Callaway 2005 Annual Report Download - page 105

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CALLAWAY GOLF COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note 17. Summarized Quarterly Data (Unaudited)
Fiscal Year 2005 Quarters
1st 2nd 3rd 4th Total(3)(4)
(In thousands, except per share data)
Net sales .................................... $299,857 $323,132 $220,611 $154,493 $998,093
Gross profit .................................. $132,606 $146,733 $ 86,898 $ 48,177 $414,414
Net income (loss) ............................. $ 18,360 $ 18,392 $ (4,804) $ (18,664) $ 13,284
Earnings (loss) per common share(1)
Basic ................................... $ 0.27 $ 0.27 $ (0.07) $ (0.27) $ 0.19
Diluted ................................. $ 0.27 $ 0.27 $ (0.07) $ (0.27) $ 0.19
Fiscal Year 2004 Quarters
1st 2nd(2) 3rd 4th Total(3)
Net sales .................................... $363,786 $297,908 $128,457 $144,413 $934,564
Gross profit .................................. $166,191 $127,836 $ 26,071 $ 38,724 $358,822
Net income (loss) ............................. $ 40,545 $ 13,715 $ (35,895) $ (28,468) $ (10,103)
Earnings (loss) per common share(1)
Basic ................................... $ 0.60 $ 0.20 $ (0.53) $ (0.42) $ (0.15)
Diluted ................................. $ 0.59 $ 0.20 $ (0.53) $ (0.42) $ (0.15)
(1) Earnings per share is computed individually for each of the quarters presented; therefore, the sum of the
quarterly earnings per share may not necessarily equal the total for the year.
(2) On May 28, 2004, the Company acquired all of the issued and outstanding shares of stock of FrogTrader,
Inc. Thus, the Company’s financial data includes the FrogTrader, Inc. results of operations from May 28,
2004.
(3) The Company’s gross profit, net income and earnings per common share include the recognition of certain
integration charges related to the consolidation of its Callaway Golf and Top-Flite golf ball and golf club
manufacturing and research and development operations. In connection with these integration charges, the
Company’s gross profit, net income and earnings per common share were reduced by approximately
$6,388,000, $7,696,000 and $0.11, respectively, for the year ended December 31, 2005 and $15,689,000,
$17,470,000 and $0.26, respectively, for the year ended December 31, 2004.
(4) In September 2005, the Company began the implementation of several company-wide restructuring
initiatives designed to improve the Company’s business processes and reduce the Company’s overall
expenses. In connection with these initiatives, the Company recorded pre-tax charges in the amount of
$7,119,000 for employee termination benefits and $1,205,000 for facility closures and other costs for the
year ended December 31, 2005. These charges reduced the Company’s gross profit, net income and earnings
per common share by approximately $2,119,000, $5,161,000 and $0.08, respectively, for the year ended
December 31, 2005.
F-37