Good morning, everyone, and welcome to the Acushnet Holdings Conference. My name is Kat and I'll be your moderator today. [Operator Instructions] I would now like to pass the conference over to your host, Sondra Lennon, Vice President of FP&A and Investor Relations. Please go ahead.

Good morning, everyone. Thank you for joining us today for Acushnet Holdings Corp.'s First Quarter 2024 Earnings Conference Call. Joining me this morning are David Maher, our President and Chief Executive Officer; and Sean Sullivan, our Chief Financial Officer. Before turning the call over to David, I would like to remind everyone that we will make forward-looking statements on the call today. These forward-looking statements are based on Acushnet's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations. For a list of factors that could cause actual results to differ, please see today's press release, the slides that accompany our presentation and our filings with the U.S. Securities and Exchange Commission. Throughout this discussion, we will make reference to non-GAAP financial metrics, including items such as net sales on a constant currency basis and adjusted EBITDA. Explanations of how and why we use these metrics and reconciliations of these items to the most directly comparable GAAP metric can be found in the schedules in today's press release, the slides that accompany this presentation and in our filings with the U.S. Securities and Exchange Commission. Please also note that references throughout this presentation to year-on-year sales increases and decreases are on a constant currency basis unless otherwise stated as we feel this measurement best provides context as to the performance and trends of our business. And when referring to year-to-date results or comparisons, we are referring to the 3-month period ended March 31, 2024 and the comparable 3-month period in 2023. With that, I'll turn the call over to David.

Thanks, Sondra, and good morning, everyone. As always, we appreciate your interest in Acushnet Holdings. I am pleased to report on a strong start to the year for Acushnet led by our momentum in golf balls and clubs supported by continued supply chain enhancements and better than expected startup at our new North American distribution center. As is customary in Q1, we launched a wide range of new products across our portfolio helping to deliver worldwide net sales of $708 million, a 4% constant currency increase over last year. This contributed to adjusted EBITDA of $154 million, a 5% gain for the quarter. Global interest in golf and rounds of play continue to be healthy. U.S. rounds were up 21% in March and 7% for the quarter, positive trends particularly given poor weather across the Southeast. Conversely, rounds were off 9% and 12% in Korea and the U.K. where elevated rainfall caused delayed starts to their seasons. These weather related puts and takes are common for Q1 and in line with the widely held belief that the golf season more often than not starts with the Masters in early April. Turning to our segment results. You see golf ball sales increased 9% in the quarter, which is noteworthy given the steep comp against last year's sizable Pro V1 launch and 21% growth. This gain was led by double-digit growth in the U.S. We successfully launched new AVX, Tour Soft and TruFeel models in the quarter and also benefited from greater than expected demand and fulfillment in our Pro V1 loyalty rewarded program in March. This golf ball success was supported by an especially fast start on the PGA Tour where Titleist golf balls were used by the winners of 16 of the first 18 events of the 2024 season. Titleist…

Thank you, David. Good morning, everyone. As David highlighted, we had a strong start to 2024 with a first quarter net sales increase of 4% over prior year. Adjusted EBITDA was $153.7 million, a 4.7% increase from the first quarter of 2023. Net sales growth in the quarter was driven by continued momentum of our Titleist brand with golf clubs, golf balls and golf gear growing by 14%, 9% and 2%, respectively. FootJoy net sales declined 6% in the quarter. Geographically net sales were up in Q1 in the U.S.; but declined in Korea, Japan and EMEA primarily due to lower net sales within our FootJoy golf wear segment and lower net sales of products that are not allocated to 1 of our 4 reportable segments. Gross profit in the first quarter of $378 million was up 3% or $12 million compared to 2023 primarily due to increased net sales partially offset by lower net sales and unfavorable manufacturing overhead absorption in FootJoy golf wear. SG&A expense of $237 million in the quarter increased $14 million or 6% from 2023 due in part to increases in advertising and promotional expense, information technology related expenses and employee related selling expenses, which were partially offset by lower retail commission expense in Korea. SG&A expense in the first quarter also included $7 million of restructuring costs related to the closing of certain production lines in China as a portion of our footwear production transitions to Vietnam. Interest expense of $13 million in the quarter was up $3 million due to an increase in interest rates and borrowings. Our effective tax rate in Q1 was 21.7%, up from 18.1% last year primarily driven by a shift in our jurisdictional mix of earnings. Moving to our balance sheet and cash flow highlights. Our balance sheet…

Thank you, Sean. Operator, could we now open up the lines for questions?

