Acushnet (US:GOLF)2022-03-01 18:02Financial Data and Key Metrics Changes - For Q4 2021, consolidated net sales were $421 million, essentially flat compared to 2020, with adjusted EBITDA at a loss of $5 million, reflecting strong demand and prioritization of production capacity for 2022 [13][30] - For the full year 2021, revenues increased by 33% to $2.15 billion, with adjusted EBITDA rising 41% to $328 million, and operating cash flow of $314 million [14][39] - Gross margins for the full year were 52.1%, up 60 basis points from the prior year, driven by higher sales volumes and average selling prices [35][36] Business Segment Data and Key Metrics Changes - Titleist golf ball sales reached $668 million, up 32% year-over-year, led by new Pro V1 and Pro V1x models [16] - Titleist clubs also saw a 32% increase, driven by new TSi metals, with gains across all product categories [17] - FootJoy's business increased nearly 40%, with significant growth in footwear and apparel [19] Market Data and Key Metrics Changes - All markets experienced over 20% growth for the year, with consistent demand across the U.S., EMEA, Japan, and Korea [21] - U.S. rounds of golf increased by 5% in 2021, with a 20% increase compared to 2019, aided by 800,000 new golfers [7][8] Company Strategy and Development Direction - The company is focused on product development and golfer connection, with capital investments at an all-time high to strengthen market leadership [10][12] - A disciplined approach to capital allocation is maintained, with $115 million returned to shareholders in 2021 through dividends and share repurchases [11][50] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the golf industry's structural health and strong demand for products, despite ongoing supply chain challenges [22][27] - The company expects full-year 2022 consolidated net sales to range from $2.175 billion to $2.225 billion, with adjusted EBITDA projected between $325 million and $345 million [53][54] Other Important Information - The company plans to increase capital expenditures to about $60 million in 2022, reflecting delays in receiving equipment due to supply chain challenges [44] - The Board of Directors approved a 9% increase in the quarterly dividend to $0.18 per share [11][47] Q&A Session Summary Question: Can you elaborate on channel inventory levels? - Management indicated that channel inventories are generally lean, down 10% to 20%, with golf balls and clubs most impacted [62][63] Question: What is the impact of the situation in EMEA on your business? - Management noted that the immediate impact on the golf business is limited, with oil prices being a significant variable affecting costs [67] Question: What data points are being monitored for growth in dedicated golfers? - Management highlighted strong demand from core dedicated golfers, who are playing more and purchasing more equipment [70][71] Question: How are supply chain challenges affecting guidance? - Management detailed that supply chain challenges vary by category, with limited raw material availability impacting golf balls and component availability affecting clubs [82][83] Question: What is the outlook for capital allocation? - Management confirmed that capital allocation priorities remain unchanged, with expectations for increased shareholder returns in 2022 [91][92]