Callaway Warning Proves Accurate

The company's third-quarter loss is in line with last month's preannouncement.
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Callaway Golf's

(ELY) - Get Report

third-quarter revenue and loss met the reduced guidance the company provided to Wall Street in October.

Net sales for the quarter fell to $193.8 million from $220.6 million in the same period a year earlier. Callaway lost 18 cents a share, compared with a loss of 7 cents last year. Excluding charges, the golf-equipment maker would have lost 13 cents in the latest quarter.

Last month, Callaway said it would lose 17 cents to 19 cents a share for the quarter, or 12 cents to 14 cents excluding items. At the time, analysts polled by Thomson First Call had an average estimate for a profit of 8 cents.

The company also said at the time that sales would be $193 million to $195 million, well below what was then the consensus target of $223 million.

"We continue to make progress on many fronts this year, despite the disappointing performance in our Top-Flite brand," said George Fellows, president and CEO. "Sales of our core brands of Callaway and Odyssey have grown significantly this year and we have materially reduced our operating expenses as a result of last September's cost cutting initiatives. More importantly, these factors should combine to increase our full-year pro forma earnings per share by more than 20% in 2006."