CARLSBAD, Calif., July 27, 2016 /PRNewswire/ -- Callaway Golf
Company (NYSE:ELY) today announced its second quarter 2016
financial results, including a 6.5% increase in net sales and a
140% increase in earnings per share compared to the same period in
2015. These results reflect the Company's continued brand strength,
additional hard goods market share gains, increased gross margins
and an $0.18 per share gain from the
sale of a portion of the Company's investment in Topgolf
International, Inc. The Company also reaffirmed its full year
financial outlook for 2016 and provided financial guidance for the
third quarter of 2016.
"We are pleased with our performance in the second quarter of
2016," commented Chip Brewer,
President and Chief Executive Officer at Callaway Golf Company.
"Despite softer than expected market conditions, we grew our net
sales by 6.5% in the second quarter, which was led by increased
sales in all product categories and in every major region. We
also continued to realize benefits from the many initiatives we
undertook during the last three years with gross margins improving
90 basis points and our realizing over $23
million in proceeds from the sale of a small portion of our
Topgolf investment."
Mr. Brewer continued, "Overall, I believe we are performing well
in the current environment as evidenced in part by our continued
increase in U.S. hard goods dollar market share for the first half
of this year. I also believe that we are on track to create
long-term shareholder value through our improved core business as
well as future growth from areas tangential to the golf equipment
business such as our recently formed joint venture in Japan. For the balance of this year, however,
there could be some additional market risk related to Brexit, the
softer than expected market conditions and the impact of those
factors on the golf specialty retail channel. Despite this
potential short-term market risk, we believe our business is strong
and we remain cautiously optimistic about the second half of the
year and are therefore reaffirming our full year guidance."
Summary of Second Quarter 2016 Financial Results
For the second quarter of 2016, Callaway announced the following
GAAP financial results, as compared to the same period in 2015
(in millions, except eps):
GAAP
RESULTS
|
|
Second
Quarter 2016
|
Second
Quarter 2015
|
Change
|
Net Sales
|
$246
|
$231
|
$15
|
Gross Profit/
% of Sales
|
$111 45.0%
|
$102 44.1%
|
$9 90
b.p.
|
Operating
Expenses
|
$90
|
$83
|
$7
|
Pre-Tax
Income
|
$36
|
$15
|
$21
|
EPS
|
$0.36
|
$0.15
|
$0.21
|
Despite softer than expected market conditions, the Company's
2016 second quarter net sales increased $15
million to $246 million, as
compared to $231 million in the
second quarter of 2015. The higher sales were led by
increases in all major product categories, including woods, irons,
putters, and balls. The Company's sales also increased in every
major region, including the United
States, Europe and
Japan, as well as in the Rest of
Asia. This sales performance
resulted in increased market shares, including an increase in total
U.S. hard goods dollar share for the first half of 2016. This is
Callaway's highest first half share in over 10 years.
The Company's 2016 second quarter financial results also include
improvements in gross margin and profitability. For the second
quarter of 2016, the Company's gross margin increased 90 basis
points to 45.0%, primarily as a result of improved operational
efficiencies and higher average selling prices. The increase
in sales and gross margin offset a $7
million increase in operating expenses related primarily to
a planned shift in marketing expenses to the second and third
quarters of 2016. As a result, operating income increased by 12% to
$21 million for the second quarter of
2016 compared to $19 million in the
same period in 2015.
The Company's diluted earnings per share increased to
$0.36 for the second quarter of 2016
compared to $0.15 for the same period
in 2015. The Company's earnings include an $18 million gain, or earnings per share of
$0.18, on the second quarter sale of
approximately 10% of the Company's investment in Topgolf. The
Company continues to hold an approximate 15% ownership interest in
Topgolf.
