CARLSBAD, Calif., April 27, 2016 /PRNewswire/ -- Callaway Golf
Company (NYSE: ELY) today announced its first quarter financial
results and updated its full year financial outlook for 2016.
The Company's 2016 first quarter net sales of $274 million, as compared to $284 million in the first quarter of 2015, were
consistent with the Company's expectations and primarily reflect a
strategic change in product launch timing, including the extension
of product lifecycles. As a result of this strategic change, a
majority of the Company's anticipated sales growth in 2016 is
expected to occur in the second half of the year. Despite
this change, the Company's 2016 product line has been well received
by retailers and consumers alike, enabling the Company to continue
its brand momentum and build upon its significant market share
gains of the last few years. For the first quarter of 2016,
Callaway maintained its #1 dollar market share position in the U.S.
for total golf clubs and its total U.S. hard goods dollar share was
the Company's highest first quarter share since
2007.
The Company's 2016 first quarter financial results also reflect
the Company's continued improvements in gross margins and
profitability. For the first quarter of 2016, despite the
planned reduction in net sales, the Company's gross margins
improved by 350 basis points to 48.3%, resulting in a $5 million (or 4.0%) increase in gross profit
compared to the same period in 2015. These improvements are the
result of continued favorable trends in the Company's business,
including continued operational efficiencies, increased average
selling prices, and less promotional activity. A $3 million decrease in operating expenses also
contributed to a 22.7% increase in operating income (29.2% on a
constant currency basis) for the first quarter of 2016 compared to
the same period in 2015.
The Company's diluted earnings per share increased to
$0.40 for the first quarter of 2016
compared to $0.39 for the first
quarter of 2015. On a constant currency basis, first quarter
diluted earnings per share increased by 23.1%. The
improvement in earnings per share is attributable to the improved
gross margins and reduced operating expenses, which allowed the
Company to more than offset the over $7
million in net foreign currency losses.
"The first quarter of 2016 was a strong start to the year for
Callaway Golf and we are encouraged by how our business is
trending," commented Chip Brewer,
President and Chief Executive Officer of Callaway Golf Company. "We
are seeing sustained improvements in market dynamics, including
less promotional activity and higher average selling prices. We are
also steadily improving our profitability via operational
improvements and our brand momentum by maintaining our leadership
position in the club category while building share in our golf ball
business, which presents an excellent growth opportunity. In
addition, we had an exceptional start on tour, winning the first
two majors of the year. Lydia Ko won
the ANA Inspiration, the LPGA's first major of the year, and
Danny Willett enjoyed a strong win
at the Masters. Both won with our new XR 16 driver which is
contributing to the buzz around that product."
Mr. Brewer continued, "Looking forward, we will continue to
focus on our core business by delivering innovative golf products
and by continuing to improve our operational efficiencies. The
effectiveness of this core strategy is proven; for example, our
trailing twelve month EBITDA as of March 31,
2016 increased by 49.0% to $46.2
million compared to the same period in 2015. Moving
forward, in addition to focusing on our core business, we intend to
use our increased profitability and strengthened financial
condition to dedicate additional resources to business development
opportunities both within our core business and in tangential
areas. Such opportunities include our previously announced
agreement in principle to form a joint venture with our long term
licensee, TSI Groove & Sports Co., Ltd., for the manufacture
and distribution of Callaway branded apparel, footwear and headwear
in Japan. We are excited about this second leg of our growth
strategy and believe it opens up a new and exciting path for
increasing long-term shareholder value."
GAAP and Constant Currency Results
In addition to the Company's results prepared in accordance
with generally accepted accounting principles in the United States ("GAAP"), the Company also
provided additional information concerning its results on a
non-GAAP basis. This non-GAAP information presents the Company's
financial results on a constant currency basis. The manner in which
this constant currency information is derived is discussed in more
detail toward the end of this release, and the Company has provided
in the tables to this release a reconciliation of the non-GAAP
information to the most directly comparable GAAP information.