[Operator Instructions] We have our first question from Matthew Boss from JPMorgan.

And congrats on a really nice quarter. So David, you cited the golf industry is structurally healthy today. Could you elaborate on overall participation and engagement that you're seeing from your dedicated golfer? Any change in U.S. momentum post the Masters? And on a global basis, any callouts on the international front just with the divergence in top line performance?

So first off, I think it's worth a minute to look at the U.S. market. Very strong rounds of play data, up 20% some-odd in March and up 6% or 7% for the quarter. That I think needs to be taken with a grain of salt because you had some tough weather in the Southeast that affected play and affected the market. So we're very pleased with the overall interest in demand and participation levels. Rounds of play in the north in Q1 are different than rounds of play in the south in Q1. I think that really just points to the weather differences we saw. But overall, structurally very pleased. And again in markets where you had tough weather, you saw rounds decline, you saw a slower retail; and conversely where you had favorable weather, you saw some nice upticks. Moving around the globe a bit, I called out we had some particularly wet starts to the season. Very common in Q1, you're going to have some slow starts and some quicker starts. Wet weather, I think I called out Korea and the U.K. slowed their starts to the season. But generally speaking where you saw a decent weather, you saw rounds of play favorable. So to our golfer and the dedicated player, not a lot has changed in the last months and quarters. Demand is strong, they're avid, they're resilient. Again the biggest callout at this stage is really focused on weather. But in terms of early demand, I'll point to some of our new product launches whether it's golf balls, I noted on the call that we're pleased and it was a unique quarter in that we drove gains from all newly launched performance models and also Pro V1, which comped against last year's launch. So we…

It's great color. And then maybe just with inventory exiting the first quarter down midteen. Could you just speak to your overall comfort with inventory on hand to support demand? And on the footwear category, just the latest timeline as we think about this category returning to clean across the marketplace and the potential return to top line growth?

Yes. Matt, maybe I'll start and David can jump in. So we feel very good about the inventory position. Obviously we wanted to call out where we are sequentially, where we are year-over-year. We've called out footwear for the last couple of quarters, we feel very good about the inventory position. So across the board in all of our product segments whether it's current gen or prior gen, we feel very good about the working capital investment there as we sit here in Q1.

Yes. Matt, I'll just follow on that a bit just to echo Sean's comments. The channels are full as they should be this time of year. So we don't see any outlying areas of inventory concern and I'll reinforce we really like our inventory position both in terms of quantity and quality. If there's 1 area we'd like to have more, it's golf balls and that's something we continue to work on. Maybe just a bit more color on footwear. The footwear market in the U.S., channel inventories all-in, total market's down about 12% from last year this time and really right where we think it ought to be not far off from believe it or not 2019. So the footwear category has grown nicely, but footwear inventories today are only up 2%, 3%, 4% from where they were in 2019. So after a year or 15 months of correction in footwear, we like where the U.S. footwear market is. Little different story around the world, I think that's trailing a quarter or 2, which is not surprising. So we see rest of world inventories, and we'd call out Japan and EMEA principally, we see that correction probably take another quarter or 2.

Congrats. Best of luck.

The next question is from Megan Alexander from Morgan Stanley.

Wanted to ask a little bit, Sean, you gave some commentary on the guidance, you left it unchanged for the year. You kept your first half expectations unchanged despite a solid 1Q beat at least versus what the Street was expecting and it seems like momentum over the quarter after a slower start. I know it's historically been your practice to wait until 2Q to make any changes given 1Q is more of a sell-in quarter. So is that how we should think about the guidance being unchanged today? Maybe related to that, you did mention that you completed the global launch of some clubs a few weeks ahead of schedule. So was there any pull forward into 1Q and how are you seeing kind of sell-through in that golf club segment trends versus your expectations?

Yes, Megan. So to the guidance in the first half, I think as David said, it's really a first half, second half. So the expectation is to hold for the first half. We do think that all the vital signs are positive with the exception of weather what David has talked about. So we just think it's prudent at this stage of the year to hold in terms of what our expectations are for the first half and the full year. That being said, certainly as you look across the board, we're pleased with the balls and the loyalty rewarded program, obviously clubs had a very strong SM10 Vokey launch in Q1. And we still feel good about Q2, obviously it still implies a low single-digit growth for the quarter. We'll continue to invest, as we've said, across the board to support our advertising, promotion, fitting network, some of the IT related expenses. So we continue to invest appropriately in SG&A. And the last thing I'll say is, and David called it out in his comments, we really are pleased with our distribution center and probably we're more efficient in the month of March than we had anticipated. So certainly that exceeded our expectations a bit. But all in all, I think we still see the first half and the full year as we've articulated and certainly when we're back together in July or early August, whenever the call is, we can certainly revisit. But all things positive, again I'll leave it at that.