Summary of First Half 2016 Financial Results
For the first half of 2016, Callaway announced the following
GAAP financial results, as compared to the same period in 2015
(in millions, except eps):
GAAP
RESULTS
|
|
First Half
2016
|
First Half
2015
|
Change
|
Net Sales
|
$520
|
$515
|
$5
|
Gross Profit/
% of Sales
|
$243 46.8%
|
$229 44.5%
|
$14 230
b.p.
|
Operating
Expenses
|
$177
|
$173
|
$4
|
Pre-Tax
Income
|
$76
|
$52
|
$24
|
EPS
|
$0.76
|
$0.54
|
$0.22
|
The Company's $520 million in net
sales for the first half of 2016 increased by 1% compared to the
first half of 2015. The Company's brand momentum and strength of
its 2016 product line allowed the Company to overcome the softer
than expected market conditions during the first half of
2016. In addition, the Company's gross margin for the first
half of 2016 increased by 230 basis points to 46.8% from 44.5% for
the first half of 2015. The gross margin improvements were driven
by continued operational efficiencies as well as increased average
selling prices. Operating expenses in the first half of 2016
remained flat at 34% of net sales when compared to operating
expenses for the first half of 2015, resulting in a 19% increase in
operating income in the first half of 2016.
Diluted earnings per share for the first half of 2016 increased
by 41% to $0.76 from $0.54 in the first half of 2015. The Company's
earnings for the first half of 2016 include an $18 million gain, or earnings per share of
$0.18, on the second quarter sale of
approximately 10% of the Company's investment in Topgolf
International, Inc.
Business Outlook for 2016
The Company cautioned that there could be some increased market
risk during the second half of 2016 related to Brexit, softer than
expected market conditions and the impact of those factors on the
golf specialty retail channel. The Company emphasized,
though, that it was unclear to what extent, if any, those factors
would impact the Company's business. Given the Company's increased
market shares and performance during the first half of 2016, the
Company is maintaining its full year guidance for 2016 as
follows:
|
2016 GAAP
Estimate
|
2015
Actual
|
Net Sales
|
$855 - $880
million
|
$844
million
|
Gross
Margins
|
44.5%
|
42.4%
|
Operating
Expenses
|
$348
million
|
$331
million
|
Pre-Tax
Income
|
$45 - $55
million
|
$20
million
|
Earnings Per
Share
|
$0.40 -
$0.50
|
$0.17
|
The Company does not anticipate that changes in foreign currency
rates will have much impact on the Company's results for the full
year. However, if the foreign currency rates were to weaken
significantly against the U.S. Dollar during the second half of the
year, the Company's financial results would be adversely affected.
The Company's pre-tax income and earnings per share estimates for
the full year 2016 include the $18
million gain ($0.18 per share)
on the second quarter sale of a portion of its Topgolf investment.
The Company's estimate for its full year 2016 earnings per share
assumes a base of 95 million shares as compared to 85 million
shares in 2015. The increased share count in 2016 is primarily the
result of the conversion of the Company's convertible debt into
equity in 2015. This estimate also includes taxes of approximately
$6 million.
Third Quarter 2016
The Company currently estimates the following financial results
for the third quarter of 2016.
|
Third
Quarter 2016 GAAP
Estimate
|
Third
Quarter 2015 Actual
|
Net Sales
|
$170 - $180
million
|
$176
million
|
Earnings Per
Share
|
($0.15) –
($0.10)
|
($0.04)
|
Net sales for the third quarter of 2016 will benefit from the
commencement of the joint venture in Japan in July
2016 and will be negatively impacted by a change in product
launch timing in Japan as compared
to 2015. The anticipated increase in loss per share in the third
quarter of 2016 as compared to 2015 reflects the addition of
operating expenses in 2016 related to the Japan joint venture, as well as a shift in
marketing expense to the third quarter of 2016 and unusually low
compensation expense in the third quarter of 2015. Given the
seasonality of the Company's business, the Company is always in a
loss position in the second half of the year. In 2016, the timing
of the second half loss is such that a greater proportion of the
loss will occur in the third quarter as compared to 2015 when a
substantial majority of the loss occurred in the fourth
quarter.
