Nike'S Greater China Profit Growth Slowed Down By &Nbsp; Sports Goods Industry Collectively Went Through The Winter.

Sports goods industry is generally depressed, showing a trend of wind and rain. Nike Recently announced the first quarter of fiscal year 2012 (June 2011 to August) results, the Greater China region revenue increased by 15%, pre tax profits increased by 4% over the same period, of which pre tax profit growth has hit Nike's Greater China region in the last 5 quarters of the new low. In addition, Nike's global inventories increased by 41% to $3 billion 100 million a year.

In the first quarter of fiscal year 2012, the income of footwear and sports equipment in Nike Greater China achieved a two digit growth, of which footwear income was $314 million, an increase of 28% compared with the same period last year, while sports equipment revenue increased by 37 million US dollars, an increase of 16% over the same period last year. However, clothing revenue decreased by 3% compared to the same period last year, only 177 million dollars, compared with 182 million dollars in the same period last fiscal year.

Nike's total revenue amounted to $528 million, an increase of 15% over the previous year, and the pre tax profit of $171 million, up only 4% from the same period last year. In the past four quarters, the growth of pre tax profits in Nike Greater China was 10%, 39%, 21%, 21%, respectively, and the growth rate of pre tax profit in the first quarter of Nike's 2012 fiscal year hit a new low.

Market watchdog Ma Gang told reporters that the income of Nike Greater China is still showing growth trend, that is, the number of Nike's new stores has increased. A large number of new stores can bring in the growth of business revenue, but the rising wage and rents in the country have increased the cost of Nike's sales, resulting in a slowdown in its pre tax profit growth.

Nike's gross profit margin in the first quarter of fiscal year 2012 was 44.3%, compared to 47% in the first quarter of last year, and 2.7 percentage points reduced. Nike explained that the overall gross margin decreased due to the increase in product costs and the increase in the proportion of discounted products in total revenue.

Nike is currently facing a sharp increase in the amount of stock in 2008~2009, Nike's first quarter of fiscal year 2012 as a whole. Stock The amount reached $3 billion 107 million, an increase of 41% over the previous year, which is at the highest level compared with the total inventory since the 2006 fiscal year.

Ma Gang pointed out that the Chinese market, for example, Nike recently raised the price of its products, about 8% of the increase, this increase is not large compared with domestic brands, but this will affect the enthusiasm of consumers to buy Nike products, and increase the number of stocks.

In addition, China Sporting goods After an average annual growth of about 30% per year in the past 10 years, the industry has reached the juncture of adjustment.

Ma Gang said that the existence of a large number of stores, while increasing the brand revenue, will also increase a large number of stocks. Now Nike has again seen a substantial increase in the amount of stock. If Nike cleaned up its stock in the form of a discount, it would inevitably encroach on the market of other brands. Other brands will have to follow the discount, and the whole market will have a chain reaction. Next year, the sporting goods market prospect is not optimistic.