Megan, just maybe some historical color. In all my time with the company, I don't know that we've ever adjusted guidance after Q1 and it really speaks to a reality of the golf business that everybody's crystal ball gets a lot clearer in the second quarter as markets open up. I made the comment about the golf season in many respects truly begins with the Masters in April, that's true. So you need to see how mid-belt and snow belt markets open up, how markets around the world open up. And again it's always been our feeling that you can't really have a clear, clear sense of the industry in the year until you get through Q2. And then maybe just another thought on distribution center progress really related to staffing and training and that's gone along quite a bit better than we anticipated some 6, 8 weeks ago. So we're very pleased with the progress being made at our new DC.

Great. That's really helpful. And then maybe just a follow-up to that point. The gross margin up again. Can you just talk a little bit about how that played out relative to your expectations and particularly how the promotional environment looks out there? I think you talked about perhaps margins and EBITDA growth being a bit more pressured in 1Q just given the promotional environment. So just trying to understand how that played out relative to your expectations as we think about the second quarter.

Sure. Megan, I'll take the margin question. I think it was in line with expectations and certainly given the margin profile of both balls and clubs and the performance of those 2 product segments, I guess we weren't surprised by the gross margin trajectory in the quarter.

As to the market, Megan, the promotional environment; again the markets are full, retailers are full as they should be this time of year in anticipation of the peak Q2 and Q3 playing seasons. There are 2 areas that we would point to drivers simply because there were a whole lot of competitive launches and with that, you get some degree of sell-off and discounting of prior generation. Same thing happened in golf balls. I don't know that I would characterize any of those as out of the ordinary though. So I don't see promotional activity as being noteworthy as either high or low or too too far off from the norms and just another reality. When you see promotional activity pick up, it tends to be late Q2, early Q3 after the season. So not a lot of new color to add other than what we're seeing is about what we expected for this time of year.

The next question is from Randy Konik from Jefferies.

I guess David, first for you. You've always been very balanced about your view on the industry and never to get too [ far ] yet the industry continues to power ahead. Is this surprising you or how much is it surprising you? And then maybe you could give us some perspective on drivers of long-term participation. Anything you can share with us from a data point perspective with your partners in the green grass area as it relates to junior programming level, female participation and lesson levels? And then just Country Club waiting list would be very helpful to get your perspective on?

Okay, Randy. Well, I appreciate your questions. From an industry standpoint, we're at a point in time where we've seen 6 years where the number of golfers has increased, right? So obviously a real positive and the industry is working hard to make good use of that interest in demand. Our focus is obviously on what happens on course and certainly there's a whole another world happening off course that we don't participate in, but I would say is additive to the on course experience. You look at NGF profile data, they'll point to women and juniors being some of the fastest growing segments. So what's the game doing about it? There was a line from I think it was [ Seth Watt ], the PGA, who said let's make sure we don't just let this great parade go by without doing something about it. And the game and the industry are working hard to be responsive and welcoming and accommodating to new players and I think a couple of themes that stand out there would be number of lessons. And the game is hard and 1 of the reasons people leave is because it's difficult. So 1 way you can make the game less difficult and more sticky, if you will, is to execute and provide more lessons. So globally we're seeing that, teachers are as busy as they've been in a long time both in the U.S. and around the world. And in terms of how we think about drivers of long-term participation, I would call out the reality that what we've seen in the last handful of years and it's sort of an unintended benefit of the game. As the game has done quite well; as golf participants, golf clubs, golf retailers have done well in recent…

That's super helpful. And then I guess maybe last question just for Sean. When you look at the 10-year historical model for this company, you have EBITDA margins that were usually around 12% to 13%. We're now around, I don't know, 15%, 16%, somewhere in that ballpark. You have lower comps, there's a consolidated industry, there's customization fittings, et cetera. Have you kind of put some thoughts to how we should be thinking about long-term margin potential in this business? Just kind of puts and takes that we should be thinking about over the long term?

