Retailers Nike (NYSE:NKE) and Next PLC set to publish results
Global footwear and apparel retailer Nike is likely to generate interest in the US next week as the group prepares to release quarterly numbers on Tuesday. Beside a broad-based, short-term negative publicity impact, according to Bloomberg Intelligence, the backlash from featuring Colin Kaepernick in its marketing campaign likely won’t have a material impact on Nike’s top-line performance. If anything, the controversy would only affect U.S. revenue, which is up to 40% of annual sales. Accelerating footwear and apparel sales internationally, and improving market trends in North America, should help Nike reach high-single-digit revenue growth in FY19.
In Europe, investors are likely to keep a watchful eye on specialty apparel retailer Next PLC, scheduled to release first half results towards next week. According to Bloomberg, Next’s inability to expand store sales in an exceptionally favourable period was a signal that it may have to begin to take the more dramatic action it signalled in March, closing a significant proportion of its 528 stores. Bloomberg Intelligence believes that Next’s unchanged full-year sales and profit guidance will slightly disappoint, given the bar was set high, following rival Asos reporting particularly robust online UK sales, the unexpected good weather boost and challenges facing some peers.
In the Asia-pacific region, investors will shift their focus towards Australia as Nufarm (worldwide manufacturer and supplier of agricultural chemicals used by farmers to protect crops from damage caused by weeds, pests and disease) prepares to release full year earnings. Bloomberg Intelligence expects Nufarm’s revenue and EBIT to remain under pressure if current dry weather in Australia persists, weakening demand for crop-protection products. The global crop-protection chemicals market remains highly competitive due to low soft-commodity prices.
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