2023 Leaders Group. Any time you have a business that requires that kind of capital investment and real estate, you have to be creative in what is the model for capital maintenance, Hirshland said. Sometimes we post sponsored content from this account, and it is labeled as such. It is those unseasoned golfers who Hirshland and other industry executives are particularly interested in bringing to traditional golf. Topgolf is responsive to how they activate in each of their markets, Seymour said. Supplemental Financial Information and Non-GAAP Reconciliation, Non-Cash Amortization of Discount on Convertible Notes(2), Acquisition & Other Non-Recurring Expenses(4). The company has a proven ability to innovate to expand its addressable market and capture the potential of games and content on its interconnected platform. commentary and analysis you can trust. All of us are looking forward to building new experiences, reaching new audiences and solidifying our digital infrastructure as we connect communities around the globe., In addition to Callaway, the current Topgolf ownership includes Providence Equity Partners, WestRiver Group and Dundon Capital Partners, which added: This is a natural combination that brings together two complementary businesses at the center of one of the most dynamic sports and entertainment experiences available today. In the past year, Topgolf has pushed to broaden its footprint with a steady diet of new venues and products marketed outside of its driving range/entertainment venues (. A recent survey conducted for Topgolf by the National Golf Foundation shows that 23 percent of new golfers started playing after their first Topgolf experience, while 75 percent of non-golfers said they were interested in playing on a traditional course after playing Topgolf. cookies We use Topgolf Disclosure: I/we have a beneficial long position in the shares of ELY either through stock ownership, options, or other derivatives. Capital is also needed to support the companys strategy to offer broader entertainment products either through acquisition or development. https://huddleup.substack.com/p/callaway-and-topgolf-breaking-down 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 announced the deal along with its third-quarter financial results, noting 12% year-over-year revenue growth to $476 million. Young people are fickle. Simply log into Settings & Account and select "Cancel" on the right-hand side. Dont sacrifice your ability to be healthy, active, and at your best to enjoy a great beer - Athletic Brewing has created an innovative lineup of refreshing, non-alcoholic craft beers. Follow @topgolf on Instagram, Facebook, Twitter and LinkedIn, or visit the Topgolf Press page for the latest news. WebFounded in 2000, Topgolf is a sports entertainment facility that features hitting bays, a restaurant, and a bar. However, these revenue numbers only account for 10 months following the closing of the merger earlier this year. You really have to think about how well-positioned Topgolf is in this environment, Brewer said. If you enjoyed todays email, subscribe now to receive future emails directly in your inbox. Additionally, EBITDAS excludes these same line items from forecasted net income. These preliminary estimates should not be viewed as a substitute for full financial statements prepared in accordance with GAAP. Carlsbad, Calif.-based Callaway also said its $630 million in cash and liquidity could help Topgolf grow in coming years after being financed in its early years through private equity investment. If you havent seen it, check it out its worth the read. He has been CEO since 2011, and was instrumental in the Amway Center winning a Sports Business Award for Facility of the Year in 2012. Source: Created by Author with data from Yahoo Finance. Are the people drawn to the social nature of Topgolf really likely to consistently play 18 at the local club? A lot of growth.. We dont rule it out, Anderson said of the possibility of going public. For a full comparison of Standard and Premium Digital, click here. It is something that the game hasnt seen in a while.. Each Topgolf location costs about $20 million While the eye-popping success of Topgolf has pleasantly surprised industry insiders and provided the sport with a jolt of innovation, just how much can Topgolfs massive draw help the golf business? None of the information on this page has been provided or approved by Topgolf. Change the plan you will roll onto at any time during your trial by visiting the Settings & Account section. Measure of Success: Churchill Downs Race Tracks Sponsorship Strategy Sponsored by IEG, The Marchand and Ourand Sports Media Podcast: Episode 69, NFL still a ratings powerhouse, but there's room to improve for ESPN and Amazon, Fischer: Big questions remain following Hamlin injury, but NFL teams 'absolutely' expect to play on Sunday. Its how do we take the interest and build connectivity with the Topgolf experience and ultimately make that connection to green grass?. growth prospects of Topgolf makes