Callaway Golf Company reported third-quarter revenues slid 1.7 percent to $173 million, compared to $176 million last year. Its net loss in the period widened to $65.2 million, or $1.01 a share, from a loss of $20.9 million, or 33 cents, a year ago. The company said that its restructuring plan is on pace to deliver gross annualized savings of approximately $50 million.
The company has developed plans to invest approximately half of the savings in brand and demand creation initiatives.
“Our third quarter results are in line with our lowered expectations and continue to reflect the impact of a challenging golf equipment market and the mistakes we have made in executing a coordinated product and marketing plan based on golf consumers' preferences,” commented Tony Thornley, who was appointed interim president and chief executive officer in June 2011. “We are on target with our recovery plan announced last quarter and have made significant progress in setting the foundation to return to profitability. We have focused the organization on the different elements of our business with the intent to achieve sustained profitability in each of these segments. Growth in sales is an essential part of this strategy, particularly in our core products. We remain committed to reinvesting approximately half of the $50 million in savings towards brand and demand creation initiatives to drive sales growth in 2012 and beyond.”
GAAP RESULTS.
For the third quarter of 2011, the company reported the following GAAP results as compared to the third quarter of 2010:
|
Dollars in millions except per share amounts |
2011 |
% of Sales |
2010 |
% of Sales |
Increase / |
|
|
Net Sales |
$173 |
– |
$176 |
– |
($3) |
|
|
Gross Profit |
$47 |
27% |
$49 |
28% |
($2) |
|
|
Operating Expenses |
$92 |
53% |
$87 |
50% |
$5 |
|
|
Operating Income/(Loss) |
($44) |
* |
($38) |
* |
($6) |
|
|
Income Tax Provision/(Benefit) |
$15 |
9% |
($22) |
* |
$37 |
|
|
Earnings/(Loss) per share |
($1.01) |
– |
($0.33) |
– |
($0.68) |
|
|
* Not meaningful |
||||||
For the first nine months of 2011, the Company reported the following GAAP results as compared to the first nine months of 2010:
|
Dollars in millions except per share amounts |
2011 |
% of Sales |
2010 |
% of Sales |
Increase / |
|
|
Net Sales |
$733 |
– |
$782 |
– |
($49) |
|
|
Gross Profit |
$274 |
37% |
$310 |
40% |
($36) |
|
|
Operating Expenses |
$305 |
42% |
$294 |
38% |
$11 |
|
|
Operating Income/(Loss) |
($31) |
* |
$16 |
2% |
($47) |
|
|
Income Tax Provision/(Benefit) |
$69 |
9% |
($4) |
* |
$73 |
|
|
Earnings/(Loss) per share |
| |||||
