Acushnet’s revenue doubles in the second quarter

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Acushnet Sees Sales Double In Second Quarter

Acushnet Holdings Corp., the parent company of Titleist and Footjoy, raised its profit and revenue guidance for 2021 after sales rose 108.3 percent in the second quarter and earnings improved significantly. Both profits and sales exceeded Wall Street targets in the second quarter.

“Demand across Acushnet’s product categories remains robust and has contributed to another great quarter for the company,” said David Maher, President and Chief Executive Officer of Acushnet. “Our strong performance was led by sales across our product portfolio, including new Titleist Pro V1 and Pro V1x golf balls, TSi drivers, and our FootJoy and KJUS brands. We look forward to building our momentum in the second half of the year with a wide range of product launches, led by new Titleist T-Series irons and new FJ shoes and HydroKnit outerwear. “

Maher continued, “As we enter the second half of 2021 and positive COVID-19 cases escalate in many regions, our top priority remains the health and safety of our employees. While we expect golfers’ engagement to remain healthy, we expect to face various disruptions within our supply chain. My Acushnet teammates are skilled at customizing and I have every confidence in their ability to handle these uncertainties with excellence as we strive to provide the highest quality products and services to our trading partners and dedicated golfers around the world. “

Consolidated net sales for the quarter rose 108.3 percent to $ 624.9 million. Wall Street’s consensus estimate was $ 528.44 million. On a constant currency basis, consolidated net sales increased 99.9 percent, mainly due to the negative impact of government-ordered closures in Q2 2020 coupled with an increase in sales volume across all reportable segments as game rounds and consumer demand for golf-related Products remained at a high level in the second quarter of 2021. The growth in sales of products that are not allocated to any of the four reportable segments also contributed to the increase in net sales.

On a geographic basis, US net sales increased 117.1 percent for the quarter, driven by an increase of $ 65.8 million in Titleist golf balls, an increase of $ 43.7 million in FootJoy golf apparel, one An increase of $ 41.1 million in Titleist golf clubs and an increase of $ 17.1 million in Titleist golf equipment, all due to the same factors described above.

Net sales in regions outside the United States increased 100.0 percent and, on a constant currency basis, increased 83.7 percent. The increase in net sales in all regions was primarily driven by increased sales in all reportable segments, which were driven by the same factors mentioned above.

Segment features:

  • 98.1 percent increase in net sales (91.6 percent increase in constant currency) of Titleist golf balls, mainly due to the negative impact of government-ordered closings in Q2 2020 coupled with higher sales volumes of its latest generation Pro V1 and Pro V1x Golf balls launched in the first quarter of 2021.
  • Net sales increased 111.0 percent (103.6 percent increase in constant currencies) of Titleist golf clubs, primarily due to the negative impact of government-ordered shutdowns in the second quarter of 2020. This increase was also driven by higher sales volumes and average sales prices all product categories.
  • 100.6 percent increase in net sales (92.9 percent increase in constant currency) of Titleist golf equipment, primarily due to the negative impact of government-ordered closures in Q2 2020. Sales volumes increased across all product categories.
  • 141.0 percent increase in net sales (129.3 percent increase in constant currency) of FootJoy golf apparel, mainly due to the negative impact of government-ordered closures in the second quarter of 2020. Sales volumes increased across all product categories and average sales of apparel and Gloves the prices were higher.

Acushnet Holdings Corp. attributable net income increased $ 78.8 million year over year to $ 81.1 million, or $ 1.08 per share, primarily due to an increase in operating income partially offset by an increase in income tax expense. Wall Street’s consensus estimate was 77 cents.

Adjusted EBITDA was $ 127.8 million, up 286.1 percent year over year. The adjusted EBITDA margin was 20.4 percent in the second quarter compared to 11.0 percent in the same period of the previous year.

Summary of the financial results for the first six months of 2021
Consolidated net sales increased 70.1 percent in the first six months. On a constant currency basis, consolidated net sales increased 64.1 percent, primarily due to the negative impact of government-ordered closures in Q2 2020 coupled with an increase in sales volume across all reportable segments as game rounds and consumer demand for golf-related products remained in the first six months of 2021 at a high level. The growth in sales of products that are not allocated to any of the four reportable segments also contributed to the increase in net sales.

