The American singer and actor Justin Timberlake has agreed to endorse and play with Callaway Golf equipment. Timberlake, who has a 6 handicap, hosts the Justin Timberlake Shriners Hospitals for Children Open, where he will use Callaway clubs, balls and bag. He is opening his own eco-friendly golf course in Memphis, Tennessee, next summer.
The unusual partnership with a well-known musician who appeals to the youth should be beneficial for Callaway, which is expecting its sales to have declined to about $213 million for the third quarter, down from $236 million in the same quarter last year. The company expects a loss per share of 12 cents to 14 cents, compared with earnings per share of 2 cents in 2007. This translates to a loss of $8.8 million compared with income of $1.3 million last year.
George Fellows, president and chief executive, said that what had started out as a record year was affected by the economic weakness throughout the globe, evidenced by lower sales both in the USA and outside the domestic market.
The gross margin for the quarter is expected to decrease by 2.5 percentage points, though this has been partially offset by gross margin initiatives. Callaway will release its final numbers for the period on Oct. 30. For the full year, the company is predicting sales of $1.125 billion to $1.145 billion, down from its previous estimate of $1.145 billion to $1.165 billion.
