Nike fu­ture or­ders dis­ap­point, shares fall

The Pak Banker - - International -

DETROIT: Nike Inc (NKE.N) posted fu­ture or­ders data that missed many an­a­lysts' ex­pec­ta­tions Tues­day, send­ing shares of the world's largest ath­letic shoe and cloth­ing maker down al­most 6 per­cent.

Nike also said it might un­der­take some tar­geted price in­creases to help off­set ris­ing cot­ton costs.

Fu­ture or­ders, ex­clud­ing cur­rency ex­change rates-a key mea­sure of sales growth-rose 11 per­cent. "They didn't beat ris­ing ex­pec­ta­tions for fu­ture or­ders and that's why the stock's down," said Jon Fisher, port­fo­lio man­ager with Fifth Third As­set Man­age­ment, which owns Nike shares. Wall Street was look­ing for fu­ture or­ders growth of 12 to 13 per­cent, he said. Nike ex­ec­u­tives also re­peated com­ments made in the pre­vi­ous quar­ter that ris­ing cot­ton, la­bor and trans­porta­tion costs would hurt profit mar­gins in the sec­ond half of the fis­cal year de­spite ris­ing de­mand. They said the cost pres­sures would ease over the next 12 to 18 months.

"As sup­ply and de­mand find a new nor­mal in the re­cov­er­ing econ­omy, our in­dus­try is go­ing to ex­pe­ri­ence mar­gin pres­sure due to ris­ing in­put costs," Nike Chief Ex­ec­u­tive Mark Parker said on a con­fer­ence call. Fore­cast-beat­ing quar­terly prof­its re­ported by ath­letic footwear re­tailer Fin­ish Line Inc (FINL.O) Tues­day un­der­scored the de­mand. -Ap

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