Adams Golf Announces Results for Second Quarter 2007

  
    
  
  
    
      Adams Golf (OTCBB:ADGO) today reported net sales of $30.4 million for 
      the second quarter ended June 30, 2007 as compared to $25.7 million in 
      the second quarter of 2006, a gain of 18%. The Company reported net 
      income of $2.5 million, or $0.10 per fully diluted share for the second 
      quarter ended June 30, 2007, as compared to net income of $1.8 million, 
      or $0.08 per fully diluted share for the comparable period of 2006.
    
    
      "We are pleased with our continued sales and earnings growth," stated 
      Mr. Chip Brewer, CEO and President of Adams Golf. "We continue to invest 
      in our leadership position in the hybrid iron set category, which we 
      believe will grow significantly in the months and years ahead. 
      Accordingly, we launched the Idea a3 hybrid iron sets and individual 
      hybrids at the end of the second quarter, and are pleased with the 
      initial customer feedback and sales results. Our individual hybrids have 
      maintained the #1 hybrid count on the combined professional men’s 
      tours (PGA, Champions and Nationwide) for the second quarter of 2007, 
      according to results from the Darrell Survey. We have won the hybrid 
      count at seven PGA Tour events since the beginning of the second 
      quarter. Adams Golf staff players have also won the last four Champion’s 
      Tour tournaments, including the U.S. Senior Open and the Senior British 
      Open. We continue to invest in our brand, our overall organization, 
      particularly our R&D group, and our positions on the competitive 
      professional tours, as we believe these investments position us for 
      continued growth."
    
    
      Adams Golf will host a conference call at 4:30 p.m. Eastern time on 
      Thursday, August 9th, 2007, with Chip Brewer, CEO and President, and 
      Eric Logan, Chief Financial Officer, to review Adams' 2007 second 
      quarter financial results. For telephone access to the conference call 
      dial [phone] or [phone] for international calls, and 
      request connection to the Adams Golf conference call. The conference ID 
      # is 12670983.
    
    
      This press release contains "forward-looking statements" made under the 
      "safe harbor" provisions of the Private Securities Litigation Reform Act 
      of 1995. The statements include, but are not limited to statements 
      regarding our ability to continue manufacturing products that are 
      commercially acceptable to consumers, statements which may imply past 
      performance as an indicator of future trends, and statements using 
      terminology such as "may," "will," "expect," "intend," "estimate," 
      "anticipate," "plan," "seek," “continued” 
      or "believe." Such statements reflect the current view of the Company 
      with respect to future events and are subject to certain risks, 
      uncertainties and assumptions related to certain factors including, 
      without limitation, the following: risks relating to product 
      development; risks that past performance may not be an accurate 
      indicator of future trends; risks that products may not meet with 
      approval and conform to governing body regulations; assembly 
      difficulties; competing product introductions; patent infringement 
      risks; uncertainty of the ability to protect intellectual property 
      rights; market demand and acceptance of products; the impact of changing 
      economic conditions; the success of our marketing strategy; our 
      dependence on a limited number of customers and suppliers; business 
      conditions in the golf industry; reliance on third parties, including 
      suppliers; the actions of competitors, including pricing, advertising 
      and product development risks concerning future technology; the 
      management of sales channels and re-distribution; and one-time events 
      and other factors detailed under "Risk Factors" in our Securities and 
      Exchange Commission filings. These filings can be obtained by visiting 
      the corporate governance section of our website at www.adamsgolf.com 
      or by contacting Adams Golf Investor Relations at [e-mail].
    
    
      Although the Company believes that the expectations reflected in such 
      forward-looking statements are reasonable, it can give no assurance that 
      such expectations will prove to be correct. Based upon changing 
      conditions, should any one or more of these risks or uncertainties 
      materialize, or should any underlying assumptions prove incorrect, 
      actual results may vary materially from those described herein. Except 
      as required by federal securities laws, Adams Golf undertakes no 
      obligation to publicly update or revise any written or oral 
      forward-looking statements, whether as a result of new information, 
      future events, changed circumstances or any other reason after the date 
      of this press release. All subsequent written and oral forward-looking 
      statements attributable to the Company or persons acting on its behalf 
      are expressly qualified in their entirety by the applicable cautionary 
      statements.
    