On a geographic basis, net sales in the United States increased 75.2 percent for the six-month period, driven by an increase of $ 107.4 million in Titleist golf balls, an increase of $ 78.4 million in Titleist golf clubs and an increase of $ 57.1 million in FootJoy Golf Wear and an increase of $ 22.3 million in Titleist golf equipment, all driven by the same factors described above.

Net sales in regions outside the US increased 65.0 percent and on a constant currency basis 52.8 percent. The increase in net sales in all regions was primarily driven by increased sales in all reportable segments, which were driven by the same factors described above.

Segment features:

  • 72.1 percent increase in net sales (67.1 percent increase in constant currency) of Titleist golf balls, mainly due to the negative impact of government-ordered closings in Q2 2020 coupled with higher sales volumes of its latest generation Pro V1 and Pro V1x Golf balls launched in the first quarter of 2021.
  • 86.4 percent increase in net sales (80.7 percent increase in constant currency) of Titleist golf clubs, mainly due to the negative impact of government-ordered closures in the second quarter of 2020. The increase was also driven by higher sales volumes and average sales prices across the board Product categories.
  • 55.6 percent increase in net sales (49.7 percent increase in constant currency) of Titleist golf equipment, primarily due to the negative impact of government-ordered closures in Q2 2020. Sales volumes increased across all product categories.
  • 63.1 percent increase in net sales (56.3 percent increase on a constant currency basis) in FootJoy golf apparel, mainly due to the negative impact of government-ordered closures in the second quarter of 2020. Sales volumes increased and average sales prices were overall all Product categories.

Acushnet Holdings Corp. attributable net income increased $ 154.8 million year over year to $ 166.0 million primarily due to an increase in operating income partially offset by an increase in income tax expense.

Adjusted EBITDA was $ 263.0 million, up 206.2 percent year over year. The adjusted EBITDA margin was 21.8 percent in the first six months compared to 12.1 percent in the same period of the previous year.

Cash dividend and share buyback
Acushnet’s board of directors today announced a quarterly cash dividend of $ 0.165 per common share. The dividend will be paid on September 17, 2021 to the shareholders of record on September 3, 2021. The number of shares outstanding as of July 30, 2021 was 73,905,679.

During the quarter, the company repurchased 88,500 shares of common stock in the open market at an average price of $ 49.51 for a total of $ 4.4 million. In addition, on April 2, 2021, the company acquired from Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Holdings Corp. share buyback obligations are discussed.

Business Impact of COVID-19
Acushnet said: “In March 2020, the World Health Organization declared a novel coronavirus (” COVID-19 “) pandemic that resulted in government-ordered closures of non-essential businesses, travel restrictions and restrictions on public gatherings and, as a result, our earnings position has been reduced for negatively impacted the second quarter and first half of 2020. As the restrictions were relaxed, the game of golf saw an increase in the number of game rounds around the world, resulting in increased demand for our products. On a company-wide basis, we quickly experienced demand pressures across all brands and product categories that challenged and continues to challenge our supply chain and our ability to serve our trading partners and golfers.

“In the first half of 2021, game rounds remained high and we continued to see increasing demand for our products, resulting in higher sales volumes in all reportable segments. During this period, however, we also experienced interruptions in the supply chain, which led to bottlenecks in various raw materials and increased freight costs. While government-ordered closures and restrictions have been relaxed in most regions and mass immunization programs are underway, the emergence of virus variants and the resurgence of positive cases has resulted in a return to tighter restrictions in some regions and could lead to tighter restrictions in other regions that may further disrupt our supply chain. While we’ve seen increased game play and demand for golf products, that could change as the pandemic progresses as mass vaccination programs continue to advance and restrictions on other activities continue to relax.

Outlook for 2021
The company anticipates full year consolidated net sales of approximately $ 1,930 to 1,990 million and adjusted EBITDA of approximately $ 285 to $ 305 million. On the basis of constant exchange rates, consolidated sales are expected to grow by 16.8 to 20.6 percent. The company’s outlook is that the pandemic will not worsen materially, including gradual closings of global markets and additional supply chain disruptions.

When releasing its first quarter results on May 6, Acushnet said it expects full year consolidated net sales of approximately $ 1,795 to $ 1,875 million and adjusted EBITDA of approximately $ 255 to $ 285 million.

Photo courtesy Acushnet

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