- Callaway Golf Co (NYSE: ELY) made an announcement before its earnings that has been exciting for investors. These are the details.
Callaway Golf Co (NYSE: ELY) made an announcement before its earnings that has been exciting for investors. In preliminary financial results for the first quarter 2020 made earlier this week, the company said it was profitable in the first quarter due to strong results that were on track for record net sales this year through the beginning of March.
And Callaway was not immune to the coronavirus crisis as the global regulatory responses and social distancing orders significantly slowed retail sales. Plus the company is also significantly reducing costs and enhancing its liquidity.
Callaway is expected to record positive profits of between $0.27 and $0.31 per share this year on revenues of between $438 million to $443 million.
But this amounts to a sales decline of 15% year-over-year. And the company is expected to see a 42% drop in profits.
Last year, Callaway acquired Jack Wolfskin for $476 million. And that brand has been seeing significant sales jumps in Germany, Austria, and Switzerland.
“Although we still delivered a profitable quarter, given the uncertain duration of the impact, the company has been focused on significantly reducing costs and enhancing liquidity to ensure we are well-positioned to navigate through a protracted downturn,” said Callaway Golf Co (NYSE: ELY) CEO Chip Brewer via San Diego Union Tribune.
Due to the disruptions associated with COVID-19, Callaway will no longer provide financial guidance for now.
“We expect the sport of golf to come back quickly as it is commonly viewed as a relatively safe and healthy outdoor activity that one can enjoy while still observing social distancing guidelines,” added Brewer. “This theory is supported by high usage rates of many golf courses that are open in North America as well as the reported usage rates as markets opened up post COVID-19 outbreaks in both Korea and China.”
