SBD/June 30, 2011/Finance

Callaway Golf CEO Resigns As Company Projects Disappointing Performance

Fellows had been Callaway Golf President & CEO for past six years
Callaway Golf yesterday announced the appointment of Anthony Thornley as Interim President & CEO, filling a vacancy created by the resignation of George Fellows. Thornley, who joined the Callaway Golf BOD in '04, was the President & COO of Qualcomm from '02-05. Fellows had served as President & CEO since '05 (Callaway Golf). In San Diego, Mike Freeman reports in addition to Fellows' resignation, Callaway Golf yesterday announced that its "second quarter results -- which are usually the strongest of the year in the golf industry as weather improves -- would miss Wall Street analysts’ expectations by a long shot." The company projects Q2 sales of $270M and a loss of $55M, or $0.84 a share. Analysts had estimated that Callaway would post sales of $309.49M and a profit of $0.23 per share. Web Street Golf Report Publisher Terry McAndrew said, "I'm sure Fellows was forced out. This has to be due to the performance of the business." Analysts said that Callaway Golf "has been losing ground to Acushnet, which owns the Titleist brand, and TaylorMade Golf, which is headquartered in the same Carlsbad business park." Furthermore, Callaway said that it "would reduce headcount 'at all levels of the organization' with the aim of slashing annual expenses" by $50M (SAN DIEGO UNION-TRIBUNE, 6/30). Callaway did not specify "how many jobs it would cut" (REUTERS, 6/29).
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