Fiscal Date: May 31, 2016

Investors.nike.com
@nike

Beaverton, Oregon

DREAM AUDACIOUSLY. HAVE THE COURAGE TO FAIL FORWARD.

ACT WITH URGENCY.
-Phil Knight, co-founder of Nike

Fiscal Year 2016

Balance Sheet
Nike Inc. started the 2015

fiscal year with $3,852 (in millions) in cash and cash equivalents. I n 2 0 1 6 t h e com p an y 's
cash was $3,138 (in millions),
which gives Nike the ability to
acquire other assets if needed.
Accounts receivable for the
2015 fiscal year was $3,358 (in
millions). The following year,
accounts receivable was valued
at $3,241 (in millions).
Allowance for Bad Debt is
listed at $43 million in 2016.
Nike had an inventory of $4,337
million in the 2015 fiscal year.
In the following year, Nikes inventory went up 11.5% to
$4,838 million.

Fiscal Year 2016

Balance Sheet
Company Noncurrent assets:
Buildings/Equipment was valued at $3,011
(in millions) for the 2015 fiscal year, only to
rise in 2016 to $3,520 (in millions).
The companys net intangible assets are
composed of indefinite-lived trademarks,
which are not amortized, and totaled $281
(in millions) in 2016 and 2015. Acquired
trademarks in 2016 were $16 million, and
this asset was completely amortized by the
end of the period. Goodwill totaled $131
(in millions) in 2015 and 2016. These intangible assets are beneficial to the company
as they add value to the overall income.
Company Liabilities:
In 2015, Nikes total current liabilities
equaled $6,332 (in millions), this number
was decreased in 2016 by $974 (in millions)
for a total of $5,358 (in millions) of current
liabilities. Their current liabilities included
compensation and benefits, endorsement
compensation, dividends payable, and
more.
The companys noncurrent liabilities were
$2,010 (in millions) in 2016, which consisted of corporate bond payables, promissory
notes, and Japanese Yen Notes.
Stockholders Equity:
The companys paid-in capital consisted of
common stock that totaled $3 million in
2015 and 2016. Retained earnings for the
year 2016 were $4,151 (in millions), representing the accumulated earnings over
time that the company has not distributed
to shareholders. Dividends were $0.62 per
common share with cumulative dividends
of $0.10 per share payable. It is noted that
no dividends can be declared or paid for
the common stock of Nike unless preferred
stock dividends have been declared and
paid in full. In 2016, dividends payable
equaled $271 million.

Fiscal Year 2016

Income Statement

Gross profit for Nike Co. was most recently valued at $14,971 (in millions) in 2016 compared to $14,067 (in millions) in 2015. Gross profit assesses a companys efficiency at using labor and supplies. Having such a large
gross profit value reflects that Nike Inc. has established a very effective method to generate sales while minimizing production costs, and it is steadily
increasing each year. This is to be assumed as technology advances and the
brand continues to gain popularity in our culture. To put into perspective
how efficient Nike Inc. is, one of our competitors, Under Armour Inc. had a
$1,905,547 (in thousands) gross profit in the 2016.
The earnings per share for Nike Inc. has increased in value from $1.52
(dollars per share) in 2014, to $1.90 (dollars per share) in 2015, and most recently up to $2.21 (dollars per share) in fiscal year 2016. EPS is vital to
determining a shares price. Because earnings per share is higher, shares of
stock are worth more as investors are willing to pay more to turn higher
profits.
Nikes price/earnings ratio is currently 23.44, with the current market
price per share being 50.63. The relatively steady ratio indicates that the
company expects higher earnings growth in the future and is a positive reflection of the company and that investors can expect high returns.

Fiscal Year 2016

Company Accounting Policies

The cost of sales within Nike mainly consists of inventory cost, along with warehousing, labor, and development costs. Due to the fact that the cost of sales is recognized
concurrently with the revenue it is important to include within the income statement.
For Nike, revenue is recognized when the title, risks and rewards of ownerships have
been passed to the customer. This means that when shipment by the company occurs
or receipt by the customer occurs then revenue can be recognized.
The property, plant, equipment, and depreciation policy for Nike is specific in its recordings and procedures as it plays a large role in the company. The noncurrent assets of property, plant, and equipment are recorded at cost. Using the straight-line
method, depreciation is then recorded for buildings and leasehold improvements
over 2 to 40 years, and for machinery and equipment it is from 2 to 15 years. Further,
depreciation and amortization of assets used in warehousing, manufacturing, and
product distribution are recorded as Cost of sales, while all other assets that are depreciated or amortized are recorded in Operating overhead expense.

Fiscal Year 2016

Ratios
2015
Working Capital

2016

shows that NIKE is being more efficient

15,265 16,038 This
and its short term financial health is strong.

2.5

2.8

Accounts Receivable Turnover

9.27

9.81

Shows NIKEs ability to efficiently issue credit

to customers and collect funds from them on
time. A high number means quality customers.

Inventory Turnover

3.60

3.79

Shows how fast NIKE sells their inventory a

year, this number represents strong sales and
from 2015 to 2016 it has risen.

Return on Equity

26%

30%

This shows the amount of net income returned as a percentage of shareholders equity. This shows how much profit NIKE generates with the money shareholders have invested. It has risen in the past two fiscal years.

Debt to Equity Ratio

0.69

0.74

This shows NIKEs financial leverage. With a

ratio below 1.0, this means NIKE funds its
projects with more equity than debt. This
shows that your money is being put to good
use.

Current Ratio

Means NIKE is able to pay back its liabilities

(debt, accounts payable) with assets
(cash, inventory, accounts receivable). The
higher the number the better. NIKE has improved from 2015 to 2016.
More Assets than Liabilities.

Fiscal Year 2016

Highlights

Fourth quarter revenues up 6 percent to $8.2 billion; 9 percent growth excluding currency changes

Fourth quarter diluted earnings per share flat to prior year at $0.49

Fiscal 2016 revenues up 6 percent to $32.4 billion; 12 percent growth excluding currency changes
Fiscal 2016 diluted earnings per share up 17 percent to $2.16
Worldwide futures orders up 8 percent; 11 percent growth excluding currency changes
Inventories as of May 31, 2016 up 12 percent

NIKE, INC. IS A GROWTH COMPANY.

We create innovative, must-have products. We build
deep, personal connections with consumers. And we
deliver an integrated marketplace with compelling retail
experiences.

"Our consistent growth is fueled by innovation, which is why fiscal

2016 was such a breakthrough year for NIKE in everything we do,
said Mark Parker, President and CEO, NIKE, Inc. From product to
manufacturing to how we serve our consumers more personally
and at scale weve raised the bar of whats possible. Its a great
time to be in sports, and the NIKE Brand has never been stronger.
Fueled by our unrivaled roster of athletes, fiscal 2017s calendar of
sport moments promises to build on our business momentum and inspire consumers.