Nike affirms importance of partners like JD Sports

Sportswear colossus Nike revealed a strong quarterly performance overnight and gave three "shout outs" to Anglo-US retailer JD Sports as it reaffirmed the importance of its strategics partners.

The US sneaker and tracksuit maker reported second-quarter revenues up 9.6% to $9.4bn and net income up 10.4% to $847m, or $0.52 per share, all beating Wall Street expectations.

"Nike's ambitious digital transformation is driving strong results and momentum in North America and in our international geographies," said chief Executive Mark Parker.

Nike said supply chain improvements had allowed it to refresh sportswear lines in stores and enabled it to grab more market share from rival Adidas, with online sales similarly driven by upping the pace of product launches and expanding its partnerships with retailers.

One UK retailer, JD Sports, was mentioned three times on a conference call with analysts, analysts at Peel Hunt noted.

JD, which this summer snapped up the US-based Finish Line chain, was cited alongside online retailer Zalando regarding Nike's "connected inventory strategy", with Foot Locker as a strategic retail partner and thirdly when management were outlining the importance of "elevated experiences" in-store.

Nike picked out Europe as an area of "exceptional momentum" for sales.

"It is very clear to us that JD is seen as a key driver of Nike profitability," Peel Hunt analysts Jonathan Pritchard and John Stevenson said.

They also highlighted Nike's opinion that apparel, ie is an "extraordinary opportunity for growth", and that merchandising "head to toe" looks is key.

With the shares having fallem almost 40% from September's all-time high, they are trading for around 10 times full year earnings, "which to us is an absolute gift", the analysts said.