For the fiscal first quarter of 2006, Ashworth saw total sales increase 11% over the prior year quarter. Sales of Ashworth branded merchandise increased 3.5% to $20 million, while Callaway Golf apparel increased 23% over last years first quarter to $10.6 million. On a conference call with analysts, management was excited about the companys newest line, Ashworth Weather Systems, which had been seeing success since its launch late in Q4. On the topic of the strategic evaluation in which Ashworth currently rests, management refused to say anything until something was ultimately decided.
In the International channel, revenues were primarily driven by significant growth from Ashworth Europe, with both the Ashworth and Callaway Golf apparel brands particularly strong. Headwear, Women's sweaters, and Men's fashion collections showed strong increases over last year. Revenues for the corporate distribution channel were $5.6 million, an increase of 29.3% over the first quarter last year. Revenues for the retail distribution channel were $5.2 million, an increase of 40.9% over first quarter 2005. First quarter revenues for Ashworth East were $10.1 million, an increase of 16.8% over the first quarter of 2005. Revenues for The Game, the company's brand in the collegiate bookstore channel, and Kudzu, the company's brand in the NASCAR/racing channel, increased 15.5% and 3.7%, respectively, over first quarter 2005 results.
Revenues from the company-owned stores were $2.3 million, an increase of 36.2% over first quarter 2005. Since the first quarter of 2005, the company added a net of 3 new outlet stores (6 outlet openings, 3 outlet closings) bringing the company's total number of outlet stores to 12. The new outlet stores, net of closings, contributed $0.6 million in sales in the first quarter of fiscal 2006, while sales on a comparative store basis were flat.
The company affirmed its previously stated (December 2005) consolidated revenue guidance for fiscal 2006 of approximately $210 to $220 million. Based on current trends, the company expects consolidated net earnings of 48 cents to 56 cents per diluted share for fiscal 2006.
| Ashworth, Inc. | |||
| Fiscal First Quarter Results | |||
| (in $ millions) | 2006 | 2005 | Change |
| Total Sales | $40.6 | $36.5 | +11.2% |
| Domestic | $11.6 | $13.3 | -12.8% |
| International | $5.8 | $4.9 | +18.4% |
| GM % | 44.3% | 40.1% | +420 bps |
| SG&A % | 43.6% | 38.6% | +500 bps |
| Net Income | ($0.1) | $0.08 | vs. profit |
| Diluted EPS | (0¢) | 1¢ | vs. profit |
| Inventory* | $61.7 | $59.2 | +4.2% |
