NIKE: SOME ACTIVISTS SEEK INVESTIGATION OF FACTORIES
(by Jeff Manning)
Blend a 66 percent orders increse , a 162 percent stock price gain and two 100 percent Olympic heroes and what do you get?
A sunny day for Nike Inc. shareholders that not even the clouds of the company's ongoing labor controversy could obscure.
News of another record quarter in sales and earnings, Olympic decathlon winner Dan O'brien and basketball gold-medalist Lisa Leslie drew boisterous ovations Monday morning from shareholders at the Beaverton company's annual shareholders meeting. Phil Knight, Nike chairman and chief executive officier, elicted another audience blizz when he announced a second consecutive 2 for 1 stock split.
The meeting resembled a peprally more than a corporate affair. More than 1,000 shareholders, including dozens of children, filled the floor of Nike's Bo Jackson Fitness Center and overflowed onto a running track one floor above.
They applauded frequently, including when Knight discussed labor practices.
Nike stock has jumped more than 150 percent in value since the company announced an identical split at last year's meeting.
In the quarter ended Aug. 311996, the company earned $226.1 million, or $1.53 a share, on total sales of $2.23 billion. In the same quarter a year ago, Nike earned $182 million, or $1.25 a share, on total sales of $1.7 billion.
Nike's "brand strength, which many through was nearing its peak last year, continues to grow unabaated in fiscal 1997", Knight said.
Tom Clarke, Nike president and chief operating officier, attributed much operating officier, attributed much of the growth to the company's apparel in the past 12 months reaching $1.7 billion, Nike is now the largest athletic apparel-maker in the business, Clarke said.
Executives voiced confidence that Nike can meet the huge demand for its products. But as of Monday, the company is two to three, weeks behind apparel shipping schedules, in part because of a June electrical fire that shut down a key Memphis warehouse for a week.
"This is putting a lot of strain on all our systems", Clark said.
Nearly loct amid the exuberant chatter were attempts by activists to wring concessions from Nike regarding its labor practices.
The United Methodist Church submitted a shareholders' resultation calling for the company to allow independent monitoring of factories run by Nike subcontractors. But more than 96 percent of woting shareholders rejected it.
Another group, Global Exchange, planned to hold a news conference after the shareholders meeting to report the the findings of a recent two-week trip to fsctories in Indonesia. Nike barred the group from the campus, foreing it to meet with reporters on the tossed a bone or two to critics.
The company has created a new position director of labor practices to ensure that subcontractors comply with Nike's international labor guidelines. Nike also is considering more factory inspections, a top priority of labor activists.
Accounting firm Ernst & Young already does some factory monitoring for the company, Knight didn't say what other group might perform the inspections. One possibility could be staffers from the Robert F. Kennedy Memorial Center for Human Rights, which initiated discussion with Nike several weeks ago.
 |
Home page |