Home / Knowledge / News / Apparel/Garments / Gross margin expansion drives Q2FY15 diluted EPS at Nike
Gross margin expansion drives Q2FY15 diluted EPS at Nike
Dec '14
Gross margin expansion and a lower average share count drove diluted earnings per share growth by 25 per cent year on year at Nike for its second fiscal quarter ended November 30, 2014.

In the second quarter of fiscal 2015, net income surged 23 per cent to $655 million, while diluted earnings per share zoomed 25 per cent to $0.74, both from a year earlier quarter.

Strong consumer demand drove revenue growth across the portfolio by 15 per cent from a year ago period to $7.4 billion, while it rose 18 per cent on a currency neutral basis.

Revenues for Nike brand amounted to $7.0 billion in the reporting quarter, up 17 per cent on a currency neutral basis, with growth in every product type, geography and key category, except Golf.

Sales for Converse brand totaled to $434 million, up a massive 24 per cent on a currency neutral basis, driven by continuing growth in existing direct distribution markets as well as market conversions.

In the period under review, gross margin increased 120 basis points year-on-year to 45.1 per cent, which it attributed to a shift in mix to higher margin products and continued growth in DTC business.

Selling and administrative expense grew 17 per cent to $2.4 billion in the second quarter of fiscal 2015, while demand creation expense was $766 million, up 11 per cent versus the prior year quarter.

In the same period, operating overhead expense hiked 19 percent from to $1.7 billion, reflecting growth in the DTC business, as well as investments in operational infrastructure and digital capabilities.

Nike said the effective tax rate for the reporting quarter was 25.4 per cent, a 20 basis point increase, primarily due to adjustments to tax expense on intercompany transactions.

Mark Parker, CEO at Nike said, “The power of our portfolio continues to unlock growth, as we keep a laser focus on our biggest opportunities.”

“The breadth and depth of that portfolio has helped us consistently deliver strong results, quarter after quarter and year after year,” he noted.

Inventories climbed 11 per cent to $4.2 billion, up 11 per cent from November 30, 2013, driven by a 9 per cent increase in Nike brand wholesale inventories and also at Converse and DTC.

Cash and short-term investments were $4.7 billion; $474 million lower than last year from growth in net income and collateral received from counterparties to foreign currency hedging instruments.

During the second quarter, Nike repurchased a total of 5.1 million shares for approximately $425 million as part of the four-year, $8 billion program approved in September 2012.

As of the end of the second quarter, a total of 67.6 million shares had been repurchased under this program for $4.7 billion at an average cost of approximately $68.96 per share. (AR)

Fibre2fashion News Desk - India

Must ReadView All

(L-R) Mr Shao Bojin, Chairman of Jihua Group and Mr Rohit Aggarwal, President of Huntsman Textile

Textiles | On 28th Oct 2016

Huntsman gets into strategic partnership with Jihua Group

Huntsman Textile Effects, the leading provider of high quality dyes...

Marzoli FT6D roving frames in Sintex’s Unit 2. Coutresy: Marzoli

Textiles | On 28th Oct 2016

Marzoli roving frames erected at Sintex textile division

A total of 48 Marzoli roving frames were erected in units I, II and...

Courtesy: Polartec

Textiles | On 28th Oct 2016

Polartec innovates most breathable waterproof fabric

Polartec, the premium provider of innovative textile solutions, has...

Interviews View All

Frank Gossmann
Rotorcraft AG

‘RT3 motto is: Do not check millimetres, check colours.’

Rahuul Jashnani

‘Online economy has changed the whole dynamics of buying habits.’

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Eric Scholler

The Indian market has huge potential in technical textiles, and by far,...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Sonam & Paras Modi

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

October 2016

October 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Advanced Search