CARLSBAD, Calif., Feb. 2, 2017 /PRNewswire/ -- Callaway Golf
Company (NYSE:ELY) announced today its fourth quarter and full year
2016 financial results and provided financial guidance for
2017.
As a result of the Company's continued brand momentum and market
share gains, the Company's 2016 fourth quarter net sales grew by
7%, or 5% on a constant currency basis, resulting in full year net
sales growth of 3%, or 2% on a constant currency basis. The
Company's overall market share gains in 2016, together with its new
apparel joint venture in Japan,
enabled it to achieve this sales growth despite softer than
expected market conditions. The Company's overall U.S. hard goods
market share increased in 2016 and the Company sustained its #1
position in U.S. golf clubs market share. In addition to this sales
growth, the Company also significantly improved its profitability
and cash flows for full year 2016, including a 64% increase in
income from operations and a 154% increase in cash provided by
operations.
"2016 was an exciting and pivotal year for Callaway Golf,"
commented Chip Brewer, President and
Chief Executive Officer of Callaway Golf Company. "We demonstrated
continued ability to grow market share and top line revenue
throughout the year by introducing engaging product with
exceptional performance, while at the same time realizing
operational efficiencies and judiciously capitalizing on investment
opportunities. Specifically, we demonstrated our commitment to
strategically investing in the core business through the
acquisition of Toulon Design and the hiring of Rock Ishii, a highly
respected innovator in the golf ball category. Furthermore, we
executed on our strategy of seeking growth in tangential areas with
the start of our new joint venture in Japan and the recent acquisition of OGIO
International, Inc., which is expected to provide a platform for
future growth in the lifestyle category and create shareholder
value for years to come. We accomplished this all while driving
market share gains in key hard goods categories like golf balls and
augmenting Callaway's position as the world's #1 sticks brand."
Mr. Brewer continued, "Looking ahead to 2017, we are encouraged
by the early enthusiasm surrounding the EPIC driver with Jailbreak
Technology and the newest addition to our Chrome Soft platform,
Chrome Soft X. On Tour, we are excited to have signed veteran
Michelle Wie just last week and to
have added earlier this year other young promising players such as
Patrick Rodgers, Mariah Stackhouse and Daniel Berger. We will continue to thoughtfully
and strategically invest in professional golfers to represent our
brand on the major global golf Tours as we believe that success on
Tour translates into success for our shareholders. Beyond the Tour,
we will also continue to seek opportunities to invest in our core
business during a period where many of our golf equipment
competitors either choose to or are forced to cut back. A good
example of this will be a significant capital investment at our
Chicopee ball manufacturing plant in 2017. The investments
are possible due to our exceptional product performance, continued
brand momentum and strong balance sheet. As we move into 2017, we
look forward to continuing to execute on our strategy and position
ourselves to create long-term shareholder value."
Reversal of Deferred Tax Valuation Allowance
The Company's fourth quarter and full year 2016 financial
results prepared in accordance with generally accepted accounting
principles in the United States
("GAAP") benefitted significantly from the non-cash reversal of a
significant portion of the Company's deferred tax valuation
allowance. The Company first established the deferred tax
valuation allowance in 2011 and it continued to increase through
2014. While this valuation allowance was in place, the
Company did not recognize any Federal U.S. income tax in its
financial statements.
As a result of the improved profitability in the Company's
business in 2015 and 2016, as well as the Company's outlook for
2017, during the fourth quarter of 2016 the Company determined that
it was more likely than not that the Company would be able to
realize most of its deferred tax assets and therefore reversed most
of the valuation allowance. As a result of this reversal, the
Company recognized a non-cash income tax benefit in the fourth
quarter of 2016 of $157 million. Also
as a result of the reversal, the Company was required to
retroactively recognize Federal U.S. income taxes for all of
2016. The Company's income tax provision therefore increased
by $16.0 million for 2016 for a net
benefit of $141 million related to
the reversal of the valuation allowance.
GAAP and Non-GAAP Results
In addition to the Company's results prepared in accordance
with GAAP, the Company provided information concerning its results
on a non-GAAP basis. This non-GAAP information presents the
Company's financial results for the fourth quarter and full year
2016 excluding the $141 million net
benefit discussed above resulting from the reversal of the deferred
tax valuation allowance. The purpose of this non-GAAP presentation
is to provide additional information to investors regarding the
underlying performance of the Company's business as compared to
2015, which did not include this non-recurring item. The Company
also provides certain information on a constant currency basis. The
manner in which this non-GAAP information is derived is discussed
in more detail toward the end of this release, and the Company has
provided in the tables to this release a reconciliation of the
non-GAAP information to the most directly comparable GAAP
information.
Summary of Fourth Quarter 2016 Financial Results
The Company announced the following GAAP and non-GAAP financial
results for the fourth quarter of 2016 (in millions, except
eps):
|
2016 RESULTS
(GAAP)
|
|
NON-GAAP
PRESENTATION
|
|
Q4
2016
|
Q4
2015
|
Change
|
|
Q4 2016
non-GAAP
|
Q4 2015
GAAP
|
Change
|
Net Sales
|
$164
|
$153
|
$11
|
|
$164
|
$153
|
$11
|
Gross Profit/
% of Sales
|
$63
38.6%
|
$51
33.3%
|
$12
530 b.p.
|
|
$63
38.6%
|
$51
33.3%
|
$12
530 b.p.
|
Operating
Expenses
|
$80
|
$80
|
$0
|
|
$80
|
$80
|
$0
|
Pre-Tax
Income/(loss)
|
($13)
|
($30)
|
$17
|
|
($13)
|
($30)
|
$17
|
Income Tax
Provision/(Benefit)
|
($137)
|
$0.5
|
$137.5
|
|
$3
|
$0.5
|
$2.5
|
Net Income
|
$123
|
($30)
|
$153
|
|
($17)
|
($30)
|
$13
|
EPS
|
$1.28
|
($0.33)
|
$1.61
|
|
($0.18)
|
($0.33)
|
$0.15
|
The Company's 2016 fourth quarter net sales were $164 million, which represents a 7% increase
compared to 2015 fourth quarter net sales of $153 million. On a constant currency basis,
net sales increased 5% for the same period. The increased sales
reflect increased sales in both the golf club and golf ball
operating segments. Through continued market share gains,
strong momentum, particularly in the U.S. green grass channel, and
the Company's new joint venture in Japan, the Company was able to grow its sales
despite overall industry headwinds and softer than expected market
conditions in Asia.
