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#<UNK>, this is ---+ looking forward is highly speculative.
Take it with a grain of salt any comments on there.
There certainly has been a less promotional environment this year.
There's been less inventory in the field.
If you look at all of the metrics you can see that the field inventories in sticks particular are down year over year and down in a meaningful manner.
That same is occurring on an international basis.
Launch cycles in general have lengthened, or product life cycles.
Certainly here at Callaway we've made a very conscious and strategic decision to lengthen many of our product life cycles.
We feel good about that.
It has led to improved market conditions in most of the markets across the globe, but particularly here in the US.
Right now I feel good about it, that there's been a stability restored to the markets that is sustainable.
But that's very speculative.
Now it does feel sustainable and we are enjoying very stable improved trading conditions.
<UNK>, this is <UNK>.
I think you have to be a little bit careful in looking at revenue as it compares to our production volume and the type of absorption we get.
I think that we will try to produce in a more stable, constant way over the course of the year, so I wouldn't necessarily try to equate, if I understand your question properly, an expected fixed cost absorption or a variable contribution on higher margin from quarter to quarter.
What I can tell you is that there's been tremendous operational improvements in the golf ball business and the margins have improved greatly year over year.
I wouldn't be necessarily looking for variation from quarter to quarter on changes in volume.
So if you compare our current results or our current guidance to prior, just for the impact of foreign exchange, there was actually a slight negative impact to our Q3 results versus our prior guidance for foreign exchange, about $2 million to $3 million on the top line.
If you look at our full-year guidance right now and the impact of that FX on that, there is actually slight positive impact of about $3 million.
I would say that's primarily due to the strengthening yen.
In the grander scheme of things in the larger context of our $800 million-plus of revenue, it sort of noise.
Hey, <UNK>, this is <UNK>.
Yes, we are.
In a local currency basis, because of the foreign exchange movements, we've also had to increase pricing in the international markets.
You are seeing both the average transacted price points move up and the price points on the new products as we bake more and more technology into them.
That seems to be resonating with consumers.
From a Callaway perspective it's been a trend that's continued for a year or two.
The sell-through results have been positive.
When you look at all of the international markets, we've started to adjust pricing, including in Europe.
Europe had a really strong quarter but there is some pricing in the results, particularly in Q3, in the international markets.
So it's definitely part of the story.
Great question.
I don't know.
We are moving based on what we believe our product is worth and the technology we're putting in it.
In the international markets we are very successfully raising the prices.
But I think there is a trend in the market as well.
We are a leader, though, in so many product categories now and so many markets that I'm sure we are influential.
And <UNK>, this is <UNK>.
The other thing that I would mention on pricing in this industry, it's not just the price that products are sold in at.
Pricing in this industry is also having to be less promotional and have less discounts.
I think the strength of our products and our market share and how the products has resonated with consumers has allowed us to be less promotional in terms of discounting.
That's price too.
Sometimes that's not as obvious as selling in at a higher price point, it's also us being less promotional and having to discount less given the success of the products.
It's probably worth explaining because it's a little bit complicated.
What's happening to the shares, they are being used in our EPS calculation.
When we converted to $85 million of debt in Q3 that actually led to the issuance of 11.3 million additional shares.
However, the weighted average shares that's used in the calculation for Q3 only went up by 5.3 million because that transaction happened somewhere after we were halfway through the quarter.
When you look at it on a full-year basis, and <UNK> mentioned that we've actually issued a notice of redemption for the remaining principal balance.
When that happens and that is redeemed, which we anticipate it would be, there'll be another 3.7 million shares.
You will get the full 15 million shares now added to our basis.
However, that would be averaged over 12 months for a full-year EPS calculation.
So on a weighted-average basis that adds less total shares to the full-year weighted average over the full year, because it's dividing by the 12 months now.
Correct, right.
That's exactly right.
You'll get the full effect of the 15 million shares in 2016 [earning] from day one.
You got it, <UNK>, and in Q4 it's going to be closer to that more into the mid 92 million because you'll have almost all the shares in for Q4.
Yes.
Thank you.
I want to thank everybody for tuning in today and calling in on the call.
Again, to the Callaway team, thanks for some great results.
Appreciate it and let's keep it going.
Thank you.