Summary of First Quarter 2016 Financial Results
For the first quarter of 2016, Callaway announced the following
GAAP and constant currency financial results, as compared to the
same period in 2015 (in millions, except
eps):
|
GAAP
RESULTS
|
|
NON-GAAP
INFORMATION
|
|
2016
GAAP
|
2015
GAAP
|
Change
|
|
2016
Constant
Currency
|
2015
GAAP
|
Change
|
|
Net Sales
|
$274
|
$284
|
($10)
|
|
$277
|
$284
|
($7)
|
|
Gross Profit/
% of Sales
|
$132
48.3%
|
$127
44.8%
|
$5
350 b.p.
|
|
$135
48.9%
|
$127
44.8%
|
$8
410 b.p.
|
|
Operating
Expenses
|
$87
|
$90
|
($3)
|
|
$88
|
$90
|
($2)
|
|
Pre-Tax
Income
|
$40
|
$37
|
$3
|
|
$47
|
$37
|
$10
|
|
EPS
|
$0.40
|
$0.39
|
$0.01
|
|
$0.48
|
$0.39
|
$0.09
|
Business Outlook for 2016
The Company revised its full year financial guidance for 2016.
The Company's revised pre-tax income and earnings guidance includes
an $18 million pre-tax gain on the
sale of approximately 10% of the Company's investment in Topgolf
International, Inc., which occurred during the second quarter of
2016. The Company still holds an approximate 15% ownership interest
in Topgolf. In addition, the planned joint venture in Japan is expected to have only a limited
impact on net sales and gross margins in 2016, as it is not
expected to be completed until sometime in the second half of the
year. However, it will have an impact on operating expenses as
formation and integration activities will occur throughout 2016.
The Company's best estimate of the impact of the joint venture is
included in the guidance below.
The Company is only providing 2016 GAAP guidance at this time.
Foreign currency exchange rates changed during the first quarter
such that there are no material differences between the Company's
GAAP guidance and constant currency guidance. The foreign currency
exchange rates used in the Company's guidance are set forth in the
schedules to this press release. Any changes in foreign currency
exchange rates from the rates used by the Company will affect the
Company's GAAP guidance.
Full Year 2016
The Company currently estimates the following full year results
for 2016:
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Net Sales
|
$855 - $880
million
|
$844
million
|
The increase in the Company's estimate of full year net sales on
a GAAP basis from its previous GAAP guidance of $845 - $870 million is due primarily to
strengthening foreign currencies relative to the U.S. Dollar in
some of the Company's foreign markets. If the U.S. Dollar were to
strengthen during the balance of the year, the Company's GAAP sales
estimates would be adversely affected.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Gross
Margins
|
44.5%
|
42.4%
|
The Company estimates that its 2016 GAAP gross margin as a
percentage of sales will improve approximately 100 basis points
from its previous guidance of 43.5% due to a stronger sales mix of
in-line products compared to closeouts, continued operational
improvements, and foreign currency exchange rates.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Operating
Expenses
|
$348
million
|
$331
million
|
The Company estimates that its 2016 GAAP operating expenses will
be slightly higher than its previous guidance of $345 million driven by foreign currencies
strengthening in select markets.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Pre-Tax
Income
|
$45 - $55
million
|
$20
million
|
The Company estimates that its 2016 pre-tax income will increase
from its previous guidance of $20 - $30
million due to the impact of the second quarter gain on the
sale of a portion of the Company's Topgolf shares, continued
improvements in gross margins and profitability, and changes in
foreign currency rates.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Earnings Per
Share
|
$0.40 -
$0.50
|
$0.17
|
The Company estimates that its fully diluted earnings per share
on a GAAP basis will increase from its previous 2016 GAAP guidance
of $0.15 - $0.25 earnings per share
due primarily to the impact of the sale of a portion of its Topgolf
investment, anticipated continued improvements in gross margins and
profitability, and changes in foreign currency rates. The Company's
revised earnings estimate represents an increase of $0.23 - $0.33 over its performance in 2015 with
the gain on the sale of the Topgolf shares accounting for
approximately $0.18 of the
increase.
