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Form			10-K

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Acushnet Holdings Corp.
(Exact name of registrant as specified in its charter)

Delaware									45-2644353
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)
333 Bridge Street			Fairhaven,			Massachusetts			02719
(Address of principal executive offices)									(Zip Code)

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

GOLF

New York Stock Exchange

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒  No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

Large accelerated filer			☒			Non-accelerated filer			☐
Accelerated filer			☐			Smaller reporting company			☐
						Emerging growth company			☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b) ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

						Page
Part I
Item 1.			Business			1
Item 1A.			Risk Factors			14
Item 1B.			Unresolved Staff Comments			39
Item 2.			Properties			40
Item 3.			Legal Proceedings			41
Item 4.			Mine Safety Disclosures			41
Part II
Item 5.			Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			43
Item 6.			Reserved			44
Item 7.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			45
Item 7A.			Quantitative and Qualitative Disclosures about Market Risk			59
Item 8.			Financial Statements and Supplementary Data			60
Item 9.			Changes in and Disagreements With Accountants on Accounting and Financial Disclosures			60
Item 9A.			Controls and Procedures			60
Item 9B.			Other Information			61
Item 9C.			Disclosure Regarding Foreign Jurisdictions that Prevent Inspections			61
Part III
Item 10.			Directors, Executive Officers and Corporate Governance			62
Item 11.			Executive Compensation			62
Item 12.			Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			62
Item 13.			Certain Relationships and Related Transactions, and Director Independence			62
Item 14.			Principal Accountant Fees and Services			62
Part IV
Item 15.			Exhibits and Financial Statement Schedules			63
Item 16.			Form 10‑K Summary			64

This Annual Report includes trademarks, trade names and service marks that we either own or license, such as “Titleist,” “FootJoy,” “Pro V1,” “Pro V1x,” "AVX," “FJ,” "MyJoys," “Pinnacle,” “Scotty Cameron,” the Circle T Design, "TSR," "T Series," “Vokey Design,” "Club Glove" and "KJUS" which are protected under applicable intellectual property laws. Solely for convenience, trademarks, trade names and service marks referred to in this report may appear without the ®,  ™ or SM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks, trade names and service marks. This report may also contain trademarks, trade names and service marks of other parties, and we do not intend our use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of us by, these other parties.

While rounds of play had been relatively stable for years, the game experienced an approximate 8% global increase in rounds in both 2021 and 2020 as dedicated golfers took full advantage of favorable weather, hybrid work schedules and an increase in discretionary time due to the circumstances attendant to the COVID-19 pandemic. The game of golf remained in high demand in 2022, with the number of rounds played approximately 16% higher than the number of rounds played in 2019. We anticipate that rounds of golf played will remain resilient in 2023, driven by golfer demographics, dedicated golfers and economic conditions.

Golfer Demographics. Golf is a recreational activity that requires time and money. The golf industry has been principally driven by the age cohort of 30 years and above, primarily “gen‑xers,” “baby boomers” and, increasingly, "millennials" who have the time and money to engage in the sport. Since a significant number of baby boomers have yet to retire, we anticipate growth in spending from this demographic, as it has been demonstrated that rounds of play increase significantly as those in this cohort reach retirement. Further, we also believe that the percentage of women golfers will continue to grow, as a higher percentage of new golfers in recent years have been women. Beyond the gen‑x and baby boomer generation, promising developments in golf include the generational shift with millennial golfers making their marks at both professional and amateur levels and, in 2022, accounting for 25% of golfers overall in the U.S., and the increase in the number of juniors (ages 6-17) who play golf in recent years.

Dedicated Golfers. Dedicated golfers are largely older millennials, gen‑xers and baby boomers who have demonstrated the propensity to pay a premium for products that help them perform better. We believe dedicated golfers, who comprise our target market, will continue to be a key driver for the global golf industry.

Weather Conditions. Weather conditions determine the number of playable days in a year and thus influence the amount of time people spend on golf. Weather conditions in most parts of the world, including our primary geographic markets, generally restrict golf from being played year‑round, with many of our on‑course retail customers closed during the cold weather months. Therefore, favorable weather conditions generally result in more playable days in a given year and more golf rounds played, which generally results in increased demand for all golf products.

Economic Conditions. The state of the economy influences the amount of money people spend on golf. Golf equipment, including clubs, shoes, balls and accessories, is recreational in nature and is therefore a discretionary purchase for consumers. Consumers are generally more willing to make discretionary purchases of golf products when economic conditions are favorable and when consumers are feeling confident and prosperous.

Introduce New Products and Extend Market Share Leadership in Equipment Categories. We expect to sustain our strong performance in our core categories of golf balls, golf clubs and golf shoes through several targeted strategies:

•Titleist Clubs, Wedges and Putters. We intend to continue to launch innovative, high performance golf clubs by further leveraging Titleist R&D excellence in all club categories. To enhance the golfer experience, we plan to continue highly focused consumer connection initiatives, promote and encourage custom fitting and trial, and offer best-in-class custom manufacturing capabilities. We also intend to continue to develop and offer concept and limited edition products to showcase advanced technologies and we intend to continue to dedicate the resources necessary to ensure that Titleist drivers, fairways, hybrids and irons, Vokey Design wedges and Scotty Cameron putters remain golf's leaders in performance, technology, craftsmanship and selection.

•FootJoy Footwear. We continue to invest in design and innovation to bring golf-specific performance advancements to the footwear category. We launched several new models in 2022, and we plan to continue to enrich our consumer connection initiatives with digital content, product trial and fit experiences in key global markets.

Increase Penetration in Golf Gear and Wear Categories. We intend to build on the brand loyalty that the dedicated golfer has developed for our Titleist ball and club categories and FootJoy shoe and glove categories in order to increase our penetration in the adjacent categories of golf gear and golf wear. We also evaluate acquisition opportunities that generally feature premium performance products that appeal to the dedicated golfer and can benefit from our global distribution and supply chain capabilities. We expect to continue to drive growth across these categories by employing the following initiatives:

•Titleist Golf Gear.  We are committed to providing dedicated golfers with golf gear—including golf bags, headwear, gloves, travel gear, head covers and other accessories—of performance and quality excellence that is faithful to the Titleist brand promise. We continue to make investments in design and engineering resources and leverage dedicated player insights to drive product excellence in these product categories.

