volume-driven expenses in existing
NIKE-owned stores and the cost of new stores opened in the last year.
-
Other expense, net was $17 million, comprised primarily
of foreign exchange losses. For the quarter, the Company estimates the
year-over-year change in currency related gains and losses included in
other expense, net, combined with the impact of changes in currency
exchange rates on the translation of foreign currency-denominated
profits, decreased pretax income by approximately $19 million.
-
The effective tax rate was 22.8 percent, compared to
27.7 percent for the same period last year. The decrease was largely
due to the benefit from the U.S. legislative reinstatement of the
research and development tax credit, as well as a lower effective tax
rate on foreign operations due to the geographical mix of earnings.
-
Net income from continuing operations increased 16
percent to $662 million while diluted earnings per share
increased 20 percent to $0.73, reflecting a 2 percent decline in the
weighted average diluted common shares outstanding.
February 28, 2013 Balance Sheet Review for Continuing Operations
-
Inventories for NIKE, Inc. were $3.3 billion, up 4
percent from February 29, 2012. NIKE Brand inventories increased 4
percent. NIKE Brand wholesale unit inventories increased 7 percent to
support future demand, while the impact of changes in foreign currency
exchange rates and changes in product cost drove a 3 percentage point
decline in NIKE Brand inventory growth.
-
Cash and short-term investments were $4.0 billion; $845
million higher than last year mainly as a result of higher net income,
proceeds from the sale of the Umbro and Cole Haan businesses and
continued focus on working capital management.
Share Repurchases
During the third quarter, NIKE, Inc. repurchased a total of 4.9 million
shares for approximately $253 million as part of the four-year, $8
billion program approved by the Board of Directors in September 2012. As
of the end of the third quarter, a total of 11.1 million shares were
repurchased under this program at a cost of approximately $548 million.
Futures Orders
As of the end of the quarter, worldwide futures orders for NIKE Brand
athletic footwear and apparel, scheduled for delivery from March through
July 2013 totaled $9.9 billion, 6 percent higher than orders reported
for the same period last year. Excluding currency changes, reported
orders would have increased 7 percent.*
Discontinued Operations
The Company continually evaluates its existing portfolio of businesses
to ensure resources are invested in those businesses that are accretive
to the NIKE Brand, and represent the largest growth potential and
highest returns. On May 31, 2012, the Company announced its intention to
divest of the Umbro and Cole Haan businesses, allowing the Company to
focus resources on driving growth in the NIKE, Jordan, Converse and
Hurley brands.
As previously announced, the Company completed the sale of certain
assets of the Umbro brand during the second quarter ended November 30,
2012 and recorded a loss on the sale of these assets of $107 million,
net of tax, that was included in the net loss from discontinued
operations for the second fiscal quarter of 2013.
On February 1, 2013, the Company completed the sale of Cole Haan to Apax
Partners for an agreed upon purchase price of $570 million and received
at closing $561 million, net of $9 million of purchase price
adjustments. For the third quarter ended February 28, 2013, the Company
recorded a gain on sale of $231 million, net of tax, representing the
sales price less the asset value of Cole Haan and other miscellaneous
charges. For the third quarter of 2013, the Company’s net income from
discontinued operations was $204 million, which includes the gain
recorded for the sale of Cole Haan, net of tax, less net operating
losses and divesture transaction costs for Cole Haan and Umbro during
the period.
Under the Cole Haan sale agreement, the Company will provide certain
transition services to Cole Haan and will license NIKE proprietary
technologies for a transition period. The continuing cash flows related
to these items are not expected to be significant to Cole Haan and the
Company will have no significant continuing involvement with Cole Haan
beyond the transition services.
Conference Call
NIKE management will host a conference call beginning at approximately
2:00 p.m. PT on March 21, 2013, to review third quarter results. The
conference call will be broadcast live over the Internet and can be
accessed at http://investors.nikeinc.com.
