The State of the Golf Industry

2

Golf Participation

3

Stocks & Flows

Source: NGF/Synovate

Golf Participants (in Millions)

2010 2011

26.1 25.7Departing Participants

-3.9

Beginners(Never played )

1.5

Returning Participants

2.0

-0.4

4

Short Term Participant Trend

Participants (MM)

Core Occasional TOTAL1-yr Change -2.7% 0.0% -1.5%5-yr Change -17.7% -8.1% -13.8%30.0 29.8 29.5 28.6

27.126.1 25.7

44%

56%

Source: NGF golf participation study

5

Long Term Participation Trend

Participants (MM)

Source: NGF golf participation study - 1990 is a calculated average of 1989 and 1991

19.7

24.2 24.7

28.8

30.630.0

25.7

6

Participant Gains vs. Losses

Source: NGF golf participation study

Participants (MM)

Recessionary effect

7

Participant Gains

Source: NGF golf participation study

Participants (MM)

8

Exclusive Range Participants

Age 6+ (millions)

Source: NGF golf participation study

9

Rounds Played – 2011 (Down -2.5% Nationally)

+2.0% or higher+1.9% to -1.9%-2.0% or lower

(% Change from previous year)

New England (-5.1%)

Mid Atlantic(-9.6%)

South Atlantic(+3.7%)

South Central(+1.1%)

Pacific(1.2%)

Mountain(-2.1%)

West N Central(-5.5%)

East N Central(-9.3%)

Source: Golf Datatech, NGF, PGA of America national rounds played reports

10

Rounds Volume

Source: Golf Datatech, NGF, PGA of America national rounds played reports

Rounds (in Millions)

1-yr Change: -2.5%Change ‘05-’11: -7.4%

11

Other Golf Participants

Total(MM)

Golfers(%)

Mini-Golf 20.6 38

Video Games

55.7 18

Simulators 2.6 76

12

Demand Takeaways

Participation appears to be stabilizing at a new base of approximately 26 million

Recessionary effects are lessening – the number of lost golfers are falling

Rounds played likely to have bottomed out in 2011 with some recovery expected

13

Golf Supply

14

Trend in Course Openings

18-hole equivalents

Source: NGF Facility Tracking

15Source: NGF Facility Tracking

18-hole equivalents

Course Closures

2011 Closures:

• PUBLIC: 131.5 (83%)Daily Fee: 120.0 (76%)Municipal: 11.5 (7%)

• PRIVATE: 26.0 (17%)

• REAL ESTATE: 35.5 (23%)(incl. both public and private)

16

Net Change in Supply

Net Change = openings minus closures (in 18-hole equivalents)

17

Growth of Golf Facilities

Number of facilities

Source: NGF

Private

Daily Fee

Municipal

18

Rounds & Golf Course Supply (The Decade)

Source: NGF/Golf Datatech

Course Supply (18 hole equiv.)

Rounds Per 18 hole equiv.

% Change in Rounds (from

previous year)Decade

-11.2%

(-0.1%) (-3.0%) (-1.5%)(0.9%) (0.0%) (0.3%) (-0.6%)(-1.8%)(-0.6%)(-2.3%)(-2.5%)

Decade-12.1%

Decade +1.7%

19

NGF Golf Course Supply/Demand Index

Source: NGF/Golf Datatech

Index of Golfers Per 18 Hole Equivalent

20

Continued Contraction in Range Supply

We have seen very little change in the range size proportions since 2000:

2011

21

Retail Supply TrendD

oors

Sq

. Ft.

(m

m)

1,067

8.2

22

Retail Consolidation – 2011 Snapshot1,067 Doors

8.2 mm Sq. Ft.

Doors Sq. Ft.

23

Trend – Doors by Type D

oors

24

Supply Takeaways

Golf course market correction slowly continues – should not materially affect rounds played

Individual golf course performance should slowly improve as rounds recover and NGF Supply/Demand Index progressing toward historical level

Correction in ranges and retail more dramatic, but slowing down

25

Industry Spending

26

Domestic – Golf Clubs

27

Domestic – Golf Balls

28

Facility Maintenance Budgets1

(1) Excluding capital expenditures and water

29

Turf Equipment – Purchase Intent

YE’05 YE‘06 YE’07 MY’08 YE’08 MY’09 YE’09 MY’10 YE’10 MY’11 YE’11

YE = Year EndMY = Mid Year

30

Confidence Indices

31

Consumer Confidence Index

Source: The Conference Board

Through March 2012

Index currently stands at 70.2 – as high as it has been since early 2008

32

Golfer Confidence

NGF Golf Consumer Confidence Index

Q: How is the economy affecting your spending on golf?

“I am playing fewer rounds”- 16% (24% in Q4)“I am delaying golf equipment purchases”- 39% (37% in Q4)“I am going on fewer golf trips”- 32% (34% in Q4)

Source: NGF quarterly Core golfer survey

33

Golfer Confidence

Percent of Golfers Reporting Playing Fewer Rounds Due to Economy

Source: NGF quarterly Core golfer survey

34

Indicators are mostly positive for improvement in golf economy

• Consumer confidence trending up• Golfer confidence trending up• Weather recovery in rounds likely

Golfer Confidence Takeaways

The State of the Golf Industry