In addition to this sales growth, the Company's gross margin
also significantly improved. For the fourth quarter of 2016, the
Company's gross margin improved 530 basis points to 38.6% as
compared to 33.3% for the comparable period in 2015. The improved
gross margin is primarily due to higher average selling prices in
the woods, irons and golf ball categories and a decrease in
promotional activity driven by longer product lifecycles and lower
inventory levels, as well as improved operational efficiencies
resulting from the many initiatives the Company has implemented
over the last several years.
Fourth quarter 2016 earnings per share were $1.28, which includes the $141 million ($1.46
per share) net impact from the reversal of the deferred tax
valuation allowance discussed above. Due to the seasonality
of the Company's business, the Company usually reports a loss in
the fourth quarter. On a non-GAAP basis, which excludes the
net impact of the reversal of the deferred tax valuation allowance,
the Company reported a loss per share for the fourth quarter of
2016 of $0.18, compared to a loss per
share of $0.33 for the fourth quarter
of 2015. This 45% improvement in loss per share was due to
increased sales and improved gross margin.
Summary of Full Year 2016 Financial Results
The Company announced the following GAAP and non-GAAP financial
results for full year 2016 (in millions, except eps):
|
2016 RESULTS
(GAAP)
|
|
NON-GAAP
PRESENTATION
|
|
2016
|
2015
|
Change
|
|
2016
non-GAAP
|
2015
GAAP
|
Change
|
Net Sales
|
$871
|
$844
|
$27
|
|
$871
|
$844
|
$27
|
Gross Profit/
% of Sales
|
$385
44.2%
|
$358
42.4%
|
$27
180 b.p.
|
|
$385
44.2%
|
$358
42.4%
|
$27
180 b.p.
|
Operating
Expenses
|
$341
|
$331
|
($10)
|
|
$341
|
$331
|
($10)
|
Pre-Tax
Income
|
$58
|
$20
|
$38
|
|
$58
|
$20
|
$38
|
Income Tax
Provision/(Benefit)
|
($133)
|
$5
|
$138
|
|
$8
|
$5
|
$3
|
Net Income
|
$190
|
$15
|
$175
|
|
$49
|
$15
|
$34
|
EPS
|
$1.98
|
$0.17
|
$1.81
|
|
$0.51
|
$0.17
|
$0.34
|
The Company's 2016 full year net sales were $871 million, which represents a 3% increase
compared to 2015 net sales of $844
million. On a constant currency basis, net sales
increased 2% for the same period. This increase represents growth
in both the golf club and golf ball operating segments, driven
primarily by increased sales in the irons, golf balls and
accessories and other categories, including sales from the
Company's new joint venture in Japan. Overall, net sales were favorably
impacted by an increase in average selling prices and market share
gains, which offset the industry headwinds and softer than expected
market conditions in Asia.
For full year 2016, the Company significantly improved its gross
margin by 180 basis points due to higher average selling prices in
all major hard goods categories and improved operational
efficiencies resulting from the many initiatives the Company has
implemented over the last several years.
The Company's earnings per share for full year 2016 were
$1.98, which includes the
$141 million ($1.47 per share) net impact from the reversal of
the deferred tax valuation allowance discussed above.
Excluding this item, the Company's non-GAAP earnings per share were
$0.51 compared to $0.17 for 2015. This increase included the
$17.7 million ($0.18 per share) gain from the 2016 second
quarter sale of a small portion of the Company's Topgolf
investment. If both the reversal of the valuation allowance
and the Topgolf gain were excluded, the Company's non-GAAP earnings
per share would have been $0.33,
compared to $0.17 for full year 2015.
This 94% increase was due to the increased full year sales and
gross margin, which more than offset the 3% increase in operating
expenses. As a result of this performance, the Company's net cash
provided by operating activities increased $47 million (154%) to $78
million for full year 2016 as compared to $31 million in 2015.
Business Outlook for 2017
OGIO acquisition. The acquisition of OGIO
International, Inc., which was completed in January 2017, is expected to contribute to the
Company approximately $45 million in
revenue for full year 2017. After absorbing non-recurring
transaction and transition expenses of approximately $7 million, OGIO is expected to be dilutive by
approximately $0.02 to Callaway's
2017 earnings per share, but is expected to be accretive
thereafter.
Basis for 2017 Pro Forma Estimates. The Company's 2017
pro forma estimates exclude non-recurring transaction and
transition expenses related to the OGIO acquisition, which are
estimated to be approximately $7
million for full year 2017. The amount incurred in the
first quarter will be affected by the timing of the various
transition initiatives planned for OGIO which is still in the
process of being finalized. The pro forma estimates are generally
based upon a blend of current foreign currency exchange rates and
the exchange rates at which the Company entered into hedging
transactions. The manner in which the constant currency information
is derived is discussed in more detail toward the end of this
release. Future changes in the applicable foreign currency
exchange rates will affect these pro forma
estimates.
Basis for 2017 Pro Forma Constant Currency
Estimates. Given the significant effect that changes in
foreign currencies are expected to have on the Company's financial
results in 2017, the Company has provided guidance on a constant
currency pro forma basis for 2017 in addition to the pro forma
estimates described above (which excludes the OGIO transaction and
transition expenses). The 2017 pro forma constant currency
estimates are derived by taking the 2017 pro forma estimates and
restating them based upon applicable 2016 foreign currency exchange
rates.
Basis for 2016 Pro Forma Results. In order to make
the 2017 guidance more comparable to 2016 with regard to the
underlying performance of the Company's business, the Company has
recast the 2016 results on a pro forma basis. The 2016 pro
forma results exclude (i) the $157
million ($1.63 per share)
benefit from the reversal of the deferred tax valuation allowance
and (ii) the $10 million
($0.11 per share) after-tax Topgolf
gain. It should be noted that the manner in which this pro forma
information is derived differs from the manner in which the 2016
non-GAAP information provided above is derived. The purpose of this
presentation is to make 2016 more comparable to 2017.
