Callaway Golf Company has announced it will pay second quarter dividends of $0.01 per share on July 15, which is a cut of six cents per share compared to the first quarter this year.
This move will allow the company to retain an additional $15.2 million in cash to shore up finances in a year that is proving extremely difficult for virtually all the biggest brands in golf.
“Over the long term, we believe Callaway’s ability to preserve its cash position and follow a prudent policy of balance sheet management is in the best interest of our shareholders,” said George Fellows, president and CEO of Callaway Golf, which includes the Odyssey, Top Flite and Ben Hogan brands. “By enhancing liquidity, we will be better positioned to manage our business and to take advantage of growth opportunities as the economy recovers. Callaway continues to maintain or grow market share even in this difficult environment, which is a testament to our global brand equity and the quality of our products.”
One of the costs affecting Callaway profits has been the outlay relating to a 10% reduction in the company’s workforce, and Fellows also cited “foreign currency headwinds”. With currency conditions expected to become more favourable in the second half of 2009, Callaway reports that it expects earnings from the remainder of 2009 to be higher than in the second half of 2008.