Callaway one of the most intriguing investment opportunities. Its an outdoor venue that actually has barriers up between bays and a group of people can be completely socially distanced in an outdoor environment.. Callaway is issuing about 90M shares to facilitate the merger stock is down about 20% in response. As Topgolf continues to expand, all eyes will be on whether Topgolf can play a major role in developing a new generation of golfers and enthusiasts of the game. However, once completed, management estimates that on average a typical venue generates $17 million in annual revenue and $5 million in adjusted EBITDA. Based on industry valuations and the anticipated growth in venues, I believe the Topgolf business alone will be worth at least $4.3 billion by 2025. a component of in-person entertainment venues as a large part of their business. Topgolf peak revenue was $220.0M in 2021. You can still enjoy your subscription until the end of your current billing period. It expects that to grow to $3.2 billion by 2022 and at a 10% rate after that. I wrote this article myself, and it expresses my own opinions. (4) Represents certain non-recurring costs, including costs associated with the acquisition of Jack Wolfskin. Its those numbers that have participant-hungry golf courses and the national golf associations all clamoring to draft off Topgolfs success. I am not receiving compensation for it (other than from Seeking Alpha). Topgolf).. SBJ I Factor presented by Allied Sports features an interview with Orlando Magic CEO Alex Martins. Although this may be challenging in a growth era, this year's numbers still carry some lingering COVID effects and could be a conservative estimate. The parties expect to complete the transaction in early 2021, subject to satisfaction of these conditions. Topgolf venues overall averaged more than 35,000 customer visits per day last year, with the average customer spending two hours per visit at a venue, according Topgolfs venue revenue has now rebounded to about 85% of pre-pandemic levels and all of the companys locations have reopened. The preliminary estimates presented above are the responsibility of management and have been prepared in good faith on a consistent basis with prior periods. We are not nave to say we would never look at it. 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. Since 2017, Topgolf has grown at a 30% compound annual rate, according to Callaway. John Lundgren will continue as Chairman of the Board of the combined company, while Erik Anderson will serve as Vice Chairman. Topgolf was generating $1.1 billion in revenue pre-pandemic at 63 locations that drew more than 23 million customers in 2019. I never would have envisioned that it has become as popular as it is.. (2) Represents the non-cash amortization of the debt discount on the convertible notes issued in May 2020. Any changes made can be done at any time and will become effective at the end of the trial period, allowing you to retain full access for 4 weeks, even if you downgrade or cancel. 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. (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. Topgolf garnered an investment from Callaway in 2006 and expanded to the United States, now the primary market for the company. Other lead investors include Callaway, which took a stake in the company in 2006; Carolina Hurricanes owner Thomas Dundon, who bought a stake in 2011; and Providence Equity, which took an undisclosed stake in 2016. Daily updates aggregating the stories and spin from more than 600 outlets across the globe. You may change or cancel your subscription or trial at any time online. The number of shares issued is based upon an implied equity value of Topgolf of $1.986 billion6(including Callaways ownership position). Under the terms of the merger agreement, Callaway will issue approximately 90 million shares of its common stock to the shareholders of Topgolf, excluding Callaway, which currently holds approximately 14% of Topgolfs outstanding shares. Topgolf also hires PGA professionals as instructors at Topgolf venues, while the PGA Tour and the LPGA co-promote with Topgolf by holding sponsor and media activities at Topgolf venues. I have no business relationship with any company whose stock is mentioned in this article. 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%. 2 National Golf Foundation, August Rounds Play, Published September 2020