•FootJoy Apparel.  We remain committed to bringing style, performance, and innovation to the golf apparel category. In addition to our seasonal apparel collections, we plan to launch new outerwear products to meet the performance expectations of the most demanding players and "make every day playable." We plan to continue to work with select players on the worldwide professional golf tours who trust the FootJoy brand to perform at the highest levels.

•Titleist Apparel. Titleist introduced apparel in Korea, Japan and China with a focus on innovative performance and styling which is specifically designed for these markets using localized go-to-market strategies. We continue to invest in innovative designs and performance fabrics to bring advancements to the apparel category in the markets where Titleist apparel is sold.

•Links & Kings. In 2018, we acquired Links & Kings, a brand focused on the design and handcrafted production of luxury leather golf and lifestyle products. We intend to increase sales of Links & Kings products by increasing production capacity and leveraging our existing distribution channels.

•KJUS Outerwear and Apparel. In the third quarter of 2019, we acquired KJUS, a brand which designs premium technical golf, ski and lifestyle apparel with distinctive, clean designs. KJUS entered the golf outerwear and apparel markets less than a decade ago with a focus on freedom of movement, temperature regulation and all-weather protection to enhance performance. We intend to continue to invest in design and innovation to deliver advancements in KJUS outerwear and apparel.

Strategically Pursue Global Growth. While our brands are global, we believe that near‑term growth will be primarily driven by more established golf markets, such as the United States, Japan, Korea and EMEA. However, less mature golf markets also represent longer‑term growth opportunities. To meet future demand, we are ensuring that local capabilities and expertise in sales, customer service, merchandising, online presence, golf education and fitting initiatives are in place to support our operations. We continue to hire local talent across all functions in order to better position Titleist and FootJoy products in those markets where participation and popularity of the sport are expected to increase.

    Titleist is the #1 ball in golf. The Titleist golf ball was founded with the purpose of designing and manufacturing a golf ball that was performance superior and quality superior to all other balls available in the market. We believe the golf ball is the most important piece of equipment in the game, as it is the only piece of equipment used by every player for each shot in the round. The golf ball category also generates the largest portion of our sales and profits.

    Titleist Golf Bags have an array of models across price points with designs ranging from those to be carried to those designed for golf carts, each with an array of functional differences and a variety of materials and colors. Titleist golf bags are used on professional tours throughout the world and are relied upon by players globally to support their game. In 2023, we plan to introduce our all-new Titleist Players Stand Bag collection, continuing the momentum of this leading bag franchise sold by leading golf courses across the globe. We also have enjoyed success with our LINKSLEGEND Series of premium golf bags that launched in the Fall of 2022 at leading clubs around the world.

    In July 2019, we acquired KJUS, a Swiss-based manufacturer of premium performance ski, golf and lifestyle apparel. The KJUS brand was born from an uncompromising commitment to performance, following brand namesake Lasse Kjus’s historic feat at the 1999 World Ski Championships, where he medaled in each of the Championships’ five disciplines. KJUS was founded with a vision to make the finest and most technologically advanced skiwear and the belief that cutting edge innovation could lead to improved performance. KJUS has today grown to be a leader in premium technical performance skiwear. Building upon this reputation, KJUS entered the golf outerwear and lifestyle apparel markets with a focus on freedom of movement, temperature regulation and all-weather protection to enhance performance. As a result, KJUS has achieved an enthusiastic following with performance-minded golfers and a premium positioning at leading golf shops worldwide.

Essential to our recruitment and retention of top talent, is our commitment to ensuring we benefit from a workplace built on our core values, including diversity, inclusion, belonging and respect. We seek to foster a culture where all associates can bring their complete, authentic self to work and we aspire to increase the diversity of our associate population globally. Our Diversity, Inclusion and Belonging strategy and initiatives are guided by an associate-led Council, consisting of associates from all facets of the Company. Engagement with associates at all levels is driven through open discussion, listening and engagement surveys. Survey results continue to demonstrate that associate engagement is strong, driven by what we believe to

The COVID-19 pandemic required the Company to modify Health and Safety programs which we continue to maintain to ensure a healthy and safe workplace across all of our global sites. The learnings from the pandemic have been integrated into our normal business practices which we regularly evaluate and will adapt as needed in the future.

•Our business could be materially adversely affected as a result of the risks associated with acquisitions and investments.

•Our credit agreements contain restrictions that limit our flexibility in operating our business.

•If we are unable to maintain effective internal controls over financial reporting, we may not be able to produce timely and accurate financial statements, which could have a material adverse effect on our business and stock price.

•power loss or network connectivity or telecommunications failure or downtime;

•equipment failure;

•human error or accidents;

•sabotage or vandalism;

•physical or electronic security breaches;

•floods, fires, earthquakes, hurricanes, tornadoes, tsunamis or other natural disasters;

•political unrest;

•labor difficulties, including work stoppages, slowdowns, labor shortages or excessive turnover;

•water damage or water shortage;

•government orders and regulations;

•pandemics and other health and safety issues (including, for example, the COVID-19 pandemic); and

•terrorism.

Golf Balls. The golf ball business is highly competitive. There are a number of well‑established and well‑financed competitors. We and our competitors continue to incur significant costs in the areas of R&D, advertising, marketing, tour and other promotional support to be competitive.

Golf Clubs. The golf club markets in which we compete are also highly competitive and are served by a number of well‑established and well‑financed companies with recognized brand names. New product introductions, price reductions, consignment sales, extended payment terms, “closeouts,” including closeouts of products that were recently commercially successful, and significant tour and advertising spending by competitors continue to generate intense market competition and create market disruptions. Our competitors in the golf club market have in the past and may continue to introduce their products on an accelerated cycle which could lead to market disruption and impact sales of our products.

Golf Gear. The golf gear market is fragmented and served by a number of established competitors as well as a number of smaller competitors. We face significant competition in every region with respect to each of our golf gear product categories.

Golf Wear. In the golf wear markets, we compete with a number of well‑established and well‑financed companies with recognized brand names. These competitors may have a large and broad consumer base, established relationships with a broad set of suppliers and customers, strong brand recognition and significant financial, R&D, marketing, distribution and other resources which may exceed our own.

