Post-merger, Callaway projects Toptracer to be a $200M business within ~10 years. Both CEOs said golf equipment and golf entertainment venues have a chance to excel in the COVID-19 environment while other forms of entertainment have been severely restricted. Through $750 million in acquisitions of premium apparel, footwear, and equipment brands like Jack Wolfskin, TravisMathew and Ogio, Callaway has desperately attempted to diversify their business and cater to a younger demographic which seems to be losing interest in golf or never picked it up in the first place. Topgolf).. Callaway announced the deal along with its third-quarter financial results, noting 12% year-over-year revenue growth to $476 million. The majority of Topgolfs revenue comes from physical locations, but they also have a growing technology business, which Callaway envisions being a significant source of revenue in the future. Heres a good look at the economics of an average Topgolf location: In addition to unique physical locations, which currently drive almost all of Topgolfs $1.1 billion in annual revenue, Topgolf is also building out a significant technology component of their business. In a statement, the House Ways and Means chair explained Source: Created by Author with data from Yahoo Finance and Q3 Earnings Call. Callaway has invested in Topgolf twice already, in 2006 and 2018, amounting to an existing ownership stake of about 14%. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. There is a lot of white space. Topgolf Note: The Company is providing information about its long-term forecasted results subsequent to December 31, 2022, excluding interest, taxes, depreciation and amortization expense, and non-cash stock compensation expense. I wrote this article myself, and it expresses my own opinions. Therefore, adjusted revenue and EBITDA numbers for the full-year 2021 would be around $1.3 billion and $190 million. 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. WebTopgolf: An entertainment complex that provides competitive golfing games for individuals and groups of all ages and skill levels. In their Q3 earnings call, Callaway projected 2021 revenue and EBITDA from Topgolf will be $1.06 billion and $158 million; this provides an EBITDA margin of 14.91%. This valuation projection assumes that Callaway commits to and has the free cash flow available to invest in the future growth of Topgolf venues. Topgolf generated $1.1 billion in revenue last year at 63 locations that drew more than 23 million customers. Topgolf currently has 28 open locations in the United States, with another dozen opening soon all over the place. The proposed expansion of the non-essential goods tax, which would see luxury good items taxed more, would generate st least P12.4 billion in annual revenue For a full comparison of Standard and Premium Digital, click here. Topgolf has 58 U.S. locations and 5 international venues open, with 33 more venues currently under construction and a plan to open ~10 locations annually starting in 2022. If you have an ad-blocker enabled you may be blocked from proceeding. It is time and circumstance specific.. Become a business insider. We see a lot of ways with golf to have a meaningful business, said Erik Anderson, executive chairman of Topgolf Entertainment. Sorry, something went wrong with the copy but here is the link for you. 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). Callaway and Topgolf both delivered strong financial results immediately before the COVID pandemic and have since recovered ahead of expectations. The words may, should, will, could, would, anticipate, plan, believe, project, estimate, expect, strategy, future, likely, and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made and are not guarantees of future performance. If youd like to retain your premium access and save 20%, you can opt to pay annually at the end of the trial. See insights on TopGolf including office locations, competitors, revenue, financials, executives, subsidiaries and more at Craft. Topgolf has been growing like crazy the last several years, with the Dallas-based company adding locations around the country. Daily updates aggregating the stories and spin from more than 600 outlets across the globe. 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. (1) Callaway Golf charges include: Non-recurring transaction and transition costs associated with the acquisition of Jack Wolfskin, including banker's fees, legal fees, consulting and travel expenses, audit fees and valuations services, as well as non-cash charges related to the valuation of acquired inventory, in addition to other non-recurring advisory fees. The deal, announced Tuesday, creates a company that can draw in non-golfers to Topgolfs entertainment venues and expose them to the broader game, said Callaway CEO Chip Brewer, whose company sells golf clubs, balls, apparel and other equipment. Martins is a long-time sports executive who first started with the Magic in 1989. Non-recurring costs and non-cash charges, before taxes (1). WebFind company research, competitor information, contact details & financial data for Topgolf International, Inc. of Dallas, TX. Its those numbers that have participant-hungry golf courses and the national golf associations all clamoring to draft off Topgolfs success. The venues include golf driving bays that use its ball-tracing technology to make games out of the experience, along with food, music and golf retail. The non-GAAP information may also be inconsistent with the manner in which similar measures are derived or used by other companies. 