Nike has record year but lags in fourth quarter

BEAVERTON, Ore. — Nike posted record sales of $15 billion for its fiscal year despite a drop in fourth-quarter earnings blamed on a Converse arbitration ruling and World Cup soccer spending.

Revenue grew 9 percent from $13.7 billion the previous year, while profits jumped 15 percent to $1.4 billion for fiscal 2006 compared to $1.2 billion in 2005. Earnings per share grew 18 percent to $5.28 from $4.48 a year ago.

"Fiscal 2006 was indeed one for the record books," said Don Blair, chief financial officer.

The final quarter saw some slippage, however, as the athletic shoe and clothing giant saw earnings drop 5 percent to $332.8 million, or $1.27 per share, from $349.5 million, or $1.30 per share, last year.

Excluding a 12-cent charge per share for a $52.5 million settlement between its Converse subsidiary and a former licensee, Nike earnings would have been $1.39 per share — a penny off the estimate of $1.40 by analysts surveyed by Thomson Financial.

Nike reported worldwide futures orders for athletic footwear and apparel, scheduled for delivery from June 2006 through November 2006, totaling $6.6 billion, 5 percent higher than reported last year.

During the fourth quarter, U.S. revenue increased 10 percent to $1.5 billion from $1.3 billion for the same period last year. Footwear revenue grew 10 percent to $993.7 million, and apparel revenue increased 18 percent to $395.7 million. Equipment sales declined 12 percent to $74.3 million.

Shares of Nike fell 62 cents to close at $83.63, and slid $2.39, or 2.9 percent, to $81.24 in aftermarket electronic activity.