The Company's 2016 earnings per share estimates assume 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.
Second Quarter 2016
The Company currently estimates the following financial results
for the second quarter of 2016.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Net Sales
|
$238 - $245
million
|
$231
million
|
The anticipated increase in net sales during the second quarter
of 2016 as compared to the same period in 2015 reflects the
Company's brand momentum, the success of the Company's 2016 product
line and the timing of product launches.
|
2016 GAAP
Estimate
|
2015
Actual
|
|
Earnings Per
Share
|
$0.33 -
$0.37
|
$0.15
|
The anticipated increase in earnings per share for the second
quarter of 2016 compared to the same period in the prior year
reflects the gain on the sale of a portion of the Company's
investment in Topgolf, which accounts for $0.18 of the expected increase, as well
anticipated continued improvements in gross margins and
profitability, partially offset by a shift in marketing expense
from the first quarter to the second quarter.
Conference Call and Webcast
The Company will be holding a conference call at 2:00 p.m. PDT today 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, May 4, 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 as follows:
Constant Currency Basis. The Company provided certain
information regarding the Company's financial results or projected
financial results on a "constant currency basis." This information
estimates the impact of changes in foreign currency rates on the
translation of the Company's current or projected future period
financial results as compared to the applicable comparable period.
This impact is derived by taking the current or projected local
currency results and translating them into U.S. Dollars based upon
the foreign currency exchange rates for the applicable comparable
period. This calculation also excludes foreign currency net gains
and losses recognized during the period from the translation of
transactions denominated in foreign currencies and foreign currency
gains and losses recognized from the Company's hedging contracts.
It does not include any other effect of changes in foreign currency
rates on the Company's results or business.
EBITDA. The Company provided information about its
results, excluding interest, taxes, depreciation and amortization
expenses.
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), the
expected terms and timing of the Company's planned joint venture in
Japan, as well as the Company's
momentum, success of future products, growth opportunities, the
investment in corporate development opportunities, future
operational efficiencies, 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 the negotiation and completion of
final terms for the planned joint venture in Japan; 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)
|
|
|
|
March 31,
2016
|
|
December 31,
2015
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
35,136
|
|
|
|
$
|
49,801
|
|
|
Accounts receivable,
net
|
|
233,210
|
|
|
|
115,607
|
|
|
Inventories
|
|
186,149
|
|
|
|
208,883
|
|
|
Other current
assets
|
|
16,203
|
|
|
|
17,196
|
|
|
Total current
assets
|
|
470,698
|
|
|
|
391,487
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
55,631
|
|
|
|
55,808
|
|
|
Intangible assets,
net
|
|
115,546
|
|
|
|
115,282
|
|
|
Investment in
golf-related ventures
|
|
54,575
|
|
|
|
53,315
|
|
|
Other
assets
|
|
15,422
|
|
|
|
15,332
|
|
|
Total
assets
|
|
$
|
711,872
|
|
|
|
$
|
631,224
