Callaway Golf Company (NYSE: ELY) announced today that its Board of
Directors has elected to reduce the second quarter dividend to $0.01 per
share, payable on July 15, 2009 to shareholders of record as of June 26,
2009. This represents a $0.06 reduction to the dividend declared and
paid on April 29, 2009, in the amount of $0.07 per share. This action
will allow the Company to retain an additional $15.2 million in cash on
an annualized basis, which represents $11.4 million over the balance of
2009.
"Over the long term, we believe that Callaway’s ability to preserve its
cash position and follow a prudent policy of balance sheet management is
in the best interest of our shareholders,” said George Fellows,
President and CEO of Callaway Golf Company. "By enhancing liquidity in
this environment, we will be better positioned to manage our business
and to take advantage of growth opportunities as the economy recovers.
The actions we announced today are definitive steps consistent with this
strategy.”
"Callaway continues to maintain or grow market share even in this
difficult environment which is a testament to our global brand equity
and the quality of our products,” Mr. Fellows added. "Based on current
trends and market conditions, we remain confident in our annual guidance
provided at our first quarter earnings call on April 30th.
The macroeconomic and foreign currency headwinds that negatively
impacted the first quarter continue to impact our second quarter. As a
result of these factors, along with charges relating to a 10% reduction
in our workforce, our second quarter earnings are, consistent with our
expectations, estimated to be similar to those achieved in the first
quarter. Earnings for the second half of the year are estimated to be
higher than last year due to less foreign currency headwinds, the
benefits associated with our cost reduction initiatives and improving
economic conditions. Our international expansion will continue, and when
the economy turns, we believe that our geographical reach will provide a
sustained competitive advantage. Preserving financial flexibility allows
Callaway to plan for the second half of 2009 and position us favorably
as we move into what we anticipate will be a better 2010.”
About Callaway Golf
Through an unwavering commitment to innovation, Callaway Golf Company
(NYSE: ELY) creates products and services designed to make every golfer
a better golfer. Callaway Golf Company manufactures and sells golf clubs
and golf balls, and sells golf accessories, under the Callaway Golf®,
Odyssey®, Top-Flite®, Ben Hogan® and uPro™ brands in more than 100
countries worldwide. For more information please visit www.callawaygolf.com
or Shop.CallawayGolf.com
Important Notice Regarding Forward-Looking Statements
The statements in this press release regarding the Company’s cash
position are forward-looking statements that involve risks and
uncertainties, including, but not limited to, market conditions, a
significant decline in revenues or further weakening of economic
conditions and foreign currency exchange rates and the Company’s ability
to comply with the financial covenants of its line of credit. The
forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those stated in any
forward-looking statements based on a number of factors. For additional
information concerning these and other risks and uncertainties that
could affect these statements and the Company’s business, see Part I,
Item 1A of the Company’s Annual Report on Form 10-K for the year ended
December 31, 2008, as well as other risks and uncertainties detailed
from time to time in the Company’s reports on Forms 10-Q and 8-K
subsequently filed from time to time 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.