For those unable to listen to the live broadcast, an archived version
will be available at the same location through 9:00 p.m. PT, March 28,
2013.
About NIKE, Inc.
NIKE, Inc., based near Beaverton, Oregon, is the world's leading
designer, marketer and distributor of authentic athletic footwear,
apparel, equipment and accessories for a wide variety of sports and
fitness activities. Wholly-owned NIKE, Inc. subsidiaries include
Converse Inc., which designs, markets and distributes athletic lifestyle
footwear, apparel and accessories and Hurley International LLC, which
designs, markets and distributes surf and youth lifestyle footwear,
apparel and accessories. For more information, NIKE’s earnings releases
and other financial information are available on the Internet at http://investors.nikeinc.com
and individuals can follow @Nike.
* The marked paragraphs contain forward-looking statements
that involve risks and uncertainties that could cause actual results to
differ materially. These risks and uncertainties are detailed from time
to time in reports filed by Nike with the S.E.C., including Forms 8-K,
10-Q, and 10-K. Some forward-looking statements in this release concern
changes in futures orders that are not necessarily indicative of changes
in total revenues for subsequent periods due to the mix of futures and
“at once” orders, exchange rate fluctuations, order cancellations,
discounts and returns, which may vary significantly from quarter to
quarter, and because a significant portion of the business does not
report futures orders.
(Additional Tables Follow)
|
NIKE, Inc.
|
CONSOLIDATED STATEMENTS OF INCOME
|
For the period ended February 28, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
|
|
%
|
|
|
NINE MONTHS ENDED
|
|
%
|
|
(Dollars in millions, except per share data)
|
|
|
2/28/2013
|
|
|
|
2/29/2012
|
|
|
Change
|
|
|
2/28/2013
|
|
|
|
2/29/2012
|
|
|
Change
|
Income from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
6,187
|
|
|
$
|
5,656
|
|
|
9
|
%
|
|
$
|
18,616
|
|
|
$
|
17,095
|
|
|
9
|
%
|
Cost of sales
|
|
|
3,451
|
|
|
|
3,171
|
|
|
9
|
%
|
|
|
10,522
|
|
|
|
9,616
|
|
|
9
|
%
|
Gross profit
|
|
|
2,736
|
|
|
|
2,485
|
|
|
10
|
%
|
|
|
8,094
|
|
|
|
7,479
|
|
|
8
|
%
|
Gross margin
|
|
|
44.2
|
%
|
|
|
43.9
|
%
|
|
|
|
|
43.5
|
%
|
|
|
43.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand creation expense
|
|
|
619
|
|
|
|
592
|
|
|
5
|
%
|
|
|
2,103
|
|
|
|
1,872
|
|
|
12
|
%
|
Operating overhead expense
|
|
|
1,244
|
|
|
|
1,116
|
|
|
11
|
%
|
|
|
3,655
|
|
|
|
3,297
|
|
|
11
|
%
|
Total selling and administrative expense
|
|
|
1,863
|
|
|
|
1,708
|
|
|
9
|
%
|
|
|
5,758
|