Conference Call and Webcast
The Company will be holding a conference call today at
2:00 p.m. PDT to discuss the
Company's financial results, outlook and business. The call will be
broadcast live over the Internet and can be accessed at
www.callawaygolf.com. To listen to the call, please go to the
website at least 15 minutes before the call to register and for
instructions on how to access the broadcast. A replay of the
conference call will be available approximately three hours after
the call ends, and will remain available through 9:00 p.m. PDT on Wednesday, August 3, 2016. The replay may be
accessed through the Internet at www.callawaygolf.com.
Non-GAAP Information
The GAAP results contained in this press release and the
financial statement schedules attached to this press release have
been prepared in accordance with accounting principles generally
accepted in the United States
("GAAP"). To supplement the GAAP results, the Company has provided
certain non-GAAP financial information about its results excluding
interest, taxes, depreciation and amortization expenses, as well as
the gain on the sale of a portion of the Company's Topgolf
investment.
In addition, the Company has included in the schedules to this
release a reconciliation of certain non-GAAP information to the
most directly correlated GAAP information. The non-GAAP information
presented in this release and related schedules should not be
considered in isolation or as a substitute for any measure derived
in accordance with GAAP. The non-GAAP information may also be
inconsistent with the manner in which similar measures are derived
or used by other companies. Management uses such non-GAAP
information for financial and operational decision-making purposes
and as a means to evaluate period over period comparisons and in
forecasting the Company's business going forward. Management
believes that the presentation of such non-GAAP information, when
considered in conjunction with the most directly comparable GAAP
information, provides additional useful comparative information for
investors in their assessment of the underlying performance of the
Company's business without regard to these items.
Forward-Looking Statements: Statements used in this press
release that relate to future plans, events, financial results,
performance or prospects, including statements relating to the
estimated 2016 sales, gross margins, operating expenses, pre-tax
income, taxes, and earnings per share (or related share count), as
well as the Company's momentum, success of future products, growth
opportunities, the investment in corporate or business development
opportunities, future market conditions, and the creation of
long-term shareholder value, are forward-looking statements as
defined under the Private Securities Litigation Reform Act of 1995.
These statements are based upon current information and
expectations. Accurately estimating the forward-looking statements
is based upon various risks and unknowns including consumer
acceptance of and demand for the Company's products; the level of
promotional activity in the marketplace; unfavorable weather
conditions; future consumer discretionary purchasing activity,
which can be significantly adversely affected by unfavorable
economic or market conditions; future retailer purchasing activity,
which can be significantly negatively affected by adverse industry
conditions and overall retail inventory levels; and future changes
in foreign currency exchange rates and the degree of effectiveness
of the Company's hedging programs. Actual results may differ
materially from those estimated or anticipated as a result of these
risks and unknowns or other risks and uncertainties, including
continued compliance with the terms of the Company's credit
facilities; delays, difficulties or increased costs in the supply
of components or commodities needed to manufacture the Company's
products or in manufacturing the Company's products; any rule
changes or other actions taken by the USGA or other golf
association that could have an adverse impact upon demand or supply
of the Company's products; a decrease in participation levels in
golf; and the effect of terrorist activity, armed conflict, natural
disasters or pandemic diseases on the economy generally, on the
level of demand for the Company's products, or on the Company's
ability to manage its supply and delivery logistics in such an
environment. For additional information concerning these and other
risks and uncertainties that could affect these statements, the
golf industry, and the Company's business, see the Company's Annual
Report on Form 10-K for the year ended December 31, 2015 as well as other risks and
uncertainties detailed from time to time in the Company's reports
on Forms 10-K, 10-Q, and 8-K subsequently filed with the Securities
and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date hereof. The Company undertakes no obligation to
republish revised forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
About Callaway Golf
Through an unwavering commitment to innovation, Callaway Golf
Company (NYSE: ELY) creates products designed to make every golfer
a better golfer. Callaway Golf Company manufactures and sells golf
clubs and golf balls, and sells golf accessories, under the
Callaway Golf® and Odyssey® brands worldwide. For more information
please visit www.callawaygolf.com.