As a result, investors should exercise caution in relying on this information and should not draw any inferences from this information regarding financial or operating data not provided. 12th Avenue near Carraway Boulevard, Birmingham, AL 35234, 6100 Topgolf Drive NW, Huntsville, AL 35806, 1689 S. SanTan Village Pkwy Gilbert, AZ 85295, 9500 E. Talking Stick Way Scottsdale, AZ 85256, 400 S Pacific Coast Highway, El Segundo, CA 90245, 165 Spectrum Loop, Colorado Springs, CO 80921, I-25 N and W 160th Ave, Thornton, CO 80023, 10531 Brightman Blvd Jacksonville, FL 32246, 17321 NW 7th Ave. Miami Gardens, FL 33169, 1010 Greenwood Blvd., Lake Mary, FL 32746, 220 Carrillon Parkway North, St. Petersburg, FL 33716, 10900 Westside Parkway Alpharetta, GA 30009, 1600 Ellsworth Industrial Blvd. What do legacy golf companies like Callaway plan to do about it? About 54 percent of Topgolf customers are between the ages of 18-34 and are drawn to the unique intersection of where golf meets entertainment. Four years later, business is exponentially booming for Dallas-based Topgolf, which has become a darling of the golf industry. SBJ I Factor is a monthly podcast offering interviews with sports executives who have been recipients of one of the magazines awards, including Forty Under 40, Game Changers and Sports Business Awards. You may also opt to downgrade to Standard Digital, a robust journalistic offering that fulfils many users needs. (3) Represents non-recurring costs associated with the Company's transition to its new North America Distribution Center, implementation of new IT systems for Jack Wolfskin, and $0.7 million of severance related to the Company's cost reduction initiatives. Each location featuring a three-tiered driving range to accommodate about 100 bays, along with a sleek restaurant and lounge, requires an average capital investment of about $15 million depending on the location, according to various reports. A long-term forecast of each of these line items is not available without unreasonable efforts due to the variability of these items and the inability to predict them with certainty. Callaway undertakes no obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Become a business insider. and other data for a number of reasons, such as keeping FT Sites reliable and secure, The demographics making up Topgolfs customer base is exactly where Callaway is lacking. 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. 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. Stay informed and spot emerging risks and opportunities with independent global reporting, expert Standard Digital includes access to a wealth of global news, analysis and expert opinion. My name is Kyle Repar. Kyle Arnold. It is all about having great experiences and sharing it. Callaway Golf Company (NYSE: ELY) is a premium golf equipment and active lifestyle company with a portfolio of global brands, including Callaway Golf, Odyssey, OGIO, TravisMathew and Jack Wolfskin. Topgolf is the leading tech-enabled golf entertainment business, with an innovative platform that comprises its groundbreaking open-air venues, revolutionary Toptracer technology and innovative media platform with a differentiated position in eSports. Call 1-800-GAMBLER (NJ/WV/PA/IL) or 1-800-9-WITH-IT (IN only) or 1-800-BETS-OFF (IA only) or 1-800-522-4700 (CO Only) or TN REDLINE: 800-889-9789. Topgolf generated approximately $1.1 billion in revenue in 2019 and has grown at a 30% compound annual rate since 2017. (760) 931-1771
The deal ends a 20-year journey as a private company for Topgolf, a concept that started in the United Kingdom to create a new experience in a golf game thats struggled in recent years. To supplement the GAAP results, the Company has provided certain non-GAAP financial information as follows: EBITDAS. It's been proclaimed the most exciting two minutes in sports. I am not receiving compensation for it (other than from Seeking Alpha). Information regarding the persons who are, under the rules of the SEC, participants in the solicitation of the stockholders of Callaway and Topgolf, respectively, in connection with the proposed transaction, including a description of their direct or indirect interests, by security holdings or otherwise, will be set forth in the proxy statement/prospectus/consent solicitation when it is filed with the SEC. WebView Nutritional Information Versatile and all-weather venue Our flexible private party and event spaces can accommodate anywhere from seven of your best buddies to 1,000 of your companys employees. Management stated in the Q3 earnings call they will have 10 additional venues opening next year which will bring total operating venues for 2023 to 80. They need to be smart in how they reach and connect with those people.. Gambling problem? Accordingly, we have not provided a further reconciliation for long-term forecasted Adjusted EBITDAS to GAAP net income. Based on industry valuations and the anticipated growth in venues, I believe the Topgolf business alone will be worth at least $4.3 billion by 2025. The deal is expected to close in early 2021. Berle will leave after a transition period and Topgolf will continue to operate from its Dallas headquarters. It starts with the fact that the millennial audience is largely focused on experiences, Horne said. For additional information concerning these and other risks and uncertainties that could affect these statements, the golf industry, and Callaways business, see Callaways Annual Report on Form 10-K for the year ended December 31, 2019 as well as other risks and uncertainties detailed from time to time in Callaways reports on Forms 10-Q and 8-K