The current U.S. presidential administration may support and introduce certain new tax, trade and tariff proposals, modifications to international trade policy and other changes, which may affect U.S. trade relations with other countries. Further, any changes in global or national political movements or trade policies could alter the trade environment and consumer purchasing behavior which, in turn, could have a material effect on our financial condition and results of operations. While the United Kingdom's exit from the European Union ("Brexit") on December 31, 2020 is now complete, policies and border control procedures continue to evolve and we continue to monitor the impact from related costs and on product transit times into the European Union and United Kingdom.

•increased difficulty in protecting our intellectual property rights and trade secrets;

•unexpected government action or changes in legal, trade, tax or regulatory requirements;

•social, economic or political instability;

•the effects of any anti‑American sentiments on our brands or sales of our products;

•increased difficulty in ensuring compliance by employees, agents and contractors with our policies as well as with the laws of multiple jurisdictions, including but not limited to the U.S. Foreign Corrupt Practices Act (the "FCPA"), and similar anti‑bribery and anti‑corruption laws, local and international environmental, health and safety laws, and increasingly complex regulations relating to data privacy and the conduct of international commerce;

•increased difficulty in controlling and monitoring foreign operations from the United States, including increased difficulty in identifying and recruiting qualified personnel for its foreign operations; and

•increased exposure to interruptions in air carrier or ship services.

•changes in consumer demand for our products or the products of our competitors;

•new product introductions by us or our competitors;

•failure to accurately forecast consumer acceptance of our products;

•failure to anticipate consumer acceptance of new technologies;

•inability to realize revenues from booking orders;

•negative publicity associated with tours or golfers we endorse;

•unanticipated changes in general market conditions or other factors, which may result in cancellations of advance orders or a reduction or increase in the rate of reorders placed by retailers;

•weakening of economic conditions or consumer confidence in future economic conditions, which could reduce demand for discretionary items, such as our products;

•terrorism or acts of war, or the threat thereof, which could adversely affect consumer confidence and spending or interrupt production and distribution of products and raw materials;

•abnormal weather patterns or extreme weather conditions including hurricanes, floods and droughts, among others, which may disrupt economic activity; and

•general economic conditions.

We use United Parcel Service and FedEx Corporation for substantially all ground shipments of products to our U.S. customers. We use ocean shipping services and air carriers for most of our international shipments of products. In addition, many of the components we use to manufacture and assemble our products are shipped to us via ocean shipping and air carrier. If there are changes in trade or tariff laws which result in customs processing delays or any significant interruption in service by such providers or at shipping ports or airports, we may be unable to engage alternative suppliers or to receive or ship goods through alternate sites in order to deliver our products or components in a timely and cost‑efficient manner. As a result, we could experience manufacturing delays, increased manufacturing and shipping costs, and lost sales as a result of missed delivery deadlines and product introduction and demand cycles. Any significant interruption in United Parcel Service or FedEx Corporation services, ship services, at shipping ports or air carrier services could materially adversely affect our business, financial condition and results of operations. For example, during 2022, late delivery of inbound products due to West Coast port congestion forced us to upgrade a significant portion of outbound freight to express parcel services in order to meet customer delivery date requirements. This upgrade resulted in unbudgeted increases in average cost per pound shipped. Furthermore, if the cost of delivery or shipping services were to increase significantly and the additional costs could not be covered by product pricing it could materially adversely affect our business, financial condition and results of operations.

•earthquake, fire, flood, hurricane and other natural disasters;

•power loss, computer systems failure, Internet and telecommunications or data network failure;

•hackers, computer viruses, unauthorized access, software bugs or glitches; and

•accidental or unlawful acts by authorized personnel, including our employees, contractors and vendors.

We are subject to income taxes in the U.S. (federal and state) and numerous foreign jurisdictions. Tax laws, regulations, and administrative practices in various jurisdictions may be subject to significant change, with or without notice, due to economic, political, and other conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes. Changes to or promulgation of new tax laws, interpretive regulations, other tax or accounting guidance could significantly impact how we are taxed on both U.S. and foreign earnings. Transactions that we have arranged in light of current tax rules could have adverse consequences if those tax rules change, and the imposition of any new or increased tariffs, duties and taxes could materially adversely affect our business, financial condition and results of operations.

Our effective tax rates in the future could be adversely affected by a number of factors, including changes in the expected geographic mix of earnings in countries with differing statutory tax rates, changes in the valuation and realizability of deferred tax assets and liabilities, changes to or issuance of new tax laws, interpretive regulations, notices or other administrative practices, principles, or guidance, changes to or issuance of new accounting guidance, changes in foreign currency exchange rates, entry into new businesses and geographies, changes to our existing businesses and operations, acquisitions (including integrations) and investments and how they are financed, changes in our stock price, and the outcome of income tax audits in various jurisdictions around the world. Finally, foreign governments may enact tax laws in response to the U.S. Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act”) that could result in further changes to global taxation and materially affect our financial position and results of operations.

•fund ongoing operations;

•take advantage of opportunities, including expansion of our business or the acquisition of complementary products, technologies or businesses;

•develop new products; or

•respond to competitive pressures.

•requiring us to utilize a substantial portion of our cash flows from operations to make payments on our indebtedness, reducing the availability of our cash flows to fund working capital, capital expenditures, product development, acquisitions, general corporate and other purposes;

•increasing our vulnerability to adverse economic, industry, or competitive developments;

•exposing us to the risk of increased interest rates because substantially all of our borrowings are at variable rates of interest;

•making it more difficult for us to satisfy our obligations with respect to our indebtedness, and any failure to comply with the obligations of any of our debt instruments, including financial maintenance covenants and restrictive covenants, could result in an event of default under the agreements governing our indebtedness;

•restricting us from making strategic acquisitions or causing us to make non‑strategic divestitures;

•limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions, and general corporate or other purposes; and

•limiting our flexibility in planning for, or reacting to, changes in our business or market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged and who, therefore, may be able to take advantage of opportunities that our leverage prevents us from exploiting.

