Nike Earnings Just Did It (NKE)

Nike Inc. (NYSE: NKE) has now reported its earnings of $1.20 earnings per share and $5.8 billion in sales.  The footwear and apparel giant had estimates from Thomson Reuters of $1.16 EPS on $5.8 billion in revenues.  The company is also targeting worldwide futures orders being up 15%, or up 18% if you account for forex.

The company described the current environment as remaining volatile but optimistic. As of the end of the quarter, Nike Brand’s worldwide futures orders scheduled for delivery from March through July 2012 came to a rise of about 15% to a total of $9.4 billion.

Gross margin fell 2 full points down to 43.8% due “primarily to higher product costs, which more than offset the positive effects of price increases, growing sales in our Direct to Consumer operations, and ongoing product cost reduction initiatives.”

Inventories were up big by 32% to about $3.4 billion, but about 20-points of the increase in NIKE Brand inventories was “due to significantly higher product input costs and changes in product mix.”   Nike spent $239 million buying back stock in the quarter and it has remaining about $1.1 billion of its total $5 billion share buyback plan available.

Shares closed up $0.55 at $110.99 and the 52-week trading range is $75.62 to $112.97.  Shares are indicated up less than $1.00 around $112.00 in the after-hours reaction.  Without guidance being offered for the quarter or the year, we would consider this unfinished or incomplete.

JON C. OGG