Callaway Golf's third quarter report wasn't pretty
Talk about seeing red. Callaway Golf Company reported a third quarter loss of $62.6 million on sales of $73 million. That sales number is down $3 million from the third quarter in 2010. Callaway lost $18 million in Q3 of 2010. Some of the Q3 2010 loss likely was attributable to charges, but the company wasn’t specific as to what those charges might have been.
If there was any good news for Callaway in the quarter, it was that its metal woods sales increased to $41.5 million compared to $27 million the same quarter a year ago. Callaway’s sales were done in other product categories: Irons ($38.3 million versus $48.6 million), putters ($15 million versus $15.9 million) and accessories ($45.7 million versus $48.8 million) and balls ($32.7 from $35.3).
“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,” said Tony Thornley, Callaway 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.”
For the nine months, Callaway reported a loss of $116 million on sales of $733 million – down $49 million from a year ago. Again, the only product category that reported a sales increase for the year is metal woods. And that’s largely thanks to the Q3. Sales of irons are lower, year-to-date, by $7.6 million; putters dropped by $19.9 million; golf ball sales down $12.5 million; and accessories were down by $12.6 million compared to 2010.
