Web Street Golf Daily Pulse
ANY IDEA WHO SAID THIS? “If I was a captain, I would be hard pressed. I don't care what he does between now and then. If Tiger wants to play, I would certainly choose him. My guess is that Tom feels pretty much the same way. Tom would certainly like to have Tiger on his team and I think anybody in their right mind, unless he just doesn't want to play or doesn't think he could play, would not choose him.”
BRAIN TEASER: Can you name the oldest golf club in North America?
WHAT DID YOU EXPECT? Expectations were modest with respect to Callaway Golf’s second quarter earnings. The golf business hasn’t exactly been lighting it up lately. The company enjoyed a strong start to the year but that was then and this is now. For the second quarter, Callaway had previously provided guidance that its sales and earnings would show a decrease versus the second quarter of 2013 as a result of a late start to the 2014 golf season, high retail inventory industry wide, and anticipated promotional activity during the second quarter. The second quarter results reflected those market conditions with sales being down 7%, coming in at $234 million versus $250 million in Q2 2013. It reported earnings of $0.04 per diluted share, $3 million, compared to $0.12 per diluted share in 2013.
Metal wood sales for the second quarter were off 27% from a year ago coming in at $52.4 million versus $71.6 million, a decrease of $19.3 million. Callaway’s iron business was down 4% for the quarter ($52.5 million versus $54.5 million in 2013) a drop off of $2 million. Putter sales were up 20% ($26.7 million versus $22.3 million) and golf balls were down 9% ($38.7 million versus $42.8 million). Callaway’s accessories business was higher by 5% ($61.6 million versus $58.5 million)
The first half of 2014 paints a brighter picture with a 9% increase in sales ($584 million versus $537 million in 2013). According to Callaway, growth came in all product categories: woods (+8%), irons (+14%), putters (+9%), golf balls (+7%) and accessories and other (+5%). In dollar terms, Callaway’s metal woods business is higher by $14 million through the first six months of 2014 compared to 2013. Irons are up $15.3 million, putters by $4.8 million, golf balls by $6.3 million and accessories by $5.9 million from 2013 at the same time.
"We are pleased with our results for the second quarter in that we were generally able to achieve our financial guidance while continuing to build brand momentum and improving field inventory levels in key markets such as the U.S. and Europe," stated Chip Brewer, President and Chief Executive Officer. "We achieved these results despite more challenging market conditions worldwide than we had anticipated. We are also pleased with our results for the first half of the year. Our continued brand momentum and the strength of our 2014 product line enabled us to grow sales for the first half in each of our product categories despite a decline in industry sales due to a late start to the 2014 golf season, high industry wide retail inventory levels, and an increase in promotional activity. As a result, we gained market share in each of our key markets around the world, positioning us well for the balance of the year.
"Looking forward, we expect market conditions will remain challenging for the second half of the year," continued Brewer. "However, we believe our brand momentum and product strength will enable us to overcome these market headwinds and achieve the full year financial goals we set at the beginning of the year. We remain pleased with the state of our turnaround and the direction of our business."
Over the first six months of 2014, US sales are up 5% at 296.3 million for the company. European sales are up 15% at $90.5 million, while Japan grew by 14% to $92.5 million. The rest of Asia was up 21% coming in at $52.1 million and the rest of the world sales were $51.4 million, up 1% from a year ago. Callaway’s 2014 sales in the US, Europe, Japan and the rest of Asia are back above 2012 levels at the midway point of the year.
Callaway is forecasting net sales for the full year in the range of $880 to $900 million, compared to $843 million last year. It believes this growth rate will exceed the overall market and be driven by brand momentum and product market share gains. Through six months of 2014 Callaway's bottom line stands at $59 million.
WHAT’S ON DECK? Upper Deck will release its new line of 2014 Exquisite Collection Golf cards on July 29th. It is considered a super-premium golf card set with each pack containing five autographed cards. Retailers are already pre-selling 2014 Exquisite Collection Golf with an average price of at least $600.00 per pack or higher, according to the company.
Highlights of the set include rookie cards of Rory McIlroy, an Upper Deck exclusive spokesman, as well as Graeme McDowell, Michelle Wie and rising star Cheyenne Woods, the niece of Tiger Woods.
“Upper Deck’s position as the leader in the sports card and authenticated collectibles industry will undoubtedly be bolstered by the unveiling of our new 2014 Exquisite Collection Golf line of cards,” said Jason Masherah, president of Upper Deck. “Having super-premium autograph rookie cards of Rory McIlroy who is coming off a sensational victory at Royal Liverpool to claim his third major championship only adds to the excitement around this release. A classy sport deserves a sophisticated and innovative product like this.”
Among the special cards that can also be found in 2014 Exquisite Collection Golf packs are McIlroy Exquisite Autographed Rookie Swatch cards (numbered to 99); shadowbox-style, Autographed Exquisite Dimension cards; ultra-limited Rookie Auto Patch Gold Spectrum 1-of-1 cards; the most extensive selection of Tiger Woods-autographed cards in one set, which also includes multi-autographed cards of Tiger paired with other legendary players; Legendary Signature and Signature Masterpiece cards of the sport’s greats from the past and present; and Upper Deck Black Signature inserts. The novel multi-autographed cards can be a collector’s prize for years to come for golf fans lucky enough to discover one in packs.
