Downturn hits sports giant Nike

Nike's forward sales are down

Profits at sportswear giant Nike have dropped in the past year as the recession took its toll.

Net profit in the year to 31 May fell to $1.49bn (£913m) from $1.88bn in the previous year. But sales revenues rose 3% to $19.2bn in that period.

The company is undergoing a costly restructuring - cutting costs and 1,750 posts, or 5% of its workforce, in the biggest job reduction in its history.

Shares in Nike dropped 5% to $50.49 after the results were announced.

'Prudent'

Nike reported that future orders for athletic footwear and apparel, scheduled to be delivered between June and November 2009, stood at $7.8bn, down 12% from the same period last year.

The Europe, Middle East and Africa division saw the greatest fall - of 24%, and US. future orders fell by 4%.

But the company said it had still seen appetite for its more expensive products. For example, one of its best-selling shoes from the Nike store online sold at $160.

"Even if the worst is behind us, we're taking an approach that's both prudent and opportunistic," Nike president Mark Parker said.