Contacts:
|
Robert
Julian
|
|
Patrick
Burke
|
|
(760)
931-1771
|
CALLAWAY GOLF
COMPANY
|
CONSOLIDATED
CONDENSED BALANCE SHEETS
|
(Unaudited)
|
(In
thousands)
|
|
|
June
30, 2016
|
|
December 31,
2015
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
67,619
|
|
|
|
$
|
49,801
|
|
Accounts receivable,
net
|
|
205,058
|
|
|
|
115,607
|
|
Inventories
|
|
151,446
|
|
|
|
208,883
|
|
Other current
assets
|
|
15,052
|
|
|
|
17,196
|
|
Total current
assets
|
|
439,175
|
|
|
|
391,487
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
53,399
|
|
|
|
55,808
|
|
Intangible assets,
net
|
|
115,063
|
|
|
|
115,282
|
|
Investment in
golf-related ventures
|
|
49,108
|
|
|
|
53,315
|
|
Other
assets
|
|
15,780
|
|
|
|
15,332
|
|
Total
assets
|
|
$
|
672,525
|
|
|
|
$
|
631,224
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts payable and
accrued expenses
|
|
$
|
106,482
|
|
|
|
$
|
122,620
|
|
Accrued employee
compensation and benefits
|
|
25,433
|
|
|
|
33,518
|
|
Asset-based credit
facility
|
|
5,331
|
|
|
|
14,969
|
|
Accrued warranty
expense
|
|
6,172
|
|
|
|
5,706
|
|
Income tax
liability
|
|
3,769
|
|
|
|
1,823
|
|
Total current
liabilities
|
|
147,187
|
|
|
|
178,636
|
|
|
|
|
|
|
|
Long-term
liabilities:
|
|
39,031
|
|
|
|
39,643
|
|
Total shareholders'
equity
|
|
486,307
|
|
|
|
412,945
|
|
Total liabilities and
shareholders' equity
|
|
$
|
672,525
|
|
|
|
$
|
631,224
|
|
CALLAWAY GOLF
COMPANY
|
CONSOLIDATED
CONDENSED STATEMENTS OF OPERATIONS
|
(Unaudited)
|
(In thousands,
except per share data)
|
|
|
Three Months
Ended
June 30,
|
|
2016
|
|
2015
|
Net sales
|
$
|
245,594
|
|
|
$
|
230,504
|
|
Cost of
sales
|
134,961
|
|
|
128,807
|
|
Gross
profit
|
110,633
|
|
|
101,697
|
|
Operating
expenses:
|
|
|
|
Selling
|
64,388
|
|
|
59,966
|
|
General and
administrative
|
17,089
|
|
|
15,536
|
|
Research and
development
|
8,288
|
|
|
7,603
|
|
Total operating
expenses
|
89,765
|
|
|
83,105
|
|
Income from
operations
|
20,868
|
|
|
18,592
|
|
Gain on sale of
golf-related investments
|
17,662
|
|
|
—
|
|
Other income
(expense), net
|
(2,488)
|
|
|
(3,957)
|
|
Income before income
taxes
|
36,042
|
|
|
14,635
|
|
Income tax
provision
|
1,937
|
|
|
1,817
|
|
Net income
|
$
|
34,105
|
|
|
$
|
12,818
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
Basic
|
$
|
0.36
|
|
|
$
|
0.16
|
|
Diluted
|
$
|
0.36
|
|
|
$
|
0.15
|
|
Weighted-average
common shares outstanding:
|
|
|
|
Basic
|
94,029
|
|
|
78,395
|
|
Diluted
|
95,893
|
|
|
94,913