Full Year 2017
The Company currently estimates the following full year results
for 2017:
|
2017 GAAP
Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma
Constant
Currency Estimate
|
2016
Pro Forma
Results
|
Net Sales
|
$910 - $935
million
|
$910 - $935
million
|
$938 - $963
million
|
$871
million
|
The pro forma constant currency net sales growth of 8% - 11% is
expected to be driven by the strength of the Company's 2017 product
line, growth from the OGIO acquisition and the full year impact of
the Japan apparel joint venture.
|
2017 GAAP
Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma Constant
Currency Estimate
|
2016 Pro
Forma
Results
|
Gross
Margin
|
44.2%
|
44.2%
|
45.4%
|
44.2%
|
The Company estimates that its 2017 pro-forma gross margin will
improve approximately 120 basis points from last year on a constant
currency basis. This increase is expected to be driven by higher
pricing, a lower mix of closeout products as well as continued
operational improvements.
|
2017
GAAP Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma Constant
Currency Estimate
|
2016
Pro Forma
Results
|
Operating
Expenses
|
$374
million
|
$367
million
|
$375
million
|
$341
million
|
The Company estimates that its 2017 pro forma constant currency
operating expenses will increase compared to 2016 due to investment
related to the OGIO acquisition, the full year impact of the
Japan joint venture, and continued
opportunistic investment in the core business and other new
strategic investment activities, as well as cost of living and
inflationary increases.
|
2017
GAAP Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma Constant
Currency Estimate
|
2016 Pro
Forma
Results
|
Earnings Per
Share
|
$0.17 -
$0.23
|
$0.21 -
$0.27
|
$0.31 -
$0.37
|
$0.24
|
The Company estimates that its fully diluted pro forma constant
currency earnings per share will increase $0.07 - $0.13 from 2016. The Company's 2017
earnings per share estimates assume a base of 96 million shares,
which is consistent with 2016.
First Quarter 2017
The Company currently estimates the following results for the
first quarter of 2017:
|
2017 GAAP
Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma Constant
Currency Estimate
|
2016
Pro Forma
Results
|
Net Sales
|
$275 - $285
million
|
$275 - $285
million
|
$279 - $289
million
|
$274
million
|
The anticipated pro forma constant currency sales growth
compared to 2016 is expected to be due to continued market share
gains and incremental sales resulting from the OGIO acquisition and
the Japan joint venture. This
sales growth is expected to be partially offset by a reduction in
sell-in launch quantities at the beginning of the new golf season
resulting from a decrease in retail doors and retailer inventory
rationalization. The Company anticipates that this reduction
in initial sell-in quantities will not significantly impact the
Company's full year results.
|
2017
GAAP Estimate
|
2017
Pro Forma Estimate
|
2017
Pro Forma Constant
Currency Estimate
|
2016 Pro
Forma
Results
|
Earnings Per
Share
|
$0.17 -
$0.20
|
$0.19 -
$0.22
|
$0.21 -
$0.24
|
$0.26
|
The Company's pro forma constant currency earnings per share is
estimated to decrease compared to the first quarter of 2016 due to
the seasonality of OGIO and the Japan joint venture as well as the reduction
in sell-in launch quantities discussed above. The Company's 2017
first quarter earnings per share estimates assume approximately 96
million shares as compared to 95 million shares in 2016.
Conference Call and Webcast
The Company will be holding a conference call at 2:00 p.m. PST today to discuss the Company's
financial results, outlook and business. The call will be broadcast
live over the Internet and can be accessed at
http://ir.callawaygolf.com/. To listen to the call, and to access
the Company's presentation materials, please go to the website at
least 15 minutes before the call to register and for instructions
on how to access the broadcast. A replay of the conference call
will be available approximately three hours after the call ends,
and will remain available through 9:00 p.m.
PST on Thursday, February 9,
2017. The replay may be accessed through the Internet at
http://ir.callawaygolf.com/.
Non-GAAP Information
The GAAP results contained in this press release and the
financial statement schedules attached to this press release have
been prepared in accordance with accounting principles generally
accepted in the United States
("GAAP"). To supplement the GAAP results, the Company has
provided certain non-GAAP financial information as follows:
Constant Currency Basis. The Company provided certain
information regarding the Company's financial results or projected
financial results on a "constant currency basis." This information
estimates the impact of changes in foreign currency rates on the
translation of the Company's current or projected future period
financial results as compared to the applicable comparable
period. This impact is derived by taking the current or
projected local currency results and translating them into U.S.
Dollars based upon the foreign currency exchange rates for the
applicable comparable period. It does not include any other effect
of changes in foreign currency rates on the Company's results or
business.
EBITDA. The Company provides information about its
results excluding interest, taxes, and depreciation and
amortization expenses.
Certain Exclusions. The Company presents certain of its
financial results excluding (i) tax benefits received from the
reversal of a significant portion of its deferred tax valuation
allowance and (ii) gains from the sale of a small portion of its
Topgolf investment.
In addition, the Company has included in the schedules to this
release a reconciliation of certain non-GAAP information to the
most directly correlated GAAP information. The non-GAAP
information presented in this release and related schedules should
not be considered in isolation or as a substitute for any measure
derived in accordance with GAAP. The non-GAAP information may also
be inconsistent with the manner in which similar measures are
derived or used by other companies. Management uses such
non-GAAP information for financial and operational decision-making
purposes and as a means to evaluate period over period comparisons
and in forecasting the Company's business going forward. Management
believes that the presentation of such non-GAAP information, when
considered in conjunction with the most directly comparable GAAP
information, provides additional useful comparative information for
investors in their assessment of the underlying performance of the
Company's business without regard to these items. The Company has
provided reconciling information in the attached schedules.