|
|
|
5,169
|
|
|
11
|
%
|
% of revenue
|
|
|
30.1
|
%
|
|
|
30.2
|
%
|
|
|
|
|
30.9
|
%
|
|
|
30.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest (income) expense, net
|
|
|
(2
|
)
|
|
|
-
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
3
|
|
|
-
|
|
Other expense (income), net
|
|
|
17
|
|
|
|
(10
|
)
|
|
-
|
|
|
|
(28
|
)
|
|
|
17
|
|
|
-
|
|
Income before income taxes
|
|
|
858
|
|
|
|
787
|
|
|
9
|
%
|
|
|
2,370
|
|
|
|
2,290
|
|
|
3
|
%
|
Income taxes
|
|
|
196
|
|
|
|
218
|
|
|
-10
|
%
|
|
|
602
|
|
|
|
580
|
|
|
4
|
%
|
Effective tax rate
|
|
|
22.8
|
%
|
|
|
27.7
|
%
|
|
|
|
|
25.4
|
%
|
|
|
25.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FROM CONTINUING OPERATIONS
|
|
|
662
|
|
|
|
569
|
|
|
16
|
%
|
|
|
1,768
|
|
|
|
1,710
|
|
|
3
|
%
|
NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS
|
|
|
204
|
|
|
|
(9
|
)
|
|
-
|
|
|
|
49
|
|
|
|
(36
|
)
|
|
-
|
|
NET INCOME
|
|
$
|
866
|
|
|
$
|
560
|
|
|
55
|
%
|
|
$
|
1,817
|
|
|
$
|
1,674
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share
|
|
$
|
0.74
|
|
|
$
|
0.62
|
|
|
19
|
%
|
|
$
|
1.97
|
|
|
$
|
1.86
|
|
|
6
|
%
|
Diluted earnings per common share
|
|
$
|
0.73
|
|
|
$
|
0.61
|
|
|
20
|
%
|
|
$
|
1.93
|
|
|
$
|
1.82
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share from discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share
|
|
$
|
0.23
|
|
|
$
|
(0.01
|
)
|
|
-
|
|
|
$
|
0.05
|
|
|
$
|
(0.04
|
)
|
|
-
|
|
Diluted earnings per common share
|
|
$
|
0.22
|
|
|
$
|
(0.01
|
)
|
|
-
|
|
|
$
|
0.05
|
|
|
$
|
(0.04
|
)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
893.9
|
|
|
|
915.1
|
|
|
|
|
|
898.9
|
|
|
|
921.2
|
|
|
|
Diluted
|
|
|
911.7
|
|
|
|
934.6
|
|
|
|
|
|
916.5
|
|
|
|
940.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per common share
|
|
$
|
0.21
|
|
|
$
|
0.18
|
|
|
|
|
$
|
0.60
|
|
|
$
|
0.52
|
|
|
|
|
Nike, Inc.
|
CONSOLIDATED BALANCE SHEETS
|
As of February 28, 2013
|
|
|
|
|
|
|
|
|
|
February 28,
|
|
February 29,
|
|
|
(Dollars in millions)
|
|
2013
|
|
2012
|
|
% Change
|
ASSETS
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and equivalents
|
|
$
|
2,557
|
|
$
|
2,021
|
|
27
|
%
|
Short-term investments
|
|
|
1,485
|
|
|
1,176
|
|
26
|
%
|
Accounts receivable, net
|
|
|
3,232
|
|
|
3,199
|
|
1
|
%
|
Inventories
|
|
|
3,329
|
|
|
3,206
|
|
4
|
%
|
Deferred income taxes
|
|
|
275
|
|
|
302
|
|
-9
|
%
|
Prepaid expenses and other current assets
|
|
|
882
|
|
|
745
|
|
18
|
%
|
Assets of discontinued operations
|
|
|
29
|
|
|
602
|
|
-95
|
%
|
Total current assets
|
|
|
11,789
|
|
|
11,251
|
|
5
|
%
|
Property, plant and equipment
|
|
|
5,370
|
|
|
4,988
|
|
8
|
%
|
