FOR IMMEDIATE RELEASE

WEB STREET GOLF REPORT

VOLUME 8, NUMBER 48

Monday, November 28, 2005

 

IS IT THE ARROW OR THE  OPERATOR? Andreas Stulz is a name  many in the golf industry may not be familiar with. However, if his past is an  illustration of the future, it may not be long before people become aware of  who he is and what his company is up to. Stulz comes from a distinguished  family of engineers and entrepreneurs.   He is part owner and board member of Stulz GmbH, a company founded by  his father that has developed into an international leader in Tier 1 automotive  parts technologies that counts Audi, BMW, Daimler-Chrysler and Ford among its  many clients. The company is also a leading developer of structural air conditioning  and ventilation systems.

 

 A successful entrepreneur in  his own right, he has developed companies in a variety of industries in the  United States and Europe. Most notably, he founded a security electronics  company that spawned what is now a $3 billion industry in Europe. The common  theme in all his ventures has been a dedication to innovation in precision  engineering and quality manufacturing. These ideas serve as the foundation of  Stulz Golf Technologies where today he resides as its Chairman and Chief  Executive Officer.

 

Stulz Golf bills itself not  as a start-up company with a pipedream. “We are in the business of problem  solving,” said Stulz, chairman of the company and formulator of the Stulz team.  “The problem in this case being that golf is a difficult game to master. But,  with the technologies that we are developing and employing, we can help solve  the problem.”

 

The company is promoting a  breakthrough series of shafts called the Stulz Nano Arrow, which employs a  never-before-used triangular shape and nano technology. Stulz has totally  eliminated the need for spining.

 

“This shaft is different than  anything out there,” said Andreas Stulz, chairman of  Stulz Golf Technologies. “Relying on our founder’s business heritage, we have  re-engineered the engine of the golf club – the shaft.  The three-edge spine design offers tighter  shot dispersion and a significant reduction in torque. In fact, because of its  unique design we are able to produce some of the industry’s lightest and strongest  shafts ever made.  We are also, for the  first time ever, able to better control the variations in CPM’s within the same  shaft.  Our measurements are taken along  the edges of triangular shaped shaft, instead of a singular spine cylindrical  shaft.”

 

 Besides the unique triangular  shape, the Nano Arrow employs nano manufacturing technology that eliminates the  possibility of any flaws, air pockets, or voids in the shaft, according to the  company. Every shaft will be uniform, consistent, and held to the exact  standards that have made the Stulz name a leader in the German engineering  business.

“We are offering technology  that has not been available before, that will clearly produce immediate results  for skilled and recreational players looking to custom-fit their new or  existing golf clubs with an industry first,” said Stulz, who also was the  president of Pro Golf of America, a national franchise chain of over 150 golf  specialty stores and president with The Gary Player Group.

 

Stulz Golf is entering the business  employing a modified Dell Computer approach to distribution. It will sell  direct to its end users through a network of certified Stulz retailers. Members  of the network include golf professionals who are knowledgeable in club  fitting, club fitters, club repair shops, selected off-course retailers and  selected shaft retailers.  With its  website, consumers will be directed to the “best of the best” in clubfitting.

 

“We want professionals,  retailers, and clubfitters to immediately understand that Stulz Golf  Technologies stands for quality and innovation that will help the business of  their game,” said Stulz. “This innovation in shaft technology and our new  methods of distribution will certainly accomplish that end.”

 

The Nano Arrow is available  in five models for woods (Nano Arrow 50, Nano Arrow 65, Nano Arrow 80, Nano  Arrow 90 and Nano Arrow 100), offering varying torque, flex and launch angle.  The Nano Arrow Iron Series is available in three different flexes, and the Nano  Arrow Hybrid Series is available in five different flexes. Suggested retail for  the Nano Arrow is $299 for the wood series, $160 for the hybrid series and $120  for the iron series. The technology conforms to the rules of golf as stipulated  by the United States Golf Association and it available to a select group of  authorized clubfitters.

 

http://www.nike.com/nikegolf/select.jhtml?mainID=&navID=experience&catID=oneplatinum

 

NOTHING BAFFLING HERE: Cobra Golf is looking to turn up the heat as it has  added three new models to its family of King Cobra Baffler Utility Metals, one  of the hottest selling utility metal lines in the industry, according to the  company. The King Cobra Baffler is the number one selling line of utility  metals at on-course retailers and has held this position for the past five  months, according to Golf Datatech, Cobra stated.