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 company asked the city for $2.6 million in With Athletic beers, you can have the full relaxing ritual of drinking a great beer to wind down the day, with your dinner, or day drinking, without derailing the rest of your day or week. 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. Along with the announcement, Callaway released a 30-page presentation giving rare insight into Topgolfs existing ownership structure, financials, and projections. Remaining privately-owned during those two decades, the company built locations in every region of the country. Each Topgolf location costs about $20 million to build, and these locations have typically paid for themselves in two years. Revenue at golf courses and clubs improved from $29.9 billion in 2011 to 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. My name is Kyle Repar. WebAbout Topgolf Entertainment Group Topgolf Entertainment Group is a technology-enabled global sports and entertainment community that connects people in meaningful ways Compare Standard and Premium Digital here. The company is headquartered in Dallas, Texas. Both our golf equipment and soft goods businesses are recovering more quickly than we expected, and our third quarter projections reflect this momentum. Award-winning original reporting, with in-depth profiles, timely research and expert opinions on the biggest issues and stories in sports business. 12+ Lunar New Year food events and specials at D-FW restaurants, French bistro La Parisienne to open at The Star in Frisco, New Chick-fil-A opens in downtown Dallas this week, La Casita has become one of the biggest bakeries in D-FW, and its just getting started, New legislative push begins to end Confederate Heroes Day as an official Texas holiday, Dallas Cowboys signing kicker Tristan Vizcaino to practice squad, Dallas ranked among the most congested cities in the U.S. as work from home is phased out, Tax relief, border security, state worker pay raises among Texas Houses top wishes, The Dallas Morning News 2022 All-area teams, football awards and more, Prime Prosper corner just north of Universals future Frisco theme park hits the market, 5 things to know about Brett Maher, Cowboys kicking situation, New Frisco shopping center is moving ahead with developer funding. In 2019, amounts represent certain non-recurring transition costs associated with the acquisition of Jack Wolfskin, including consulting costs, audit fees and travel expenses, in addition to other non-recurring advisory fees. Itll be fun to see how creative Callaway gets in an attempt to funnel recreational driving range visitors into legitimate customers for their existing brand. Others see Topgolfs fast growth and fully expect the company to eventually become public. Anderson would not disclose any company financial information or the cost of building Topgolf venues, but building between seven and 10 new venues annually would require a hefty dose of capital. (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. It starts with the fact that the millennial audience is largely focused on experiences, Horne said. Upon completion of the merger, Callaway shareholders will own approximately 51.5% and Topgolf shareholders (excluding Callaway) will own approximately 48.5% of the combined company on a fully diluted basis. Callaway, Topgolf, and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Callaway in connection with the proposed transaction. Accordingly, we have not provided a further reconciliation of EBITDAS to GAAP net income. What do legacy golf companies like Callaway plan to do about it? Kyle Arnold. A resurgence in corporate events business drove most of the same venue sales positive surprise in Q4, explained Callaway President and offers FT membership to read for free. Calloway's stock is at the same price as it was in 1998. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. This combination unites proven leaders with a shared passion for delivering exceptional golf experiences for all from elite touring professionals to new and aspiring entrants to the game. Goldman Sachs & Co. LLC served as the financial advisor to Callaway and Latham & Watkins LLP served as legal counsel. Looking for a great beer for Sunday through Thursday nights? 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 Weve long seen the value in Topgolf and we are confident that together, we can create a larger, higher growth, technology-enabled global golf and entertainment leader. invrelations@callawaygolf.com, For Topgolf: For a valuation method, I used EBITDA trading multiples from a collection of companies that I believe best competes in this entertainment industry that Topgolf truly specializes in. Topgolf now has 38 U.S. and three overseas venues where customers can hit chip-embedded balls at high-tech driving range targets in a lounge-like atmosphere, complete with DJs and drink specials. The foregoing list is not exhaustive. 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