For a preview of the cards and to watch LPGA star Natalie Gulbis’s reaction to the Upper Deck 2014 Exquisite Collection Golf cards as she sees them for the first time and signs them, click HERE.
ONE OF A KIND: KZG is getting into the putter business. The company introduced the DS-1, the first model in its Limited Edition “Designer Series” of putters. The name helps to explain what makes the putter different from anything else on the market. Each putter in the Designer Series will be designed by one of the Top 100 ClubFitters in the World, according to the company.
The DS-1 was designed by Bryan “Buddy” Beem who has been rated among the World’s Top 100 ClubFitters for 9 years in a row and has had over 30 years experience working with touring professionals, head pros, avid golfers, university teams and junior amateurs. He owns Buddy Beem Custom Clubs near Denver, Colorado and 15 of the top 20 players on the Colorado junior circuit have been coached and fit by him. Coincidentally they all play KZG.
In designing the DS-1, Buddy explained, “I chose a triple-forged process so that the putter is extremely responsive and helps my golfers learn to feel the subtle differences in the way they make contact with the ball. Over time, they will be able to consistently repeat their best strokes. And forged putters definitely are the easiest putters for making lie and loft adjustments, which is absolutely critical for a perfect fit.”
He continued, “The perimeter weighting on the DS-1 is designed for stability, the leading edge is cambered and the micro-milled face gives a clean, sharp roll for better control. The whole set up and look at address makes it easy to just ‘point and shoot.’”
In designing the DS-1 putter, Buddy noted that, “right-eye-dominant players need an offset neck and clear alignment markings to help them set up with the ball precisely in the middle of their stance. The DS-1 addresses this phenomenon, ensuring that the putter head will be square to the player’s target line as the ball leaves the face.”
“KZG works with its engineers, but we go a step further and rely heavily on design feedback from the finest fitters and teachers in the golf industry” said Jennifer King, president of KZG. “We believe it is the professionals that are working with golfers day in and day out that are best informed on what the golfer needs for a better game. We are very appreciative of Buddy’s efforts in making the DS-1 such a great performing putter that is already gaining rave reviews.”
Every DS-1 putter will be custom fit to each golfer’s unique specifications as KZG products are only available through KZG’s network of qualified professional teachers and fitters, which are listed on the Dealer Locator at www.kzg.com. Available in either brushed satin or matte black, the MSRP for the DS-I Putters is $299.
WHO WINS? There seems little prospect that the bitter dispute between golfer Rory McIlroy and his former agents being heard in Dublinwill be settled out of court. The world's number two ranked golfer instituted proceedings against Horizon, claiming he had been on a worse deal than another high-profile client, fellow major winner Graeme McDowell. The agency helped negotiate McIlroy's $20m-a-year (£12m) deal with sportswear giant Nike in 2012. READ MORE>>>
LIFE IN A BUBBLE: Rory McIlroy looks to be celebrating his Open victory by spending some quality time with rumored new love interest Sasha Gale. The Sun reported today that McIlroy took former air stewardess Miss Gale out for a high-class meal at Chelsea Wine Bar in South Belfast to celebrate his victory in the Open last weekend. A source told the paper the couple got together after meeting five weeks ago and their 'romance is blossoming'. READ MORE>>>
LIKE KAYMER? Bernhard Langer made a statement of intent when he opened with a 6-under-par 65 to take a two-stroke lead over American Bob Tway in the British Senior Open at a sweltering Royal Porthcawl on Thursday. READ MORE>>>
If it were up to Jack Nicklaus, Tiger Woods would be an easy decision as a pick for the U.S. Ryder Cup team. "Oh, absolutely," Nicklaus said Thursday during a conference call with reporters. "I couldn't imagine [Woods] not being on a Ryder Cup team, unless he does absolutely nothing in recovering from his game between now and then." READ MORE>>>
OPPORTUNITY KNOCKING: Tim Petrovic and Michael Putnam shared the first-round lead in the Canadian Open on Thursday, shooting 6-under 64 in sunny, breezy afternoon conditions at rain-softened Royal Montreal. The 47-year-old Petrovic was the last player to get in the field, grabbing a spot when Benjamin Alvarado withdrew Tuesday. "I didn't set my expectations high because I got in late, so this was kind of my practice round," Petrovic said. "I walked the back nine (Wednesday). READ MORE>>>
ANSWERS: “If I was a captain, I would be hard pressed. I don't care what he does between now and then. If Tiger wants to play, I would certainly choose him. My guess is that Tom feels pretty much the same way. Tom would certainly like to have Tiger on his team and I think anybody in their right mind, unless he just doesn't want to play or doesn't think he could play, would not choose him.”--Jack Nicklaus.
Royal Montreal, home to the RBC Canadian Open this week, is the oldest golf club in North America, having been founded in 1873. In that year, a small group of eight gentlemen sat in a dockside office and formed the Montreal Golf Club. Eleven years later, in 1884, permission was granted by Queen Victoria to use the “Royal” prefix.
The first golf course was a 9-hole layout on Fletcher’s Field, part of Mount Royal Park, which was shared by the red coated golfers and other citizens relaxing in what was then the outskirts of Montreal. In 1896, the Club moved to Dixie, in the parish of Dorval, where it remained until the pressures of urban growth dictated a move. The last move was to Ile Bizard in 1959, where 45 holes were constructed. Royal Montreal was one of the five founding Clubs of the Royal Canadian Golf Association, which celebrated its 100th anniversary in 1995.
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