NIKE JUST DO ITIntroductionJUST DO IT 1964 년에 오리건 주의 육상코치 빌 보워먼과 중거리 육상선수 필립 나이트가 더 좋은 신발을 만들고자 세워진 회사 , NIKE Intro NIKE Accounting Standards Financial Statement AnalysisIF YOU HAVE A BODY, YOU ARE AN ATHLETE MISSION JUST DO IT! JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisNIKE Products JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisSource : NIKE Annual Report (2014) NIKE Revenues by Product JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisSource : NIKE Annual Report (2014) NIKE Revenues by Region JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisFootwear Apparel Equipment Source : NIKE Annual Report (For the Year Ended May 31 2010) ADIDAS Annual Report (For the Year Ended Dec 31 2010) (B$) JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisJUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisJUST DO IT Intro NIKE Accounting Standards Financial Statement Ane greatest potential impact on our financial statements …… .”Revenue Recognition Revenue Recording Sales Return Estimate JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisInventory Allowance for AR JUST DO IT Intro NIKE Accounting Standards Financial Statement Analysis “We …… estimates relating to the net realizable value of inventories …… . If we estimate that the net realizable value of our inventory is less than the cost of the inventory recorded on our books, we record …… to Cost of sales .” “We …… maintain an allowance for estimated losses resulting from the inability of our customers to make required payments. …… consider our historical level of credit losses and make judgments about the creditworthiness of significant customers based on ongoing credit evaluations . …… we would record a credit or a charge to Operating overhead expense in the period in which such a determination is made.”Contingent Payments under Endorsement Contracts JUST DO IT Intro NIKE Accentory Reserves Revenue Recognition Contingent Payments under Endorsement Contracts JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisFinancial StatementFor the Year Ended May 31 (In millions, except per share data) 2014 2013 2012 Revenues $ 27,799 $ 25,313 $ 23,331 Cost of sales $ 15,353 $ 14,279 $ 13,183 Gross profit $ 12,446 $ 11,034 $ 10,148 Gross margin (%) 44.8% 43.6% 43.5% Demand creation expense $ 3,031 $ 2,745 $ 2,607 Operating overhead expense $ 5,735 $ 5,051 $ 4,472 Total selling and administrative expense $ 8,766 $ 7,796 $ 7,079 Interest income, net $ (33) $ 3 $ (4) Other (income) expense, net $ (103) $ 15 $ (54) Income before income taxes $ 3,544 $ 3,256 $ 3,011 Income taxes $ 851 $ 805 $ 754 Net income $ 2,693 $ 2,451 $ 2,257 Basic earnings per common share $ 3.05 $ 2.74 $ 2.45 Diluted earnings per common share $ 2.97 $ 2.68 $ 2.40 Dividends declared per common share $ 0.93 $ 0.81 $ 0.70 Income Statement JUST DO IT Intro NIKE Accounting Standards Finacounting Standards Financial Statement AnalysisMay 31 2014 2013 LIABILITIES AND SHAREHOLDERS’ EQUITY (In millions) Current liabilities: Current portion of long-term debt $ 7 $ 57 Notes payable $ 167 $ 98 Accounts payable $ 1,930 $ 1,669 Accrued liabilities $ 2,491 $ 2,036 Income taxes payable $ 432 $ 84 Total current liabilities $ 5,027 $ 3,962 Long-term debt (Note 8) $ 1,199 $ 1,210 Deferred income taxes and other liabilities $ 1,544 $ 1,292 Commitments and contingencies $ - $ - Redeemable Preferred Stock $ - $ - Shareholders’ equity: Common stock at stated value Class A convertible — 178 and 178 shares outstanding $ - $ - Class B— 692 and 716 shares outstanding $ 3 $ 3 Capital in excess of stated value $ 5,865 $ 5,184 Accumulated other comprehensive income $ 85 $ 274 Retained earnings $ 4,871 $ 5,620 Total shareholders’ equity 10,824 11,081 Total liabilities and shareholders’ equity 18,594 17,545 Liabilities 20.2% ↑ Equity 2.3% ↓ Statement of Financial Position Liabilities and Equityntro NIKE Accounting Standards Financial Statement AnalysisDemand Creation Expense Overhead Expense 10.9% of revenue 20.6% of revenue Commercial – TV, online, promotion Deal with sports team - Brazil, Korea Gas, water, electricity, etc.. JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisNet income before Taxation Tax Expense Net income from Continuous Operation Net income from Discontinuous Operation Net income $ 3,544 $ 851 $ 2,693 $ 0 $ 2,693 24% Taxation Operating Margin = 12.7% 8.3% (Unit : million$) JUST DO IT Intro NIKE Accounting Standards Financial Statement AnalysisRatio Analysis Liquidity Ratios Current ratio 2.7 Acid-test(Quick) ratio 1.7 Account receivable turnover 4.7 Inventory turnover 4.1 Solvency Ratios Long-term debt to total assets ratio 6.4% Profitability Ratios Profit margin 44.8% Asset turnover 82.5% Return on assets 14.9% Earnings per share(EPS) 6.02 Price-earnings(P-E) ratio 25.9 (In millions) JUST DO IT Intro NIKE Accounting Standards Financ}