 

Players now have greater options  to improve their game with the addition of the King  Cobra Baffler 1/R and 6/R to the Men's and Senior's lines and the new 7/R  Baffler to the Women's line.

 

"The Baffler family has  been successful because golfers that have tried them experience the superior  performance that Baffler Utility Metals provide and, as a result, are putting  one or more in their bags," said Jeff Harmet, President, Cobra Golf.  "Baffler Utility Metals are perfect options for golfers that struggle with  their long irons. They are easier to hit from any lie and turf condition and  promote high launch and superior carry distance."

 

The original Baffler,  launched in 1975, was the first utility metal in the retail marketplace. The  new King Cobra Baffler Utility Metal, the company said is designed for golfers  of all skill levels seeking to replace their long irons with more versatile and  forgiving utility clubs that offer higher trajectory and longer distance.

 

 The new 1/R, 6/R and Women’s  7/R King Cobra Baffler Utility Metals are shipping immediately to authorized  retail accounts with a suggested retail price of $180 with a graphite shaft and  $160 in steel.

 

STAYING IN THE LOOP: Nike Golf announced that it has added belts to its  line of accessories for men by virtue of a U.S licensing agreement with Los  Angeles-based Spirit Leatherworks. The agreement represents Nike Golf’s first  entry into the belt market. Spirit Leatherworks, which designs Bill Adler  Design Belts, will be the exclusive U.S. licensee for Nike Golf and Tiger Woods  belts and leather accessories.

 

 “We have been monitoring the  belt market for years and feel there is an opportunity to offer consumers  exciting new performance products they have come to expect from Nike Golf,”  said David Hagler, Global Director of Apparel. “With Spirit Leatherworks we  have chosen a partner who shares our vision to redefine markets through  innovation and design.”

 

 Bill Adler, President and  Creative Director of Spirit Leatherworks, has created a line for Nike Golf and  Tiger Woods that is uniquely designed to enhance comfort, flexibility and  support, according to the company. The perforated leathers breathe and stretch  as the body swings. The Tiger Woods belt collection is infused with new  standards of luxury and elegance. Nike Golf promises that golf belts will never  be the same.

 

 Tiger Woods, Justin Leonard,  Stewart Cink, Chad Campbell and the rest of Nike Golf’s PGA Tour staff will  wear the product to begin the 2006 season. Retail prices range from $40.00 -  $80.00 and will begin shipping to golf retailers in April.

 

http://www.dqgolf.com/

 

CLOSING TIME: Golf Headquarters, a 180-store specialty golf store,  is shutting down its business in the Pittsburgh area. The Boardman, Ohio-based  retailer is advertising a liquidation sale in local newspapers, expecting to  close its five area locations after the Christmas sales season. Located in  stores and averaging around 10,000 square feet in size, Golf Headquarters bills  itself as having the largest number of golf specialty stores in the United  States.

 

THE LONG ARM OF THE LAW: The U.S. Golf Manufacturers Anti-Counterfeiting  Working Group (Acushnet Company, Callaway Golf, Cleveland Golf, MacGregor Golf,  Nike, Ping and TaylorMade-adidas Golf) reported that the Chinese government has  launched a major new offensive against manufacturers and retailers of  counterfeit golf equipment in China.

 The offensive comes after recent meetings between Chris Israel (International  Intellectual Property Rights Enforcement Coordinator) and Vice-Premier Wu Yi,  where the widespread problem concerning counterfeiting of golf equipment was  addressed. As part of its obligations as a World Trade Organization member and  other commitments it has made to control piracy of goods, the Chinese  government promised that enforcement action would be taken.

 

 Shortly following the meetings, Chinese authorities began a campaign of factory  and retail raids stretching from Beijing in the North to Shenzhen in the South.  The most impressive and significant of the raids were against counterfeit golf  retailers in the Beijing Silk Market - a well known counterfeit haven in  Beijing. Some 100 government and police officers  descended upon the Beijing Silk Market and shut down all counterfeit golf  retail operations in the market.

