Acushnet’s Q1 Revenues Gain 4 Percent
Friday, May 6, 2022
by: SGB

Section: Industry News




Acushnet’s Q1 Revenues Gain 4 Percent

Acushnet Holdings Corp., the parent of Titleist and Footjoy, reported sales in the first quarter ended March 31 of $606.1 million, up 4.3  percent year over year and ahead 7.6  percent in constant currency. First-quarter net income reached $81.0 million, down 4.7  percent year over year.

“I am pleased to report that Acushnet delivered a solid first quarter with constant currency sales up 8 percent, as our team continues to effectively manage supply chain challenges affecting each of our businesses. This growth was led by FootJoy, up double-digits across all product categories, and Titleist clubs, driven by the successful launch of new Vokey SM9 wedges and continuing success of T-Series irons,” said David Maher, Acushnet’s president and CEO.

Maher continued, “We are excited for our innovative product lineup in 2022, which began with successful launches in the first quarter led by new Titleist AVX and Velocity golf balls, Vokey Design SM9 wedges, FootJoy Tour Alpha and FJ Fuel golf shoes, and new performance apparel collections from FJ and KJUS.

“I would like to thank my fellow associates for their dedication and commitment, and our valued trade partners who continue to take great care of golfers while meeting strong interest in the game. We believe the golf industry is structurally healthy and are pleased with the initial response to our 2022 product offerings. Looking forward, we are enthused by the game’s momentum as the golf season opens up in northern markets and anticipate that our supply-side environment will improve over the course of the year.”

Consolidated net sales for the quarter increased 4.3  percent to $606.1 million. On a constant-currency basis, consolidated net sales were up 7.6  percent driven by increased sales in FootJoy golf wear due to sales volume increases and higher average selling prices across all product categories and Titleist golf clubs due to higher sales of newly introduced Vokey SM9 wedges and T-Series irons. These increases were partially offset by sales decreases in Titleist golf gear due to supply chain and fulfillment constraints and Titleist golf balls primarily as a result of limited availability of certain raw materials. On a geographic basis, net sales in the United States decreased 4.4  percent primarily as a result of a decrease of $10.6 million in Titleist golf balls, primarily due to limited availability of certain raw materials and a decrease of $4.6 million in Titleist golf gear, largely due to supply chain and fulfillment constraints.

On a geographic basis, net sales in the United States decreased 4.4  percent primarily as a result of a decrease of $10.6 million in Titleist golf balls, primarily due to limited availability of certain raw materials and a decrease of $4.6 million in Titleist golf gear, largely due to supply chain and fulfillment constraints.

On a constant currency basis, net sales in regions outside the United States increased 21.2  percent. In EMEA, net sales increased across all reportable segments and were primarily due to the adverse impact of government-ordered shutdowns in this region during the first quarter of 2021. In Korea, net sales increased in all reportable segments except Titleist golf gear which was impacted by supply chain constraints. In Japan, net sales decreased in all reportable segments except FootJoy golf wear due to supply chain and fulfillment constraints. In Rest of World, net sales increased across all reportable segments.

Segment Specifics

  • 5.6  percent decrease in net sales (3.5  percent decrease on a constant-currency basis) of Titleist golf balls due to lower sales volumes across all models as a result of limited availability of certain raw materials.
  • 3.2  percent increase in net sales (6.1  percent increase on a constant-currency basis) of Titleist golf clubs primarily driven by higher sales volumes of our newly introduced SM9 wedges launched in the first quarter of 2022 and T-Series irons launched in the fourth quarter of 2021. This increase was partially offset by lower sales volumes of drivers, hybrids and fairways which were all in their second model year and were also impacted by component shortages and delays.
  • 16.9  percent decrease in net sales (14.1  percent decrease on a constant-currency basis) of Titleist golf gear primarily due to sales volume decreases in golf bags and headwear product categories due to supply chain and fulfillment constraints, partially offset by higher average selling prices across all product categories.
  • 24.0  percent increase in net sales (28.2  percent increase on a constant-currency basis) in FootJoy golf wear primarily driven by increased sales volumes and higher average selling prices across all product categories primarily driven by EMEA.

Net income attributable to Acushnet Holdings Corp. decreased $4.0 million to $81.0 million, down 4.7  percent year over year, primarily as a result of a decrease in income from operations, partially offset by a decrease in income tax expense. Adjusted EBITDA was $120.0 million, down 11.3  percent year over year. Adjusted EBITDA margin was 19.8  percent for the first quarter versus 23.3  percent for the prior-year period.

Cash Dividend and Share Repurchase
Acushnet’s Board of Directors today declared a quarterly cash dividend of $0.18 per share of common stock. The dividend will be payable on June 17, 2022 to shareholders of record as of June 3, 2022. The number of shares outstanding as of April 29, 2022 was 72,224,555.

During the quarter, the company repurchased 1,163,799 shares of common stock at an average price of $50.79 for an aggregate of $59.1 million. Included in this amount were 699,819 shares of common stock repurchased from Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Holdings Corp., for an aggregate of $37.5 million, in satisfaction of the company’s previously disclosed share repurchase obligation. On April 28, 2022, Acushnet’s Board of Directors authorized the company to repurchase up to an additional $150.0 million of its issued and outstanding common stock, bringing the total authorization up to $350.0 million.

2022 Outlook
The company affirms its full-year outlook and expects full-year consolidated net sales to be approximately $2,175 to $2,225 million and Adjusted EBITDA to be approximately $325 to $345 million. On a constant currency basis, consolidated net sales are expected to be in the range of 3.8 percent to 6.1  percent. The company’s outlook assumes no significant worsening of the COVID-19 pandemic, additional supply chain disruptions, or changes in the impact of foreign currency. The company plans to share additional details of the 2022 Outlook during its investor conference call.

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