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts payable and
accrued expenses
|
|
$
|
110,268
|
|
|
|
$
|
122,620
|
|
|
Accrued employee
compensation and benefits
|
|
22,025
|
|
|
|
33,518
|
|
|
Asset-based credit
facility
|
|
78,969
|
|
|
|
14,969
|
|
|
Accrued warranty
expense
|
|
6,350
|
|
|
|
5,706
|
|
|
Income tax
liability
|
|
2,741
|
|
|
|
1,823
|
|
|
Total current
liabilities
|
|
220,353
|
|
|
|
178,636
|
|
|
|
|
|
|
|
|
Long-term
liabilities:
|
|
38,860
|
|
|
|
39,643
|
|
|
Total shareholders'
equity
|
|
452,659
|
|
|
|
412,945
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
711,872
|
|
|
|
$
|
631,224
|
|
|
CALLAWAY GOLF
COMPANY
CONSOLIDATED
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands,
except per share data)
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
Net sales
|
$
|
274,053
|
|
|
$
|
284,179
|
|
|
Cost of
sales
|
141,661
|
|
|
156,913
|
|
|
Gross
profit
|
132,392
|
|
|
127,266
|
|
|
Operating
expenses:
|
|
|
|
|
Selling
|
63,286
|
|
|
66,319
|
|
|
General and
administrative
|
15,544
|
|
|
16,099
|
|
|
Research and
development
|
8,234
|
|
|
7,916
|
|
|
Total operating
expenses
|
87,064
|
|
|
90,334
|
|
|
Income from
operations
|
45,328
|
|
|
36,932
|
|
|
Other income
(expense), net
|
(5,537)
|
|
|
525
|
|
|
Income before income
taxes
|
39,791
|
|
|
37,457
|
|
|
Income tax
provision
|
1,401
|
|
|
1,638
|
|
|
Net income
|
$
|
38,390
|
|
|
$
|
35,819
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
Basic
|
$
|
0.41
|
|
|
$
|
0.46
|
|
|
Diluted
|
$
|
0.40
|
|
|
$
|
0.39
|
|
|
Weighted-average
common shares outstanding:
|
|
|
|
|
Basic
|
93,952
|
|
|
77,753
|
|
|
Diluted
|
95,424
|
|
|
93,896
|
|
|
|
|
|
|
CALLAWAY GOLF
COMPANY
CONSOLIDATED
CONDENSED STATEMENTS OF CASH FLOW
(Unaudited)
(In
thousands)
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net income
|
$
|
38,390
|
|
|
$
|
35,819
|
|
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
4,157
|
|
|
4,703
|
|
|
Deferred taxes,
net
|
—
|
|
|
(15)
|
|
|
Share-based
compensation
|
2,194
|
|
|
1,826
|
|
|
Gain on disposal of
long-lived assets and deferred gain amortization
|
(270)
|
|
|
(257)
|
|
|
Debt discount
amortization on convertible notes
|
—
|
|
|
202
|
|
|
Changes in assets and
liabilities
|
(115,930)
|
|
|
(132,626)
|
|
|
Net cash used in
operating activities
|
(71,459)
|
|
|
(90,348)
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Capital
expenditures
|
(4,963)
|
|
|
(2,393)
|
|
|
Investment in
golf-related ventures
|
(1,260)
|
|
|
—
|
|
|
Proceeds from note
receivable
|
3,104
|
|
|
—
|
|
|
Proceeds from sale of
property, plant and equipment
|
6
|
|
|
1
|
|
|
Net cash used in
investing activities
|
(3,113)
|
|
|
(2,392)
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from
asset-based credit facilities, net
|
64,000
|
|
|
79,083
|
|
|
Exercise of stock
options
|
384
|
|
|
2,239
|
|
|
Dividends
paid
|
(941)
|
|
|
(780)
|
|
|
Acquisition of
treasury stock
|
(2,878)
|
|
|
(1,402)
|
|
|
Net cash provided by
financing activities
|
60,565
|
|
|
79,140
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(658)
|
|
|
(799)
|
|
|
Net decrease in cash
and cash equivalents
|
(14,665)
|
|
|
(14,399)
|
|
|
Cash and cash
equivalents at beginning of period
|
49,801
|
|
|
37,635
|
|
|
Cash and cash
equivalents at end of period
|
$
|
35,136
|
|
|
$
|
23,236
|
|
|
CALLAWAY GOLF
COMPANY
Consolidated Net
Sales and Operating Segment Information and Non-GAAP
Reconciliation
(Unaudited)
(In
thousands)
|
|
|
|
Net Sales by
Product Category
|
|
|
Year Ended
March 31, 2016
|
|
Decline
|
|
Non-GAAP
Constant
Currency
vs.
