GOLFWEEK STAFFTrue Temper Sports Inc. announced its third quarter net sales increased 0.3 percent and its net loss narrowed to $6.6 million.
For the three-month period net sales increased to $24.2 million from $24.1 million in the same quarter of 2007. The company posted a net loss of $22.8 million a year ago. (The 2007 period included a charge of $13.0 million related to the initial establishment of a valuation allowance for deferred tax assets.)
Scott Hennessy, True Temper’s president and CEO, said the company achieved golf revenue gains of 3.0 percent.
“Within our core steel golf shaft business, we continued to realize unit volume and revenue gains in both the True Temper and Project X brand families,” Hennessy said. “In addition, although the current economic downturn has spread to a number of countries beyond our US borders, True Temper's business throughout Asia remains strong, up 17.5 percent during the third quarter and 24.3 percent on a year-to-date basis. Our growth within the Japanese market in particular delivered a significant portion of our overall third quarter golf increase.”
Hennessy also addressed the company’s efforts to improve profitability.
“Given the weakening in the overall U.S. retail momentum, we have reacted quickly and decisively, taking action in both our variable and fixed cost base. Among a number of cost control initiatives enacted recently, we have reduced manufacturing employment by approximately 25 percent and adjusted salaried staffing levels accordingly, in anticipation of some challenging quarters ahead."
Though True Temper is expecting fourth-quarter revenue to be down, it is still projecting 2008 sales in excess of $120 million, which would be a first for the company.
Added Hennessy: “While the golf market has, historically, been quite resilient during difficult economic times, it would not be prudent to assume that it could come through this current global situation unscathed.”
Posted: 11/17/2008
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