Callaway calls Brewer’s number
Monday, March 12, 2012
Beating rivals and generating buzz among fans.
Those are the self-proclaimed top priorities for Chip Brewer, sounding much like a college football coach who just landed his dream job. But he’ll be tackling such tasks as the newly appointed president and CEO of Callaway Golf Co.
The gridiron comparison is apropos because Callaway, not unlike a blue-chip program that has lost its dominance, is turning to Brewer to rejuvenate its fortunes. After an eight-month search, Callaway’s board of directors announced Feb. 27 the hiring of Brewer, who led an impressive turnaround of Adams Golf since becoming its CEO in 2002.
For his part, Brewer acknowledged that he had envisioned, if not coveted, leading Callaway one day.
“Since having some success at Adams, I have been fortunate enough to be in the consideration set for other top jobs,” said Brewer, 48, who was expected to begin his tenure with the Carlsbad, Calif.-based equipment maker March 5. “However, for many reasons this was always the one that I found most appealing, and it is probably the only one that could have made me leave Adams.”
Though he’ll inherit one of the most iconic brands in golf, Brewer takes over a company far removed from its heyday. Callaway’s once-dominant market-share position has been usurped by rivals – most notably TaylorMade. Callaway, which last eclipsed $1 billion in annual revenue in 2008, has seen sales trend downward, with net losses each year since. For 2011, Callaway reported sales of $886.5 million and a net loss of $171.8 million.
Retailers and industry observers, however, maintain that Callaway has continued to make high-performance products, and that its miscues have come more on the marketing front. Aside from insufficient spending, some critics say Callaway’s brand messaging in recent years hasn’t resonated with consumers.
“Chip knows how to grind out gains in market share, and that’s what you have to do in this business,” said Casey Alexander, special-situations analyst for Gilford Securities.
Brewer’s departure for Callaway, in turn, prompted Adams Golf to appoint company founder Barney Adams as interim CEO. The Plano, Texas-based business previously had retained investment bank Morgan Stanley to evaluate future options, including a possible sale of the company. Barney Adams said it would be premature to discuss any long-term decisions until Morgan Stanley completed its assignment.
Meanwhile, Brewer declined to comment about specific initiatives he planned to pursue at Callaway, but made clear the status quo is unacceptable.
“Over the last 10 years, I’ve gotten my competitive juices flowing via building a great team, helping that team turn around Adams Golf and working with them to build shareholder value via gaining market share,” he said. “I really look forward to doing that same thing at Callaway, but this time on a bigger stage and with significantly more resources.”