Callaway 2004 Annual Report Download - page 11

Download and view the complete annual report

Please find page 11 of the 2004 Callaway annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

The following table sets forth the contribution to net sales attributable to the principal product groups for
the periods indicated:
Year Ended December 31,
2004 2003 2002
(In millions)
Drivers and fairway woods ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $238.6 25% $252.4 31% $310.0 39%
Irons* ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 259.1 28% 280.7 34% 252.2 32%
Putters ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 100.5 11% 142.8 18% 111.5 14%
Golf balls ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 231.3 25% 78.4 10% 66.0 8%
Accessories and other* ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 105.1 11% 59.7 7% 53.5 7%
Net sales ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $934.6 100% $814.0 100% $793.2 100%
* Beginning with the year ended December 31, 2004, the Company includes wedge sales within the iron sales
product category. Previously, wedge sales were included as a component of the accessories and other
category. Prior periods have been reclassiÑed to conform with the current period presentation.
For a discussion regarding the changes in net sales for each product group from 2004 to 2003 and from
2003 to 2002, see below, ""Management's Discussion and Analysis of Financial Condition and Results of
Operations Ì Results of Operations'' contained in Item 7.
The Company's current principal products by product group are described below:
Drivers and Fairway Woods. This product category includes sales of the Company's drivers and fairway
woods, which are sold under the Callaway Golf, Top-Flite and Ben Hogan brands. The Company's drivers and
fairway woods are generally made of metal (either titanium or steel) or a combination of metal and a
composite material. The Company's products compete at all price segments in the drivers and fairway woods
category. In general, composite/metal ""Fusion'' drivers and fairway woods sell at higher price points than
most titanium drivers and fairway woods, and titanium products sell at higher price points than steel products.
The Company's drivers and fairway woods are available in a variety of lofts, shafts and other speciÑcations to
accommodate the preferences and skill levels of all golfers. All of the Company's current drivers and fairway
woods conform to the current rules of the United States Golf Association (the ""USGA'') or the Royal and
Ancient Golf Club of St. Andrews (the ""R&A''), as applicable to the markets in which the products are
intended to be sold.
Irons. This product category includes sales of the Company's irons and wedges, which are sold under
the Callaway Golf, Ben Hogan and Top-Flite brands. The Company's irons are generally made of metal
(either titanium or steel) or a combination of metal and a composite material. The Company's products
compete at all price segments in the irons category. In general, the Company's composite/metal irons sell at
higher price points than its titanium irons, and the Company's titanium irons sell at higher price points than its
steel irons. The Company's irons are available in a variety of lofts, shafts and other speciÑcations to
accommodate the preferences and skill levels of all golfers. All of the Company's current iron products
conform to the current rules of the USGA and the R&A, as applicable.
Putters. This product category includes sales of the Company's putters, which are sold under the
Odyssey, Callaway Golf, Ben Hogan and Top-Flite brands. The Company's products compete at all price
segments in the putters category. The Company's putters are available in a variety of styles, shafts and other
speciÑcations to accommodate the preferences and skill levels of all golfers. All of the Company's current
putter products conform to the current rules of the USGA and the R&A, as applicable.
Golf Balls. This product category includes sales of the Company's golf balls, which are sold under the
Callaway Golf, Ben Hogan and Top-Flite brands. The Company's golf balls are generally either a 2-piece golf
ball (consisting of a core and cover) or a multi-layer golf ball (consisting of two or more components in
addition to the cover). The Company's golf ball products include covers that incorporate a traditional dimple
pattern as well as covers that incorporate the Company's unique HEX Aerodynamics (i.e., a series of
2