•incur, assume, or permit to exist additional indebtedness or guarantees;

•incur liens;

•make investments and loans;

•pay dividends, make payments on, or redeem or repurchase capital stock or make prepayments, repurchases or redemptions of certain indebtedness;

•engage in mergers, liquidations, dissolutions, asset sales, and other non-ordinary course dispositions (including sale leaseback transactions);

•amend or otherwise alter terms of certain indebtedness or certain other agreements;

•enter into agreements limiting subsidiary distributions or containing negative pledge clauses;

•engage in certain transactions with affiliates;

•alter the nature of the business that we conduct;

•change our fiscal year or accounting practices; or

•enter into a transaction or series of transactions that constitutes a change of control.

•the requirement that a majority of our board of directors consist of “independent directors” as defined under the rules of the NYSE;

•the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

•the requirement that we have a nominating and corporate governance committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

•the requirement for an annual performance evaluation of the compensation and nominating and corporate governance committees;

•the compensation committee be explicitly charged with hiring and overseeing compensation consultants, legal counsel, and other committee advisors; and

•the compensation committee be required to consider, when engaging compensation consultants, legal counsel, or other advisors, certain independence factors, including factors that examine the relationship between the consultant or advisor’s employer and us.

•although we do not have a stockholder rights plan, these provisions would allow us to authorize the issuance of undesignated preferred stock in connection with a stockholder rights plan or otherwise, the terms of which may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend, or other rights or preferences superior to the rights of the holders of common stock;

•these provisions require advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;

•these provisions prohibit stockholder action by written consent;

•these provisions provide for the removal of directors only upon affirmative vote of holders of at least 66⅔% of the shares of common stock entitled to vote generally in the election of directors if Magnus and its affiliates hold less than 50% of our outstanding shares of common stock; and

•these provisions require the amendment of certain provisions only by the affirmative vote of at least 66⅔% of the shares of common stock entitled to vote generally in the election of directors if Magnus and its affiliates hold less than 50% of our outstanding shares of common stock.

Location

Type

Facility Size(1)

Leased/Owned

Fairhaven, Massachusetts

Headquarters and Golf Ball R&D

222,720

Owned

Golf Balls

North Dartmouth, Massachusetts

Golf ball manufacturing

179,602

Owned

New Bedford, Massachusetts

Golf ball manufacturing

244,091

Owned

Amphur Pluakdaeng Rayong, Thailand

Golf ball manufacturing

230,003

Owned

New Bedford, Massachusetts

Golf ball customization and distribution center

438,007

Owned

Fairhaven, Massachusetts

Golf ball packaging

49,580

Owned

New Bedford, Massachusetts

Golf ball advanced engineering and ball cavity manufacturing

34,000

Leased

Sugarland, Texas

Golf ball recycling and distribution center

87,214

Leased

Golf Clubs, Wedges and Putters

Carlsbad, California

Golf club assembly and R&D

165,485

Leased

San Marcos, California

Putter research

19,200

Leased

Encinitas, California

Putter fitting and sales

3,754

Leased

Tochigi, Japan

Golf club assembly

20,376

Leased

FootJoy

Fuzhou, Fujian, China (40% owned joint venture)

Golf shoe manufacturing and distribution center

525,031

Building Owned/Land Leased

Brockton, Massachusetts

Golf shoe R&D, custom glove assembly and distribution center

146,000

Leased

Sriracha Chonburi, Thailand

Golf glove manufacturing

112,847

Building Owned/Land Leased

Sales Offices and Distribution Centers (used by multiple reportable segments)

Fairhaven, Massachusetts

East Coast customization and distribution center

185,370

Owned

Vista, California

West Coast distribution center and golf bag embroidery

102,319

Leased

Cambridgeshire, United Kingdom

Sales office and distribution center, as well as golf club assembly and golf ball customization

156,326

Owned

Helmond, The Netherlands

Sales office and distribution center

69,965

Leased

Victoria, Australia

Sales office and distribution center, as well as golf club assembly

37,027

Leased

Ontario, Canada

Sales office and distribution center

102,057

Leased

Randburg, South Africa

Sales office and distribution center, as well as golf club assembly

25,060

Leased

Yongin-shi, Korea

Distribution center, golf ball customization and golf club assembly

174,982

Leased

Product Testing and Fitting Centers (Golf Balls and Golf Clubs)

Acushnet, Massachusetts

East Coast product testing and fitting for golf balls and golf clubs

22 acres total, including 7,662 square foot building

Owned

Oceanside, California

West Coast product testing and fitting for golf balls and golf clubs (Titleist Performance Institute)

30 acres total, including 20,539 square foot building

Owned

(1)Facility size represents square footage of the building, unless otherwise noted.

Name

Age

Position

David Maher

55

President and Chief Executive Officer

Mary Lou Bohn

62

President, Titleist Golf Balls

Steven Pelisek

62

President, Titleist Golf Clubs

John (Jay) Duke, Jr.

54

President, Titleist Golf Gear

Christopher Lindner

54

President, FootJoy

Thomas Pacheco

54

Executive Vice President, Chief Financial Officer and Chief Accounting Officer

Roland Giroux

62

Executive Vice President, Chief Legal Officer and Corporate Secretary

Brendan Reidy

45

Executive Vice President, Chief People Officer

Roger Czuchra

53

Executive Vice President, Chief Technology and Digital Officer

David Maher, 55, joined the Company in 1991 and was appointed President and Chief Executive Officer in January 2018. From 2001 through 2017, Mr. Maher held a variety of roles at the Company’s Fairhaven, Massachusetts headquarters, including Vice President, Titleist U.S. Sales; Senior Vice President, Titleist Worldwide Sales and Global Operations; and Chief Operating Officer. Prior to that, Mr. Maher spent several years in Northern California as a Titleist Sales Representative and Northwest Regional Sales Manager, and previously gained valuable experience in the Company’s professional development program, working at the Company’s golf ball operations in Massachusetts, the FootJoy factory in Brockton, Massachusetts and in the Company’s Southern California golf club operations. Mr. Maher holds a B.S. in Finance from Babson College.

Mary Lou Bohn, 62, joined the Company in 1987 and was appointed President, Titleist Golf Balls in 2016. Prior to that, Ms. Bohn held positions at the Company of Executive Vice President, Titleist Golf Balls and Communications; Vice President Golf Ball Marketing and Titleist Communications; Vice President, Advertising & Communications; and Director, Titleist Advertising. Ms. Bohn holds a B.S./B.A. in Marketing from the University of New Hampshire.