Randy, so we talk about it quite often. I guess before I get specifically into the margin, I think that what we're most excited about is the building blocks for growth here in terms of the portfolio of assets that we have and products to service the dedicated golfer and certainly as that dedicated golfer universe continues to expand to the extent that all of these investments that are occurring and the participation rates continue, we feel we've got real building blocks for long-term growth that we're excited about, number one, and that's excluding any potential M&A. We've done a few things over the last 5 or 6 years that still have opportunities for growth. So first and foremost, we're excited about what the growth outlook can be on the top line for the company over a 5- to 10-year period. Number two, we're making a lot of investments as we've talked about across the company to meet the needs of the dedicated golfer; that's in terms of customization, in terms of fitting. So we believe we're well positioned there and certainly we like the margin profile of customization and personalized fitting of our products. In addition through technology, through direct-to-consumer channels, obviously managing all channels and all key on and off-course partners, we think there's opportunity. Certainly we talk about operating leverage in the business and the ability to continue to through the use of technology and efficiency deliver incremental EBITDA and long-term margin growth. So those are kind of the puts and the outlook that I see. I'm certainly not going to dimensionalize what I see the road map in 5 to 10 years, certainly a long time from now. But we believe that, as I said, we've got the revenue trajectory and we're making the appropriate investments across the globe and portfolio that will drive long-term growth and hopefully margin expansion.

The next question is from Joe Altobello from Raymond James.

I guess first question, I wanted to get your thoughts on the growth in the quarter of Pro V1, Pro V1x against the launch period, which I think is sort of unusual. Maybe what did sell-through look like in the quarter and did you guys experience any meaningful share gain in the quarter?

Joe, I'll take that one. So it is, we had a significant launch last year and it's unusual when you comp favorably against a launch in the following year given our 2-year product life cycles. I think the key differential, we saw really nice demand for our loyalty rewarded program, which is our buy 3 get 1 free to start the season and our ops team did a nice job fulfilling that demand in March. So we like the message that sends around demand for our product. So that was theme one. In terms of market share, again we're coming off a big comp last year. We launched a whole new range of new products this year. We feel very strong about our market position. It's always a little different in the first quarter of an even year as we comp against last year when we sold off some prior generation inventory. And conversely, our competitors sell off some of their prior generation inventory this year. So net-net we like the way our ball business is moving along. And I would add we continue to see nice demand in the corporate space for corporate logo products. So that's just another dimension of the golf ball business that's driving our success. To demand, I hate to keep drilling on the regional piece and the weather piece, but said simply where people are playing, we like demand; where they're not playing due to weather or slow starts, obviously demand is slower. But again that's life in the golf business in Q1. But overall, we are really pleased with our first quarter performance and the overall state and readiness of our golf ball business and our ball fitting teams around the globe to do what they're going to do here in the next couple of months.

Very helpful. And maybe a couple of follow-ups for Sean. I guess first, the yen has weakened a little bit here. Is there any impact on your business or is it too insignificant to really call out? And maybe secondly, how are you thinking about free cash flow conversion in terms of your EBITDA outlook for this year?

Sorry, I'm not sure I got the second one. But the yen, we're certainly watching it. Obviously it's at historic levels. We definitely had an impact in the first quarter, which was probably $5-plus million in terms of impact year-over-year. So we're keeping an eye on it. Overall we continue to like the overall international businesses for 2024 in the aggregate. Certainly we're keeping our eye on Japan. And sorry, Joe, your second question?

Yes, free cash flow conversion relative to EBITDA this year?

Yes, I don't know that we guide to that. But again I would expect us to convert not at the similar rate that we have historically.

The next question is from Casey Alexander from Compass Point.

He just stole my Japan question, but I'll move on to my next one. There seemed to be sort of a hat tip towards travel related products in the press release. Is this a nod towards Club Glove, which you basically took control of this year? Has there been sort of an uptick in demand for that new company that you brought on? Did you kind of walk into a nice little uptick in demand at Club Glove?

Casey, I wouldn't make that assumption. I think it's more commentary on the total of our gear business. We were looking last year, we were up some 50% in the quarter and felt we had a nice comp this year even while we added Club Glove and also pulled back on some Titleist branded travel products that were maybe a bit redundant to Club Glove. But I wouldn't point to that simply because while we're pleased with the early start to Club Glove, it's a rather small piece of the gear story. And again while we're bullish and enthused about Club Glove both today and longer term, again I wouldn't read too much into that piece of the story.

All right. And secondly, my second question is historically the repurchase from Magnus has been in $100 million increments and this most recent one pulled down to $37.5 million. Why the change in the cadence of when do you repurchase? Is it to try to keep the stock closer to what the repurchase price is? I'm just curious why change that cadence after several that were at $100 million.

