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Mar 31, 2023
Topgolf Callaway Q1 2023 Earnings Report
Topgolf Callaway Brands' Q1 2023 results exceeded expectations with strong revenue growth and improved profitability.
Key Takeaways
Topgolf Callaway Brands reported better-than-expected financial results for the first quarter of 2023. Net revenues increased by 12.2%, driven by growth in Topgolf and Active Lifestyle segments. The company remains on track to be free cash flow positive by the end of the year and has increased its full-year revenue and Adjusted EBITDA guidance.
Q1 2023 revenue and Adjusted EBITDA exceeded expectations.
Topgolf delivered same venue sales growth of 11% compared to Q1 2022, marking six consecutive quarters of reported same venue sales growth.
Topgolf venue profitability and return metrics are improving versus the Company’s previously disclosed long-term targets.
Completed debt refinancing, resulting in lower cost of debt, extended debt maturities, improved liquidity and a more unified and simplified financial structure.
Topgolf Callaway
Topgolf Callaway
Topgolf Callaway Revenue by Segment
Topgolf Callaway Revenue by Geographic Location
Revenue by Segment
Topgolf Revenue
CapyFin.comGolf Equipment Revenue
CapyFin.comActive Lifestyle Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.comEurope Revenue
CapyFin.comAsia Revenue
CapyFin.comRest of World Revenue
CapyFin.com Forward Guidance
The company provided its 2023 outlook, estimating consolidated net revenues between $4,420 million and $4,470 million, Topgolf revenue of approximately $1,900 million, consolidated Adjusted EBITDA between $625 million and $640 million, and Non-GAAP diluted earnings per share between $0.63 and $0.69.
Positive Outlook
- Company remains on track to be free cash flow positive by end of year
- Increased midpoint of full year 2023 revenue guidance
- Improved operational efficiencies at existing Topgolf venues
- Contribution from newly opened Topgolf venues
- Successful Paradym launch
Challenges Ahead
- Negative impact from changes in foreign currency rates
- Increase in interest expense related to higher interest rates and increased interest related to new Topgolf venues
- Negative foreign currency translation impact on operating income
- Decrease in other income net hedge gains
- Inventory catch-up at retail in Q1 2022 that did not recur in Q1 2023
Revenue & Expenses
Visualization of income flow from segment revenue to net income