Less accumulated depreciation
|
|
|
3,110
|
|
|
2,855
|
|
9
|
%
|
Property, plant and equipment, net
|
|
|
2,260
|
|
|
2,133
|
|
6
|
%
|
Identifiable intangible assets, net
|
|
|
376
|
|
|
366
|
|
3
|
%
|
Goodwill
|
|
|
131
|
|
|
131
|
|
0
|
%
|
Deferred income taxes and other assets
|
|
|
1,059
|
|
|
913
|
|
16
|
%
|
TOTAL ASSETS
|
|
$
|
15,615
|
|
$
|
14,794
|
|
6
|
%
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Current portion of long-term debt
|
|
$
|
57
|
|
$
|
49
|
|
16
|
%
|
Notes payable
|
|
|
103
|
|
|
91
|
|
13
|
%
|
Accounts payable
|
|
|
1,241
|
|
|
1,255
|
|
-1
|
%
|
Accrued liabilities
|
|
|
1,899
|
|
|
1,798
|
|
6
|
%
|
Income taxes payable
|
|
|
138
|
|
|
59
|
|
134
|
%
|
Liabilities of discontinued operations
|
|
|
62
|
|
|
175
|
|
-65
|
%
|
Total current liabilities
|
|
|
3,500
|
|
|
3,427
|
|
2
|
%
|
Long-term debt
|
|
|
161
|
|
|
229
|
|
-30
|
%
|
Deferred income taxes and other liabilities
|
|
|
1,287
|
|
|
962
|
|
34
|
%
|
Redeemable preferred stock
|
|
|
-
|
|
|
-
|
|
-
|
|
Shareholders' equity
|
|
|
10,667
|
|
|
10,176
|
|
5
|
%
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
$
|
15,615
|
|
$
|
14,794
|
|
6
|
%
|
|
|
NIKE, Inc.
|
DIVISIONAL REVENUES1 |
For the period ended February 28, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change
|
|
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
Excluding
|
|
|
|
|
|
|
|
Excluding
|
|
|
THREE MONTHS ENDED
|
|
%
|
|
Currency
|
|
NINE MONTHS ENDED
|
|
%
|
|
Currency
|
(Dollars in millions)
|
|
2/28/2013
|
|
2/29/2012
|
|
Change
|
|
Changes2
|
|
2/28/2013
|
|
2/29/2012
|
|
Change
|
|
Changes2
|
North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
$
|
1,691
|
|
|
$
|
1,470
|
|
|
15
|
%
|
|
15
|
%
|
|
$
|
4,894
|
|
|
$
|
4,219
|
|
|
16
|
%
|
|
16
|
%
|
Apparel
|
|
|
697
|
|
|
|
573
|
|
|
22
|
%
|
|
22
|
%
|
|
|
2,280
|
|
|
|
1,866
|
|
|
22
|
%
|
|
22
|
%
|
Equipment
|
|
|
158
|
|
|
|
106
|
|
|
49
|
%
|
|
51
|
%
|
|
|
499
|
|
|
|
330
|
|
|
51
|
%
|
|
51
|
%
|
Total
|
|
|
2,546
|
|
|
|
2,149
|
|
|
18
|
%
|
|
18
|
%
|
|
|
7,673
|
|
|
|
6,415
|
|
|
20
|
%
|
|
20
|
%
|
Western Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
|
692
|
|
|
|
606
|
|
|
14
|
%
|
|
14
|
%
|
|
|
1,951
|
|
|
|
1,875
|
|
|
4
|
%
|
|
10
|
%
|
Apparel
|
|
|
298
|
|
|
|
305
|
|
|
-2
|
%
|
|
-3
|
%
|
|
|
981
|
|
|
|
1,045
|
|
|
-6
|
%
|
|
0
|
%
|
Equipment
|
|
|
50
|
|
|
|
51
|
|
|
-2
|
%
|
|
-3
|
%
|
|
|
172
|
|
|
|
185
|
|
|
-7
|
%
|
|
-1
|
%
|
Total
|
|
|
1,040
|
|
|
|
962
|
|
|
8
|
%
|
|
8
|
%
|
|
|
3,104
|
|
|
|
3,105
|
|
|
0
|
%
|
|
6
|
%
|
Central & Eastern Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
|
179
|
|
|
|
161
|
|
|
11