Steven Pelisek, 62, joined the Company in 1993 and was appointed President, Titleist Golf Clubs in 2016. Prior to that, Mr. Pelisek held positions at the Company of General Manager, Titleist Golf Clubs and Vice President, Club Sales for both the Titleist and Cobra golf club brands. In addition, Mr. Pelisek has held both Marketing and Field Sales positions with the Company and with Lynx Golf. Mr. Pelisek holds a B.S. in Engineering and an M.S. in Civil Engineering, both from the University of Maryland.

John (Jay) Duke, Jr., 54, joined the Company and was appointed President, Titleist Golf Gear in 2014. Prior to joining the Company, Mr. Duke was Vice President and Global Franchise Leader for Hasbro - Transformers Global Brand from 2012-2014, President of Karhu Holdings BV from 2008-2012, and held senior general management and strategy positions with Converse Inc. (a subsidiary of Nike, Inc.). Mr. Duke also spent time earlier in his career working for Morgan Stanley’s Investment Banking Division and in general management positions with Reebok International Ltd. Mr. Duke holds a B.A. in Economics and History from Boston College and an MBA from Duke University.

Thomas Pacheco, 54, joined the Company in 2017 and was appointed Executive Vice President, Chief Financial Officer and Chief Accounting Officer in January 2019. Prior to that, Mr. Pacheco was Senior Vice President, Finance and Chief Accounting Officer from April 2017 to December 2018. Prior to joining the Company, Mr. Pacheco was Senior Vice President, Finance and Chief Audit Executive of Dell Technologies from September 2016 to March 2017. Prior to September 2016, Mr. Pacheco served as Senior Vice President, Finance and Chief Accounting Officer at EMC until it was acquired by Dell Technologies. He joined EMC in 2005 and held several roles in Finance including Assistant Corporate Controller, CFO - Cloud Services Division and Senior Director of Corporate Accounting and Reporting. Mr. Pacheco is a Certified Public Accountant and holds an M.B.A from the University of North Carolina and a B.S. in Accounting from Providence College.

Roland Giroux, 62, joined the Company in 2000 and was appointed Executive Vice President, Chief Legal Officer and Corporate Secretary in July 2021. Prior to that, Mr. Giroux held a number of positions with the Company, most recently as Vice President and Associate General Counsel beginning in 2017. Prior to joining the Company, Mr. Giroux was Counsel for Fortune Brands, Inc. and worked at Chadbourne and Parke LLP in the Corporate and Project Finance practice groups. Mr. Giroux holds a B.S. in Chemical Engineering from Rensselaer Polytechnic Institute, an M.B.A. from Long Island University and a J.D. from Pace University.

Brendan Reidy, 45, joined the Company in January 2019 and was appointed Executive Vice President, Chief People Officer in February 2021. Prior to that, Mr. Reidy was the Company’s Senior Vice President, Chief Human Resources Officer from January 2019 to February 2021. Prior to joining the Company, he was Vice President Human Resources - Organizational Effectiveness at Biogen, Inc. from January 2015 to April 2018, where he had responsibility for talent management, global learning, culture initiatives and people analytics, and also led HR for the global R&D organization and Global Commercial Operations. Prior to Biogen, Mr. Reidy worked at P&G and Gillette and held a number of positions in HR including as Country HR Manager for Costa Rica and as a leader of key integration projects for the integration of P&G and Gillette. Mr. Reidy holds a B.A. in English from Stonehill College.

Roger Czuchra, 53, joined the Company in November 2022 and was appointed Executive Vice President, Chief Technology and Digital Officer. Prior to joining the Company, he was the Chief Information Officer at Centric Brands from May 2019 to November 2022 and Chief Information Officer, North & Central America at Legrand from July 2015 to May 2019, where he was responsible for developing a global technology foundation and creating a digital-first strategy. Mr. Czuchra has extensive experience with business analytics and transforming the way diverse, global organizations leverage technology for long-term success. Prior to Legrand, he worked at Stanley Black & Decker. Mr. Czuchra holds a B.S. in Business Management from Albertus Magnus College and a Master of Science in Organizational Leadership from Quinnipiac University School of Business.

						31-Dec-17						31-Dec-18						31-Dec-19						31-Dec-20						31-Dec-21						31-Dec-22
Acushnet Holdings Corp.						$100.00						$102.10						$160.92						$204.66						$271.57						$220.75
S&P 500						$100.00						$95.62						$125.72						$148.85						$191.58						$156.88
S&P 500 Consumer Durables & Apparel						$100.00						$88.04						$118.33						$142.22						$174.02						$122.93

Period						Total number of shares purchased						Average price paid per share						Total number of shares purchased as part of publicly announced plans or programs						Approximate dollar value of shares that may yet be purchased under the plans or programs (1)(2) (in thousands)
October 1, 2022 - October 31, 2022						369,382						$	44.85					369,382						$	191,857
November 1, 2022 - November 30, 2022						375,000						45.34						375,000						174,854
December 1, 2022 - December 31, 2022						387,089						45.05						387,089						157,416
Total						1,131,471						$	45.08					1,131,471						$	157,416

(1)    In connection with our share repurchase program, we have entered into certain share repurchase agreements with Magnus Holdings Co., Ltd. ("Magnus"), a wholly-owned subsidiary of Fila Holdings Corp., to purchase from Magnus an equal amount of our common stock as we purchase on the open market at the same weighted average per share price. In relation to these agreements, we recorded a liability of $92.6 million to purchase an additional 2,000,839 shares of common stock from Magnus as of December 31, 2022. See “Notes to Consolidated Financial Statements-Note 16-Common Stock,” Item 8 of Part II, included elsewhere in this report, for disclosures related to the Magnus share repurchase agreements.

(2)     On February 9, 2023, the Board of Directors authorized us to repurchase up to an additional $250.0 million of our issued and outstanding common stock, bringing the total authorization up to $700.0 million since the share repurchase program was established in 2018.

Our financial results and operations continue to be impacted by the macroeconomic environment, including the ongoing COVID-19 pandemic. Global supply chain issues, the impact of inflation and the impact of changes in foreign currency exchange rates have resulted in constrained raw material, component and sourced product availability and increased raw material and other input costs, including higher freight expense. These increased costs negatively impacted cost of sales for the year ended December 31, 2022, resulting in a lower gross margin as compared to the year ended December 31, 2021. The impact of inflation, particularly in the form of higher raw material costs, as well as the impact of changes in foreign currency exchange rates, is expected to continue in 2023; however, to a lesser extent than experienced in 2022.