 

 In quick succession, raids  were carried out in Beijing, Xiamen, Quanzhou, Dongguan, Chang'an, Zhongshan,  and Shenzhen. During the latest operation, illegal manufacturing equipment and  thousands of counterfeit golf products ranging from clubs, bags, shoes,  garments and balls were seized. It is estimated that the recent seizures are  worth in excess of $5 million.

 

 Loo Shih Yann, a principal with the international law firm of Baker and  McKenzie, who is coordinating efforts on behalf of the US Golf Manufacturers  Group in China calls this "one of the most intense enforcement efforts  that he has seen on behalf of any industry by the Chinese government."

 

 However, the efforts of the  Chinese government still could be greater because none of the culprits were  arrested during the massive campaign. Loo said that until those who are responsible  are subject to criminal penalties and jail sentences are meted out, the latest  round of raids will not have a serious deterrent effect and will merely add to  the costs of doing business for the counterfeiters. This is apparent from  intelligence showing that  counterfeiters are now moving retail operations out of city centers and  manufacturing operations are going deeper underground to avoid detection.

 

 The Chinese government has promised additional crackdowns against counterfeit  golf equipment in coming weeks. The U.S. Golf Manufacturers Anti-Counterfeiting  Working Group will continue to cooperate closely with Chinese enforcement  authorities to sustain the momentum in enforcing the laws against golf  equipment counterfeiters.

 

FOOD FOR THOUGHT: Sodexho  Prestige, which is believed to be the UK's largest event caterer and corporate  hospitality provider, was awarded the catering business for next year's Ryder  Cup. The contract for the bi-annual event, which is to be held at the K Club in  Ireland, is estimated to be valued at around £1.5 million.

 

 Sodexho Prestige said that it  will employ between 500 and 750 staff on site each day. The new business will  include 7,000 hospitality tents over four days, all the public catering and the  catering for K Club members, PGA members, international pavilions and the  media.

 

QUIET PLEASE: Now hear this: A buzz has been emerged from the Golf  Europe Show in Munich where Voit has introduced a V MP3 Golf Bag Series. The  said to be ultra light stand bag with 6-slot divider and padded dual shoulder  strap, is provided with a waterproof MP3 player carry pouch located on the left  shoulder strap and secured with a heavy-duty Velcro fixing system. The zipped  and heavily- padded pouch keeps the MP3 player safe from the weather and free  of scratches.

 

 Voit Europe managing director Ulrich Roebbecke explained, “It’s a small detail  but the MP3 pouch really helps with the golf bag’s overall attraction. The  design and bright color options already make the VMP3 bags stand out, but this  additional feature puts this bag in a class of its own.”

 

 Voit Golf Europe recently formed a partnership with Voco Ltd. to distribute  Voit products in the UK. The bag will be available in the UK from January 2006  and the recommended retail price is £79.99.

 

CHEERS: Ping has won a trade award at the recent TGI Golf Show  in Harrogate, located in the UK. Members of the 360 buying group, exhibitors  and delegates voted Ping as the Best Hardware Brand of 2005 in recognition of  the success of its G2 series.

 

 Voters were asked to base their judgment on a number of different criteria -  technical innovation, retail price, ability to maintain profit margin and value  for money to the customer – and the result elected Ping as the brand.

 

 “Ping’s G2 series was the hottest hardware range in golf this year and its  success meant that many of our delegates were eager to see the new G5 products,”  said Eddie Reid, TGI’s golf retail development manager. “This (the G5 range) is  an even better range of clubs and an even more appealing proposition to both  retailers and customers.”

 

 Reid went on to praise Ping’s distribution system. “TGI Golf members also have  confidence in Ping’s ability to supply its products efficiently. That ensures  it gets into the hands of the end user.”

 

 Managing director of Ping Europe, John Clark, thanked voters for the award and  stressed that he believed the new G5 range would be even more successful than  its predecessor.

 

RAIN MAN: Daymond Willis Holdings, which recently acquired the  licensing rights to Sunderland of Scotland, Lyle & Scott and Penfold Golf,  announced it has developed, what it believes is a state of the art rainwear  technology under the Penfold brand. The Rainbreaker rain suit features fabric  that is formed by using a space age spray adhesive system, according to the  company, to laminate a micro-porous film to a strong substrate resulting in a  waterproof garment with a very high ‘MVTR’ (Moisture Vapor Transmission Rate).  Using ultra sonic sound waves, seams of the garment are welded together thus  eliminating the need for any sewing.

