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Segment Information
 9 Months Ended
Sep. 30, 2014
Segment Reporting [Abstract]  
Segment Information
Note 16. Segment Information
The Company has two operating segments that are organized on the basis of products, namely the golf clubs segment and golf balls segment. The golf clubs segment consists of Callaway Golf woods, hybrids, irons and wedges and Odyssey putters. This segment also includes golf apparel and footwear, golf bags, golf gloves, travel gear, headwear and other golf-related accessories, in addition to royalties from licensing of the Company’s trademarks and service marks and sales of pre-owned golf clubs. The golf balls segment consists of Callaway Golf balls that are designed, manufactured and sold by the Company. There are no significant intersegment transactions.
The table below contains information utilized by management to evaluate its operating segments for the interim periods presented (in thousands):
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2014
 
2013(1)
 
2014
 
2013(1)
Net sales:
 
 
 
 
 
 
 
Golf Clubs
$
143,353

 
$
152,207

 
$
635,821

 
$
604,433

Golf Balls
25,219

 
26,022

 
116,518

 
111,198

 
$
168,572

 
$
178,229

 
$
752,339

 
$
715,631

Income before income taxes:
 
 
 
 
 
 
 
Golf Clubs (2)
$
3,760

 
$
(5,060
)
 
$
77,922

 
$
63,969

Golf Balls (2)
543

 
(2,770
)
 
17,350

 
(85
)
Reconciling items(3)
(5,133
)
 
(12,286
)
 
(34,074
)
 
(28,365
)
 
$
(830
)
 
$
(20,116
)
 
$
61,198

 
$
35,519

Additions to long-lived assets:
 
 
 
 
 
 
 
Golf Clubs
$
2,169

 
$
4,236

 
$
7,401

 
$
10,669

Golf Balls
102

 
66

 
203

 
95

 
$
2,271

 
$
4,302

 
$
7,604

 
$
10,764

 
(1)
The prior year amounts have been reclassified to reflect the Company's current year allocation methodology related to freight revenue and costs, certain discounts and other reserves not specific to a product type. For the three months ended September 30, 2013, this resulted in a decrease to net sales and an increase to loss before income taxes of $403,000 and $650,000, respectively, in the golf clubs segment, and a corresponding increase to net sales and decrease to loss before income taxes in the golf balls segment. For the nine months ended September 30, 2013, this resulted in increases in net sales and income before income taxes of $834,000 and $3,559,000, respectively, in the golf clubs segment, and corresponding decreases in net sales and income before income taxes in the golf balls segment.
(2)
In connection with the Cost Reduction Initiatives (see Note 2), the Company’s golf clubs and golf balls segments recognized pre-tax charges of $990,000 and $454,000, respectively during the three months ended September 30, 2013, and $4,261,000 and $4,682,000, respectively, during the nine months ended September 30, 2013.
(3)
Reconciling items represent corporate general and administrative expenses and other income (expense) not included by management in determining segment profitability. The change in reconciling items in the third quarter and first nine months of 2014 compared to the same periods in 2013 was primarily due to foreign currency transactions. During the three and nine months ended September 30, 2013, the reconciling items include pre-tax charges of $414,000 and $1,423,000, respectively, in connection with the Cost Reduction Initiatives.