|
%
|
|
8
|
%
|
|
|
491
|
|
|
|
476
|
|
|
3
|
%
|
|
9
|
%
|
Apparel
|
|
|
119
|
|
|
|
96
|
|
|
24
|
%
|
|
21
|
%
|
|
|
370
|
|
|
|
330
|
|
|
12
|
%
|
|
18
|
%
|
Equipment
|
|
|
20
|
|
|
|
18
|
|
|
11
|
%
|
|
10
|
%
|
|
|
65
|
|
|
|
64
|
|
|
2
|
%
|
|
9
|
%
|
Total
|
|
|
318
|
|
|
|
275
|
|
|
16
|
%
|
|
13
|
%
|
|
|
926
|
|
|
|
870
|
|
|
6
|
%
|
|
12
|
%
|
Greater China
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
|
410
|
|
|
|
449
|
|
|
-9
|
%
|
|
-11
|
%
|
|
|
1,090
|
|
|
|
1,116
|
|
|
-2
|
%
|
|
-4
|
%
|
Apparel
|
|
|
196
|
|
|
|
221
|
|
|
-11
|
%
|
|
-13
|
%
|
|
|
598
|
|
|
|
666
|
|
|
-10
|
%
|
|
-11
|
%
|
Equipment
|
|
|
29
|
|
|
|
24
|
|
|
21
|
%
|
|
22
|
%
|
|
|
96
|
|
|
|
90
|
|
|
7
|
%
|
|
5
|
%
|
Total
|
|
|
635
|
|
|
|
694
|
|
|
-9
|
%
|
|
-10
|
%
|
|
|
1,784
|
|
|
|
1,872
|
|
|
-5
|
%
|
|
-6
|
%
|
Japan
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
|
96
|
|
|
|
108
|
|
|
-11
|
%
|
|
-4
|
%
|
|
|
309
|
|
|
|
311
|
|
|
-1
|
%
|
|
3
|
%
|
Apparel
|
|
|
65
|
|
|
|
79
|
|
|
-18
|
%
|
|
-10
|
%
|
|
|
224
|
|
|
|
234
|
|
|
-4
|
%
|
|
-1
|
%
|
Equipment
|
|
|
14
|
|
|
|
15
|
|
|
-7
|
%
|
|
-1
|
%
|
|
|
44
|
|
|
|
49
|
|
|
-10
|
%
|
|
-8
|
%
|
Total
|
|
|
175
|
|
|
|
202
|
|
|
-13
|
%
|
|
-6
|
%
|
|
|
577
|
|
|
|
594
|
|
|
-3
|
%
|
|
0
|
%
|
Emerging Markets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
|
590
|
|
|
|
553
|
|
|
7
|
%
|
|
9
|
%
|
|
|
1,912
|
|
|
|
1,780
|
|
|
7
|
%
|
|
15
|
%
|
Apparel
|
|
|
195
|
|
|
|
187
|
|
|
4
|
%
|
|
6
|
%
|
|
|
679
|
|
|
|
602
|
|
|
13
|
%
|
|
20
|
%
|
Equipment
|
|
|
54
|
|
|
|
53
|
|
|
2
|
%
|
|
5
|
%
|
|
|
167
|
|
|
|
159
|
|
|
5
|
%
|
|
13
|
%
|
Total
|
|
|
839
|
|
|
|
793
|
|
|
6
|
%
|
|
8
|
%
|
|
|
2,758
|
|
|
|
2,541
|
|
|
9
|
%
|
|
16
|
%
|
Global Brand Divisions3 |
|
|
30
|
|
|
|
27
|
|
|
11
|
%
|
|
11
|
%
|
|
|
84
|
|
|
|
84
|
|
|
0
|
%
|
|
5
|
%
|
Total NIKE Brand
|
|
|
5,583
|
|
|
|
5,102
|
|
|
9
|
%
|
|
10
|
%
|
|
|
16,906
|
|
|
|
15,481
|
|
|
9
|
%
|
|
12
|
%
|
Other Businesses4 |
|
|
615
|
|
|
|
563
|
|
|
9
|
%
|
|
9
|
%
|
|
|
1,768
|
|
|
|
1,636
|
|
|
8
|
%
|
|
8
|
%
|
Corporate5 |
|
|
(11
|
)
|
|
|
(9
|
)
|
|
-
|
|
|
-
|
|
|
|
(58
|
)
|
|
|
(22
|
)
|
|
-
|
|
|
-
|
|
Total NIKE, Inc. Revenues From Continuing Operations
|
|
$
|
6,187
|
|
|
$
|
5,656
|
|
|
9
|
%
|
|
10
|
%
|
|
$
|
18,616
|
|
|
$
|
17,095
|
|
|
9
|
%
|
|
12
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total NIKE Brand
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footwear
|
|
$
|
3,658
|
|
|
$
|
3,347
|
|
|
9
|
%
|
|
9
|
%
|
|
$
|
10,647
|
|
|
$
|
9,777
|
|
|
9
|
%
|
|
12
|
%
|
Apparel
|
|
|
1,570
|
|
|
|
1,461
|
|
|
7
|
%
|
|
8
|
%
|
|
|
5,132
|