    
      
        
          
            ADAMS GOLF, INC. AND SUBSIDIARIES
          
          
            CONDENSED CONSOLIDATED BALANCE SHEETS
          
          
            (in thousands, except share amounts)
          
        
      
      
        
           
        
      
      
        
          ASSETS
        
      
      
        
        
        
        
        
          June 30,2007
        
        
        
        
          December 31,2006
        
      
      
        
        
        
        
        
          (unaudited)
        
        
        
        
        
      
      
        
          Current assets:
        
        
        
        
        
        
        
        
        
      
      
        
          Cash and cash equivalents
        
        
        
        
          $
        
        
          7,806
        
        
        
        
        
        
          $
        
        
          9,472
        
        
        
      
      
        
          
            Trade receivables, net of allowance for doubtful accounts of $709 
            (unaudited) and $702 in 2007 and 2006, respectively
          
        
        
        
        
        
        
          27,797
        
        
        
        
        
        
        
        
          13,553
        
        
        
      
      
        
          Inventories, net
        
        
        
        
        
        
          25,189
        
        
        
        
        
        
        
        
          24,651
        
        
        
      
      
        
          Prepaid expenses
        
        
        
        
        
        
          1,768
        
        
        
        
        
        
        
        
          686
        
        
        
      
      
        
          Other current assets
        
        
        
        
           
        
        
          1,398
        
        
           
        
        
        
        
           
        
        
          1,371
        
        
           
        
      
      
        
          Total current assets
        
        
        
        
        
        
          63,958
        
        
        
        
        
        
        
        
          49,733
        
        
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Property and equipment, net
        
        
        
        
        
        
          755
        
        
        
        
        
        
        
        
          719
        
        
        
      
      
        
          Deferred tax asset – non current
        
        
        
        
        
        
          4,052
        
        
        
        
        
        
        
        
          4,052
        
        
        
      
      
        
          Other assets, net
        
        
        
        
           
        
        
          1,407
        
        
           
        
        
        
        
           
        
        
          1,099
        
        
           
        
      
      
        
        
        
        
        
          $
        
        
          70,172
        
        
           
        
        
        
        
          $
        
        
          55,603
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          LIABILITIES AND STOCKHOLDERS' EQUITY
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Current liabilities:
        
        
        
        
        
        
        
        
        
      
      
        
          Accounts payable
        
        
        
        
          $
        
        
          10,607
        
        
        
        
        
        
          $
        
        
          6,271
        
        
        
      
      
        
          Accrued expenses
        
        
        
        
           
        
        
          10,531
        
        
           
        
        
        
        
           
        
        
          7,463
        
        
           
        
      
      
        
          Total liabilities
        
        
        
        
           
        
        
          21,138
        
        
           
        
        
        
        
           
        
        
          13,734
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Stockholders' equity:
        
        
        
        
        
        
        
        
        
      
      
        
          Preferred stock, $0.01 par value; authorized 5,000,000 shares; none 
          issued
        
        
        
        
        
        
          --
        
        
        
        
        
        
        
        
          --
        
        
        
      
      
        
          
            Common stock, $.001 par value; authorized 50,000,000 shares; 
            25,526,647 and 24,895,226 shares issued and 24,418,051 and 
            23,958,606 shares outstanding at June 30, 2007 (unaudited) and 
            December 31, 2006, respectively
          
        
        
        
        
        
        
          26
        
        
        
        
        
        
        
        
          25
        
        
        
      
      
        
          Additional paid-in capital
        
        
        
        
        
        
          91,160
        
        
        
        
        
        
        
        
          90,630
        
        
        
      
      
        
          Accumulated other comprehensive income
        
        
        
        
        
        
          1,594
        
        
        
        
        
        
        
        
          887
        
        
        
      
      
        
          Accumulated deficit
        
        
        
        
        
        
          (39,876
        
        
          )
        
        
        
        
        
        
          (46,147
        
        
          )
        
      
      
        
          
            Treasury stock, 1,108,596 and 936,627 common shares, at cost, at 
            June 30, 2007 (unaudited) and December 31, 2006, respectively
          
        
        
        
        
           
        
        
          (3,870
        
        
          )
        
        
        
        
           
        
        
          (3,526
        
        
          )
        
      
      
        
          Total stockholders' equity
        
        
        
        
           
        
        
          49,034
        
        
           
        
        
        
        
           
        
        
          41,869
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          $
        
        
          70,172
        
        
           
        
        
        
        
          $
        
        
          55,603
        
        
           
        
      
    
    
      
        