We generate substantially all of our sales from the sale of golf‑related products, including golf balls, golf clubs, golf shoes, golf gloves, golf gear and golf apparel. The demand for golf‑related products in general, and golf balls in particular, is directly related to the number of golf participants and the number of rounds of golf being played by these participants. While rounds of play had been relatively stable for years, the game experienced an approximate 8% global increase in rounds in both 2021 and 2020 as dedicated golfers took full advantage of favorable weather, hybrid work schedules and an increase in discretionary time due to the circumstances attendant to the COVID-19 pandemic. The game of golf remained in high demand in 2022, with the number of rounds played approximately 16% higher than the number of rounds played in 2019. We anticipate that rounds of golf played will remain resilient in 2023, driven by golfer demographics, dedicated golfers and economic conditions.

•drivers and fairways in the third or fourth quarter of even‑numbered years, which typically results in an increase in sales of drivers and fairways during such quarters because retailers take on initial supplies of these products as stock inventory, with increased sales generated by such new products continuing the following spring and summer of odd‑numbered years;

•hybrids in the first or second quarter of odd-numbered years, with the majority of sales generated by such new products occurring in the spring, summer and fall of odd‑numbered years;

•irons in the third or fourth quarter of odd‑numbered years, with the majority of sales generated by such new products occurring in the following spring and summer of even‑numbered years because a higher percentage of our new irons as compared to our drivers and fairways are sold through on a custom fit basis and the spring and summer is when golfers tend to make such custom fit purchases;

•Vokey Design wedges in the first quarter of even‑numbered years, with the majority of sales generated by such new products occurring in the spring and summer of such even‑numbered years; and

•Scotty Cameron putters in the first quarter, with the majority of sales generated by such new products occurring in the spring and summer of the year in which they are launched. Historically, Select models were launched in even‑numbered years and Phantom X models launched in odd‑numbered years, however, as a result of the market disruptions caused by the COVID-19 pandemic, we now launch Phantom X models in even-numbered years and Select models in odd-numbered years.

			Year ended December 31,
(in thousands)			2022						2021						2020
Net sales			$	2,270,336					$	2,147,930					$	1,612,169
Cost of goods sold			1,091,103						1,029,493						782,333
Gross profit			1,179,233						1,118,437						829,836
Operating expenses:
Selling, general and administrative			833,422						795,422						610,603
Research and development			56,393						55,335						48,942
Intangible amortization(1)			7,885						7,868						11,629
Restructuring charges			—						—						13,207
Income from operations			281,533						259,812						145,455
Interest expense, net			13,269						7,709						15,630
Other expense, net			8,829						4,280						16,776
Income before income taxes			259,435						247,823						113,049
Income tax expense			54,351						63,583						13,038
Net income			205,084						184,240						100,011
Less: Net income attributable to noncontrolling interests			(5,806)						(5,367)						(4,005)
Net income attributable to Acushnet Holdings Corp.			$	199,278					$	178,873					$	96,006
Adjusted EBITDA:
Net income attributable to Acushnet Holdings Corp.			$	199,278					$	178,873					$	96,006
Interest expense, net			13,269						7,709						15,630
Income tax expense			54,351						63,583						13,038
Depreciation and amortization (1)			41,706						41,243						45,429
Share-based compensation			24,083						27,639						16,016
Restructuring and transformation costs(2)			—						2,429						15,589
Beam indemnification expense (3)			—						—						9,871
Other extraordinary, unusual or non-recurring items, net (4)(5)			(85)						1,494						17,600
Net income attributable to noncontrolling interests			5,806						5,367						4,005
Adjusted EBITDA			$	338,408					$	328,337					$	233,184
Adjusted EBITDA margin			14.9		%				15.3		%				14.5		%

			Year ended																								Constant Currency
			December 31,												Increase/(Decrease)												Increase/(Decrease)
(in millions)			2022						2021						$ change						% change						$ change						% change
Titleist golf balls			$	678.8					$	667.6					$	11.2					1.7		%				$	37.9					5.7		%
Titleist golf clubs			609.6						551.5						58.1						10.5		%				89.7						16.3		%
Titleist golf gear			204.9						192.6						12.3						6.4		%				24.1						12.5		%
FootJoy golf wear			618.0						580.6						37.4						6.4		%				71.1						12.2		%

			Year ended																								Constant Currency
			December 31,												Increase/(Decrease)												Increase/(Decrease)
(in millions)			2022						2021						$ change						% change						$ change						% change
United States			$	1,227.8					$	1,125.0					$	102.8					9.1		%				$	102.8					9.1		%
EMEA(1)			321.5						296.0						25.5						8.6		%				60.6						20.5		%
Japan			161.0						188.0						(27.0)						(14.4)		%				4.2						2.2		%
Korea			312.7						322.6						(9.9)						(3.1)		%				29.6						9.2		%
Rest of World			247.3						216.3						31.0						14.3		%				43.5						20.1		%
Total net sales			$	2,270.3					$	2,147.9					$	122.4					5.7		%				$	240.7					11.2		%

			Year ended
			December 31,												Increase/(Decrease)
(in millions)			2022						2021						$ change						% change
Titleist golf balls			$	112.7					$	106.2					$	6.5					6.1		%
Titleist golf clubs			100.9						75.4						25.5						33.8		%
Titleist golf gear			11.7						14.7						(3.0)						(20.4)		%
FootJoy golf wear			37.0						44.2						(7.2)						(16.3)		%

A detailed review of our results of operations for the year ended December 31, 2021 as compared to the year ended December 31, 2020 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Annual Report for the year ended December 31, 2021, which was filed with the SEC on March 1, 2022, and is incorporated herein by reference.

Our primary cash needs relate to working capital, capital expenditures, servicing our debt, paying dividends, pension contributions and repurchasing shares of our common stock. Additionally, from time to time, we may make strategic acquisitions and investments to complement our products, technologies or businesses, which could impact our liquidity needs. We expect to rely on cash flows from operations and borrowings under our revolving credit facility and local credit facilities as our primary sources of liquidity.

