Acushnet (GOLF)2024-11-09 17:21Financial Data and Key Metrics Changes - Acushnet reported net sales of 107 million, up 9% from Q3 2023 [5][15] - Year-to-date net sales surpassed 392 million, an increase of 4% [6][15] - Gross profit for Q3 was 29 million compared to 2023, with a gross margin of 54.4%, an increase of 240 basis points year-over-year [17][18] Business Segment Data and Key Metrics Changes - Titleist Golf Balls saw a 1% decrease in net sales for Q3 but a 5% increase year-to-date, driven by Pro V1 momentum [7][16] - Titleist Golf Clubs experienced a significant 19% increase in Q3, with year-to-date growth of 9%, led by the successful launch of GT drivers and Fairway Metals [9][16] - Titleist Golf Gear increased by 9% in Q3 and 3% year-to-date, while FootJoy revenues decreased by 2% in Q3 and 3% year-to-date due to a soft apparel and footwear market [10][16] Market Data and Key Metrics Changes - In the U.S. market, net sales increased by 6% in Q3 and 7% year-to-date, with growth across all segments [12] - Internationally, Japan, Korea, and Rest of World saw increases, while EMEA experienced a decline [12] - Year-to-date rounds of play in the U.S. are up 2%, with projections indicating a 2% decrease in rounds outside the U.S. [12][29] Company Strategy and Development Direction - Acushnet plans to launch new Pro V1 models in January 2025, marking the 25th anniversary of Pro V1, with positive player feedback already received [8] - The company is transitioning its footwear production to a new facility in Vietnam to enhance innovation and speed to market [10] - A new operating segment combining Titleist Golf Balls and Golf Clubs into Titleist Golf Equipment will be reported starting with the 2024 10-K filing [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the U.S. consumer and the overall health of the golf industry, despite some weather-related variability [28][29] - The company anticipates year-over-year sales growth in all segments except Golf Balls for Q4, with expected adjusted EBITDA improvement [22][23] - Management highlighted a strong balance sheet and disciplined capital allocation as foundational to the company's investment thesis [14][20] Other Important Information - The company returned approximately 0.215 per share declared [21] - Inventory position improved significantly, declining 19% compared to year-end 2023 [20] Q&A Session Summary Question: Trends in participation and engagement in the current landscape - Management noted a 2% year-to-date increase in U.S. rounds of play, with positive indicators for the golf industry despite some regional slow starts [27][28] Question: Insights on gross margin and promotional landscape - Management indicated that gross margin trends are expected to remain stable, with normal promotional activity anticipated during the holiday season [30][31]