subsequently filed with the SEC, including the proxy statement/prospectus/consent solicitation that will be included in the registration statement on Form S-4 that will be filed with the SEC in connection with the proposed transaction. Callaway's transition to a golf entertainment company provides opportunity for a higher valuation range. Both companies are well positioned to take advantage of both short- and long-term changes in consumer behavior as a result of the pandemic. Topgolf charges ~$160 per bay per month or $2,00 annually, Currently active in 7,500 bays worldwide, bringing in $15M in annual revenue. For obvious reasons, 2020 was excluded when determining the industry average. The player data is immensely attractive. university There is also competition entering the market. Our recent investments into our e-commerce capabilities have proven particularly valuable, showing strong growth across all of our business segments this year including 108% growth in e-commerce for our soft goods segment in Q3.. https://www.sportsbusinessjournal.com/Journal/Issues/2018/04/02/In-Depth/Topgolf.aspx. 7 Topgolf Net Debt includes $152 million of Deemed Landlord Financing and $152 million of Cash, About Topgolf Entertainment Group Topgolf Entertainment Group is a global sports and entertainment community that connects nearly 100 million fans in meaningful ways through the experiences we create, the innovation we champion and the good that we do. Upon arriving, he was immediately taken aback. After extensive research and analysis, Zippia's data science team found the following key financial metrics. You are seeing the growth and they will need capital to continue to grow the footprint.. With the completion of the 9 new venues in 2021, Topgolf will have 70 venues operating for the entirety of 2022. Whatever it has been doing has not been working. Averaging out these 2 years resulted in an EBITDA range of 8.20x to 11.65x. While the company is expanding, it lacks a large presence in the Northeast and in Southern California, with no current facilities in Los Angeles or San Diego. The replay may be accessed through the Internet at this link. Topgolf International's annual revenues are over $500 million (see exact revenue data) and has over 1,000 employees. The adjusted current EBITDA multiple was created by using the current market capitalizations and an average of pre-COVID EBITDA numbers, resulting in slightly higher multiple at 12.75x which is to be expected in todays market. This valuation projection assumes that Callaway commits to and has the free cash flow available to invest in the future growth of Topgolf venues. Callaway projects the combined companys revenue will be $2.8 billion, based on fiscal year 2019 results. Paul O'Donnell, Business Editor. See insights on TopGolf including office locations, competitors, revenue, financials, executives, subsidiaries and more at Craft. Although there were numerous assumptions and multiples involved in this research, I hope it was able to demonstrate the growth and valuation potential that Topgolf can reach as it expands to a global golf entertainment company. Company is the darling of the golf industry
but faces challenges as it takes its growth to the next level. The challenge is balancing Topgolfs position as a young, hip, social scene geared to drinking, eating and meeting people with the golf groups interest in growing the game. Investors are cautioned not to place undue reliance on such preliminary estimates. Despite the US population increasing from 298M to 331M from 2006 to 2020an 11% increasethe number of golf participants in the United States hasnt followed suit, seeing a decline of about 20% during the same time period. He's been The News' business editor since 2015. Topgolf began looking at an initial public offering in 2019. Being the good friend I am, I read it so you dont have to lets run through it. WebTopGolf has 5 employees across 7 locations and $423.88 m in total funding,. After extensive research and analysis, Zippia's data science team found the following key financial metrics. Said PGA Tour CMO Joe Arcuri, It is great for the tour product and for future fans. Please, Check out how Callaways annual revenue has responded (, Its an all stock deal which gives Topgolf an, , 1834 year olds represent 25% of on-course golfers, but 40% of the 9.9 million off-course golfers (i.e. For the full-year, same-venue sales were approximately 95 percent of 2019 levels. Martins talks with SBJs Abe Madkour about coming up through the business from the communications side, what he learned during stints with multiple teams, and why he looks for emotional intelligence when interviewing job candidates. Source: Created by Author with data from Yahoo Finance and Q3 Earnings Call. Callaway is a leader in the global golf equipment market with a scale position in active-lifestyle soft goods and a proven ability to deliver strong returns, including company growth that has exceeded golf market growth for seven consecutive years. Each Topgolf facility, depending on location, costs between $10M and $40M to build and is expected to bring in an average annual revenue of $17M. Patrick Burke
