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CALLAWAY GOLF AGAIN REPORTS RECORD SALES AND EARNINGS; SALES AND EARNINGS MORE THAN DOUBLE FOR THIRD CONSECUTIVE QUARTER

 CALLAWAY GOLF AGAIN REPORTS RECORD SALES AND EARNINGS;


SALES AND EARNINGS MORE THAN DOUBLE FOR THIRD CONSECUTIVE QUARTER
 CARLSBAD, Calif., Oct. 22 /PRNewswire/ -- Callaway Golf Company (NYSE: ELY) announced today the results for its third quarter ended Sept. 30, 1992, according to Donald H. Dye, vice chairman and chief operating officer, and Ely Callaway, chairman and chief executive officer.
 For the third quarter ended Sept. 30, 1992, net sales increased 111 percent to $35.9 million, compared to $17.0 million for the same period in the prior year. Net income increased 130 percent to $5.3 million ($.62 per share) from $2.3 million ($.31 per share) for the same period in 1991.
 For the nine months ended Sept. 30, 1992, net sales increased 143 percent to a record $95.3 million from $39.2 million in 1991. Net income for the nine months increased 195 percent to a record $14.1 million ($1.68 per share) as compared to $4.8 million ($.65 per share) in the same period in 1991, and as compared to $6.4 million ($.86 per share) for all of 1991.
 The percentage of pre-tax profits to sales for the September 1992 quarter was higher than the September 1991 quarter primarily because of increased sales volume.
 The percentage of gross margin for the September 1992 quarter (51 percent) was lower than the September 1991 quarter (53 percent) primarily because of increases in the reserve for product warranty in the September 1992 quarter. The increase in the warranty reserve is to obtain an even more conservative position against potential warranty claims in the future. The company does not expect any future increase in the rate at which warranty reserves are being accrued. This decrease in gross margin was more than offset by a decrease in the company's Selling General & Administrative expenses as percent of net sales. The decrease was a result of fixed costs being spread over an increased sales volume.
 Consumer demand for all of the Callaway golf clubs continued strong. This is contrary to sluggish conditions for the economy in general and for the world wide golf club industry in particular.
 The Oct. 5, 1992 issue of Fortune magazine ranked Callaway Golf Company No. 21 on its list of America's 100 fastest-growing companies.
 The company designs, manufactures, and markets high quality, relatively high priced, innovative golf clubs under the design concept known as "S2H2(R)." One of these unique products is the Big Bertha(R) line of metal woods.
 CALLAWAY GOLF COMPANY
 Summary of Operations
 (In thousands, except per share data)
 Condensed Income Statement
 (Unaudited)
 Third quarter ended Nine months ended
 Sept. 30, Sept. 30,
 1992 pct 1991 pct 1992 pct 1991 pct
 Net sales $35,896 100 $16,986 100 $95,331 100 $39,218 100
 Cost of
 goods sold 17,662 49 7,999 47 45,132 47 18,950 48
 Gross
 profit 18,234 51 8,987 53 50,199 53 20,268 52
 Operating
 expenses:
 Selling
 expense 5,090 14 3,001 18 15,045 16 8,091 21
 General &
 administra-
 tive 3,500 10 1,973 12 9,927 10 3,702 9
 Research &
 develop-
 ment 541 2 193 1 1,157 1 527 1
 Income from
 operations 9,103 25 3,820 22 24,070 25 7,948 20
 Other income
 (expense),
 net 187 15 330 54
 Income before
 income
 taxes 9,290 26 3,835 23 24,400 26 7,894 20
 Provision for
 income
 taxes 3,945 11 1,508 9 10,262 11 3,103 8
 Net income $5,345 15 $2,327 14 $14,138 15 $4,791 12
 Earnings
 per common
 share:
 Primary $.69 $.35 $1.90 $.72
 Fully
 diluted $.62 $.31 $1.68 $.65
 Common
 equivalent
 shares:
 Primary 7,778 6,711 7,452 6,574
 Fully
 diluted 8,714 7,679 8,466 7,525
 CALLAWAY GOLF COMPANY
 Condensed Balance Sheet
 (In thousands)
 Sept. 30, Dec. 31,
 1992 1991
 (Unaudited)
 ASSETS
 Current assets:
 Cash and cash equivalents $28,621 $5,178
 Accounts receivable, net 15,435 6,113
 Inventories, net 12,115 11,188
 Deferred taxes 5,054 2,273
 Other current assets 456 627
 Total current assets 61,681 25,379
 Property and other assets 9,746 3,445
 Total $71,427 $28,824
 LIABILITIES AND SHAREHOLDERS'
 EQUITY
 Current liabilities:
 Accounts payable and accrued
 expenses $9,488 $5,726
 Accrued employee compensation
 and benefits 5,354 957
 Accrued warranty expense 3,674 1,301
 Income taxes payable 2,689 1,163
 Total current liabilities 21,205 9,147
 Long-term debt 3,500 4,450
 Shareholders' equity:
 Convertible preferred stock --- 23
 Common stock 71 16
 Paid-in capital 29,063 11,738
 Retained earnings 17,588 3,450
 Total shareholders' equity 46,722 15,227
 Total $71,427 $28,824
 -0- 10/22/92
 /CONTACT: Ely Callaway, chairman and CEO, Carol Kerley, CFO, or Don Dye, vice chairman and COO, of Callaway Golf Company, 619-931-1771/
 (ELY) CO: Callaway Golf Company ST: California IN: SU: ERN


JL -- SD006 -- 3284 10/22/92 08:07 EDT
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Date:Oct 22, 1992
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