Aldila CEO Peter Mathewson is rawboned and lanky, with a firm jaw and penetrating eyes.
In what has become an extremely competitive business – with graphite shaftmakers literally scattered around the globe – Mathewson, 56, has distinguished himself by engineering one of the golf industry’s most dramatic turnabouts.
“I admire him tremendously for what he has done,” said Chip Brewer, who, as CEO of club manufacturer Adams Golf, has orchestrated a corporate transformation of his own.
Named chairman and CEO in 2000, Mathewson, an executive with the company since 1990, assumed control during the worst of times.
When Aldila’s stock price dropped below $1 in the late 1990s, Mathewson didn’t flinch. Instead, he cut corporate overhead and positioned Aldila to catch lightning in a bottle, which it did in 2003 with the luminous green NV shaft.
Now, three years later, it is the best of times at Aldila.
On April 26, reporting on the first quarter of 2006, the company announced record net income of $4.3 million on sales of $20.8 million. By comparison, Aldila posted net income of $3.3 million and sales of $17.8 million in the same period a year ago. The stock price, in busting through the $35 barrier, also achieved a new high. (After the stock fell below $1, Mathewson and other directors implemented a 1-for-3 reverse stock split.)
“He has done a heck of a job in getting the company turned around from what looked disastrous four or five years ago,” said Casey Alexander, a special situations analyst with Gilford Securities in New York. “He did sort of inherit the worst part of the golf cycle. Aldila was in quite a precarious position.”
Founded in 1972 by San Diego businessman Jim Flood, who two decades later would start putter maker Odyssey, Aldila has been making graphite golf shafts longer than any U.S. manufacturer.
Mathewson has been with Aldila for all but one of the company’s 34 years. He started as a shipping clerk, then worked in purchasing and production before becoming plant manager. In 1990, he was named vice president of manufacturing. This set the stage for his ascension into upper management. He was named a director in 1997, president in 1998 and has been chairman and CEO for six years.
Aldila recently announced that it is building a new production plant near Ho Chi Minh City in Vietnam. Scheduled for completion in the first quarter of 2007, it will join existing facilities in Tijuana, Mexico, and Zhuhai, China.
The company sold about 6 million golf shafts in 2005. It also produces graphite hockey sticks and other composite products.
Aldila and Mitsubishi Rayon, the Japanese advanced materials company, are the only two graphite golf shaftmakers that are vertically integrated. This means they produce all three elements of the graphite manufacturing process – carbon fiber, prepreg and finished shafts.
Aldila’s carbon fiber plant is located in Evanston, Wyo., and is a joint venture with SGL Carbon, a German company.
To make a graphite shaft, strands of carbon fiber are joined together with resin and pressed into thin, solid sheets of prepreg. These sheets are cut into different patterns and wound around a mandrel. With pressure and heat, the prepreg is transformed into what golfers call graphite. When the mandrel is removed, the result is a hollow-core, lightweight golf shaft.
Graphite shafts range from about 40 grams to 130 grams. The lighter shafts are used in woods, the heavier ones in irons. A 40-gram driver shaft is about one-third the weight of the steel driver shaft that was used in the pre-graphite era. With less weight in the shaft, more weight is added to the head.
Aldila’s recent success can be attributed to two major factors.
One, the demand for carbon fiber has increased drastically, thanks largely to the renewed and seemingly insatiable appetite of the aeronautics industry.
More important, though, has been Aldila’s success with its NV line. The original green-colored NV was introduced in 2003, and its popularity has grown beyond anyone’s expectations.
“We knew it was a great shaft,” Mathewson said, “but we didn’t know it would have such a huge impact. It was one of those things where the stars were aligned. The timing was perfect.”
Ben Curtis used the shaft during his British Open victory in 2003, and NV was off and running.
“It’s been a great run for us,” said John Oldenburg, Aldila’s vice president of engineering and product development. “The demand hasn’t slowed down at all. I think this reflects the fact that we are a materials company and not just a golf shaft company.”
The NV platform is one Aldila of balance. “Better balance, more consistent,” said Oldenburg.
The NV features a straight taper from butt to tip. It is a stiff-tipped shaft that doesn’t necessarily feel stiff to golfers. The entire NV family includes four wood shafts – the original NV, the softer-tipped NVS, the touring pro-inspired NV ProtoPype, and the new VS Proto – along with the NV iron shaft and the VS Proto Hybrid shaft.
VS Proto is the name chosen for the extension of the NV line. All VS Proto shafts are made with ultra-strong carbon nano tubes incorporated in a new resin system. The wood shafts are available in 60, 70 and 80 grams, with the 80-gram shaft measuring barely more than 2 degrees of torque.
As a sign of these colorful times, Aldila is selling an unexpected number of pink NV wood shafts (available in 55 grams and 65 grams). The trend started with LPGA star Paula Creamer, who is paid by Aldila. She was using a green NV and quickly accepted the company’s invitation to switch to an NV in her trademark pink.
This sparked a demand among consumers.
“It is surprising how many men are using this shaft,” Mathewson said. “The whole NV story has been pretty amazing.”
Stock analyst Alexander reflected on this phenomenon: “The shaft business is sort of like shaft du jour. For the NV, or any shaft, to have this kind of legs is very unusual. Because of this, the company has been able to build up some significant amounts of cash.
“This will allow them to prepare for the inevitable, when they no longer have the shaft du jour.”