Adams Golf posted net sales of $15.0 million for the third quarter, jumping 47.1% from $10.2 million in the comparable period of 2005. The company reported a net loss of $0.5 million, or 2 cents per fully diluted share, as compared to a net loss of $0.4 million, or 2 cents per fully diluted share for the third quarter last year. In the 2005 third quarter, the company benefited from the reversal of a legal accrual in the amount of $1.8 million pretax.
For the nine months ended September 30, 2006, net sales were $63.0 million as compared to net sales of $46.8 million in the comparable period of 2005. The company reported net income of $4.6 million in the 2006 period, or 20 cents fully diluted per share, as compared to net income of $4.3 million and fully diluted earnings per share of 19 cents in the comparable period of the prior year.
“I'm very pleased with the company's sales, earnings growth and overall progress year to date,” said Mr. Chip Brewer, CEO and President of Adams Golf. “Our growth has been primarily driven by our Idea hybrid iron sets which, according to Golf Datatech, LLC, have been the #1 selling brand of irons in Off Course Golf Specialty retail sales since December of 2005. Additionally, our individual hybrids have become the #1 hybrid played by professionals on the combined professional men's tours (PGA, Champions and Nationwide) for the year to date period, according to results from the Darrell Survey. Lastly, we've continued to make investments in our brand and overall organization, particularly our R&D organization.”
ADAMS GOLF, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
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2006 2005 2006 2005
---------- --------- ---------- --------
Net sales $14,960 $10,180 $62,958 $46,769
Cost of goods sold 8,575 6,027 34,952 24,734
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Gross profit 6,385 4,153 28,006 22,035
Operating expenses:
Research and development
expenses 652 598 1,889 1,725
Selling and marketing
expenses 4,292 4,172 15,805 13,435
General and administrative
expenses 1,979 1,649 5,820 5,474
Reversal of settlement
expenses -- (1,788) -- (1,771)
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Total operating
expenses 6,923 4,631 23,514 18,863
---------- --------- ---------- --------
Operating income
(loss) (538) (478) 4,492 3,172
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Other income (expense):
Interest income (expense),
net 68 68 146 154
Other income (expense),
net (8) 12 35 1,005
---------- --------- ---------- --------
Income (loss) before
income taxes (478) (398) 4,673 4,331
Income tax expense 22 6 53 64
---------- --------- ---------- --------
Net income (loss) $(500) $(404) $4,620 $4,267
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Net income (loss) per common
share - basic $(0.02) $(0.02) $0.20 $0.19
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- diluted $(0.02) $(0.02) $0.16 $0.15
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