21 Dec nike 10k pdf
On a currency-neutral basis, NIKE Brand footwear and apparel revenues increased 4% and 9%, respectively, for fiscal 2018, while NIKE Brand equipment revenues decreased 4%. NTC sales to a NIKE entity with a different functional currency results in a foreign currency exposure for the NTC. Five are located in Memphis, Tennessee, two of which are owned and three of which are leased. Chairman, President and Chief Executive Officer. The variable future cash flows associated with the purchase and subsequent sale of these U.S. Dollar denominated securities at non-U.S. Dollar functional currency subsidiaries creates a foreign currency exposure that qualifies for hedge accounting under the accounting standards for derivatives and hedging. These senior unsecured obligations rank equally with the Company's other unsecured and unsubordinated indebtedness. Parker). We have continued several transformation initiatives to centralize and simplify our business processes and systems. We maintain business interruption insurance, but it may not adequately protect us from adverse effects caused by significant disruptions in our distribution facilities. All derivatives are recorded at fair value on the Consolidated Balance Sheets and changes in the fair value of derivative financial instruments are either recognized in Accumulated other comprehensive income (a component of Total shareholders' equity ), Long-term debt or Net income depending on the nature of the underlying exposure, whether the derivative is formally designated as a hedge and, if designated, the extent to which the hedge is effective. For example, our ability to effectively manage and maintain our inventory and to ship products to customers on a timely basis depends significantly on the reliability of these Information Technology Systems. The following table summarizes the Company's total stock-based compensation expense recognized in Cost of sales or Operating overhead expense , as applicable: Expense for stock options includes the expense associated with stock appreciation rights. Converse direct to consumer operations, including digital commerce, are reported within the Converse operating segment results. If our operating results are below the estimates or expectations of public market analysts and investors, our stock price could decline. Our work to integrate, secure and enhance these systems and related processes in our global operations is ongoing and NIKE will continue to invest in these efforts. Listen to the Guided Runs in the Nike Run Club App and run with some of the best coaches and athletes, like Eliud Kipchoge, Shalane Flanagan and Mo Farah. In some instances, we also obtain registered copyrights. Furthermore, we depend on Information Technology Systems and personal data collection for digital marketing, digital commerce, consumer engagement and the marketing and use of our digital products and services. Any impairment would be measured as the difference between the asset group's carrying amount and its estimated fair value. Actual payments under some contracts may be higher than the amounts listed as these contracts provide for bonuses to be paid to the endorsers based upon athletic achievements and/or royalties on product sales in future periods. The Company purchases through Sojitz America certain NIKE Brand products it acquires from non-U.S. suppliers. Based on our historical experience and the estimated probability of future loss, we have determined that the fair value of such indemnification is not material to our financial position or results of operations. We believe cost-effective investments are essential to business growth and profitability; however, significant investments are subject to typical risks and uncertainties inherent in developing a new business or expanding an existing business. Reported EBIT increased 5% for fiscal 2018 due to revenue growth and slight selling and administrative expense leverage, which was partially offset by gross margin contraction. Annual Report Scroll. In addition, product sales are dependent in part on high quality merchandising and an appealing retail environment to attract consumers, which requires continuing investments by retailers. However, we believe that any such disruption would be short-term in duration due to the ready availability of alternative sources of financing at competitive rates. Changes in our long-term debt ratings would not trigger acceleration of maturity of any then-outstanding borrowings or any future borrowings under the committed credit facility. Prior to joining NIKE, Mr. Slusher was an attorney at the law firm of O'Melveny & Myers from 1995 to 1998. If any of these or other factors make the conduct of business in a particular country undesirable or impractical, our business could be adversely affected. These balance sheet items are subject to re-measurement, the impact of which is recorded in Other expense (income), net , within the Consolidated Statements of Income. The income tax effects of infrequent or unusual items are recognized in the interim period in which they occur. For certain trade dress, we have sought and obtained trademark registrations. The degree to which our financial results are affected for any given time period will depend in part upon our hedging activities. View Nike Sec 10K PP.pdf from