|
|
|
|
|
|
|
Six Months
Ended
June 30,
|
|
2016
|
|
2015
|
Net sales
|
$
|
519,647
|
|
|
$
|
514,683
|
|
Cost of
sales
|
276,622
|
|
|
285,720
|
|
Gross
profit
|
243,025
|
|
|
228,963
|
|
Operating
expenses:
|
|
|
|
Selling
|
127,674
|
|
|
126,285
|
|
General and
administrative
|
32,633
|
|
|
31,635
|
|
Research and
development
|
16,522
|
|
|
15,519
|
|
Total operating
expenses
|
176,829
|
|
|
173,439
|
|
Income from
operations
|
66,196
|
|
|
55,524
|
|
Gain on sale of
golf-related ventures
|
17,662
|
|
|
—
|
|
Other income
(expense), net
|
(8,025)
|
|
|
(3,432)
|
|
Income before income
taxes
|
75,833
|
|
|
52,092
|
|
Income tax
provision
|
3,338
|
|
|
3,455
|
|
Net income
|
$
|
72,495
|
|
|
$
|
48,637
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
Basic
|
$
|
0.77
|
|
|
$
|
0.62
|
|
Diluted
|
$
|
0.76
|
|
|
$
|
0.54
|
|
Weighted-average
common shares outstanding:
|
|
|
|
Basic
|
93,990
|
|
|
78,076
|
|
Diluted
|
95,658
|
|
|
94,406
|
|
|
|
|
|
CALLAWAY GOLF
COMPANY
|
CONSOLIDATED
CONDENSED STATEMENTS OF CASH FLOW
|
(Unaudited)
|
(In
thousands)
|
|
|
Six Months
Ended
June 30,
|
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
72,495
|
|
|
$
|
48,637
|
|
Adjustments to
reconcile net income to net cash provided by (used in) operating
activities:
|
|
|
|
Depreciation and
amortization
|
8,337
|
|
|
9,157
|
|
Deferred taxes,
net
|
(347)
|
|
|
145
|
|
Share-based
compensation
|
4,329
|
|
|
3,561
|
|
Gain on disposal of
long-lived assets and deferred gain amortization
|
(124)
|
|
|
(510)
|
|
Gain on sale of
golf-related investments
|
(17,662)
|
|
|
—
|
|
Debt discount
amortization on convertible notes
|
—
|
|
|
395
|
|
Loss on foreign
currency hedges
|
884
|
|
|
—
|
|
Changes in assets and
liabilities
|
(50,151)
|
|
|
(94,052)
|
|
Net cash provided by
(used in) operating activities
|
17,761
|
|
|
(32,667)
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Proceeds from sale of
investments in golf-related ventures
|
23,429
|
|
|
—
|
|
Proceeds from note
receivable
|
3,104
|
|
|
—
|
|
Capital
expenditures
|
(7,487)
|
|
|
(5,912)
|
|
Investment in
golf-related ventures
|
(1,560)
|
|
|
—
|
|
Proceeds from sale of
property, plant and equipment
|
20
|
|
|
2
|
|
Net cash provided by
(used in) investing activities
|
17,506
|
|
|
(5,910)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
(Repayments of)
proceeds from asset-based credit facilities, net
|
(9,638)
|
|
|
27,364
|
|
Acquisition of
treasury stock
|
(5,133)
|
|
|