          
            ADAMS GOLF, INC. AND SUBSIDIARIES
          
          
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
          
          
            (in thousands, except per share amounts)
          
          
            (unaudited)
          
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          Three Months Ended
        
        
        
        
          Six Months Ended
        
      
      
        
        
        
        
        
          June 30,
        
        
        
        
          June 30,
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          2007
        
        
        
        
          2006
        
        
        
        
          2007
        
        
        
        
          2006
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net sales
        
        
        
        
          
            $
          
        
        
          
            30,403
          
        
        
        
        
        
        
          $
        
        
          25,733
        
        
        
        
        
        
          $
        
        
          58,211
        
        
        
        
        
        
          $
        
        
          47,998
        
      
      
        
          Cost of goods sold
        
        
        
        
           
        
        
          
            17,101
          
        
        
           
        
        
        
        
           
        
        
          14,563
        
        
           
        
        
        
        
           
        
        
          32,714
        
        
           
        
        
        
        
           
        
        
          26,377
        
      
      
        
          Gross profit
        
        
        
        
        
        
          13,302
        
        
        
        
        
        
        
        
          11,170
        
        
        
        
        
        
        
        
          25,497
        
        
        
        
        
        
        
        
          21,621
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating expenses:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Research and development expenses
        
        
        
        
        
        
          818
        
        
        
        
        
        
        
        
          627
        
        
        
        
        
        
        
        
          1,629
        
        
        
        
        
        
        
        
          1,237
        
      
      
        
          Selling and marketing expenses
        
        
        
        
        
        
          7,711
        
        
        
        
        
        
        
        
          6,603
        
        
        
        
        
        
        
        
          13,417
        
        
        
        
        
        
        
        
          11,513
        
      
      
        
          General and administrative expenses
        
        
        
        
           
        
        
          2,194
        
        
           
        
        
        
        
           
        
        
          2,169
        
        
           
        
        
        
        
           
        
        
          4,108
        
        
           
        
        
        
        
           
        
        
          3,841
        
      
      
        
          Total operating expenses
        
        
        
        
           
        
        
          10,723
        
        
           
        
        
        
        
           
        
        
          9,399
        
        
           
        
        
        
        
           
        
        
          19,154
        
        
           
        
        
        
        
           
        
        
          16,591
        
      
      
        
          Operating income
        
        
        
        
           
        
        
          2,579
        
        
           
        
        
        
        
           
        
        
          1,771
        
        
           
        
        
        
        
           
        
        
          6,343
        
        
           
        
        
        
        
           
        
        
          5,030
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Other income (expense):
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Interest income (expense), net
        
        
        
        
        
        
          20
        
        
        
        
        
        
        
        
          32
        
        
        
        
        
        
        
        
          44
        
        
        
        
        
        
        
        
          77
        
      
      
        
          Other income (expense), net
        
        
        
        
           
        
        
          (49
        
        
          )
        
        
        
        
           
        
        
          (3
        
        
          )
        
        
        
        
           
        
        
          (36
        
        
          )
        
        
        
        
           
        
        
          44
        
      
      
        
          Income before income taxes
        
        
        
        
        
        
          2,550
        
        
        
        
        
        
        
        
          1,800
        
        
        
        
        
        
        
        
          6,351
        
        
        
        
        
        
        
        
          5,151
        
      
      
        
          Income tax expense
        
        
        
        
           
        
        
          33
        
        
           
        
        
        
        
           
        
        
          30
        
        
           
        
        
        
        
           
        
        
          80
        
        
           
        
        
        
        
           
        
        
          31
        
      
      
        
          Net income
        
        
        
        
          $
        
        
          2,517
        
        
           
        
        
        
        
          $
        
        
          1,770
        
        
           
        
        
        
        
          $
        
        
          6,271
        
        
           
        
        
        
        
          $
        
        
          5,120
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net income per common share
          
          
            - basic
          
        
        
        
        
          $
        
        
          0.10
        
        
           
        
        
        
        
          $
        
        
          0.08
        
        
           
        
        
        
        
          $
        
        
          0.26
        
        
           
        
        
        
        
          $
        
        
          0.22
        
      
      
        
          - diluted
        
        
        
        
          $
        
        
          0.08
        
        
           
        
        
        
        
          $
        
        
          0.06
        
        
           
        
        
        
        
          $
        
        
          0.20
        
        
           
        
        
        
        
          $
        
        
          0.18