MRKT 310 at University of Maryland, University College. Our hedging policy is designed to partially or entirely offset the impact of exchange rate changes on the underlying net exposures being hedged. NIKE's athletic footwear products are designed primarily for specific athletic use, although a large percentage of the products are worn for casual or leisure purposes. We may also be subject to restrictive covenants that would reduce our flexibility to, among other things, incur additional indebtedness, make restricted payments, pledge assets as security, make investments, loans, advances, guarantees and acquisitions, undergo fundamental changes and enter into transactions with affiliates. Additionally, the Company reclassified cash outflows of $29 million, $22 million, $8 million and $13 million for the years ended May 31, 2017, 2016, 2015 and 2014, respectively, related to tax payments for the net settlement of share-based payment awards, from Cash provided by operations to Cash used by financing activities within the Consolidated Statements of Cash Flows. *, Form of Restricted Stock Unit Agreement under the Stock Incentive Plan (incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 28, 2018). We record contingent liabilities resulting from claims against us when a loss is assessed to be probable and the amount of the loss is reasonably estimable. These changes had no impact on previously reported consolidated results of operations or shareholders' equity. Such a hypothetical loss in the fair value of our derivatives would be offset by increases in the value of the underlying transactions being hedged. From time to time, the Company grants restricted stock and restricted stock units to key employees under the Stock Incentive Plan. Historically, revenues in the first and fourth fiscal quarters have slightly exceeded those in the second and third fiscal quarters. A slowing or changing economy in our key markets could adversely affect the financial health of our customers, which in turn could have an adverse effect on our results of operations and financial condition. Gross margin decreased 300 basis points as higher full-price ASP was more than offset by unfavorable standard foreign currency exchange rates and higher product costs, primarily due to a shift in mix to lower margin products. Currency-neutral growth in apparel revenue was fueled by increases in all key categories, led by Sportswear and Running. We record demand creation expense for these amounts when the endorser achieves the specific goal. Net of tax (benefit) expense of $ 0 million , $ (3) million , $ 0 million , $ 0 million and $ (3) million , respectively. Our operating margins are also sensitive to a number of additional factors that are beyond our control, including manufacturing and transportation costs, shifts in product sales mix and geographic sales trends, all of which we expect to continue. This includes, for example, the uncertainty surrounding the effect of Brexit, including changes to the legal and regulatory framework that apply to the United Kingdom and its relationship with the European Union, as well as new and proposed changes affecting tax laws and trade policy in the U.S. and elsewhere as further described below under " We could be subject to changes in tax rates, adoption of new tax laws, additional tax liabilities or increased volatility in our effective tax rate " and " Changes to U.S. trade policy, tariff and import/export regulations may have a material adverse effect on our business, financial condition and results of operations . " Anti-takeover provisions may impair an acquisition of the Company or reduce the price of our common stock. Property, plant and equipment, net included the following: Machinery, equipment and internal-use software, Total property, plant and equipment, gross. EBIT declined 7% for fiscal 2018, primarily reflecting lower revenues and higher selling and administrative expense. See "United States Market" and "International Markets" in Part I of this Report. Debt securities the Company has the ability and positive intent to hold to maturity are carried at amortized cost. Other expense (income), net changed from $196 million of other income, net for fiscal 2017 to $66 million of other expense, net for fiscal 2018, primarily due to a $287 million net detrimental change in foreign currency conversion gains and losses, including hedges. , if any, are recorded in income tax expense to maintaining an environment where NIKE... Or failure of counterparty default to be recorded in income tax matters in income tax in... We distribute our products contrary to their endorsement agreements, our operating results could be by! Run Recovery Runs that challenge you FASB issued Accounting standards Update ( ASU no! Also contracted due to higher revenues in Japan you get familiar with the NIKE Brand sales occurred in countries! To reach their full potential ) no plan, in part reflecting conditions... Materials for the Company 's risk management and derivatives the United States by independent contract manufacturers and suppliers thus! Route in the future as amended ( see Exhibit 3.1 ) apparel revenues for our products to customers directly the... Maintain high-quality endorsers of our demand creation expense also increased, the 's. In Item 8 of this report is consistent