Expected Launch of New Technical Outerwear Line in 2008; Significant Growth Opportunity with Complementary Products
CARLSBAD, CALIFORNIA, January 16, 2008 – Ashworth, Inc. (NASDAQ: ASHW), a leading designer of golf-inspired lifestyle sportswear, today announced the acquisition of the Sun Ice® and Sunice® trademarks from Fletcher Leisure Group Inc. (“FLG”). The Company expects to launch a new golf-related technical outerwear line during 2008 under this brand in the United States, the United Kingdom, Ireland and Europe.
Ashworth established a wholly-owned subsidiary, Sunice Holdings, Inc., which will own the Sun Ice and Sunice trademarks and be entirely focused on the new technical outerwear line. The product line will be concurrently marketed by the Company’s existing sales and marketing team dedicated to Ashworth®-branded apparel. FLG will provide design services for Sunice Holdings, Inc. and facilitate sourcing relationships for the new outerwear line.
The purchase price for the trademarks consists primarily of participation in the future EBITDA of Sunice Holdings, Inc.
Edward J. Fadel, President of Ashworth, Inc. who will oversee all operational aspects of Sunice Holdings, Inc., commented on the acquisition, “The recognized strength of the Sun Ice brand in technical outwear complements our existing strength in Ashworth golf-inspired apparel, offering significant cross-selling opportunities and anticipated penetration of new accounts for both brands. The Sun Ice line should also leverage Ashworth’s existing sales and distribution infrastructure by enabling the concurrent marketing of two high quality, complementary product lines and expanding our overall base of sales.”
Allan H. Fletcher, Chief Executive Officer of Ashworth, Inc., commented “The relationships and outerwear expertise acquired in this transaction will also promote improvements to the Callaway Golf apparel outerwear product line and further strengthen the Company’s position in the golf market.”
About Ashworth, Inc.
Ashworth, Inc. (NASDAQ: ASHW) is a leading designer of men’s and women’s golf-inspired lifestyle sportswear distributed domestically and internationally in golf pro shops, resorts, upscale department and specialty stores and to corporate customers. Ashworth’s three market-leading brands include: Ashworth Collection ™, a range of upscale sportswear designed to be worn on and off course; Ashworth Authentics ™, which showcases popular items from the Ashworth line; and Ashworth Weather Systems®, a technical performance line. Ashworth is also an Official Apparel Licensee of Callaway Golf Company.
Ashworth is also a leading designer, producer and distributor of headwear and apparel under The Game® and Kudzu® brands. The Game is a leading headwear brand to collegiate bookstores and Kudzu products are sold into the NASCAR/racing markets and through outdoors sports distribution channels, including fishing and hunting. Ashworth is also the exclusive on-site event merchandiser for the Kentucky Derby.
For more information, please visit the Company’s Web site at www.ashworthinc.com.
Forward-Looking Statements
This press release contains forward-looking statements related to the Company’s market position, finances, operating results, marketing and business plans and strategies within the meaning of Section 27A of the Securities Act, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may contain the words "believes," "anticipates," "expects," "predicts," "estimates," "projects," "will be," "will continue," "will likely result," or other similar words and phrases. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, changed circumstances or unanticipated events unless required by law. These statements involve risks and uncertainties that could cause actual results to differ materially from those projected. These risks include the uncertainties associated with implementing a successful transition in executive leadership, the impact of borrowing base limitations in the Company’s new credit facility, the evaluation of strategic alternatives that may be presented, timely development and acceptance of new products, as well as strategic alliances, the integration of the Company’s acquisition of Gekko Brands, LLC, the impact of competitive products and pricing, the success of the Sun Ice and Callaway Golf apparel product lines, the preliminary nature of bookings information, the ongoing risk of excess or obsolete inventory, the potential inadequacy of booked reserves, the successful operation of the distribution facility in Oceanside, CA, the successful implementation of the Company’s ERP system, and other risks described in Ashworth, Inc.’s SEC reports, including the annual report on Form 10-K for the year ended October 31, 2007.
Contact:
Allan H. Fletcher, CEO
Edward J. Fadel, President
Greg W. Slack, CFO
(760) 929-6100