Forward-Looking Statements
Statements used in this press release that relate to future
plans, events, financial results, performance or prospects,
including statements relating to the Company's estimated 2017
sales, gross margins, operating expenses, and earnings per share
(or related share count), the creation of shareholder value, the
expected timing and expenses related to the integration of the OGIO
acquisition, and the related impact on earnings and revenues,
growth opportunities and the future business and prospects of
Callaway and OGIO, including future corporate development
opportunities or investments, the expected impact on sales and
operating expenses as a result of the joint venture in Japan, as well as the Company's momentum,
success of future products, market share gains, and ability to
maximize current conditions or to leverage and capitalize on
improved industry or macroeconomic conditions, are forward-looking
statements as defined under the Private Securities Litigation
Reform Act of 1995. These statements are based upon current
information and expectations. Accurately estimating the
forward-looking statements is based upon various risks and unknowns
including any unfavorable changes in U.S. trade, tax or other
policies, including restrictions on imports or an increase in
import tariffs; delays, difficulties, or increased costs in
integrating the acquired OGIO business or implementing the
Company's growth strategy generally; consumer acceptance of and
demand for the Company's products; the level of promotional
activity in the marketplace; unfavorable weather conditions; future
consumer discretionary purchasing activity, which can be
significantly adversely affected by unfavorable economic or market
conditions; future retailer purchasing activity, which can be
significantly negatively affected by adverse industry conditions
and overall retail inventory levels; changes in the assessment of
whether a deferred tax valuation allowance is necessary; and future
changes in foreign currency exchange rates and the degree of
effectiveness of the Company's hedging programs. Actual results may
differ materially from those estimated or anticipated as a result
of these risks and unknowns or other risks and uncertainties,
including continued compliance with the terms of the Company's
credit facilities; delays, difficulties or increased costs in the
supply of components or commodities needed to manufacture the
Company's products or in manufacturing the Company's products; the
ability to secure professional tour player endorsements at
reasonable costs; any rule changes or other actions taken by the
USGA or other golf association that could have an adverse impact
upon demand or supply of the Company's products; a decrease in
participation levels in golf; and the effect of terrorist activity,
armed conflict, natural disasters or pandemic diseases on the
economy generally, on the level of demand for the Company's
products or on the Company's ability to manage its supply and
delivery logistics in such an environment. For additional
information concerning these and other risks and uncertainties that
could affect these statements, the golf industry, and the Company's
business, see the Company's Annual Report on Form 10-K for the year
ended December 31, 2015 as well as
other risks and uncertainties detailed from time to time in the
Company's reports on Forms 10-K, 10-Q and 8-K subsequently filed
with the Securities and Exchange Commission. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company undertakes no
obligation to republish revised forward-looking statements to
reflect events or circumstances after the date hereof or to reflect
the occurrence of unanticipated events.
About Callaway Golf
Through an unwavering
commitment to innovation, Callaway Golf Company (NYSE:ELY) creates
products designed to make every golfer a better golfer. Callaway
Golf Company manufactures and sells golf clubs and golf balls, and
sells bags, accessories and apparel in the golf and lifestyle
categories, under the Callaway Golf®, Odyssey®, and OGIO brands
worldwide. For more information please visit
www.callawaygolf.com,
www.odysseygolf.com and www.ogio.com
Contacts:
|
Robert
Julian
|
|
Patrick
Burke
|
|
(760)
931-1771
|
CALLAWAY GOLF
COMPANY
CONSOLIDATED
CONDENSED BALANCE SHEETS
(Unaudited)
(In
thousands)
|
|
|
December
31, 2016
|
|
December 31,
2015
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
125,975
|
|
|
|
$
|
49,801
|
|
Accounts receivable,
net
|
|
127,863
|
|
|
|
115,607
|
|
Inventories
|
|
189,400
|
|
|
|
208,883
|
|
Other current
assets
|
|
17,187
|
|
|
|
17,196
|
|
Total current
assets
|
|
460,425
|
|
|
|
391,487
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
54,475
|
|
|
|
55,808
|
|
Intangible assets,
net
|
|
114,324
|
|
|
|
115,282
|
|
Investment in
golf-related ventures
|
|
48,997
|
|
|
|
53,315
|
|
Deferred taxes,
net
|
|
114,707
|
|
|
|
6,962
|
|
Other
assets
|
|
8,354
|
|
|
|
8,370
|
|
Total
assets
|
|
$
|
801,282
|
|
|
|
$
|
631,224
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts payable and
accrued expenses
|
|
$
|
132,521
|
|
|
|
$
|
122,620
|
|
Accrued employee
compensation and benefits
|
|
32,568
|
|
|
|
33,518