			Year ended December 31,
(in thousands)			2022						2021						2020
Cash flows from:
Operating activities			$	(67,787)					$	314,122					$	264,425
Investing activities			(140,222)						(37,597)						(24,675)
Financing activities			(8,584)						(140,326)						(128,587)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash			(6,180)						(5,974)						6,105
Net (decrease) increase in cash, cash equivalents and restricted cash			$	(222,773)					$	130,225					$	117,268

A review of our cash flow activities for the year ended December 31, 2021 as compared to the year ended December 31, 2020 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Annual Report for the year ended December 31, 2021, which was filed with the SEC on March 1, 2022, and is incorporated herein by reference.

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: 

•Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;

•Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

•Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2022. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control – Integrated Framework (2013)”. 

Based on our assessment, our management determined that, as of December 31, 2022, our internal control over financial reporting is effective. 

ITEM 15.            EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)The following documents are filed as a part of this report:

(1)Financial Statements. See Index to Consolidated Financial Statements on page F-1 hereof.

(2)Financial statement schedules are omitted because they are not applicable or the required information is shown in the Consolidated Financial Statements or notes thereto.

(3)Exhibits Index:

Exhibit Number						Description
3.1						Amended and Restated Certificate of Incorporation of Acushnet Holdings Corp. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8‑K filed on November 2, 2016 (No. 001‑37935)).
3.2						Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Acushnet Holdings Corp. (incorporated by reference to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K filed on February 28, 2019 (No. 001-37935)).
3.3						Amended and Restated Bylaws of Acushnet Holdings Corp. (incorporated by reference to Exhibit 3.2 to the Registrant's Current Report on Form 8-K filed on November 2, 2016 (no. 001-37935)).
4.1						Description of Securities (incorporated by reference to Exhibit 4.1 to the Registrant's Annual Report on Form 10-K filed on February 27, 2020 (No. 001-37935)).
10.1†						Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement under the Acushnet Holdings Corp. 2015 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registrant's Annual Report on Form 10-K filed on March 1, 2022 (No. 001-37935)).
10.2†						Form of Performance Stock Unit Grant Notice and Performance Stock Unit Agreement under the Acushnet Holdings Corp. 2015 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 to the Registrant's Annual Report on Form 10-K filed on March 1, 2022 (No. 001-37935)).
10.3†						Acushnet Executive Severance Plan (as amended and restated effective January 1, 2019) (incorporated by reference to Exhibit 10.3 to the Registrant's Annual Report on Form 10-K filed on February 28, 2019 (No. 001-37935)).
10.4†						Acushnet Company Supplemental Retirement Plan (as amended and restated effective December 31, 2015) (incorporated by reference to Exhibit 10.10 to the Registrant’s Registration Statement on Form S‑1 (No. 333‑212116)).
10.5†						Acushnet Company Amended and Restated Trust Agreement, dated as of August 31, 2016 (incorporated by reference to Exhibit 10.11 to the Registrant’s Registration Statement on Form S‑1 (No. 333‑212116)).
10.6†						Amended and Restated Acushnet Company Excess Deferral Plan II (effective July 29, 2011) (incorporated by reference to Exhibit 10.16 to the Registrant’s Registration Statement on Form S‑1 (No. 333‑212116)).
10.7						Second Amendment and Agency Resignation, Appointment and Assumption, dated as of August 2, 2022, by and among Acushnet Holdings Corp., Acushnet Company, Acushnet Canada Inc., Acushnet Europe Limited, certain subsidiaries of Acushnet Company, the lenders party thereto, Wells Fargo Bank, National Association, as the resigning administrative agent, and JPMorgan Chase Bank, N.A., as the successor administrative agent (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q filed on August 4, 2022 (No. 001-37935)).
10.8						Joint Venture Agreement between Acushnet Cayman Limited and Myre Overseas Corporation, dated as of June 1, 1995 (incorporated by reference to Exhibit 10.18 to the Registrant’s Registration Statement on Form S‑1 (No. 333‑212116)).
10.9						Registration Rights Agreement, dated October 26, 2016, among the Company and the Holders (as defined therein) (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8‑K filed on November 1, 2016 (No. 001‑37935)).
10.10†						Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement for Directors under the Acushnet Holdings Corp. 2015 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.12 to the Registrant's Annual Report on Form 10-K filed on February 28, 2019 (No. 001-37935)).
10.11†						Acushnet Holdings Corp. Independent Directors Deferral Plan (incorporated by reference to Exhibit 10.21 to the Registrant’s Registration Statement on Form S‑1 (No. 333‑212116)).
10.12†						Acushnet Holdings Corp. 2015 Omnibus Incentive Plan, as amended on February 16, 2017 (filed herewith).
10.13†						Employment Agreement between Acushnet Holdings Corp. and David E. Maher, dated as of December 22, 2017 (incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K filed on March 7, 2018 (No. 001-37935 ).
10.14†						Acushnet Holdings Corp. Employee Deferral Plan (incorporated by reference to Exhibit 10.18 to the Registrant’s Annual Report on Form 10-K filed on March 7, 2018 (No. 001-37935)).
21.1						List of Subsidiaries (filed herewith).
23.1						Consent of PricewaterhouseCoopers LLP (filed herewith).
24.1						Power of Attorney (filed herewith).
31.1						Certification of Periodic Report by Chief Executive Officer Pursuant to Rule 13a–14(a) or 15d–14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
31.2						Certification of Periodic Report by Chief Financial Officer Pursuant to Rule 13a–14(a) or 15d–14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

32.1						Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.2						Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
101.INS						Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH						XBRL Taxonomy Extension Schema (filed herewith).
101.CAL						XBRL Taxonomy Extension Calculation Linkbase (filed herewith).
101.DEF						XBRL Taxonomy Extension Definition Linkbase (filed herewith).
101.LAB						XBRL Taxonomy Extension Label Linkbase (filed herewith).
101.PRE						XBRL Taxonomy Extension Presentation Linkbase (filed herewith).
104						Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).