2015(1)
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
|
Woods
|
$
|
86,070
|
|
|
$
|
89,483
|
|
|
$
|
(3,413)
|
|
|
(3.8)%
|
|
|
(3.2)%
|
|
|
Irons
|
59,232
|
|
|
61,545
|
|
|
(2,313)
|
|
|
(3.8)%
|
|
|
(3.0)%
|
|
|
Putters
|
29,750
|
|
|
30,945
|
|
|
(1,195)
|
|
|
(3.9)%
|
|
|
(2.6)%
|
|
|
Gear/Accessories/Other
|
57,585
|
|
|
59,183
|
|
|
(1,598)
|
|
|
(2.7)%
|
|
|
(1.4)%
|
|
|
Golf balls
|
41,416
|
|
|
43,023
|
|
|
(1,607)
|
|
|
(3.7)%
|
|
|
(2.9)%
|
|
|
$
|
274,053
|
|
|
$
|
284,179
|
|
|
$
|
(10,126)
|
|
|
(3.6)%
|
|
|
(2.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Calculated by
applying 2015 exchange rates to 2016 reported sales in regions
outside the U.S.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales by
Region
|
|
|
Year Ended
March 31, 2016
|
|
Growth/(Decline)
|
|
Non-GAAP
Constant Currency
vs.
2015(1)
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
|
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
$
|
160,048
|
|
|
$
|
168,623
|
|
|
$
|
(8,575)
|
|
|
(5.1)%
|
|
|
(5.1)%
|
|
|
Europe
|
37,901
|
|
|
41,757
|
|
|
(3,856)
|
|
|
(9.2)%
|
|
|
(5.9)%
|
|
|
Japan
|
39,278
|
|
|
37,188
|
|
|
2,090
|
|
|
5.6%
|
|
|
1.1%
|
|
|
Rest of
Asia
|
15,808
|
|
|
16,473
|
|
|
(665)
|
|
|
(4.0)%
|
|
|
2.9%
|
|
|
Other foreign
countries
|
21,018
|
|
|
20,138
|
|
|
880
|
|
|
4.4%
|
|
|
13.0%
|
|
|
$
|
274,053
|
|
|
$
|
284,179
|
|
|
$
|
(10,126)
|
|
|
(3.6)%
|
|
|
(2.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Calculated by
applying 2015 exchange rates to 2016 reported sales in regions
outside the U.S.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Segment
Information
|
|
|
|
|
Year Ended
March 31, 2016
|
|
Growth/(Decline)
|
|
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
|
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
Golf Club
|
$
|
232,637
|
|
|
$
|
241,156
|
|
|
$
|
(8,519)
|
|
|
(3.5)%
|
|
|
|
|
|
Golf Ball
|
41,416
|
|
|
43,023
|
|
|
(1,607)
|
|
|
(3.7)%
|
|
|
|
|
|
$
|
274,053
|
|
|
$
|
284,179
|
|
|
$
|
(10,126)
|
|
|
(3.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes:
|
|
|
|
|
|
|
|
|
|
|
Golf clubs
|
$
|
44,946
|
|
|
$
|
40,940
|
|
|
$
|
4,006
|
|
|
9.8%
|
|
|
|
|
|
Golf balls
|
10,563
|
|
|
7,409
|
|
|
3,154
|
|
|
42.6%
|
|
|
|
|
|
Reconciling
items(1)
|
(15,718)
|
|
|
(10,892)
|
|
|
(4,826)
|
|
|
44.3%
|
|
|
|
|
|
$
|
39,791
|
|
|
$
|
37,457
|
|
|
$
|
2,334
|
|
|
6.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 - Non-GAAP Information and
Reconciliation
(Unaudited)
(In thousands,
except per share data)
|
|
|
|
Quarter Ended
March 31,
|
|
|
|
|
|
|
|
|
|
2016
|
|
2016(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016
|
|
Foreign
|
|
Non-GAAP
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Callaway
Golf
|
|
Currency
|
|
Constant
|
|
Callaway
Golf
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Impact
|
|
Currency
|
|
As
Reported
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
274,053
|
|