|
|
Asset-based credit
facilities
|
|
11,966
|
|
|
|
14,969
|
|
Accrued warranty
expense
|
|
5,395
|
|
|
|
5,706
|
|
Income tax
liability
|
|
4,404
|
|
|
|
1,823
|
|
Total current
liabilities
|
|
186,854
|
|
|
|
178,636
|
|
|
|
|
|
|
|
Long-term
liabilities
|
|
5,828
|
|
|
|
39,643
|
|
Total Callaway Golf
Company shareholders' equity
|
|
598,906
|
|
|
|
412,945
|
|
Non-controlling
interest in consolidated entity
|
|
9,694
|
|
|
|
—
|
|
Total liabilities and
shareholders' equity
|
|
$
|
801,282
|
|
|
|
$
|
631,224
|
|
CALLAWAY GOLF
COMPANY
CONSOLIDATED
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands,
except per share data)
|
|
|
Three Months
Ended
December 31,
|
|
2016
|
|
2015
|
Net sales
|
$
|
163,695
|
|
|
$
|
153,331
|
|
Cost of
sales
|
100,584
|
|
|
102,263
|
|
Gross
profit
|
63,111
|
|
|
51,068
|
|
Operating
expenses:
|
|
|
|
Selling
|
52,013
|
|
|
50,235
|
|
General and
administrative
|
19,485
|
|
|
21,160
|
|
Research and
development
|
8,376
|
|
|
9,021
|
|
Total operating
expenses
|
79,874
|
|
|
80,416
|
|
Loss from
operations
|
(16,763)
|
|
|
(29,348)
|
|
Other income
(expense), net
|
3,768
|
|
|
(611)
|
|
Loss before income
taxes
|
(12,995)
|
|
|
(29,959)
|
|
Income tax (benefit)
provision
|
(137,193)
|
|
|
493
|
|
Net income
(loss)
|
124,198
|
|
|
(30,452)
|
|
Less: Net income
attributable to non-controlling interests
|
927
|
|
|
—
|
|
Net income (loss)
attributable to Callaway Golf Company
|
$
|
123,271
|
|
|
$
|
(30,452)
|
|
|
|
|
|
Earnings (loss) per
common share:
|
|
|
|
Basic
|
$
|
1.31
|
|
|
$
|
(0.33)
|
|
Diluted
|
$
|
1.28
|
|
|
$
|
(0.33)
|
|
Weighted-average
common shares outstanding:
|
|
|
|
Basic
|
94,114
|
|
|
92,272
|
|
Diluted
|
96,316
|
|
|
92,272
|
|
|
|
|
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
Net sales
|
$
|
871,192
|
|
|
$
|
843,794
|
|
Cost of
sales
|
486,181
|
|
|
486,161
|
|
Gross
profit
|
385,011
|
|
|
357,633
|
|
Operating
expenses:
|
|
|
|
Selling
|
235,556
|
|
|
228,910
|
|
General and
administrative
|
71,969
|
|
|
68,567
|
|
Research and
development
|
33,318
|
|
|
33,213
|
|
Total operating
expenses
|
340,843
|
|
|
330,690
|
|
Income from
operations
|
44,168
|
|
|
26,943
|
|
Gain on sale of
golf-related ventures
|
17,662
|
|
|
—
|
|
Other expense,
net
|
(3,437)
|
|
|
(6,880)
|
|
Income before income
taxes
|
58,393
|
|
|
20,063
|
|
Income tax (benefit)
provision
|
(132,561)
|
|
|
5,495
|
|
Net income
|
190,954
|
|
|
14,568
|
|
Less: Net income
attributable to non-controlling interests
|
1,054
|
|
|
—
|
|
Net income
attributable to Callaway Golf Company
|
$
|
189,900
|
|
|
$
|
14,568
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
Basic
|
$
|
2.02
|
|
|
$
|
0.18
|
|
Diluted
|
$
|
1.98
|
|
|
$
|
0.17
|
|
Weighted-average
common shares outstanding:
|
|
|
|
Basic
|
94,045
|
|
|
83,116
|
|
Diluted
|
95,845
|
|
|
84,611
|
|
CALLAWAY GOLF
COMPANY
CONSOLIDATED
CONDENSED STATEMENTS OF CASH FLOW
(Unaudited)
(In
thousands)
|
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
189,900
|
|
|
$
|
14,568
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
16,586
|
|
|
17,379
|
|
Deferred taxes,
net
|
(141,447)
|
|
|
128
|
|
Share-based
compensation
|
8,965
|
|
|
7,542
|
|
Gain on disposal of
long-lived assets and deferred gain amortization
|
(116)
|
|
|
(1,006)
|
|
Gain on sale of
golf-related investments
|
(17,662)
|
|
|
—
|
|
Unrealized loss on
foreign currency forward contracts
|
1,054
|
|
|
—
|
|
Net income
attributable to non-controlling interests
|
(683)
|
|
|
—
|
|
Debt discount
amortization on convertible notes
|
—
|
|
|
531
|
|
Changes in assets and
liabilities
|
21,113
|
|
|
(8,561)
|
|
Net cash provided by
operating activities
|
77,710
|
|
|
30,581
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Proceeds from sale of
investments in golf-related ventures
|
23,429
|
|
|
—
|
|
Payments from
(issuance of) notes receivable
|
3,104
|
|
|
(3,104)
|
|
Capital
expenditures
|
(16,152)
|
|
|
(14,369)
|
|
Investment in
golf-related ventures
|
(1,448)
|
|
|
(940)
|
|
Proceeds from sale of
property, plant and equipment
|
20
|
|
|
2
|
|
Net cash provided by
(used in) investing activities
|
8,953
|
|
|
(18,411)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Acquisition of
treasury stock
|
(5,144)
|
|
|
(1,960)
|
|
Dividends
paid
|
(3,764)
|
|
|
(3,391)
|
|
Repayments of
asset-based credit facilities, net
|
(3,003)
|
|
|
(266)
|
|
Exercise of stock
options
|
2,637
|
|
|
6,565
|
|
Other financing
activities
|
20
|
|
|
—
|
|
Net cash (used in)
provided by financing activities
|
(9,254)
|
|
|
948
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(1,235)
|
|
|
(952)
|
|
Net increase in cash
and cash equivalents
|
76,174
|
|
|
12,166
|
|
Cash and cash
equivalents at beginning of period
|
49,801
|
|
|
37,635
|
|
Cash and cash
equivalents at end of period
|
$
|
125,975
|
|
|
$
|
49,801
|
|
CALLAWAY GOLF
COMPANY
Consolidated Net
Sales and Operating Segment Information and Non-GAAP
Reconciliation
(Unaudited)
(In
thousands)
|
|
|
Net Sales by
Product Category
|
|
Net Sales by
Product Category
|
|
Three Months
Ended
December 31,
|
|
Growth/(Decline)
|
|
Non-GAAP
Constant
Currency
vs. 2015(1)
|
|
Year Ended
December 31,
|
|
Growth/(Decline)
|
|
Non-GAAP
Constant
Currency
vs.