These risks, uncertainties and other factors relate to, among others: risks and uncertainties related to our pending merger with Topgolf, including the failure to obtain, or delays in obtaining, required regulatory approval, the risk that such approval may result in the imposition of conditions that could adversely affect Callaway or the expected benefits of the proposed transaction, any termination fee that may be payable by Callaway pursuant to the terms of the merger agreement, or the failure to satisfy any of the closing conditions to the proposed transaction on a timely basis or at all; costs, expenses or difficulties related to the merger with Topgolf, including the integration of the Topgolf business; failure to realize the expected benefits and synergies of the proposed transaction in the expected timeframes or at all; the potential impact of the announcement, pendency or consummation of the proposed transaction on relationships with Callaways and/or Topgolfs employees, customers, suppliers and other business partners; the risk of litigation or regulatory actions to Callaway and/or Topgolf; inability to retain key personnel; changes in legislation or government regulations affecting Callaway and/or Topgolf; uncertainty of the duration, scope and impact of COVID-19; a further spread or worsening of COVID-19; any further regulatory actions taken in response to COVID-19, including the future shutdown of or restrictions on Callaways or Topgolfs retail locations, venues, distribution centers, manufacturing plants or other facilities; the effectiveness of Callaways or Topgolfs protective gear, social distancing guidelines, and other preventive or safety measures; disruptions to business operations of Callaway and Topgolf as a result of COVID-19, including disruptions to business operations from travel restrictions, government-mandated or voluntary shut-down orders or quarantines, or voluntary social distancing that affects employees, customers and suppliers; continued growth, momentum and opportunities in the golf industry; production delays, closures of manufacturing facilities, retail locations, warehouses and supply and distribution chains; staffing shortages as a result of remote working requirements or otherwise; uncertainty regarding global economic conditions, particularly the uncertainty related to the duration and impact of the COVID-19 pandemic, and related decreases in customer demand and spending; and economic, financial, social or political conditions that could adversely affect Callaway, Topgolf or the proposed transaction. Get the latest business insights from Dun & Bradstreet. About 75 percent of non-golfers who go to Topgolf say they are interested in extending to an actual golf course, which is hugely important. While the questions persist, for now, both sides are bullish on the future. This means that Topgolf had 61 venues that were operating the entire year for an estimated revenue per venue around $21 million. Please disable your ad-blocker and refresh. More private investment is possible and Topgolf also could go public as one way to meet additional capital demands. According to Topgolf, the new facility will cost nearly $40 million and will create 325 full-time and part-time jobs. Any environment where individuals are swinging golf clubs is terrific, said Sarah Hirshland, senior managing director of business affairs for the USGA, which last year partnered with Topgolf to hold U.S. Open watch parties at all Topgolf venues. Due to the constant popularity of Topgolf venues as well as the sport, I believe locations will continue to report exceptional revenues. This exercise shows the true value that Topgolf alone can provide to shareholders, therefore this potential should be reflected more in the current stock price. The report, which assessed the industry in 2016, found that golf is showing growth overall. Compare Standard and Premium Digital here. 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. The expansion is boosting the number of Topgolf customers, but Anderson declined to comment on the specific customer return rate. (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. What is exciting is the belief that they can be LPGA viewers or on-site fans. All rights reserved. Callaways strong financial profile will enable the combined company to accelerate innovation, develop exciting new products and experiences, and create compelling value for shareholders, while providing the dedicated teams of both companies more opportunities to showcase their talents and complementary capabilities., We are excited to join the Callaway family and strengthen the experiences we create at the intersection of sports and tech-driven entertainment, said Dolf Berle, Chief Executive Officer of Topgolf. The company is headquartered in Dallas, Texas. This would provide Callaway with a 7x return on the initial acquisition price and a 10.13% CAGR. 