Adams Golf reported net sales of $86.3 million for the year ended Dec.  31, as compared to $76.1 million in a prior year, an increase of 12% year-over-year. The net profit reached $5.0 million, or 66 cents per fully diluted share, for the year as compared to a loss of $12.2 million, or $1.82 per share, for the comparable period of 2009.

The loss during 2009 included a $5.0 million one time charge to settlement expense resulting from the accrual of the settlement of the class action lawsuit, and a one time charge to cost of goods sold of $3.6 million for the write-down of products to the lower of cost or market. Excluding these charges during 2009, the loss would have been $3.6 million, or 53 cents per share, for the year ended Dec. 31, 2009.

“2010 was a successful year for Adams Golf and we are pleased with our financial performance,” said Chip Brewer, CEO and President of Adams Golf. “Equally important, we believe that during 2010 we continued to make progress with our brand development and market positions. Evidence of this progress includes:

  • According to Golf Datatech LLC, our full year 2010 U.S. iron dollar share in the combined On and Off Course Channels was 10.2%, up 17% year-over-year. Our full year 2010 wood dollar share in the same channels was 5.5%, up 6% year-over-year. These same market shares for the month of January 2011 were 12.4% and 7.0% respectively
  • On tour, we sustained our position as the # 1 hybrid on the PGA, Nationwide and Champions tours during 2010, and continued to strengthen our brand through periodic tour exposure. Additionally, we believe having Yani Tseng and Bernhard Langer named as Players of the Year on their respective tours in 2010, along with recent staff additions such as Ryan Moore, and our continued association with key players such as Tom Watson, help further build our brand strength in the eyes of avid golfers.
  • International growth continues to be a key initiative for our company and we perceive this as an area of strong future growth potential. During 2010, our international revenues increased 8% over the previous year and we continue to devote more resources towards the development of this business, including but not limited to, establishing a third party distribution center to better service and develop the European market.
  • In the 2011 Golf Digest Hot List, our Idea Tech V3 irons won gold designation, Category Leader in Innovation and Editors Choice. The Idea Tech V3 hybrids, Idea CB2 irons, and Idea a7OS irons also won gold designations. Since the inception of the Golf Digest Hot List rankings, Adams Golf has earned more category leader awards for innovation than any other manufacturer.
  • We are pleased with the market response to new premium product launches such as the Speedline F11 drivers and fairway woods, and Idea Tech V3 irons and hybrids. Our research shows that the new technology incorporated into the Speedline F11 fairway woods, the Velocity Slot Technology, increases both ball speed and forgiveness. Given this, we believe the Speedline F11 fairway wood is an important addition to our product line and has the potential to drive significant market share growth in the fairway wood category.
  • Consistent with the above results, recent brand research shows that our brand strength is continuing to improve, as is purchase interest in our products.
  • Lastly, in January of 2011, Adams Golf purchased the intellectual property and select assets of the Yes! branded putter business via a U.S. Bankruptcy Court auction for the bulk sale offering of Denver-based Progear Holdings. We plan to re-launch this brand in the U.S. during the second quarter of 2011 and believe that over the next several years this acquisition will provide us with opportunities for both international and domestic growth in the putter category.

“It is our belief that market conditions are continuing a slow improvement trend that began during 2010, and that we are positioned to continue our progress on brand and market development. As a result, we are cautiously optimistic for our business in 2011,” concluded Brewer.