Casey, it's Sean. That's a good question. At the end of the day, as I've said a few times, we're really guided by the leverage, right, in terms of maintaining leverage below 2.25x. So often given the cadence of the year with the sell-in in the first quarter, the investment in working capital, we look at the share repurchase and the Magnus agreement in the context of overall leverage. So I don't know that I would read a whole lot into past practice or current practice, but I really point to you to we're trying to manage the business and maintain a very strong balance sheet with that leverage target.

The next question is from Mike Swartz from Truist Securities.

I just wanted to start with the ball business and maybe following up on Joe's question, but taking a little higher level view of it. In a typical even numbered year lapping a Pro V1 launch if it's been very rare that the ball business has grown and I think even back in February, you had said you expected the ball business to grow year-over-year. I think you've had a loyalty program before, understanding you've got some new product launches this year. But I guess has something structurally changed relative to maybe the prepandemic level where you can now grow in even number years in that business or is this more of a factor of inventory levels are just still too low and you're still rebuilding some of that this year?

Mike, I would say it's a good question. What's different today versus a handful of years ago. I've said this before, annually there are about 150 million or so more rounds of golf being played today than were played in 2019, right? So you do the math on that and what it means to a golf ball company. I would also say that we've been producing golf balls at near full capacity for quite some time to keep pace with demand and to put enough product in the market to represent the brand the way we want it to be represented. So without pointing to 1 singular event, I would say overall demand is up. We think our shares are up. We think our manufacturing capabilities and output certainly this year versus last year are in better shape and I would point to global channel inventories as being healthy and where they ought to be. So not 1 singular answer, but rather health across the board. I mentioned a moment or 2 ago, we're seeing a nice return of the corporate business and have for the last couple of years. So a lot of positives there and particularly to the quarter. We were a bit constrained last year from a supply standpoint and lead times were longer than we would have liked. That is no longer the case. So I think you're seeing the business perform sort of without limitations right now whereas the last couple of years we've had limitations due to raw materials, we've had limitations due to strong demand, et cetera, et cetera. So we like where we are. I will say longer term we'd like to normalize our production schedules so we're not operating at peak capacity for as long as we are and we do expect that at some point that will happen. But for the time being, we like the way the business is running and again I think I've given you 3 or 4 ideas as to why we saw what we saw in Q1 of '24 where again a Pro V1 launch was comped favorably. So obviously we feel really good about the ball business and our most pressing not threat, but our most pressing area of interest right now is really weather because when weather's decent, people are out playing golf and purchasing Titleist golf balls. So hopefully that gives you some color.

Yes, that was great, And then just second question just to put a finer point on the first quarter because I think when you gave kind of the guidance and the cadence of the year back in February, I think it implied EBITDA dollars down year-over-year. Obviously you came in ahead of that. So is that simply the product of better performance at your distribution center and maybe a little bit of the Vokey launch slipping into the first quarter versus I guess your assumption that some of that would have been in the second quarter when we talked in February?

Yes, that's fair. That's a fair portrayal of the first half in terms of where we sit here today versus the end of February.

The next question is from Noah Zatzkin from KeyBanc Capital Markets.

Just wondering if there's any early reads on your sense of sell-through across categories exiting the quarter in terms of trajectory from March into and through April? Has demand in April remained strong? Any color there would be great particularly as it relates to FootJoy?

Yes. I would say the common theme in Q1 was where weather was decent, demand was good; where weather was less than decent, demand was affected. So the Southeast in particular was slower than we would have liked, again not surprising given the rounds profile. I would say and we hear this every year as weather turned and as March turned to April, we did begin to hear some more positives from our retail partners as their seasons opened up. So I think the narrative is more about delayed start to season versus strong demand, weak demand. Within our product lines, we've been especially pleased with our wedge launch and early demand there. Team did a great job as I've said and early demand has been strong. So much of our products are custom fit and a lot of that activity is going to start here in April, May, June, July. So we'll have just a much better read on our custom fitting activity, whether it's golf clubs, golf balls, I called out some new footwear fitting opportunities that we're going to embark on here later this month. And now to your final comment about FootJoy, again we really like the product story. We like what's happening in our footwear business and our apparel business and our glove business. I think we've pointed to back half growth in that business after what was obviously a slow start although we did call out growth in the U.S., which we were pleased with more than offset by some declines outside the U.S. So FootJoy is working its way through a correction period and again we're optimistic for growth in the back 3 quarters of the year really built around a product portfolio that we feel really good about.

