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Justin Rose leaving Honma ???


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In a bull market you can take big swings at the plate like that, but thanks to Corona Virus the market has turned bear. If they have made a bunch of large investments with long tail pay offs their timing could not be worse and has potential to be down right catastrophic. Golf companies struggle to turn a profit in the best economies and when the economy turns south it gets ugly fast. That's why there is the saying 'if you want to turn a billionaire into a millionaire just sell them a golf company'...

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The simplest explanation is money. Money was probably the driving factor in the decision to leave TM in the first place and makes the most sense as the factor to suddenly jump ship. I imagine his agreement with Honma had a lot of fine print given that it was a very big move for both parties. Rose probably wanted lots of creative input and control, and Honma wanted a Top 10 player regularly on the first page of the leaderboard. With Rose losing form, it is easy to imagine Honma wanting to revisit/change the agreement. An already frustrated Rose then could easily just throw in the towel and say "Screw it! I'm going back to what was working to get my game back". When you're already feeling the pressure and frustration of losing form, the last thing you want is drama at home with your big sponsor, especially if you don't need the money.

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I don't think anyone is disputing the mental side or lack of accountability from the player in situations like this. I am not sure who is blind and walking to a ledge? Honma targeted Rose to be their guy and made an investment in him and it obviously failed. Regardless of how great their clubs may be this will likely negatively impact their bottom line and overall business. Just like in baseball, when a smaller market team signs an expensive free agent the risk is greater than a big market team who can absorb the loss if it doesn't work out. I wish Honma the best but it will be tough for a company that was already struggling to break into the general retail space to make strides after taking a financial and public perception blow like this.

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As I was typing this I just did more research and I fully expect Honma to close up shop or announce substantial cutbacks and reorganization. They were listed on the NASDAQ as HNMGF with a final trade date of March 2nd at $0.57 per share. They have been trading at less than $1 per share since July when they announced that their revenue had nearly cut in half and they were operating at a $25 million quarterly loss. Typically companies are given a window of time to get their share price back over $1 by the exchange on which they are listed before that exchange delists them. As of Monday March 2nd it appears that 6 month window ran out and they were delisted by NASDAQ. That's going to be very tough if not impossible to come back from. The same week they were delisted they parted ways with their only big spokesman...I'll be the first to call a time of death for Honma Golf as Monday March 2, 2020.

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Ah, good sleuthing there! That certainly does not sound good for Honma.

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Thanks. Even deeper dive... July is right about the time Mark King hit the gas on Honma to become the CEO of Taco Bell. He also removed Honma from his LinkedIn profile which a lot of people do to try to hide something from their resume especially when the job is associated with a negative. I promise you those dates and numbers are not a coincidence. This company has clearly been on life support just under the radar because the golf media doesn't cover the financial side of things and the finance media could care less about the golf industry. I would be willing to bet the reason an announcement hasn't been made is because they are trying to shop the brand to see if anyone is interested in saving it. Again, timing could not be worse. I'd be shocked if there is a buyer with current market conditions.

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That's the Hong Kong exchange, they have been delisted in the US. But the top development on that link has an investor purchasing 90 million shares 4 days ago which tracks. Seems like they found the life support they needed, but investments like that always come with substantial reorgs and general company changes.

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I can’t for the life of me figure out how a peeps elbows don’t fall out using PX 6.5’s! Gotta be the harshest shafts on planet Earth! My arms hurt just saying the words ?BB

based on this read sounds like I might be able to find a good set of Rose Protos on the cheap soon!

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Their success in Asia is mostly what keeps them a float in the US and the rest of the world. It’s like any company entering a new market sometimes another region has to prop them up while they get their feet wet. The impact of the corona virus on Honma’s success in the states is really nonexistent. They have plenty of inventory sitting on the shelves the last few times I stopped by to see what Honma House had to offer.

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If it is any consolation to you Ben it got my back hurting just reading your post and thinking on the same lines

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Don't hurt yourself walking back those bold pronouncements up thread. A "deep dive" surely would have uncovered the fact that the company was dual-listed and had a market cap north of $2.5 billion in HKD terms. Obviously the company has struggled a bit but it's not exactly at death's door.

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The impact of the Corona Virus hasn't been felt yet but it will just like every other industry. People will have less money to spend on leisure items like golf clubs. So if you have a long tail investment like Honma does in the US and it's being propped up by another country also going into recession you're not going to be able to prop things up as long as you hoped.

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Trust me I understand your point, I work in the advisory world. If you are too than you understand after any recession comes expansion. Realistically any recession that people fear will be short lived. We have survived larger pandemics.

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The last one will cost him the most. ?

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Me thinks a Callaway deal or he goes the route of choosing his own bag with no club sponsorship.

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He plays TaylorMade for 20 years and goes to a new manufacturer and either doesn't like the clubs or doesn't like that Mark King left. He immediately puts TaylorMade clubs in the bag this week, but you think he's going to Callaway? He's not going to make the same mistake twice.

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The blind sheep are those that are saying “so much for Honma” simply because a pro golfer is struggling and is choosing to equipment search. They are not taking into account how poorly he performed the last two weeks as he was removing Honma clubs from his bag. The logic doesn’t make sense. The switch to Honma helped Honma get in the door in the US. Now they are slowly starting to leak into club fitters matrix drawers and getting into people’s hands. I just recently put their gear in my fitting matrix and have seen great performance out of their gear. I don’t think Rose switching will have much affect, as long as people are looking at it logically. He played poorly and missed the cut at the API with TaylorMade clubs, so it’s obviously not the clubs. I wouldn’t be surprised of Honma gets other players in their gear and we quickly forget about Rose.

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We will all soon find out that JR moving on from Honma had way more to do about business, money, contract clauses & most importantly King moving on.

Honma sticks (irons & wedges) are just as good as any other top level JDM brand.

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Great post. Even the pros need to be free/clear headed to compete at the highest level but unfortunately Rose has the look of broken man. He could have used any clubs, could have taken a Milligan a hole and would still have comfortably missed the cut.

Whatever he is searching for me needs to stop looking before he does irreversible damage to his swing.

Must admit I have been very impressed with the Honma range - Rose protos are stunning, colour scheme of the bag and headcovers are quality. Definitely not the clubs to blame.

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Do you actually believe what you posted? JR missed the cut this weekend because of his horrific putting and short game around the greens. His game off the tee and approach shots were not an issue. FWIW JR missed the cut by 3 shots. Pretty sure if you gave him 36 mulligans for 36 holes he would have made the cut. I know actual facts are frowned upon here by most but here are a few from his performance in the first two rounds. At times people need to check their hyperbole at the door.

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