Business news :Nike Q1 earnings drop 12%, but still manages to beat forecasts

First quarter earnings fell 12 per cent for the world’s leading supplier of athletic shoes and apparel, while futures orders in China fell for the first time in three years, despite a strong year of growth and results.
Even after beating analyst expectations, the news of a decline in orders sent Nike shares down 3 per cent after market close on Thursday.

According to Reuters, futures orders of Nike-branded shoes and clothes for September 2012 to January 2013 rose 6 per cent. However, in Nike’s all-important Chinese market, it was a different story. Futures plummeted from a 27 per cent high in growth last year to a 5 per cent decline, a result investors did not take to kindly.

"The (Chinese) consumer is becoming more discerning and sophisticated. At the same time the economy seems to be slowing, creating short-time challenges for retailers," Charlie Denson, president for the Nike brand, said in light of the results.

"It's a natural evolution we've seen in many markets, so we're not surprised," he said.
In spite of the fall, Nike’s results for the first quarter fared well against a tumultuous economic backdrop. The sportswear giant earned USD 1.23 a share for the quarter to 31 August, compared to USD 1.36 a share the year before. However, the average analyst forecast from Thomson Reuters I/B/E/S came in at USD 1.12 a share.

Similarly, Nike revenue rose 10 per cent to USD 6.7 billion, compared with estimates of USD 6.42 billion.

( source myretailmedia.com )

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