|
|
|
4,743
|
|
|
8
|
%
|
|
11
|
%
|
Equipment
|
|
|
325
|
|
|
|
267
|
|
|
22
|
%
|
|
23
|
%
|
|
|
1,043
|
|
|
|
877
|
|
|
19
|
%
|
|
22
|
%
|
Global Brand Divisions3 |
|
|
30
|
|
|
|
27
|
|
|
11
|
%
|
|
11
|
%
|
|
|
84
|
|
|
|
84
|
|
|
0
|
%
|
|
5
|
%
|
1 Certain prior year amounts have been reclassified to
conform to fiscal year 2013 presentation. These changes had no
impact on previously reported results of operations or
shareholders' equity.
|
2 Fiscal 2013 results have been restated using fiscal
2012 exchange rates for the comparative period to enhance the
visibility of the underlying business trends excluding the impact
of foreign currency exchange rate fluctuations.
|
3 Global Brand Divisions primarily represent NIKE Brand
licensing businesses that are not part of a geographic operating
segment.
|
4 Other businesses represent activities of Converse,
Hurley, and NIKE Golf.
|
5 Corporate revenues primarily consist of intercompany
revenue eliminations and foreign currency revenue-related hedge
gains and losses generated by entities within the NIKE Brand
geographic operating segments and certain Other Businesses through
our centrally managed foreign exchange risk management program.
|
|
NIKE, Inc.
|
EARNINGS BEFORE INTEREST AND TAXES1,2 |
For the period ended February 28, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
|
|
%
|
|
NINE MONTHS ENDED
|
|
%
|
(Dollars in millions)
|
|
2/28/2013
|
|
|
2/29/2012
|
|
|
Change
|
|
|
2/28/2013
|
|
2/29/2012
|
|
Change
|
North America
|
|
$
|
625
|
|
|
$
|
503
|
|
|
24
|
%
|
|
$
|
1,811
|
|
|
$
|
1,468
|
|
|
23
|
%
|
Western Europe
|
|
|
178
|
|
|
|
149
|
|
|
19
|
%
|
|
|
505
|
|
|
|
464
|
|
|
9
|
%
|
Central & Eastern Europe
|
|
|
71
|
|
|
|
60
|
|
|
18
|
%
|
|
|
175
|
|
|
|
163
|
|
|
7
|
%
|
Greater China
|
|
|
218
|
|
|
|
273
|
|
|
-20
|
%
|
|
|
567
|
|
|
|
664
|
|
|
-15
|
%
|
Japan
|
|
|
24
|
|
|
|
24
|
|
|
0
|
%
|
|
|
91
|
|
|
|
93
|
|
|
-2
|
%
|
Emerging Markets
|
|
|
221
|
|
|
|
215
|
|
|
3
|
%
|
|
|
749
|
|
|
|
652
|
|
|
15
|
%
|
Global Brand Divisions3 |
|
|
(324
|
)
|
|
|
(299
|
)
|
|
-8
|
%
|
|
|
(1,023
|
)
|
|
|
(846
|
)
|
|
-21
|
%
|
TOTAL NIKE BRAND
|
|
|
1,013
|
|
|
|
925
|
|
|
10
|
%
|
|
|
2,875
|
|
|
|
2,658
|
|
|
8
|
%
|
Other Businesses4 |
|
|
128
|
|
|
|
104
|
|
|
23
|
%
|
|
|
329
|
|
|
|
280
|
|
|
18
|
%
|
Corporate5 |
|
|
(285
|
)
|
|
|
(242
|
)
|
|
-18
|
%
|
|
|
(840
|
)
|
|
|
(645
|
)
|
|
-30
|
%
|
TOTAL EARNINGS BEFORE INTEREST AND TAXES
|
|
$
|
856
|
|
|
$
|
787
|
|
|
9
|
%
|
|
$
|
2,364
|
|
|
$
|
2,293
|
|
|
3
|
%
|
1 The Company evaluates performance of individual
operating segments based on earnings before interest and taxes (also
