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Callaway Golf reported business is better than expected. Sales grew in its second quarter by $15 million versus a year ago. The improvement came largely from two categories. Iron sales were up $4.1 million and golf ball sales grew by another $6.1 million during the reporting period. Filling in the other segments, metal wood sales grew by $1 million, while putter were up $592,000 and the category of gear/accessories/other delivered an increase of $3.2 million as compared to 2015’s second quarter.

Despite softer than expected market conditions, 2016 second quarter net sales were $246 million, as compared to $231 million in 2015. The Company's sales also increased in every major region, including the United States, Europe and Japan, as well as in the Rest of Asia. The sales performance resulted in increased market shares, Callaway reported, including an increase in total U.S. hard goods dollar share for the first half of 2016. This is Callaway's highest first half share in over 10 years, it stated.

Diluted earnings per share for the first half of 2016 increased by 41% to $0.76 from $0.54 in the first half of 2015. Callaway's earnings for the first half of 2016 include an $18 million one-time gain, or earnings per share of $0.18, on the second quarter sale of approximately 10% of the Company's investment in Topgolf International, Inc. It maintains an approximate 15% stake in Topgolf after the partial sale it reported in the quarter.

"We are pleased with our performance in the second quarter of 2016," stated Chip Brewer, President and Chief Executive Officer at Callaway Golf Company. "Despite softer than expected market conditions, we grew our net sales by 6.5% in the second quarter, which was led by increased sales in all product categories and in every major region. We also continued to realize benefits from the many initiatives we undertook during the last three years with gross margins improving 90 basis points and our realizing over $23 million in proceeds from the sale of a small portion of our Topgolf investment."

Brewer continued, "Overall, I believe we are performing well in the current environment as evidenced in part by our continued increase in U.S. hard goods dollar market share for the first half of this year. For the balance of this year, however, there could be some additional market risk related to Brexit, the softer than expected market conditions and the impact of those factors on the golf specialty retail channel. Despite this potential short-term market risk, we believe our business is strong and we remain cautiously optimistic about the second half of the year and are therefore reaffirming our full year guidance."