 

 The Rainbreaker will be  available to pro shops and can be purchased by retailers in quantities of 36.  The product will retail for $20.00.

 

 “This is a remarkable product  and is available to the consumer at a very reasonable price,” stated Dennis  Goldasich, VP of Sales. “On rainy days merchandisers and pros can put these  rain suits which come packed in their own POP on the pro shop counter and can  be sold out by the end of the day. The only thing that the shop has to do is to  take the lid off of the box. The price and the technology will really please  golfers who don’t want to have their round impaired by wet conditions.”

 

SURE THING??? Tiger Woods has already won all of golf's majors in  his young career. Michelle Wie has yet to capture her first LPGA win, but big  things are expected from the Hawaiian teenager as she turns pro in 2006.  Sportsbook.com has already posted lines for the upcoming season on golf's  dynamic duo.

 

 "Everybody bets, and  when it comes to golf, it's Woods and Wie that sportsbook.com players wager on  the most," said Peter Childs, Odds Maker, Sportsbook.com. "The real  big question heading into 2006 is how many Majors will Woods win, and can Wie  pull off a Major victory in her first full year on the LPGA Tour?"

 

 In 2005 Woods regained his  dominant position on the PGA Tour after a so called slump. Now critics say he  is poised to take the next step in his journey by claiming all four majors in  2006. Sportsbook.com's line for the grand slam is 35-1. Woods' most favorable  odds are that he will take one major, a 5-4 bet. He is a 3-2 bet that he won’t  win any of the four majors in 2006.

 

 Sportsbook.com has posted  odds at 1-2 that Wie will go winless in 2006 at the four Majors, but 9-5 that  she will post at least one victory and 50-1 to win all four

the Grand Slam.

 

TRYING TO MAKE A BUCK: Sport-Haley (SPOR: NASDAQ) announced its first quarter  operating results for the fiscal year 2006. The company continued its trend of  losing money as the new fiscal year began with the bottom line marked in red to  the tune of $426,000. Net sales decreased by 28 percent, or $1,559,000, to  $4,011,000 from $5,570,000 in the same period in the prior fiscal year. In the  comparable reporting period, Sport-Haley lost $1.3 million from the operations  of its business.

 

 Interim CEO, Don Jewell,  stated the results were in line with the company’s expectations and pointed to  the fact that the first quarter is his company’s weakest, historically. He also  stated the decline in sales was a result of the discontinuance of the  Sport-Haley men's fashion apparel collections, which Jewell said accounted for  slightly over $1 million of the company’s net sales as recently as the  September '04 fiscal quarter.

 

 “We've worked diligently in the last 12 months to ensure the long-term  financial health of the company, and we believe that we have taken the  necessary steps to return the company to profitability in this fiscal year,  including the joint venture we recently formed to introduce Top-Flite-branded  apparel," Jewell stated. "We've maintained on track with our  objectives to reduce operating costs," he continued. "Our inventory  position has remained in line with our expectations, and our reduced operating  costs are indicative of the significant reductions that we implemented in the  last year. While our plans include focusing our efforts to find more ways to  continue to decrease our operating costs, we believe that the success we  achieved during our first quarter certainly indicates that the changes we have  implemented to date have improved our overall operations."

 

QUESTION OF THE WEEK: Last week's question was:

 Which do you think will  provide greater drama: The PGA Grand Slam or the Skins Game?

Web Street readers favored  Fred Funk and his skirt in this year’s the Skins Game by 71 percent. Thank you  to everyone that replied.

 

 This week’s question is:

 Do you think Michelle Wie  will be invited into next year’s Skin Game? Yes or No.

Send an email to  terrymcandrew@golfbiz.net with your answer.

 

STOCK WATCH: Don’t look now but there appears to be an early Santa  Claus rally! Stocks have been marching higher in November amid well-advertised  expectations for a year-end rally. In October, high oil prices, political  turmoil in Washington, D.C., and concerns about the strength of the housing  market tripped up stocks. A series of speeches by Federal Reserve governors  also caused concerns that policy makers might push rates higher than many had  hoped and cause the economy to potentially slide into a recession.

