Callaway 2015 Annual Report Download - page 38

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December 31,
2015(1)(9) 2014(1) 2013(1)(2) 2012(1)(2)(3) 2011(5)(7)(8)
(In thousands)
Balance Sheet Data:
Cash and cash equivalents ............................... $ 49,801 $ 37,635 $ 36,793 $ 52,003 $ 43,023
Working capital................................................ $ 212,851 $ 199,905 $ 195,407 $ 225,430 $ 251,545
Total assets....................................................... $ 631,224 $ 624,811 $ 663,863 $ 637,636 $ 727,112
Long-term liabilities ........................................ $ 39,643 $ 149,149 $ 153,048 $ 154,362 $ 46,514
Total Callaway Golf Company shareholders’
equity............................................................ $ 412,945 $ 291,534 $ 284,619 $ 318,990 $ 509,956
(1) On August 29, 2012, the Company issued $112.5 million of 3.75% Convertible Senior Notes (the “convertible notes”)
in exchange for cash and 0.6 million shares of the Company’s then-outstanding 7.50% Series B Cumulative Perpetual
Convertible Preferred Stock in separate, privately negotiated exchange transactions. During the second half of 2015, the
convertible notes were eliminated pursuant to certain exchange transactions and shareholder conversions, which resulted,
among other things, in the issuance of approximately 15.0 million shares of common stock to the note holders (see Note
3 “Financing Arrangements” in the Notes to Consolidated Financial Statements in this Form 10-K). In connection with
the elimination of the convertible notes and the issuance of the 15.0 million shares of common stock, the Company
recorded $109.0 million in shareholders' equity as of December 31, 2015, net of the outstanding discount of $3.4 million.
The Company recognized interest expense of $3.2 million, $5.0 million and $4.9 million for the years ended December 31,
2015, 2014 and 2013, respectively.
(2) The Company’s operating statements for the years ended December 31, 2013 and 2012 include pre-tax charges of $16.6
million and $54.1 million, respectively, in connection with the Company's cost-reduction initiatives that were announced
in July 2012 (the "Cost Reduction Initiatives"). As a result of these initiatives, in 2012, the Company recorded related
decreases in working capital and total assets from the impairment of certain intangible assets including goodwill, as well
as the write-off of certain long-lived assets and inventory. See Note 17 “Restructuring Initiatives" in the Notes to
Consolidated Financial Statements in this Form 10-K.
(3) During the first quarter of 2012, in an effort to simplify the Company’s operations and increase focus on the Company’s
core Callaway and Odyssey business, the Company sold its Top-Flite and Ben Hogan brands, including trademarks,
service marks and certain other intellectual property for net cash proceeds of $26.9 million. The sale of these two brands
resulted in a pre-tax net gain of $6.6 million.
(4) The Company’s operating statements for the years ended December 31, 2012 and 2011 include pre-tax charges of $1.0
million and $16.3 million, respectively, in connection with workforce reductions related to the reorganization and
reinvestment initiatives announced in June 2011.
(5) The Company’s provision for income taxes for the year ended December 31, 2011 includes $52.5 million of tax expense
in order to establish a valuation allowance against its U.S. deferred tax assets and $21.6 million related to the recognition
of certain prepaid tax expenses on intercompany profits. The reduction of deferred tax assets had a corresponding decrease
in working capital and total assets, as well as an increase in long-term liabilities. See Note 9 “Income Taxes” in the Notes
to Consolidated Financial Statements in this Form 10-K.
(6) In connection with the global operations strategy initiatives that were announced in 2010, the Company’s operating
statements for the years ended December 31, 2011 include a pre-tax charge of $24.7 million related to these initiatives.
(7) In 2011, the Company recognized a pre-tax impairment charge of $5.4 million in connection with the write-down of
certain trademarks and trade names. Additionally, in 2011, the Company recognized a pre-tax impairment charge of $1.1
million in connection with the write-off of goodwill.
(8) In March 2011, the Company completed the sale of three of its buildings located in Carlsbad, California. In connection
with this sale, the Company recognized a pre-tax gain of $6.2 million.
(9) In December 2015, the Company early adopted Accounting Standards Update No 2015-17, "Income Taxes (Topic 740):
Balance Sheet Classification of Deferred Taxes." This update eliminates the current requirement for organizations to
present deferred tax liabilities and assets as current and noncurrent in a classified balance sheet, and instead classify all
deferred tax assets and liabilities as noncurrent. The adoption of this update was made on a prospective basis as of
December 31, 2015, therefore working capital and long-term liabilities in 2015 are not comparable to prior periods
presented.