Topgolf Callaway Brands has reported a revenue decline for the third quarter, but management said the results were ahead of expectations despite a “challenging macroeconomic backdrop”.
For the quarter ended September 30, net revenues were down 2.7 per cent year-on-year to $1.012 billion. Income from operations fell 54.3 per cent to $33.7 million.
The company swung to a net loss of $3.6 million from net income of $29.7 million in the year-ago period.
“We are pleased to announce results that exceeded our expectations for Q3 amid a challenging macroeconomic backdrop,” said Chip Brewer, president and CEO of Topgolf Callaway Brands.
“Topgolf performed consistent with our revenue expectations and continued to show strong venue profitability despite the challenging sales environment.”
The Topgolf business recorded a 1.2 per cent uplift in revenue, but same-venue sales were down 11 per cent. The golf equipment segment saw flat revenue but lower operating income, with Callaway remaining the hero brand.
Active lifestyle segment’s revenue dropped 11.1 per cent, mainly due to lower European wholesale revenue at Jack Wolfskin.
The company has lowered full-year revenue guidance to approximately $4.2 billion, the lower end of previous outlook. Adjusted EBITDA is expected to range from $560 to $570 million.
The company maintained prior Topgolf revenue guidance and increased the brand’s adjusted EBITDA guidance. It continues to believe that separating Topgolf from the core business will create shareholder value and is fully engaged in this work.
