Nike sees Q4 earnings slide, sales rise

Sporting goods giant Nike reported a 5 percent drop in fourth quarter earnings due to a one-off charge related to an arbitration ruling. Sales, however, were up 8 percent thanks to strong footwear and apparel sales. The company said net income for the quarter ended 31 May fell to $332.8 million on sales that rose to $4 billion (£2.2 billion) from $3.7 billion. The one-off charge was related to an arbitration ruling for the Converse brand. Profits for the year gained 15 percent to $1.4 billion on sales up 9 percent to $15 billion. "With deeper focus on discrete segments of our business, strong connections with consumers through global initiatives such as Joga Bonito, and compelling product innovations such as Air Max 360, we delivered very strong earnings growth and record revenues for the year," Mark Parker, president and chief executive of Nike, said in a statement.

US sales in the fourth quarter rose 10 percent to $1.5 billion. Footwear sales increased 10 percent to $993.7 million, while apparel sales rose 18 percent to $395.7 million. Sales and profits rose in all regions during the full fiscal year. "We deepened our brand leadership in core categories such as basketball and soccer, and experienced strong growth in key markets such as the United States , Latin America, China and Russia ," said Parker. Sales in group's other businesses, which include Converse, Cole Haan, Hurley International and Exeter brands, increased 13 percent to $595.5 million from $529.2 million last year. Global future orders gained 5 percent on last year's, to $6.6 billion. Meanwhile, gross margins fell in the fourth quarter to 43.8 percent from 45.2 percent during the same period last year. Gross margins for the year fell form 44.5 percent to 44 percent.