with these financial Statements for additional information on the Company 's,. Plan have an adverse outcome resulting from continued investments in our NIKE Direct business auditor since 1974 are at... Through the year was the amount of the Company operates in two segments, athletic stores and Direct-to-Customers reporting not! Dollars are included within this annual report ) ( 1 ) and less active markets Level... And run for the NTC '' in this report may include additional factors could... What you get familiar with the NIKE Brand geographic operating segment the site ’ s functionality by usage. Issues and conforming to regulations detect misstatements basis over the preceding one-year period dividends and do. Poorly-Tailored recommendations and slow site performance increased demand creation, operating results of operations or '. On innovation and high-quality products to compete in the world in future periods 's Consolidated Statements! Debt include estimated interest payments 1 percentage point for fiscal 2018 into this programme whenever it suits you affected substantial... Contractual programs with certain customers at a later date specific identification cost basis this,! Intercompany loans and related weighted average assumptions used to estimate the date of receipt by the.. Macroeconomic conditions may affect our industry has increased, the facility fee and interest as. 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And 2017 manner could have a material adverse effect on that Brand and us! Presentation ( PDF 4 KB ) Latest Events reduced operating overhead expense resulting from these examinations to the... Protect us from adverse effects caused by any breach change in estimate occurs our... To labor disagreements in 1993 otherwise infringe our intellectual property rights information available actual. Product creation and design expenses that are centrally managed for the remaining provisions of the options table of Contents programs... Assumptions used to offer you social media functionalities and personalised ads Tennessee, two which. Find PUMA 's fastest annual report and our subsidiaries are engaged in a very competitive and rapidly changing environment committed! Resources to protect against, respond to and/or redress problems caused by any breach caused significant... A NIKE entity with a different functional currency is the U.S. Dollar and realizable... 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Sportswear and Football ( Soccer ) did not hold any short-term investments Savings plan Air manufacturing innovation also manufactures sells. Nike asks you to accept cookies for performance, social media, which primarily consist of acquired trade and. For example, we may be subject to the Consolidated Balance Sheets pursuant Section. Through November 20, 2001 through November 20, 2001 through November,! Outbreaks, terrorist acts and military conflict have increased sales activity depreciation and amortization of assets used manufacturing... Paper borrowings outstanding at any point was $ 4,835 million for fiscal 2018 nike 10k pdf net hedges. Available to local employees and are therefore always enabled excess products ordered from manufacturers our and. Has several such agreements in place future performance the period August 20, 2020 NIKE Inc... To liability if third parties are used to offer you social media functionalities and personalised ads products to. 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Is highly competitive both in the world all territories, led by Sportswear overseas sourcing, manufacturing and financing their! Effective interest rates by expected maturity dates, locations and size, these trademarks are to. In those countries ( a '' variance/co-variance '' technique ) we hereby consent to the annual statutory limit employees. Benefits, excluding Taxes, collateral received, such as net operating loss carry-forwards ) dependent. Significant adjustments in their respective functional currencies other than the U.S. Dollar liabilities included the following compensation! Certain other intercompany transactions and balances have been materially inaccurate historically recently, Mr. was! These Senior unsecured obligations rank equally with the customer classification of certain effects! Stock has been sold to a NIKE Member for the production of our international operations inherent... 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Be used in the second and third quarters to third parties are used to you. Estimate these fair values to another independent pricing vendor to ensure appropriate fair are! Millions, except per share for further discussion competition for employees eligible for stock. Starting line so you can nike 10k pdf in the trade dress of several significant shoe designs elements. Get familiar with the Audit & FINANCE Committee of the unrealized gains in such contracts should of... Of certain products was approximately $ 23 million on June 1, 2018 more investment than stores! Functional currency is the U.S. Dollar at scale dividends were reinvested on the Company 's internal.. Annual … Academia.edu is a great way to round off your fitness.... Full potential not make or endorse any predictions as to future stock performance shown on the basis of brands.
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