(1,915)
|
|
Dividends
paid
|
(1,882)
|
|
|
(1,565)
|
|
Exercise of stock
options
|
2,096
|
|
|
5,330
|
|
Net cash (used in)
provided by financing activities
|
(14,557)
|
|
|
29,214
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(2,892)
|
|
|
(1,558)
|
|
Net increase
(decrease) in cash and cash equivalents
|
17,818
|
|
|
(10,921)
|
|
Cash and cash
equivalents at beginning of period
|
49,801
|
|
|
37,635
|
|
Cash and cash
equivalents at end of period
|
$
|
67,619
|
|
|
$
|
26,714
|
|
CALLAWAY GOLF
COMPANY
|
Consolidated Net
Sales and Operating Segment Information
|
(Unaudited)
|
(In
thousands)
|
|
|
Net Sales by
Product Category
|
|
Net Sales by
Product Category
|
|
Three Months
Ended
June 30,
|
|
Growth
|
|
|
Six Months
Ended
June 30,
|
|
Growth/(Decline)
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Woods
|
$
|
50,478
|
|
|
$
|
49,387
|
|
|
$
|
1,091
|
|
|
2.2
|
%
|
|
|
$
|
136,548
|
|
|
$
|
138,870
|
|
|
$
|
(2,322)
|
|
|
(1.7)
|
%
|
Irons
|
63,416
|
|
|
59,268
|
|
|
4,148
|
|
|
7.0
|
%
|
|
|
122,648
|
|
|
120,813
|
|
|
1,835
|
|
|
1.5
|
%
|
Putters
|
25,013
|
|
|
24,421
|
|
|
592
|
|
|
2.4
|
%
|
|
|
54,763
|
|
|
55,366
|
|
|
(603)
|
|
|
(1.1)
|
%
|
Gear/Accessories/Other
|
59,691
|
|
|
56,540
|
|
|
3,151
|
|
|
5.6
|
%
|
|
|
117,276
|
|
|
115,723
|
|
|
1,553
|
|
|
1.3
|
%
|
Golf balls
|
46,996
|
|
|
40,888
|
|
|
6,108
|
|
|
14.9
|
%
|
|
|
88,412
|
|
|
83,911
|
|
|
4,501
|
|
|
5.4
|
%
|
|
$
|
245,594
|
|
|
$
|
230,504
|
|
|
$
|
15,090
|
|
|
6.5
|
%
|
|
|
$
|
519,647
|
|
|
$
|
514,683
|
|
|
$
|
4,964
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales by
Region
|
|
Net Sales by
Region
|
|
Three Months
Ended
June 30,
|
|
Growth/(Decline)
|
|
|
Six Months
Ended
June 30,
|
|
Growth/(Decline)
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
$
|
127,182
|
|
|
$
|
121,974
|
|
|
$
|
5,208
|
|
|
4.3
|
%
|
|
|
$
|
287,230
|
|
|
$
|
290,597
|
|
|
$
|
(3,367)
|
|
|
(1.2)
|
%
|
Europe
|
36,923
|
|
|
35,181
|
|
|
1,742
|
|
|
5.0
|
%
|
|
|
74,824
|
|
|
76,938
|
|
|
(2,114)
|
|
|
(2.7)
|
%
|
Japan
|
40,551
|
|
|
32,439
|
|
|
8,112
|
|
|
25.0
|
%
|
|
|
79,829
|
|
|
69,627
|
|
|
10,202
|
|
|
14.7
|
%
|
Rest of
Asia
|
20,137
|
|
|
19,011
|
|
|
1,126
|
|
|
5.9
|
%
|
|
|
35,946
|
|
|
35,484
|
|
|
462
|
|
|
1.3
|
%
|
Other foreign
countries
|
20,801
|
|
|
21,899
|
|
|
(1,098)
|
|
|
(5.0)
|
%
|
|
|
41,818
|
|
|
42,037
|
|
|
(219)
|
|
|
(0.5)
|
%
|
|
$
|
245,594
|
|
|
$
|
230,504
|
|
|
$
|
15,090
|
|
|
6.5
|
%
|
|
|
$
|
519,647
