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Document 7 of 67.

Copyright 1998 Information Access Company,
a Thomson Corporation Company;
ASAP
Copyright 1998 Capital Cities Media Inc.
Daily News Record

September 23, 1998

SECTION: No. 116, Vol. 28; Pg. 16; ISSN: 1041-1119

IAC-ACC-NO: 21159545

LENGTH: 231 words

HEADLINE: MOODY'S MAY DOWNGRADE NIKE DEBT; 'UNCERTAIN' FOOTWEAR FUTURE IS CITED.

BODY:
NEW YORK -- Moody's Investor Service on Tuesday said it may downgrade Nike Inc.'s debt ratings, citing "uncertain prospects in the footwear industry."

The debt under review includes its senior unsecured medium notes rated A1.

Moody's said the athletic footwear industry has been hurt by soft demand, especially in the U.S.

"Continued softness in demand has resulted in lower sales and higher markdowns for domestic retailers, and the economic conditions in Asia and Latin America have hurt foreign sales revenues," Moody's said.

Moody's commented that Nike could also be hurt by shifting trends, citing the recent popularity of brown shoes.

It also noted that "consumers may be weighing fashion more heavily than performance in choosing athletic shoes."

The rating agency said its review will focus on "the changing structural dynamics of this intensely competitive industry, as well as the company's proposal for capital expenditures, for share repurchases and for improving returns."

Nike's current debt-holder protection measures, while solid, have declined noticeably due to the industry and international economic environment, Moody's said.

In addition, the company has continued to repurchase shares -- $ 202 million in the fiscal year that ended in May.

Another $ 52 million in shares was reacquired in the first quarter of its current fiscal year.

LANGUAGE: ENGLISH

IAC-CREATE-DATE: September 30, 1998

LOAD-DATE: October 01, 1998