2015(1)
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Woods
|
$
|
29,532
|
|
|
$
|
34,915
|
|
|
$
|
(5,383)
|
|
|
(15.4)
|
%
|
|
(14.6)
|
%
|
|
$
|
201,813
|
|
|
$
|
222,193
|
|
|
$
|
(20,380)
|
|
|
(9.2)
|
%
|
|
(9.1)
|
%
|
Irons
|
39,027
|
|
|
42,250
|
|
|
(3,223)
|
|
|
(7.6)
|
%
|
|
(7.8)
|
%
|
|
211,947
|
|
|
205,522
|
|
|
6,425
|
|
|
3.1
|
%
|
|
2.7
|
%
|
Putters
|
13,989
|
|
|
13,707
|
|
|
282
|
|
|
2.1
|
%
|
|
(2.1)
|
%
|
|
86,042
|
|
|
86,293
|
|
|
(251)
|
|
|
(0.3)
|
%
|
|
(2.4)
|
%
|
Gear/Accessories/Other
|
49,942
|
|
|
32,483
|
|
|
17,459
|
|
|
53.7
|
%
|
|
45.9
|
%
|
|
219,133
|
|
|
186,641
|
|
|
32,492
|
|
|
17.4
|
%
|
|
14.3
|
%
|
Golf balls
|
31,205
|
|
|
29,976
|
|
|
1,229
|
|
|
4.1
|
%
|
|
4.2
|
%
|
|
152,257
|
|
|
143,145
|
|
|
9,112
|
|
|
6.4
|
%
|
|
6.4
|
%
|
|
$
|
163,695
|
|
|
$
|
153,331
|
|
|
$
|
10,364
|
|
|
6.8
|
%
|
|
4.9
|
%
|
|
$
|
871,192
|
|
|
$
|
843,794
|
|
|
$
|
27,398
|
|
|
3.2
|
%
|
|
2.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Calculated by applying 2015 exchange rates to 2016 reported sales
in regions outside the U.S
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales by
Region
|
|
Net Sales by
Region
|
|
Three Months
Ended
December 31,
|
|
Growth/(Decline)
|
|
Non-GAAP
Constant
Currency
vs.
2015(1)
|
|
Year Ended
December 31,
|
|
Growth/(Decline)
|
|
Non-GAAP
Constant
Currency
vs.
2015(1)
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
Percent
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
$
|
67,440
|
|
|
$
|
68,897
|
|
|
$
|
(1,457)
|
|
|
(2.1)
|
%
|
|
(2.1)
|
%
|
|
$
|
447,613
|
|
|
$
|
446,474
|
|
|
$
|
1,139
|
|
|
0.3
|
%
|
|
0.3
|
%
|
Europe
|
21,634
|
|
|
21,479
|
|
|
155
|
|
|
0.7
|
%
|
|
11.6
|
%
|
|
122,805
|
|
|
125,116
|
|
|
(2,311)
|
|
|
(1.8)
|
%
|
|
2.8
|
%
|
Japan
|
49,573
|
|
|
34,781
|
|
|
14,792
|
|
|
42.5
|
%
|
|
28.4
|
%
|
|
170,760
|
|
|
138,031
|
|
|
32,729
|
|
|
23.7
|
%
|
|
10.6
|
%
|
Rest of
Asia
|
15,256
|
|
|
17,975
|
|
|
(2,719)
|
|
|
(15.1)
|
%
|
|
(14.8)
|
%
|
|
67,099
|
|
|
70,315
|
|
|
(3,216)
|
|
|
(4.6)
|
%
|
|
(2.1)
|
%
|
Other foreign
countries
|
9,792
|
|
|
10,199
|
|
|
(407)
|
|
|
(4.0)
|
%
|
|
(6.5)
|
%
|
|
62,915
|
|
|
63,858
|
|
|
(943)
|
|
|
(1.5)
|
%
|
|
1.9
|
%
|
|
$
|
163,695
|
|
|
$
|
153,331
|
|
|
$
|
10,364
|
|
|
6.8
|
%
|
|
4.9
|
%
|
|
$
|
871,192
|
|
|
$
|
843,794
|
|
|
$
|
27,398
|
|
|
3.2
|
%
|
|
2.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Calculated by applying 2015 exchange rates to 2016 reported sales
in regions outside the U.S
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Segment
Information
|
|
|
|
Operating Segment
Information
|
|
|
|
Three Months
Ended
December 31,
|
|
Growth
|
|
|
|
Year Ended
December 31,
|
|
Growth
|
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
|
2016
|
|
2015
|
|
Dollars
|
|
Percent
|
|
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Golf Club
|
$
|
132,490
|
|
|
$
|
123,355
|
|
|
$
|
9,135
|
|
|
7.4
|
%
|
|
|
|
$
|
718,935
|
|
|
$
|
700,649
|
|
|
$
|
18,286
|
|
|
2.6
|
%
|
|
|
Golf Ball
|
31,205
|
|
|
29,976
|
|
|
1,229
|
|
|
4.1
|
%
|
|
|
|
152,257
|
|
|
143,145
|
|
|
9,112
|
|
|
6.4
|
%
|
|
|
|
$
|
163,695
|
|
|
$
|
153,331
|
|
|
$
|
10,364
|
|
|
6.8
|
%
|
|
|
|
$
|
871,192
|
|
|
$
|
843,794
|
|
|
$
|
27,398
|
|
|
3.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Golf clubs
|
$
|
(6,143)
|
|
|
$
|
(16,556)
|
|
|
$
|
10,413
|
|
|
62.9
|
%
|
|
|
|
$
|
65,023
|
|
|
$
|
52,999
|
|
|
$
|
12,024
|
|
|
22.7
|
%
|
|
|
Golf balls
|
2,432
|
|
|
165
|
|
|
2,267
|
|
|
1373.9
|
%
|
|
|
|
25,642
|
|
|
17,724
|
|
|
7,918
|
|
|
44.7
|
%
|
|
|
Reconciling
items(1)
|
(9,284)
|
|
|
(13,568)
|
|
|
4,284
|
|
|
31.6
|
%
|
|
|
|
(32,272)
|
|
|
(50,660)
|
|
|
18,388
|
|
|
36.3
|
%
|
|
|
|
$
|
(12,995)
|
|
|
$
|
(29,959)
|
|
|
$
|
16,964
|
|
|
56.6
|
%
|
|
|
|
$
|
58,393
|
|
|
$
|
20,063
|
|
|
$
|
38,330
|
|
|
191.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents corporate general and administrative expenses and other
income (expense) not utilized by management in determining segment
profitability
|
|
CALLAWAY GOLF
COMPANY
Supplemental
Financial Information and Non-GAAP Reconciliation
(Unaudited)
(In
thousands)
