Acushnet Holdings Corp., the parent of Titleist, FootJoy and KJUS, reported earnings rose 15.2 percent in the first quarter ended March 31 on a 13.2 percent sales gain. Healthy double-digit increases led the gains in golf balls and club sales, with the U.S. turning in the best regional performance. Results beat analyst expectations, although Acushnet maintained its full-year guidance.

EPS of $1.36 topped Wall Street’s consensus estimate of $1.09. Sales of $686.3 million exceeded the consensus estimate of $626 million.

“Our teams did great work executing new product launches, and our double-digit top-line growth in the quarter reflects the overall health of the Titleist, FootJoy and KJUS brands and the strength of our global supply chain,” said David Maher, Acushnet’s president and CEO. “Growth in Titleist golf balls was led by the successful launch of Pro V1 and Pro V1x models and gains in Titleist golf clubs were driven by the continued momentum of our TSR metalwood family. Both Titleist golf gear and FootJoy golf wear benefited from new product introductions and our enhanced supply chain and customization capabilities.” 

Maher continued, “As we look ahead to the balance of the year, we are well-positioned to meet the continued demand for our products and are encouraged by the resilience and engagement of Acushnet’s core consumer, the game’s dedicated golfer. I would like to thank my fellow associates for their commitment to delivering exceptional product and service experiences as we seek to generate long-term value for our partners and shareholders.”

Summary of First Quarter 2023 Financial Results
Consolidated net sales for the quarter increased 13.2 percent, or 17.2 percent on a constant currency basis, to $686.3 million, driven by higher sales volumes across all reportable segments. 

On a geographic basis, net sales in the U.S. were higher, driven by increases of 23.0 percent in Titleist golf balls, 21.2 percent in FootJoy golf wear, 19.7 percent in Titleist golf clubs, and 66.2 percent in Titleist golf gear. The increase in Titleist golf balls was primarily driven by higher sales volumes from its latest generation Pro V1 and Pro V1x golf balls. The rise in FootJoy golf wear was primarily driven by higher sales volumes across all product categories, led by apparel. The increase in Titleist golf clubs was primarily driven by higher sales volumes of its TSR drivers, fairways and hybrids, partially offset by lower sales volumes of wedges which are in their second model year. The increase in Titleist golf gear was primarily driven by higher sales volumes across all product categories reflecting improvements in supply chain and fulfillment constraints versus their impact in the first quarter of 2022.

Net sales outside the U.S. increased 1.7 percent, or 9.4 percent, on a constant currency basis. In Korea and Rest of World, net sales increased across all reportable segments. In Japan, net sales increased in all reportable segments except Titleist golf clubs which were flat. In EMEA, net sales increased across all reportable segments except FootJoy golf wear.

Segment Specifics

  •  17.2 percent increase in net sales (20.6 percent increase on a constant currency basis) of Titleist golf balls primarily due to higher sales volumes of our latest generation Pro V1 and Pro V1x golf balls launched in the first quarter of 2023. 
  • 12.4 percent increase in net sales (16.3 percent increase on a constant currency basis) of Titleist golf clubs primarily driven by higher sales volumes of our TSR drivers and fairways launched in the third quarter of 2022 and TSR hybrids launched in the first quarter of 2023. Lower sales volumes of second-model-year wedges partially offset this increase.
  • 51.9 percent increase in net sales (57.4 percent increase on a constant-currency basis) of Titleist golf gear primarily due to higher sales volumes across all product categories reflecting improvements in supply chain and fulfillment constraints versus their impact in the first quarter of 2022. 
  • 3.9 percent increase in net sales (7.8 percent increase on a constant-currency basis) in FootJoy golf wear primarily driven by increased sales volumes in apparel reflecting improvements in supply chain constraints.

Net income attributable to Acushnet Holdings Corp. increased $12.3 million to $93.3 million, or $1.36 a share, up 15.2 percent year over year, primarily due to increased income from operations, partially offset by an increase in net interest expense.

Adjusted EBITDA was $146.8 million, up 22.3 percent year over year. The adjusted EBITDA margin was 21.4 percent for the first quarter versus 19.8 percent for the prior year’s period.

Cash Dividend and Share Repurchase
Today, Acushnet’s Board of Directors declared a quarterly cash dividend of $0.195 per share of common stock. The dividend will be payable on June 16, 2023, to shareholders of record as of June 2, 2023. The number of shares outstanding as of April 28, 2023, was 67,363,140. 

During the quarter, the company repurchased 2,514,917 shares of common stock at an average price of $46.17 for an aggregate of $116.1 million. Included in this amount were 2,168,528 shares of common stock repurchased from Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Holdings Corp., for an aggregate of $100.0 million, in satisfaction of the company’s previously disclosed share repurchase obligation.

2023 Outlook 
The company affirmed its full-year outlook and expects full-year consolidated net sales to be approximately $2,325 to $2,375 million and Adjusted EBITDA of roughly $345 million to $365 million. On a constant-currency basis, consolidated net sales are expected to be in the range of up 5.0 percent to up 7.2 percent. The company’s outlook assumes no additional supply chain disruptions or changes in the impact of foreign currency. 

Photo courtesy Titleist