Global Edition

 

Callaway Results confirmed

9.25am 3rd November 2009 - Corporate - This story was updated on Monday, June 27th, 2011

George Fellows, President and CEO Callaway Golf
George Fellows, President and CEO Callaway Golf

Callaway Golf Company (NYSE:ELY) has announced its financial results for the third quarter and first nine months ended September 30, 2009, consistent with the preliminary results released on October 15th, 2009.

For the third quarter, the Company reported:

  • Net sales of $191 million, a decrease of 11% compared to $213 million for the third quarter of 2008. On a currency neutral basis, net sales would have been $194 million, a decrease of 9% compared to the third quarter of 2008.
  • Gross profit of $60 million (31% of net sales) compared to gross profit of $80 million (38% of net sales) in the third quarter of 2008.
  • Operating expenses of $85 million (45% of net sales) compared to $93 million (43% of net sales) for the same period in 2008.
  • A loss of $0.25 per share (on 63.2 million shares outstanding), compared to a loss of $0.12 per share (on 62.5 million shares outstanding) in 2008. The loss per share for the third quarter of 2009 was adversely affected by $0.01 per share associated with the Company’s gross margin initiatives and $0.04 per share dilution related to the Company’s preferred stock issuance. The loss per share for the third quarter of 2008 included after-tax charges of $0.04 per share for the gross margin initiatives.

For the first nine months, the Company reported:

  • Net sales of $765 million, a decrease of 19% compared to $946 million for the same period last year. On a currency neutral basis, net sales would have been $810 million, a decrease of 14% compared to the first nine months of 2008.
  • Gross profit of $286 million (37% of net sales) compared to $427 million (45% of net sales) for 2008.
  • Operating expenses of $287 million (38% of net sales) compared to $314 million (33% of net sales) for 2008.
  • A loss per share of $0.04 (on 63.1 million shares outstanding) compared to fully diluted earnings per share of $1.08 (on 64.0 million shares outstanding) for 2008. The loss per share for the first nine months of 2009 was adversely affected by $0.04 per share associated with the Company’s gross margin initiatives and $0.05 per share dilution related to the Company’s preferred stock issuance. Fully diluted earnings per share for the first nine months of 2008 included after-tax charges of $0.09 per share for the gross margin initiatives.

“While market conditions have been challenging this year, we have managed our business in such a way that we have gained market share in all club categories, managed our expenses responsibly and invested in a few important growth initiatives that should position Callaway Golf to grow when the economy begins to rebound,” commented George Fellows, President and CEO.

“We are already seeing some improvement in global economic conditions and a lessening of the negative impact of foreign currency exchange rates. Furthermore, initial feedback on our 2010 new products has been positive, our supply chain continues to improve, and the many actions we’ve taken this year, together with our increased market share base, should position us to generate a meaningful turnaround and return to profitability next year.”

Business Outlook

The Company estimates sales for the year will be down approximately 16% due to the challenging economic and market environment in addition to unfavorable foreign currency exchange rates. Gross margins for the year are now estimated to be approximately 37% compared to the Company’s prior estimate of 38% – 40%, due to higher than expected participation rates on second and third quarter sales promotions.

Operating expenses for the year are still anticipated to be approximately $370 – $380 million as compared to $403 million in 2008. This estimate includes increased expenses in 2009 resulting from investments in the Company’s business including the uPro acquisition, costs related to reductions in workforce, and international expansion.

The Company estimates a full year loss per share of $0.30 to $0.35 which includes after tax charges of $0.05 per share for gross margin initiatives and approximately $0.09 per share of dilution associated with the Company’s preferred equity.

Callaway Golf www.callawaygolf.com

       

You can see the latest news letter here.

Follow us on Twitter and LinkedIn.            

Use the buttons above to control the search results you want.

Prefixing a search term with a hyphen will exclude results matching that term.
For example 'green -greenkeeper' will return results containing 'green' but not 'greenkeeper'.