commonly referred to as “EBIT”), which represents net income before
interest expense, net, and income taxes.
|
2 Certain prior year amounts have been reclassified to
conform to fiscal year 2013 presentation. These changes had no
impact on previously reported results of operations or
shareholders' equity.
|
3 Global Brand Divisions primarily represent NIKE Brand
licensing businesses that are not part of a geographic operating
segment and selling general and administrative expenses that are
centrally managed for the Nike Brand.
|
4 Other Businesses represent activities of Converse,
Hurley, and NIKE Golf.
|
5 Corporate consists of unallocated general and
administrative expenses, which includes expenses associated with
centrally managed departments, depreciation and amortization
related to the Company’s corporate headquarters, unallocated
insurance and benefit programs, certain foreign currency gains and
losses, including certain hedge gains and losses, corporate
eliminations and other items.
|
|
NIKE, Inc.
|
NIKE BRAND REPORTED FUTURES GROWTH BY GEOGRAPHY1 |
As of February 28, 2013
|
|
|
|
|
|
|
|
Reported Futures Orders
|
|
Excluding Currency Changes 2
|
North America
|
|
11
|
%
|
|
11
|
%
|
Western Europe
|
|
-5
|
%
|
|
-5
|
%
|
Central & Eastern Europe
|
|
11
|
%
|
|
11
|
%
|
Greater China
|
|
4
|
%
|
|
3
|
%
|
Japan
|
|
-8
|
%
|
|
5
|
%
|
Emerging Markets
|
|
12
|
%
|
|
16
|
%
|
Total NIKE Brand Reported Futures
|
|
6
|
%
|
|
7
|
%
|
1 Futures orders by geography and in total for NIKE Brand
athletic footwear and apparel scheduled for delivery from March 2013
through July 2013.
|
|
The reported futures and advance orders growth is not necessarily
indicative of our expectation of revenue growth during this period.
This is due to year-over-year changes in shipment timing and because
the mix of orders can shift between advance/futures and at-once
orders and the fulfillment of certain orders may fall outside of the
schedule noted above. In addition, exchange rate fluctuations as
well as differing levels of order cancellations and discounts can
cause differences in the comparisons between advance/futures orders
and actual revenues. Moreover, a significant portion of our revenue
is not derived from futures and advance orders, including at-once
and close-out sales of NIKE Brand footwear and apparel, sales of
NIKE Brand equipment, sales from certain of our Direct to Consumer
operations, and sales from our Other Businesses.
|
|
2 Reported futures restated using prior year exchange
rates to enhance the visibility of the underlying business trends
excluding the impact of foreign currency exchange rate fluctuations.
|