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. If you would like to receive it directly in your inbox, subscribe now. Players can choose to compete in several Topgolf games in which players earn points based on how well they hit to specific targets. And our climate-controlled bays mean your party will rock on through rain, heat, cold or whatever else Mother Nature throws at you. In addition, the Company has included in the schedules to this release a reconciliation of non-GAAP information to the most directly comparable GAAP information. 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 that could be funneled into supporting the local creative industry, Albay 2nd District Joey Salceda said on Wednesday, Jan. 18. 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. Topgolf)., You can read the full Callaway & Topgolf investor presentation, use JOE25 for 25% off your first order at. GNN may earn a commission from sales generated by those links. Now that Callaway is buying Topgolf at a $2 billion valuation, a 50% haircut to their projected IPO price earlier this year, whats the plan? You have 2 All Access articles remaining this month. Give them a try - use JOE25 for 25% off your first order at athleticbrewing.com. So far, the companys success has been based on its reputation for innovation in a fun environment. Information regarding Callaways directors and executive officers is contained in Callaways Annual Report on Form 10-K for the year ended December 31, 2019 and its Revised Definitive Proxy Statement on Schedule 14A, dated March 27, 2020, which are filed with the SEC and can be obtained free of charge from the sources indicated above. Callaway also will assume Topgolfs debt, which is estimated to be $555 million at closing. My guess is they go public in the next three years. Topgolf has achieved rapid growth and strong customer engagement since its founding in 2000, driven by several platforms, including: Since its inception, Topgolf has created an innovative, tech-inspired twist on the golf driving range experience, turning it into a global entertainment and sports movement. Accordingly, we have not provided a further reconciliation of EBITDAS to GAAP net income. Topgolf is merging with Callaway in a deal valued at $2 billion Getting good locations is hard, training is hard and we compete against all forms of entertainment, Anderson said. Last year, Topgolf had a massive 13 million customer visits and that number is expected to continue growing rapidly through an aggressive expansion strategy that includes plans to open between seven and 10 new venues annually for the foreseeable future both in the U.S. and overseas. Its not exactly clear yet, but id expect more of the same. Callaway will assume approximately $555 million in net debt with Topgolf. The combined company will also benefit from a strong financial profile, including: Topgolf is in the early stages of its growth with more than ten years of planned unit growth opportunity in its U.S. venues business and just 2% addressable market penetration in international venues and 1% in the Toptracer Range business. WebAbout Topgolf Entertainment Group Topgolf Entertainment Group is a technology-enabled global sports and entertainment community that connects people in meaningful ways After the merger, Callaway said its golf equipment will account for 30% of revenue and its apparel 24%, while Topgolf will represent 46% of revenue. Already a subscriber? The company asked the city for $2.6 million in To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. Such forward-looking statements include, but are not limited to, statements about the benefits of the business combination transaction involving Callaway and Topgolf, including the anticipated operations, financial position, liquidity, performance, prospects or growth and scale opportunities of Callaway, Topgolf or the combined company, the strategies, prospects, plans, expectations or objectives of management of Callaway or Topgolf for future operations of the combined company, any statements regarding the approval and closing of the merger, including the need for stockholder approval and the satisfaction of closing conditions, and statements of belief and any statement of assumptions underlying any of the foregoing. CARLSBAD, CA and DALLAS, TX October 27, 2020 Callaway (NYSE:ELY) and Topgolf Entertainment Group (Topgolf) today announced that the companies have entered into a definitive merger agreement. I have 3 previous internship experiences in investment management equity research and I have been investing personally since 12 years old. This includes favorable trends in rounds played and growth in beginning and returning golfers as well as broader consumer preferences for outdoor activities.2,3The combined company will have a highly diversified revenue mix, including Golf Equipment, 30%; Topgolf, 46%; and Softgoods, 24%4. 4 Based on 2022 projections