|
|
|
$
|
514,683
|
|
|
$
|
4,964
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Segment
Information
|
|
|
Operating Segment
Information
|
|
Three Months
Ended
June 30,
|
|
Growth
|
|
|
Six Months
Ended
June 30,
|
|
Growth
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Golf Club
|
$
|
198,598
|
|
|
$
|
189,616
|
|
|
$
|
8,982
|
|
|
4.7
|
%
|
|
|
$
|
431,235
|
|
|
$
|
430,772
|
|
|
$
|
463
|
|
|
0.1
|
%
|
Golf Ball
|
46,996
|
|
|
40,888
|
|
|
6,108
|
|
|
14.9
|
%
|
|
|
88,412
|
|
|
83,911
|
|
|
4,501
|
|
|
5.4
|
%
|
|
$
|
245,594
|
|
|
$
|
230,504
|
|
|
$
|
15,090
|
|
|
6.5
|
%
|
|
|
$
|
519,647
|
|
|
$
|
514,683
|
|
|
$
|
4,964
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Golf clubs
|
$
|
23,402
|
|
|
$
|
22,051
|
|
|
$
|
1,351
|
|
|
6.1
|
%
|
|
|
$
|
68,348
|
|
|
$
|
62,990
|
|
|
$
|
5,358
|
|
|
8.5
|
%
|
Golf balls
|
8,801
|
|
|
6,639
|
|
|
2,162
|
|
|
32.6
|
%
|
|
|
19,364
|
|
|
14,047
|
|
|
5,317
|
|
|
37.9
|
%
|
Reconciling
items(1)
|
3,839
|
|
|
(14,055)
|
|
|
17,894
|
|
|
(127.3)
|
%
|
|
|
(11,879)
|
|
|
(24,945)
|
|
|
13,066
|
|
|
(52.4)
|
%
|
|
$
|
36,042
|
|
|
$
|
14,635
|
|
|
$
|
21,407
|
|
|
146.3
|
%
|
|
|
$
|
75,833
|
|
|
$
|
52,092
|
|
|
$
|
23,741
|
|
|
45.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents corporate general and administrative expenses and other
income (expense) not utilized by management in determining segment
profitability.
|
CALLAWAY GOLF
COMPANY
|
Supplemental
Financial Information and Non-GAAP Reconciliation
|
(Unaudited)
|
(In
thousands)
|
|
|
Three Months Ended
June 30,
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2016
|
|
2016
|
|
2015
|
|
|
|
2016
|
|
2016
|
|
2016
|
|
2015
|
|
|
|
As
Reported
|
|
Topgolf
Gain
|
|
Pro
Forma
|
|
As
Reported
|
|
|
|
As
Reported
|
|
Topgolf
Gain
|
|
Pro
Forma
|
|
As
Reported
|
|
|
Net sales
|
$
|
245,594
|
|
|
$
|
—
|
|
|
$
|
245,594
|
|
|
$
|
230,504
|
|
|
|
|
$
|
519,647
|
|
|
$
|
—
|
|
|
$
|
519,647
|
|
|
$
|
514,683
|
|
|
|
Gross
profit
|
110,633
|
|
|
—
|
|
|
110,633
|
|
|
101,697
|
|
|
|
|
243,025
|
|
|
—
|
|
|
243,025
|
|
|
228,963
|
|
|
|
% of sales
|
45.0
|
%
|
|
—
|
%
|
|
45.0
|
%
|
|
44.1
|
%
|
|
|
|
46.8
|
%
|
|
—
|
%
|
|
46.8
|
%
|
|
44.5
|
%
|
|
|
Operating
expenses
|
89,765
|
|
|
—
|
|
|
89,765
|
|
|
83,105
|
|
|
|
|
176,829
|
|
|
—
|
|
|
176,829
|
|
|
173,439
|
|
|
|
Income from
operations
|
20,868
|
|
|
—
|
|
|
20,868
|
|
|
18,592
|
|
|
|
|
66,196
|
|
|
—
|
|
|
66,196
|
|
|
55,524
|
|
|
|
Other income
