Callaway 1997 Annual Report Download - page 4

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of one benefit of our Casting Technology Center was
demonstrated by Odyssey Go l f , which found it could get a
p rototype putter head design fabricated in less than 3 days
— a process that formerly took 3 we e k s .
Callaway Golf Pe rf o rmance Centers: In Ja n u a ry of 1997
we opened Callaway Golf Pe rformance Centers including the
Sir Isaac Pe rformance Sy s t e m ™at Walt Disney World in
Orlando, Florida, and at the Pebble Beach Golf Re s o r t in
Carmel, California. A third Callaway Golf Pe r f o r m a n c e
Center opened in Oc t o b e r, 1997, in Las Vegas, Ne vada. T h e s e
t h r ee new sites, along with the original Pe r formance Center at
our headquarters in Carlsbad, California, provide golfers with
the information to evaluate which model of Callaway Go l f
club will work best for them. At the same time, these sites give
us invaluable feedback as to what works best for the wide
variety of golfers who want to use our product.
Callaway Golf Ball Company: In keeping with our original
announcement in May of 1996, Callaway Golf plans to
introduce a golf ball in late 1999. We are designing and
manufacturing prototype golf balls at our temporary plant,
and plan to break ground in Spring 1998 for our permanent
golf ball plant. Our temporary plant contains all of the
state of the art equipment needed to design, manufacture
and test prototype balls. Although we will not recognize
any significant revenues from golf ball sales until the year
2000, we made significant investment in this effort in 1997
and will continue to do so in 1998 and 1999. We already
are benefiting from our golf ball venture, gaining knowl-
edge that will help us conceive and design new golf clubs.
More on that in the future.
In t e r a c t i v e Go l f : An integral part of the Callaway Go l f
Pe rformance Center™is the Sir Isaac Pe rformance Sy s t e m™, a
sophisticated and highly technical swing analysis device that
g i ves us and the golf consumer valuable information not
readily available through other means. We are learning this
t e c h n o l o g y, effectively employed, can make the game of golf
m o r e enjoyable, and we believe there is much we can do to
f u r ther enhance this Callaway Golf Ex p e r i e n c e.
™We will
continue to invest time, money and energy in this endeavo r.
Information Technology Enhancement: In October 1997,
we converted our information system to the state-of-the-art
SAP computer software system. At an initial cost of $20
million, we believe that we have not only solved the vast
majority of the highly-discussed “Year 2000 Problem,” but
we have also provided Callaway Golf with a fully-integrated
system that will support all our existing businesses and all
our contemplated businesses around the world. Odyssey
Golf, Inc. was added to the system in January, 1998. The
Callaway Golf Ball Company also will operate on this
system. All our foreign distribution subsidiaries are scheduled
to be on the system by the end of 1999.
The images that follow are presented to give you a better
understanding of how we can capitalize on our version of
technology. If you want to see more firsthand, please come
and visit us in Carlsbad, California.
In closing, we want to remind you that the last several ye a r s
h a ve been ve ry good ones for Callaway Golf Company.
T h e r e are no guarantees that such good fortune will always
befall us but we believe that if we work as hard as we have
in the past, 1998 has the potential to be the best year in
the history of the Company. We thank our share h o l d e r s ,
customers, vendors and friends around the world for their
continued interest in being actively and enthusiastically
i n vo l ved with us.
Ely R. Callaway
Founder and Chairman
Donald H. Dye
President and C.E.O.