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2016
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2016
|
|
2016
|
|
2016
|
|
2015
|
|
As
Reported
|
|
Release of Tax VA
(1)
|
|
U.S. Tax
Adjustment (2)
|
|
Non-G
AAP
|
|
As
Reported
|
|
As
Reported
|
|
Release of
Tax VA (1)
|
|
U.S. Tax
Adjustment (2)
|
|
Non-
GAAP(3)
|
|
As
Reported
|
Net sales
|
$
|
163,695
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
163,695
|
|
|
$
|
153,331
|
|
|
$
|
871,192
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
871,192
|
|
|
$
|
843,794
|
|
Gross
profit
|
63,111
|
|
|
—
|
|
|
—
|
|
|
63,111
|
|
|
51,068
|
|
|
385,011
|
|
|
—
|
|
|
—
|
|
|
385,011
|
|
|
357,633
|
|
% of sales
|
38.6
|
%
|
|
—
|
|
|
—
|
|
|
38.6
|
%
|
|
33.3
|
%
|
|
44.2
|
%
|
|
—
|
|
|
—
|
|
|
44.2
|
%
|
|
42.4
|
%
|
Operating
expenses
|
79,874
|
|
|
—
|
|
|
—
|
|
|
79,874
|
|
|
80,416
|
|
|
340,843
|
|
|
—
|
|
|
—
|
|
|
340,843
|
|
|
330,690
|
|
Income (loss) from
operations
|
(16,763)
|
|
|
—
|
|
|
—
|
|
|
(16,763)
|
|
|
(29,348)
|
|
|
44,168
|
|
|
—
|
|
|
—
|
|
|
44,168
|
|
|
26,943
|
|
Other income
(expense), net
|
3,768
|
|
|
—
|
|
|
—
|
|
|
3,768
|
|
|
(611)
|
|
|
14,225
|
|
|
—
|
|
|
—
|
|
|
14,225
|
|
|
(6,880)
|
|
Income (loss) before
income taxes
|
(12,995)
|
|
|
—
|
|
|
—
|
|
|
(12,995)
|
|
|
(29,959)
|
|
|
58,393
|
|
|
—
|
|
|
—
|
|
|
58,393
|
|
|
20,063
|
|
Income tax provision
(benefit)
|
(137,193)
|
|
|
(156,588)
|
|
|
15,974
|
|
|
3,421
|
|
|
493
|
|
|
(132,561)
|
|
|
(156,588)
|
|
|
15,974
|
|
|
8,053
|
|
|
5,495
|
|
Net income
(loss)
|
124,198
|
|
|
156,588
|
|
|
(15,974)
|
|
|
(16,416)
|
|
|
(30,452)
|
|
|
190,954
|
|
|
156,588
|
|
|
(15,974)
|
|
|
50,340
|
|
|
14,568
|
|
Less: Net income
attributable to non-controlling interests
|
927
|
|
|
—
|
|
|
—
|
|
|
927
|
|
|
—
|
|
|
1,054
|
|
|
—
|
|
|
—
|
|
|
1,054
|
|
|
—
|
|
Net income (loss)
attributable to Callaway Golf Company
|
$
|
123,271
|
|
|
$
|
156,588
|
|
|
$
|
(15,974)
|
|
|
$
|
(17,343)
|
|
|
$
|
(30,452)
|
|
|
$
|
189,900
|
|
|
$
|
156,588
|
|
|
$
|
(15,974)
|
|
|
$
|
49,286
|
|
|
$
|
14,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share:
|
$
|
1.28
|
|
|
$
|
1.63
|
|
|
$
|
(0.17)
|
|
|
$
|
(0.18)
|
|
|
$
|
(0.33)
|
|
|
$
|
1.98
|
|
|
1.63
|
|
|
(0.16)
|
|
|
$
|
0.51
|
|
|
$
|
0.17
|
|
Weighted-average
shares outstanding:
|
96,316
|
|
|
96,316
|
|
|
96,316
|
|
|
96,316
|
|
|
92,272
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
84,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-cash
tax benefit due to the reversal of a significant portion of the
Company's deferred tax valuation allowance
|
(2) Additional
U.S. tax provision recorded during the period due to the reversal
of the Company's deferred tax valuation allowance
|
(3) The 2016 Non-GAAP
results for the year ended December 31, 2016 include a $17.7
million ($0.18 per share) pre-tax gain on the sale of a small
portion of the Company's investment in Topgolf
|
|
2016 Trailing
Twelve Month Adjusted EBITDA
|
|
2015 Trailing
Twelve Month Adjusted EBITDA
|
|
Quarter
Ended
|
|
Quarter
Ended
|
|
March
31,
|
|
June
30,
|
|
September
30,
|
|
December
31,
|
|
|
|
March
31,
|
|
June
30,
|
|
September
30,
|
|
December
31,
|
|
|
|
2016
|
|
2016
|
|
2016
|
|
2016
|
|
Total
|
|
2015
|
|
2015
|
|
2015
|
|
2015
|
|
Total
|
Net income
(loss)
|
$
|
38,390
|
|
|
$
|
34,105
|
|
|
$
|
(5,866)
|
|
|
$
|
123,271
|
|
|
$
|
189,900
|
|
|
$
|
35,819
|
|
|
$
|
12,818
|
|
|
$
|
(3,617)
|
|
|
$
|
(30,452)
|
|
|
$
|
14,568
|
|
Interest expense,
net
|
621
|
|
|
347
|
|
|
431
|
|
|
348
|
|
|
1,747
|
|
|
2,021
|
|
|
1,936
|
|
|
3,520
|
|
|
868
|
|
|
8,345
|
|
Income tax provision
(benefit)
|
1,401
|
|
|
1,937
|
|
|
1,294
|
|
|
(137,193)
|
|
|
(132,561)
|
|
|
1,638
|
|
|
1,817
|
|
|
1,547
|
|
|
493
|
|
|
5,495
|
|
Depreciation and
amortization expense
|
4,157
|
|
|
4,180
|
|
|
4,204
|
|
|
4,045
|
|
|
16,586
|
|
|
4,703
|
|
|
4,454
|
|
|
4,193
|
|
|
4,029
|
|
|
17,379
|
|
EBITDA
|
$
|
44,569
|
|
|
$
|
40,569
|
|
|
$
|
63
|
|
|
$
|
(9,529)
|
|
|
$
|
75,672
|
|
|
$
|
44,181
|
|
|
$
|
21,025
|
|
|
$
|
5,643
|
|
|
$
|
(25,062)
|
|
|
$
|
45,787
|
|
Gain on sale of
Topgolf investments
|
—
|
|
|
17,662
|
|
|
—
|
|
|
—
|
|
|
17,662