(expense), net
|
15,174
|
|
|
17,662
|
|
|
(2,488)
|
|
|
(3,957)
|
|
|
|
|
9,637
|
|
|
17,662
|
|
|
(8,025)
|
|
|
(3,432)
|
|
|
|
Income before income
taxes
|
36,042
|
|
|
17,662
|
|
|
18,380
|
|
|
14,635
|
|
|
|
|
75,833
|
|
|
17,662
|
|
|
58,171
|
|
|
52,092
|
|
|
|
Income tax
provision
|
1,937
|
|
|
—
|
|
|
1,937
|
|
|
1,817
|
|
|
|
|
3,338
|
|
|
—
|
|
|
3,338
|
|
|
3,455
|
|
|
|
Net income
|
$
|
34,105
|
|
|
$
|
17,662
|
|
|
$
|
16,443
|
|
|
$
|
12,818
|
|
|
|
|
$
|
72,495
|
|
|
$
|
17,662
|
|
|
$
|
54,833
|
|
|
$
|
48,637
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 Trailing
Twelve Month Adjusted EBITDA
|
|
2015 Trailing
Twelve Month Adjusted EBITDA
|
|
Quarter
Ended
|
|
Quarter
Ended
|
|
September
30,
|
|
December
31,
|
|
March
31,
|
|
June
30,
|
|
|
|
September
30,
|
|
December
31,
|
|
March
31,
|
|
June
30,
|
|
|
|
2015
|
|
2015
|
|
2016
|
|
2016
|
|
Total
|
|
2014
|
|
2014
|
|
2015
|
|
2015
|
|
Total
|
Net income
(loss)
|
$
|
(3,617)
|
|
|
$
|
(30,452)
|
|
|
$
|
38,390
|
|
|
$
|
34,105
|
|
|
$
|
38,426
|
|
|
$
|
(1,134)
|
|
|
$
|
(41,539)
|
|
|
$
|
35,819
|
|
|
$
|
12,818
|
|
|
$
|
5,964
|
|
Interest expense,
net
|
3,520
|
|
|
868
|
|
|
621
|
|
|
347
|
|
|
5,356
|
|
|
2,037
|
|
|
1,764
|
|
|
2,021
|
|
|
1,936
|
|
|
7,758
|
|
Income tax
provision
|
1,547
|
|
|
493
|
|
|
1,401
|
|
|
1,937
|
|
|
5,378
|
|
|
304
|
|
|
1,980
|
|
|
1,638
|
|
|
1,817
|
|
|
5,739
|
|
Depreciation and
amortization expense
|
4,193
|
|
|
4,029
|
|
|
4,157
|
|
|
4,180
|
|
|
16,559
|
|
|
5,222
|
|
|
4,857
|
|
|
4,703
|
|
|
4,454
|
|
|
19,236
|
|
EBITDA
|
$
|
5,643
|
|
|
$
|
(25,062)
|
|
|
$
|
44,569
|
|
|
$
|
40,569
|
|
|
$
|
65,719
|
|
|
$
|
6,429
|
|
|
$
|
(32,938)
|
|
|
$
|
44,181
|
|
|
$
|
21,025
|
|
|
$
|
38,697
|
|
Gain on sale of
Topgolf investments
|
—
|
|
|
—
|
|
|
—
|
|
|
17,662
|
|
|
17,662
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted
EBITDA
|
$
|
5,643
|
|
|
$
|
(25,062)
|
|
|
$
|
44,569
|
|
|
$
|
22,907
|
|
|
$
|
48,057
|
|
|
$
|
6,429
|
|
|
$
|
(32,938)
|
|
|
$
|
44,181
|
|
|
$
|
21,025
|
|
|
$
|
38,697
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Logo - http://photos.prnewswire.com/prnh/20091203/CGLOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/callaway-golf-company-announces-second-quarter-2016-financial-results-including-a-65-increase-in-net-sales-and-a-140-increase-in-earnings-per-share-callaway-reaffirms-2016-full-year-net-sales-and-earnings-guidance-300305123.html
SOURCE Callaway Golf Company