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SHOE and clothing company Nike said yesterday that, despite weak domestic sales, its profits grew 9 percent in the second quarter after strong sales overseas.
The Oregon-based company reported its net income rose to US$391 million, or 80 cents a share, compared with net income of US$359.4 million, or 71 cents a share, in the same quarter last year.
The company said its total revenue grew 6 percent to US$4.6 billion, from US$4.3 billion in 2007. Changes in currency exchange rates also boosted revenue.
Nike president and Chief Executive Officer Mark Parker said the results demonstrated the strength of the brand. He said the current state of the industry and the world offered opportunities for Nike to become a stronger leader.
"In challenging times like these, it's especially important to stay focused on what we do best ?? delivering the most innovative and relevant product, strengthening our relationship with consumers and driving excellence into every area of our business," Parker said. "That's how we continue to lead the industry, take market share from competitors and grow our business."
The company saw strong sales growth in Asia and other foreign markets. Revenue in Asia jumped 22 percent for the quarter. But domestic sales were weak. Total revenue in the United States decreased 1 percent.
Nike said sales at six of its top 10 accounts in the US were essentially flat. And comparable-store sales for Nike-owned stores dropped nearly 20 percent, because the company had little promotional activity compared to the rest of the marketplace. Many of its stores are in tourist areas, which are among those hit hardest by the economic downturn. Comparable-store sales are considered a key indicator of a retailer's health.
Nike's orders for product to be delivered between December and April dropped 1 percent below the same period last year. Company leaders are confident they will thrive under the continued macro-economic pressures and will tightly control inventory and focus on investments that sustain long-term growth.
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