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Last Update: 28-Sep-12 09:29 ET
Nike shares fall 3% following disappointing futures orders in its earnings report
Nike (NKE $93.12 -2.88) reported first quarter earnings of $1.23 per share, $0.11 better than the Capital IQ consensus of $1.12, while revenues rose 10.2% year/year to $6.7 bln vs the $6.42 bln consensus. Gross margin declined 80 basis points to 43.5 percent. Gross margin continued to benefit from pricing actions and product cost reduction initiatives, however, this was more than offset by higher input costs, primarily materials and labor. In addition, gross margin was negatively impacted by a shift in the Company's mix to lower margin businesses within the NIKE Brand and the conversion of the China market to direct distribution for Converse. Inventories for NIKE, Inc. were $3.4 billion, up 10 percent from August 31, 2011, in line with revenue growth, and reflecting strong demand for NIKE, Inc. products. Futures Orders As of the end of the quarter worldwide futures orders for NIKE Brand athletic footwear and apparel, scheduled for delivery from September 2012 through January 2013, totaled $8.9 billion, 6 percent higher than orders reported for the same period last year. Excluding currency changes, reported orders would have increased 8 percent.
