In the third quarter, Adams Golf managed a sharp jump in net sales that came solely from sales of irons as both drivers and fairway woods were down for the period. Unfortunately, because of the nature of the golf business and the reversal of litigation in the year-ago quarter, the company saw its quarterly net loss widen.

ADGO posted net sales of $15.0 million for the third quarter, jumping 47.1% from $10.2 million in the comparable period of 2005. Net sales of irons increased 143% to $10.2 million from $4.2 million in the same quarter last year, but a 54.5% decrease in net sales of drivers to $1.5 million from $3.3 million last year and a 19.2% decrease in sales of fairway woods to $2.1 million from $2.6 million in the year-ago quarter, slowed the overall sales growth.

Gross margins increased 190 basis points to 42.7% of net sales from 40.8% during last year’s third quarter. The margin expansion was not enough to bring the bottom line for the quarter out of the red as the company posted a net loss of $500,000. In addition, the net loss expanded over last year’s loss of $478,000 due to a $1.8 million pretax reversal of a legal accrual that boosted the year-ago result. Diluted earnings per share were flat for the quarter at two cents per share.