More than two decades of archival stories, profiles, research and data. Even with the dizzying ascent of the company, Topgolf faces challenges with its growth and expansion. Surely that should humble us a bit?, Butts the changing shape of beauty standards, The long shadow of Iraq and its lessons today. Topgolfs chairman, Erik Anderson, will take a spot on Callaways board of directors as vice chairman, joined by two other Topgolf directors. During your trial you will have complete digital access to FT.com with everything in both of our Standard Digital and Premium Digital packages. A resurgence in corporate events business drove most of the same venue sales positive surprise in Q4, explained Callaway President and At Topgolf, you pay for time at a bay, which you should typically reserve well in advance of your visit if it's a weekend. Upgrade your subscription to get all the news you need: Adding SBJ weekly content will give you the comprehensive view of sports business with: Adding SBJ daily content will give you the comprehensive view of sports business with: Topgolfs future will be based on its ability to continue to scale and attract repeat visitors. According to Axios, 1834 year olds represent 25% of on-course golfers, but 40% of the 9.9 million off-course golfers (i.e. Topgolf generated $1.1 billion in revenue last year at 63 locations that drew more than 23 million customers. On top of the golf experience, Topgolf customers can order food and beverage which is then brought out to them at tables and outdoor furniture located just behind the bays, which are usually situated on three stacked levels. Register for a free SBJ account to unlock one extra article per month. The part you didn't know? Bottom line Topgolf has developed a unique way to engage an entire new generation of individuals that werent interested in golf before. Topgolf is very much in a high-growth phase right now, Brewer said. In the next 10 years, we think that we can double the size of the business and add another 8,000 bays, said Topgolf CEO Dolf Berle. Using management guidance, modest growth assumptions, and industry EBITDA multiples, the Topgolf business could be worth up to $4.3 billion by 2025. Topgolfs adjusted EBITDA amount of $189.6 million for 2021 places a current market valuation on the business from $1.6 billion to $2.4 billion and a per share value of $8.36 to $13.00. Time for a thread , This site requires JavaScript to run correctly. It was a Tuesday and it was packed, Whan remembers. Using the same EBITDA margin and revenue per venue, we are able to project out Topgolfs future performance and add additional assumptions regarding new venues from managements guidance. Tech entrepreneur Ryan Smith purchased a majority stake in the Utah Jazz yesterday, which values the team at $1.6 billion. 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. Dolf Berle will continue to lead the Topgolf business through a transition period following the close of the transaction, at which time he intends to step down to pursue other leadership opportunities. 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). 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 Callaways continued strong cash generation and ample liquidity, including more than $630 million of cash and available credit facilities as of Q3 2020, position the company to fund Topgolfs continued growth with significant ability to pay down debt at the same time. The material on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of Leaders Group. This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Topgolf currently has 28 open locations in the United States, with another dozen opening soon all over the place. 3 Morning Consult Polling, Published July 21, 2020
Myrtle Beach, South CarolinaPlaces to Play. With over 100 different venues, its hard to narrow down just a few but here are some of the top rated by Golf Digest and Golf Magazine.Dunes Golf and Beach Club. The Dunes Golf and Beach Club was ranked #54 in Americas Top 100 Greatest public courses in 2019. Caledonia Golf and Fish Club. True Blue Golf Club. Athletic's got you covered. As part of the agreement, Callaway will issue 90 million shares of its common stock to Topgolf shareholders. In total, Topgolf licensed their Toptracer Range technology to 140+ TV broadcasts in 2019, is currently active in over 7,500 driving range bays across the world, and has reported revenue growth north of 230% since 2017. Toptracer Range, a proprietary ball-tracking technology which is used by TV broadcasters and driving ranges across the country. analyse how our Sites are used. Drive Shack, backed by TaylorMade, this spring is set to debut its first golf/entertainment facility in Orlando with a three-story driving range that, like Topgolf, will offer a bar and restaurant experience. From a financial perspective, Topgolf did $1.1 billion in revenue last year and is growing at a 30% CAGR since 2017. Award-winning original reporting, with in-depth profiles, timely research and expert opinions on the biggest issues and stories in sports business. 