 

 But energy prices have cooled  down, at least for the time being and renewed hopes for consumers to spend  early and often have contributed to the positive tone on Wall Street. The  market also got a charge after the White House nominated Ben Bernanke to  replace Alan Greenspan as chairman of the Fed on Oct. 24. Early last week,  stocks jumped amid hopes the Fed may be close to wrapping up its  rate-tightening campaign. Since mid-October, the Dow industrials have gained 7  percent.

 

 Wall Street finished the week  with moderate gains, extending a November rally in an abbreviated trading week  due to the observance of the American Thanksgiving holiday.

 The major indexes closed out  their fifth straight winning week and pushed past four-year highs. For the  week, the Dow gained 1.54 percent, closing at 10,931.62, the S&P 500  advanced 1.6 percent and the Nasdaq rose 1.61 percent.

 

 So far this year, the Dow is  up 1.38 percent, the S&P 500 has grown by 4.03 percent and the Nasdaq is  4.65 percent higher. The blue-chip average, created in 1896, has been creeping  near the 11,000 mark, which it last finished above on June 7, 2001. Most  analysts believe that a Dow 11,000 won't mean much to the market, beyond  setting a positive psychological tone for stocks.

 

 Callaway Golf Company (ELY:  NYSE) announced its Board of Directors has authorized the Company to repurchase  up to $50 million of it's common stock in the open market or in private  transactions beginning in the first quarter of 2006. The Company said it will  assess market conditions and buying opportunities from time to time and will  make strategic repurchases when it deems it to be appropriate. The new stock  repurchase program supersedes all prior stock repurchase authorizations.

 

 Aldila's (ALDA: NASDAQ) board  of directors has declared a quarterly cash dividend of 15¢ per share and a  one-time special dividend of $1.00 per share, both to be paid on December 16 to  shareholders of record as of December 2.

 

TRAVEL:

RUB OF THE GREEN: Starwood Hotels & Resorts Worldwide, Inc. is  openings its second property in Ireland in the spring of 2006, with the newly  constructed Sheraton Fota Island Golf Resort &Spa, Cork. For those not very  familiar with the Emerald Isle, it is located on the scenic Fota Island in  County Cork, located on the southern Irish coast and 20 minutes from Cork  Airport.

 

 The hotel is being  constructed on the site of the existing Fota Island Golf Club - home of the  Irish Open in 2001 and 2002. In addition to the championship golf course, hotel  and lodge, guests will also enjoy the full service destination Spa with 17  treatment rooms, a specialty restaurant, a full-service dining restaurant and  Whiskey Bar in one of the most idyllic settings in Ireland. The resort will  also ultimately include over 250 luxury residential lodges.

 

 "We are thrilled to be  opening another hotel in Ireland," said Roeland Vos, President, Starwood  Hotels & Resorts Europe, Middle East& Africa. "Since the opening  of The Westin Dublin in 2001, we have been looking for other opportunities in  this market. This hotel increases Starwood's commitment to Ireland, while  further expanding on the wonderful resorts we can offer our guests around the  world."

 

 "We chose Sheraton  because it is a great brand to be working with on this project," said John  Fleming, Managing Director, Fleming Construction, co-developer of the project  along with Starwood. "Fota Island is already highly regarded as a golf  destination - the new hotel, residential lodge development and extensive spa  facilities will really add to the appeal of this part of Ireland for leisure,  incentive and conference business. With Starwood already having a presence in  Ireland and a proven track record with the success of The Westin Dublin, they  make an ideal hotel management partner for us."

 In June of 2006 Fota Island  golf course is hosting the AIB Irish Seniors Open Golf Championship. With the  launch of the new resort, the existing PGA-endorsed golf course will offer another reason for  golfers to experience the warmth and hospitality of the Irish while testing  their skills against world-class golf destination.

 

THE INFORMATION CONTAINED  IS BELIEVED TO BE RELIABLE, BUT IT IS NOT GUARANTEED. THE OPINION EXPRESSED IS  THAT OF TERRY MCANDREW AND SHOULD NOT BE CONSIDERED A SOLICITATION TO BUY OR  SELL SECURITIES IN ANY OF THE COMPANIES DISCUSSED WITHIN THIS NEWSLETTER.  CONTENTS OF THIS NEWSLETTER MAY NOT BE REPRINTED OR REBROADCAST WITHOUT THE  EXPRESSED WRITTEN CONSENT OF TMAC GOLF.