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted
EBITDA
|
$
|
44,569
|
|
|
$
|
22,907
|
|
|
$
|
63
|
|
|
$
|
(9,529)
|
|
|
$
|
58,010
|
|
|
$
|
44,181
|
|
|
$
|
21,025
|
|
|
$
|
5,643
|
|
|
$
|
(25,062)
|
|
|
$
|
45,787
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALLAWAY GOLF
COMPANY
Supplemental
Financial Information and Reconciliation of Recast Pro Forma 2016
Results
(Unaudited)
(In
thousands)
|
|
|
2016 Recast Pro
Forma Reconciliation
|
|
Year Ended
December 31, 2016
|
|
As
Reported
|
|
Release of
Tax VA(1)
|
|
U.S. Tax
Adjustment(2)
|
|
Non-GAAP
|
|
Topgolf
Gain(3)
|
|
U.S. Tax
Adjustment(2)
|
|
Recast
Pro
Forma(4)
|
Net sales
|
$
|
871,192
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
871,192
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
871,192
|
|
Gross
profit
|
385,011
|
|
|
—
|
|
|
—
|
|
|
385,011
|
|
|
—
|
|
|
—
|
|
|
385,011
|
|
% of sales
|
44.2
|
%
|
|
—
|
|
|
—
|
|
|
44.2
|
%
|
|
—
|
|
|
—
|
|
|
44.2
|
%
|
Operating
expenses
|
340,843
|
|
|
—
|
|
|
—
|
|
|
340,843
|
|
|
—
|
|
|
—
|
|
|
340,843
|
|
Income from
operations
|
44,168
|
|
|
—
|
|
|
—
|
|
|
44,168
|
|
|
—
|
|
|
—
|
|
|
44,168
|
|
Other income
(expense), net
|
14,225
|
|
|
|
|
|
|
14,225
|
|
|
17,662
|
|
|
—
|
|
|
(3,437)
|
|
Income before income
taxes
|
58,393
|
|
|
—
|
|
|
—
|
|
|
58,393
|
|
|
17,662
|
|
|
—
|
|
|
40,731
|
|
Income tax provision
(benefit)
|
(132,561)
|
|
|
(156,588)
|
|
|
15,974
|
|
|
8,053
|
|
|
7,188
|
|
|
(15,974)
|
|
|
16,839
|
|
Net income
(loss)
|
190,954
|
|
|
156,588
|
|
|
(15,974)
|
|
|
50,340
|
|
|
10,474
|
|
|
15,974
|
|
|
23,892
|
|
Less: Net income
attributable to non-controlling interests
|
1,054
|
|
|
—
|
|
|
—
|
|
|
1,054
|
|
|
—
|
|
|
—
|
|
|
1,054
|
|
Net income (loss)
attributable to Callaway Golf Company
|
$
|
189,900
|
|
|
$
|
156,588
|
|
|
$
|
(15,974)
|
|
|
$
|
49,286
|
|
|
$
|
10,474
|
|
|
$
|
15,974
|
|
|
$
|
22,838
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share:
|
$
|
1.98
|
|
|
1.63
|
|
|
(0.16)
|
|
|
$
|
0.51
|
|
|
$
|
0.11
|
|
|
$
|
0.16
|
|
|
$
|
0.24
|
|
Weighted-average
shares outstanding:
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
95,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-cash
tax benefit due to the reversal of a significant portion of the
Company's deferred tax valuation allowance
|
|
|
(2) Additional
U.S. tax provision recorded during the period due to the reversal
of the Company's deferred tax valuation allowance
|
|
|
(3) Represents a gain
on the sale of a small portion of the Company's Topgolf investment
as well as the income tax impact on the gain due to the reversal of
the Company's deferred tax valuation allowance in Q4 of
2016
|
(4) In order to make
the 2017 guidance more comparable to 2016 with regard to the
underlying performance of the Company's business, the Company has
recast its 2016 results on a pro forma basis. The 2016 Recast Pro
Forma results (i) exclude the $156.6 million ($1.63 per share)
benefit from the reversal of the deferred tax valuation allowance,
(ii) exclude the $10.5 million ($0.11 per share) after-tax Topgolf
gain, and (iii) eliminates the U.S. tax adjustment to make 2016
more comparable to 2017 from a tax perspective
|
CALLAWAY GOLF
COMPANY
Foreign Exchange
Rates Used For 2017 Guidance
(Unaudited)
|
|
2017 Operating
margin impact(1)
|
|
|
|
Euro
|
1% Move:
$0.3m
|
British
Pound
|
1% Move:
$0.4m
|
Japanese
Yen
|
1% Move:
$1.0m
|
South Korean
Won
|
1% Move:
$0.3m
|
All
Other(2)
|
1% Move:
$0.4m
|
|
|
|
Rates used in 2017
guidance(3)
|
|
|
|
|
|
Euro
|
1.05
|
|
British
Pound
|
1.21
|
|
Japanese
Yen
|
116.00
|
|
South Korean
Won
|
1,200.00
|
|
Canadian
Dollar
|
1.34
|
|
Australian
Dollar
|
0.73
|
|
|
|
(1)
|
Operating margin
impact can vary depending on the region and the time of
year.
|
(2)
|
Includes CAD, AUD,
CNY and INR.
|
(3)
|
75% of the Company's
net foreign currency exposure is hedged.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/callaway-golf-company-announces-fourth-quarter-and-full-year-2016-financial-results-reflecting-continued-sales-growth-brand-momentum-and-market-share-gains-as-well-as-increased-profitability-and-cash-flows-and-provides-2017-fi-300401584.html
SOURCE Callaway Golf Company