Great. Maybe just 1 other question just on your comments around the North America distribution center startup exceeding expectations. Just wondering if you could provide a bit of color there in terms of how we should be thinking about the potential P&L benefits both near term and long term?

Noah, so again as David said; it's really about hiring, it's about training and it's about getting the throughput and the efficiency up to where we want it to be. So the primary products there are FootJoy and Titleist gear. When we think longer term, I think it's much about efficiency as it is ownership and control and customization. So a big part of the strategic benefit of this distribution center, it's also a customization center of excellence. So this is much about quality product and serving our customers well as it is about doing it efficiently. So we're still in the early stages of ramp up. We feel very good about where we're at. Certainly hope that there is more opportunity to further leverage that facility across the portfolio. So that's a little bit of the color of what transpired in Q1. Again we went live on January 1 from that location. So we're pleased where we are after 4 months of operation.

I'll just add some historical context on that, Noah. We felt some pressure points with customization and distribution for FootJoy and gear throughout the COVID years and that led to the decision that Sean outlined to take greater control of golf bag embroidery, apparel embroidery and distribution of those products. So really the origins were some pressure points of a few years back and the team has done a nice job mobilizing and we like the control we have because, again I'll echo Sean's comments, we just think it allows us to deliver better service to our trade partners and to golfers.

We have a question from J.P. Wollam from ROTH MKM.

Maybe first in terms of kind of the investments in IT and infrastructure and understanding kind of usual protocol about forward guidance, but putting together kind of Q1 EBITDA and just the investments that have been made so far. I'm curious if there's anything to read through in terms of maybe more than expected investment costs going forward particularly in the back half of the year? And then you alluded to kind of maybe some investments for that FJ fitting lab. Are those new or have that always been contemplated and will that be impacting kind of SG&A in the back half of the year?

J.P., I'll start. So I think that at the end of the year, we did talk about growth in OpEx in '24, right, outpacing sales if I recall correctly. So this is expected. I think we're still in the early stages of this and you'll see this flow through throughout the year. But again important to recognize that some of these things are enterprise investments, some of these are specific to product segments around fitting networks, about fitting apps and technology. So we do intend to continue to invest and you'll see that flow through in SG&A in 2024 and it's embedded in our full year guidance. So we think these are all certainly appropriate, necessary to better serve and create the operating leverage that we expect to deliver here in outer years.

And J.P., just a quick follow on to your question about for FootJoy's FitLab. Yes, that has been contemplated and planned for in our outyear plans. I think more of it to follow in 2025 than late '24, but we're enthused about getting that program running.

Okay. Understood. And then maybe just on FootJoy. In thinking about kind of international markets, I think you maybe touched on being optimistic about the product portfolio. But could you maybe just give a little bit more color? In your prepared remarks, you said that you are kind of optimistic about things stabilizing in the back half of the year. So what gives you confidence there? And then just maybe anything you're seeing with kind of broader customer behavior specifically on the international side?

So to part 1 of your question, what gives us comfort is the correcting footwear inventory landscape. As I noted, it's all but corrected and normalized in the U.S. We think that process takes another quarter or 2 outside the U.S. and when that happens, we just feel confident that our products will be better positioned to succeed. I will call out as you think about markets around the world, and we spoke of this before, Korea has a very unique super premium golf apparel market and we pursue that with both the FootJoy brand and a Korea specific Titleist apparel brand. That region has seen some outsized growth in the last couple of years and more recently we're seeing a bit of a correction. Strong demand followed by a whole lot of new entrants resulted in excess inventory and promotional activities. So we feel as though we're in the midst of a correction within the Korea golf apparel market space. We've planned for it and while we like our positioning over the long term and we like our ability to withstand the effects of this correction in 2024, we have factored in market softness. That's the only real unique callout that I think is worth noting. The others I think I hit on, particularly EMEA which is just a slow start. But 1 area we're seeing it does affect, it shows up in our other segment on the Titleist side, it shows up on the FootJoy side is just a softness after a period of outsized growth in Korea and we think that market is going to correct throughout the year and will probably correct for the full year we anticipate again. We like our positioning over the long term and we think we're in a good shape to withstand the effects of the correction. But that's the only market that I think warrants a unique callout at this stage.

Great. I appreciate the color. Best of luck moving forward.

Thanks to all for your questions and interest. Hopefully you take advantage of some nice weather here in the few months and go play some golf and we look forward to speaking with you on our next call. Thanks again.

This concludes today's call. Thank you for joining. You may now disconnect your lines.