It's a driving range where players of all skill levels can hit balls, each with an RFID chip in them, to different targets up and down the range. Please. (1) In 2020, amounts represent certain non-recurring costs, including costs associated with the Company's transition to its new North America Distribution Center and the implementation of new IT systems for Jack Wolfskin, as well as $0.7 million of severance related to the Company's cost reduction initiatives. Additionally, EBITDAS excludes these same line items from forecasted net income. Paul directs the work of an award-winning staff covering business news in the nation's fourth largest metro region. The number of shares issued is also based upon a fixed price of Callaway common stock of $19.40 per share. Callaway Preliminary Q3 Results and Business Update, Chip Brewer added: The world is rediscovering golf in a way that has led to a record quarter for our company. Daily updates aggregating the stories and spin from more than 600 outlets across the globe. He has been CEO since 2011, and was instrumental in the Amway Center winning a Sports Business Award for Facility of the Year in 2012. Any environment where individuals are swinging golf clubs is terrific, said Sarah Hirshland, senior managing director of business affairs for the USGA, which last year partnered with Topgolf to hold U.S. Open watch parties at all Topgolf venues. We are the subject of inquiries from the capital market world and our investors would look at it as a way to grow the company and get liquidity. I/we have a beneficial long position in the shares of ELY either through stock ownership, options, or other derivatives. The foregoing list is not exhaustive. Change the plan you will roll onto at any time during your trial by visiting the Settings & Account section. 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Disclosure: I/we have a beneficial long position in the shares of ELY either through stock ownership, options, or other derivatives. In addition, the Company's independent registered public accounting firm has not audited this information or completed its quarterly review procedures for the quarter ended September 30, 2020 and does not express an opinion or any other form of assurance with respect to these preliminary estimates or their achievability. We are not nave to say we would never look at it. Management believes that the presentation of such non-GAAP information, when considered in conjunction with the most directly comparable GAAP information, provides additional useful comparative information for investors in their assessment of the underlying performance of the Company's business with regard to these items. What began as a technology that enhanced the game of golf now encompasses a range of unmatched experiences where communities can discover common ground. A long-term forecast of each of these line items is not available without unreasonable efforts due to the variability of these items and the inability to predict them with certainty. Topgolf, in addition to tapping into golf as a property, has seen their growth based in providing great experiences both in their venues and outside.. Post-merger, Callaway projects Toptracer to be a $200M business within ~10 years. Topgolf projects adding more than 3,500 bays in 2020, and around 8,000 new bays per year starting in 2022. All rights reserved. Before that, he was editor-in-chief at the Dallas Business Journal and business editor at the Cleveland Plain Dealer. Why did Callaway buy Topgolf? Chip Brewer will continue to lead the combined company as President and Chief Executive Officer. The transaction is subject to the approval of the shareholders of both Callaway and Topgolf, as well as other customary closing conditions, including required regulatory approval. GNN may earn a commission from sales generated by those links. Last year, Topgolf had a massive 13 million customer visits and that number is expected to continue growing rapidly through an aggressive expansion strategy that includes plans to open between seven and 10 new venues annually for the foreseeable future both in the U.S. and overseas. Topgolf is expected to generate $1.06 billion in revenue and $158 million in EBITDA in 2021. This includes favorable trends in rounds played and growth in beginning and returning golfers as well as broader consumer preferences for outdoor activities.2,3The combined company will have a highly diversified revenue mix, including Golf Equipment, 30%; Topgolf, 46%; and Softgoods, 24%4. He is a University of Washington graduate. SBJ I Factor is a monthly podcast offering interviews with sports executives who have been recipients of one of the magazines awards, including Forty Under 40, Game Changers and Sports Business Awards. or Topgolf was generating $1.1 billion in revenue pre-pandemic at 63 locations that drew more than 23 million customers in 2019. Timely, daily updates provide the latest developments and news relied upon by industry leaders. Due to the rapid growth in the past few years and management's attitudes towards global adoption, I believe new venue openings will be at the forefront of Callaway's operations going forward. What is exciting is the belief that they can be LPGA viewers or on-site fans. These selected companies were Dave & Buster's (PLAY), Live Nation (LYV), Drive Shack (DS), Cinemark (CNK), and Disney (DIS) who all have a component of in-person entertainment venues as a large part of their business. Callaway already had an exclusive relationship with Topgolf, which put their clubs, merchandise, and apparel in every location worldwide, but you can expect Callaway penetrate that relationship even more. Its whether the locations they are building are consistent so that there is a reason for people to come back more than once.. Any time you have a business that requires that kind of capital investment and real estate, you have to be creative in what is the model for capital maintenance, Hirshland said. Over the course of the initial 20-year ground lease, once construction is completed and Topgolf is open for business, the county will receive more than $625,000 in annual revenue, benefiting the San Bernardino County Regional Parks system, https://parks.sbcounty.gov/, which includes nine regional parks throughout the county and ICYMI, I wrote a thread last night breaking down his incredible entrepreneurial journey. Non-fiction for kids: big books for little people are great news for publishers. Topgolf began looking at an initial public offering in 2019. Dr Pepper flavored Peeps arrive in Texas soon. Along with the announcement, Callaway released a 30-page presentation giving rare insight into Topgolfs existing ownership structure, financials, and projections. Thats a goal of golf governing bodies, who already have instituted youth development programs aimed at attracting more young golfers to the game. Upon closing, the combined companys Board of Directors will consist of 13 directors, including three directors appointed by Topgolf shareholders. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. Topgolf also hires PGA professionals as instructors at Topgolf venues, while the PGA Tour and the LPGA co-promote with Topgolf by holding sponsor and media activities at Topgolf venues. The challenge is balancing Topgolfs position as a young, hip, social scene geared to drinking, eating and meeting people with the golf groups interest in growing the game. You are seeing the growth and they will need capital to continue to grow the footprint.. Its those numbers that have participant-hungry golf courses and the national golf associations all clamoring to draft off Topgolfs success. From a financial perspective, Topgolf did $1.1 billion in revenue last year and is growing at a 30% CAGR since 2017. Topgolfs venue revenue has now rebounded to about 85% of pre-pandemic levels and all of the companys locations have reopened. The number of shares issued is based upon an implied equity value of Topgolf of $1.986 billion6(including Callaways ownership position). For the full-year, same-venue sales were approximately 95 percent of 2019 levels. https://www.sportsbusinessjournal.com/Journal/Issues/2018/04/02/In-Depth/Topgolf.aspx. 4 Based on 2022 projections Callaway is a leader in the global golf equipment market with a scale position in active-lifestyle soft goods and a proven ability to deliver strong returns, including company growth that has exceeded golf market growth for seven consecutive years. Callaway first invested in Topgolf in 2006, and the companies have maintained a strong partnership since, including an exclusive golf partnership agreement at all Topgolf venues. Callaway Golf Company will file with the SEC a registration statement on Form S-4, which will include the proxy statement of Callaway Golf Company that also constitutes a prospectus of Callaway Golf Company and a consent solicitation statement of Topgolf International, Inc. (the proxy statement/prospectus/consent solicitation). Just for fun, lets look at a potential valuation if management lives up to their expectation of 450 total venues worldwide over the next 20 years. Callaway has invested in Topgolf twice already, in 2006 and 2018, amounting to an existing ownership stake of about 14%. Said PGA Tour CMO Joe Arcuri, It is great for the tour product and for future fans. What that success means in terms of revenue and profitability arent made public by the privately held company, but the company has found the formula to attract a crush of interest from both golfers and non-golfers alike. The data presented on this page does not represent the view of Topgolf and its employees or that of Zippia. Topgolf is continuing on its expansion plans in major American cities, as well expanding into Australia, Mexico and Canada through licensing deals. Both companies are well positioned to take advantage of both short- and long-term changes in consumer behavior as a result of the pandemic. Fueled by a tremendous team of associates and a diverse offering across our venues, Toptracer, and media platform, Topgolf is truly changing the landscape of the industry by making golf more inclusive and accessible to people of all ages, demographics and skill levels. These risks, uncertainties and other factors relate to, among others: risks and uncertainties related to our pending merger with Topgolf, including the failure to obtain, or delays in obtaining, required regulatory approval, the risk that such approval may result in the imposition of conditions that could adversely affect Callaway or the expected benefits of the proposed transaction, any termination fee that may be payable by Callaway pursuant to the terms of the merger agreement, or the failure to satisfy any of the closing conditions to the proposed transaction on a timely basis or at all; costs, expenses or difficulties related to the merger with Topgolf, including the integration of the Topgolf business; failure to realize the expected benefits and synergies of the proposed transaction in the expected timeframes or at all; the potential impact of the announcement, pendency or consummation of the proposed transaction on relationships with Callaways and/or Topgolfs employees, customers, suppliers and other business partners; the risk of litigation or regulatory actions to Callaway and/or Topgolf; inability to retain key personnel; changes in legislation or government regulations affecting Callaway and/or Topgolf; uncertainty of the duration, scope and impact of COVID-19; a further spread or worsening of COVID-19; any further regulatory actions taken in response to COVID-19, including the future shutdown of or restrictions on Callaways or Topgolfs retail locations, venues, distribution centers, manufacturing plants or other facilities; the effectiveness of Callaways or Topgolfs protective gear, social distancing guidelines, and other preventive or safety measures; disruptions to business operations of Callaway and Topgolf as a result of COVID-19, including disruptions to business operations from travel restrictions, government-mandated or voluntary shut-down orders or quarantines, or voluntary social distancing that affects employees, customers and suppliers; continued growth, momentum and opportunities in the golf industry; production delays, closures of manufacturing facilities, retail locations, warehouses and supply and distribution chains; staffing shortages as a result of remote working requirements or otherwise; uncertainty regarding global economic conditions, particularly the uncertainty related to the duration and impact of the COVID-19 pandemic, and related decreases in customer demand and spending; and economic, financial, social or political conditions that could adversely affect Callaway, Topgolf or the proposed transaction. 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