In This Article:
By James Davey
LONDON (Reuters) - British sportswear retailer JD Sports, one of Nike's largest customers, said on Wednesday it felt "really good" about the direction of the brand and their relationship despite trading and tariff challenges.
Shares in Nike, based in Beaverton, Oregon, have slumped 42% over the last year, initially due to weak trading in the face of intensifying competition and more recently the hit from U.S. President Donald Trump's imposition of new tariffs.
Nike products account for about 45% of JD's sales. With almost 40% of JD's sales made in the U.S., the group is also exposed to the tariffs. JD's shares are down 45% over the past year.
Despite these challenges, Mike Armstrong, JD's global managing director, gave a vote of confidence to Nike and its new CEO Elliott Hill's strategy to put the company back on track by refocusing its business on sport and selling more items at premium price.
"We're very much early into Elliott's tenure in the business and we've no reason to suggest doing anything differently from what Elliott suggested," Armstrong told analysts and investors at a strategy presentation.
"Generally, we feel really good about the direction the brand's headed, we're seeing green shoots in the men's business in Europe particularly which is really encouraging and we're working really closely with those guys to get it back on track in every market that we operate in," he said.
Armstrong added that he was sure Nike and JD can get their partnership "back (to) full speed soon".
Earlier on Wednesday, JD forecast little or no profit growth this year, even before any potential impact from U.S. tariffs, with the trading environment in its key markets expected to be "volatile".
CEO Regis Schultz told analysts and investors the firm was still "digesting" the tariffs.
"We are looking at it, it's a very serious matter, we are working on it," he said, adding the company could not yet provide guidance on their impact.
(Reporting by James Davey, editing by Ed Osmond)