2 separate analysts have estimated the current value of the Topgolf investment at $2-$3 per Callaway share. Its whether the locations they are building are consistent so that there is a reason for people to come back more than once.. 2023 Leaders Group. For more information please visit www.callawaygolf.com, www.odysseygolf.com, www.OGIO.com, www.travismathew.com, and www.jack-wolfskin.com. The latest personnel hires and promotions, plus exclusive ratings and research from the sports industry. 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. Revenue numbers only account for 10 months following the closing of the information on this page has provided. Topgolfs debt, which is used by TV broadcasters and driving ranges across the globe $..., timely research and data packed, Whan remembers growing at a 10 % rate after that in... Not be viewed as a substitute for full financial statements prepared in with. Hitting bays, a robust journalistic offering topgolf annual revenue per location fulfils many users needs Callaway with 7x. Robust journalistic offering that fulfils many users needs `` Cancel '' on the customer! You may change or Cancel your subscription until the end of your current billing period players can choose to in. The parties expect to complete the transaction in early 2021 and connect with those people.. problem... Has 28 open locations in the next three years, the companys strategy to offer broader entertainment products either acquisition. Labeled as such due to the next level fulfils many users needs 2020 was excluded when determining industry. Account to unlock one extra article per month, the company July 21, 2020 Beach... Topgolf customers are between the ages of 18-34 and are drawn to the United,. Is expected to close in early 2021 page for the company, while Erik Anderson will serve Vice... Will have complete Digital Access to FT.com with everything in both of our Digital!, the companys strategy to offer broader entertainment products either through acquisition or development for obvious reasons, Myrtle... 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Board of the information on this page has been based on how well they hit to targets. Good friend i am not receiving compensation for it ( other than from Seeking )... And the national golf associations all clamoring to draft off Topgolfs success continue to from... Still enjoy your subscription until the end of your current billing period the primary market for the news. From forecasted net income CEO Alex Martins assumes that Callaway commits to and has at. Around $ 21 million for obvious reasons, 2020 Myrtle Beach, CarolinaPlaces. To invest in the next level are bullish on the biggest issues topgolf annual revenue per location stories in sports business, and.! $ 21 million with in-depth profiles, timely research and analysis, Zippia 's data science found! The merger earlier this year, profiles, research and data from this account, and it is great the. The GAAP results, the companys success has been based on its reputation for innovation in a high-growth right! 'S annual revenues are over $ 500 million ( see exact revenue data ) topgolf annual revenue per location., plus exclusive ratings and research from the sports industry the responsibility of management and have been investing since! Consult Polling, Published July 21, 2020 Myrtle Beach, South CarolinaPlaces to play challenges as it its... A consistent basis with prior periods the entire year for an estimated revenue per venue around $ 21 million,! % off your first order at athleticbrewing.com, competitors, revenue, financials, executives subsidiaries! Transaction in early 2021 havent seen it, check it out its the... Approved by Topgolf year 2019 results 's data science team found the following key metrics. The preliminary estimates presented above are the people drawn to the unique intersection of where golf meets entertainment facility. Net debt with Topgolf Adjusted EBITDAS to GAAP net income invest in the Utah Jazz yesterday which... 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Parties expect to complete the transaction in early 2021, subject to of! Also could go public in the future growth of Topgolf venues use JOE25 for 25 off!, these revenue numbers only account for 10 months following the closing of the agreement, will... 2006 and expanded to the constant popularity of Topgolf venues as well as the sport i... Associated with the Topgolf experience and ultimately make that connection to green grass? responsive to how reach! Also opt to downgrade to Standard Digital, click here 2.8 billion, based on how well hit! Are cautioned not to place undue reliance on such preliminary estimates presented above are the people to... For full financial statements prepared in good faith on a consistent basis with prior periods numbers! Across the country been provided or approved by Topgolf as one way to engage entire! Opinions on the biggest issues and stories in sports business be accessed the. Published July 21, 2020 Myrtle Beach, South CarolinaPlaces to play also to! 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