			ACUSHNET HOLDINGS CORP.
			By:			/s/ David Maher
						Name:			David Maher
Date: March 1, 2023						Title:			President and Chief Executive Officer

Signature

Capacity

Date

/s/ David Maher

President and Chief Executive Officer (Principal Executive Officer)

March 1, 2023

David Maher

/s/ Thomas Pacheco

Executive Vice President, Chief Financial Officer and Chief Accounting Officer (Principal Financial Officer and Principal Accounting Officer)

March 1, 2023

Thomas Pacheco

*

Chairman

March 1, 2023

Yoon Soo Yoon

*

Director

March 1, 2023

Gregory Hewett

*

Director

March 1, 2023

Ho Yeon Lee

*

Director

March 1, 2023

Jan Singer

*

Director

March 1, 2023

Sean Sullivan

*

Director

March 1, 2023

Steven Tishman

*

Director

March 1, 2023

Keun Chang Yoon

*By:			/s/ Roland Giroux
			Name:			Roland Giroux
			Title:			Attorney In Fact

			Page(s)
Audited Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm  (PCAOB ID 238)			F-2
Consolidated Balance Sheets			F-4
Consolidated Statements of Operations			F-5
Consolidated Statements of Comprehensive Income			F-6
Consolidated Statements of Cash Flows			F-7
Consolidated Statements of Shareholders' Equity			F-8
Notes to Consolidated Financial Statements			F-9

We have audited the accompanying consolidated balance sheets of Acushnet Holdings Corp. and its subsidiaries (the “Company”) as of as of December 31, 2022 and 2021, and the related consolidated statements of operations, comprehensive income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2022, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

(in thousands, except share and per share amounts)			December 31, 2022						December 31, 2021
Assets
Current assets
Cash, cash equivalents and restricted cash ($14,376 and $15,612 attributable to the variable interest entity ("VIE"))			$	58,904					$	281,677
Accounts receivable, net			216,695						174,435
Inventories ($17,866 and $19,385 attributable to the VIE)			674,684						413,314
Prepaid and other assets			108,793						99,750
Total current assets			1,059,076						969,176
Property, plant and equipment, net ($10,089 and $10,466 attributable to the VIE)			254,472						231,761
Goodwill ($32,312 and $32,312 attributable to the VIE)			224,814						210,431
Intangible assets, net			525,903						465,341
Deferred income taxes			47,551						60,814
Other assets ($2,083 and $2,166 attributable to the VIE)			81,991						68,313
Total assets			$	2,193,807					$	2,005,836
Liabilities, Redeemable Noncontrolling Interests and Shareholders' Equity
Current liabilities
Short-term debt			$	40,336					$	116
Current portion of long-term debt			—						17,500
Accounts payable ($11,914 and $13,275 attributable to the VIE)			166,998						163,607
Accrued taxes			40,922						57,307
Accrued compensation and benefits ($1,651 and $1,511 attributable to the VIE)			98,245						113,453
Accrued expenses and other liabilities ($3,380 and $4,677 attributable to the VIE)			202,124						131,041
Total current liabilities			548,625						483,024
Long-term debt			527,509						297,354
Deferred income taxes			5,896						4,950
Accrued pension and other postretirement benefits			74,234						93,705
Other noncurrent liabilities ($2,145 and $2,218 attributable to the VIE)			54,177						43,237
Total liabilities			1,210,441						922,270
Commitments and contingencies (Note 22)
Redeemable noncontrolling interests			6,663						3,299
Shareholders' equity
Common stock, $0.001 par value, 500,000,000 shares authorized; 76,321,523 and 75,855,036 shares issued			76						76
Additional paid-in capital			960,685						948,423
Accumulated other comprehensive loss, net of tax			(109,668)						(99,582)
Retained earnings			473,130						324,966
Treasury stock, at cost; 8,892,425 and 3,314,562 shares (including 2,000,839 and 537,839 of accrued share repurchase) (Note 16)			(385,167)						(131,039)
Total equity attributable to Acushnet Holdings Corp.			939,056						1,042,844
Noncontrolling interests			37,647						37,423
Total shareholders' equity			976,703						1,080,267
Total liabilities, redeemable noncontrolling interests and shareholders' equity			$	2,193,807					$	2,005,836

			Year ended  December 31,
(in thousands, except share and per share amounts)			2022						2021						2020
Net sales			$	2,270,336					$	2,147,930					$	1,612,169
Cost of goods sold			1,091,103						1,029,493						782,333
Gross profit			1,179,233						1,118,437						829,836
Operating expenses:
Selling, general and administrative			833,422						795,422						610,603
Research and development			56,393						55,335						48,942
Intangible amortization			7,885						7,868						11,629
Restructuring charges			—						—						13,207
Income from operations			281,533						259,812						145,455
Interest expense, net (Note 19)			13,269						7,709						15,630
Other expense, net			8,829						4,280						16,776
Income before income taxes			259,435						247,823						113,049
Income tax expense			54,351						63,583						13,038
Net income			205,084						184,240						100,011
Less:  Net income attributable to noncontrolling interests			(5,806)						(5,367)						(4,005)
Net income attributable to Acushnet Holdings Corp.			$	199,278					$	178,873					$	96,006
Net income per common share attributable to Acushnet Holdings Corp.:
Basic			$	2.77					$	2.40					$	1.29
Diluted			2.75						2.38						1.28
Weighted average number of common shares:
Basic			71,958,879						74,536,637						74,494,310
Diluted			72,560,098						75,265,074						75,060,610

			Year ended  December 31,
(in thousands)			2022						2021						2020
Net income			$	205,084					$	184,240					$	100,011
Other comprehensive (loss) income :
Foreign currency translation adjustments			(30,940)						(23,009)						27,281
Cash flow derivative instruments
Unrealized holding gain (loss) arising during period			10,856						10,049						(6,823)
Reclassification adjustments included in net income			(9,840)						4,991						(2,220)
Tax (expense) benefit			(585)						(4,223)						2,495
Cash flow derivative instruments, net			431						10,817						(6,548)
Pension and other postretirement benefits
Pension and other postretirement benefits adjustments			25,473						13,332						(6,362)
Tax (expense) benefit			(5,050)						(4,540)						1,475
Pension and other postretirement benefits adjustments, net			20,423						8,792						(4,887)
Total other comprehensive (loss) income			(10,086)						(3,400)						15,846
Comprehensive income			194,998						180,840						115,857
Less: Comprehensive income attributable to noncontrolling interests			(5,775)						(5,310)						(4,243)
Comprehensive income attributable to Acushnet Holdings Corp.			$	189,223					$	175,530					$	111,614