|
$
|
2,598
|
|
|
$
|
276,651
|
|
|
$
|
284,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
132,392
|
|
|
3,019
|
|
|
135,411
|
|
|
127,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of sales
|
48.3
|
%
|
|
n/a
|
|
|
48.9
|
%
|
|
44.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
87,064
|
|
|
637
|
|
|
87,701
|
|
|
90,334
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
45,328
|
|
|
2,382
|
|
|
47,710
|
|
|
36,932
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense), net
|
(5,537)
|
|
|
4,931
|
|
|
(606)
|
|
|
525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
39,791
|
|
|
7,313
|
|
|
47,104
|
|
|
37,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
1,401
|
|
|
43
|
|
|
1,444
|
|
|
1,638
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
38,390
|
|
|
$
|
7,270
|
|
|
$
|
45,660
|
|
|
$
|
35,819
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share:
|
$
|
0.40
|
|
|
$
|
0.08
|
|
|
$
|
0.48
|
|
|
$
|
0.39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding:
|
95,424
|
|
|
95,424
|
|
|
95,424
|
|
|
93,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Calculated by
applying 2015 exchange rates to 2016 reported results in regions
outside the U.S.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
2016 Trailing
Twelve Month EBITDA
|
|
2015 Trailing
Twelve Month EBITDA
|
|
Quarter
Ended
|
|
Quarter
Ended
|
|
June
30,
|
|
September
30,
|
|
December
31,
|
|
March
31
|
|
|
|
June
30,
|
|
September
30,
|
|
December
31,
|
|
March
31,
|
|
|
|
2015
|
|
2015
|
|
2015
|
|
2016
|
|
Total
|
|
2014
|
|
2014
|
|
2014
|
|
2015
|
|
Total
|
|
Net income
(loss)
|
$
|
12,818
|
|
|
$
|
(3,617)
|
|
|
$
|
(30,452)
|
|
|
$
|
38,390
|
|
|
$
|
17,139
|
|
|
$
|
3,369
|
|
|
$
|
(1,134)
|
|
|
$
|
(41,539)
|
|
|
$
|
35,819
|
|
|
$
|
(3,485)
|
|
|
Interest expense,
net
|
1,936
|
|
|
3,520
|
|
|
868
|
|
|
621
|
|
|
6,945
|
|
|
2,612
|
|
|
2,037
|
|
|
1,764
|
|
|
2,021
|
|
|
8,434
|
|
|
Income tax
provision
|
1,817
|
|
|
1,547
|
|
|
493
|
|
|
1,401
|
|
|
5,258
|
|
|
1,873
|
|
|
304
|
|
|
1,980
|
|
|
1,638
|
|
|
5,795
|
|
|
Depreciation and
amortization expense
|
4,454
|
|
|
4,193
|
|
|
4,029
|
|
|
4,157
|
|
|
16,833
|
|
|
5,460
|
|
|
5,222
|
|
|
4,857
|
|
|
4,703
|
|
|
20,242
|
|
|
EBITDA
|
$
|
21,025
|
|
|
$
|
5,643
|
|
|
$
|
(25,062)
|
|
|
$
|
44,569
|
|
|
$
|
46,175
|
|
|
$
|
13,314
|
|
|
$
|
6,429
|
|
|
$
|
(32,938)
|
|
|
$
|
44,181
|
|
|
$
|
30,986
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALLAWAY GOLF
COMPANY
2016 Foreign
Exchange Rates
|
|
|
|
Rates used in the
Company's current guidance for 2016
|
|
|
|
EUR
|
1.12
|
|
GBP
|
1.45
|
|
JPY
|
115.00
|
|
KRW
|
1,192.00
|
|
CAD
|
1.31
|
|
AUD
|
0.74
|
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-first-quarter-2016-financial-results-with-continued-improvements-in-gross-margins-and-profitability-callaway-increases-2016-full-year-gaap-revenue-and-earnings-guidance-300258781.html
SOURCE Callaway Golf Company