The fourth quarter isn't generally a great time for the golf business, but Callaway Golf (NYSE: ELY) is making it look tougher than usual this year. Replacing aging golf clubs apparently isn't high on shoppers' priority lists, and Callaway's once-lofty hopes for 2010 have been pushed back to 2011.

Sales were flat in the fourth quarter versus last year; the company reported a $32.3 million loss for the period, versus a $15.6 million loss last year. Higher operating expenses and a $7.5 million impairment charge from 2003's acquisition of Top-Flite accounted for most of the difference.

The cash picture doesn't look much better. In 2010, the company burned through $23.3 million, including paying a dividend to shareholders, as conditions got worse. This cash burn came despite cutting capital expenditures to $22.2 million, from $38.8 million a year earlier. With $55 million of cash on hand, Callaway has time to sort out its issues, but it needs to improve at some point in 2011.

The conference call gave investors few indications of a quick turnaround. Management cited an improving auto industry as a hopeful sign for 2011, making this Fool a little worried about how much hope there really is. Are executives grabbing at straws, or just crossing their fingers and hoping things get better?

An unplayable lie
Callaway isn't the only one having trouble selling golf equipment. Fortune Brands' (NYSE: FO) golf sales were down nearly 5% last quarter, even as the rest of the sporting world started picking up. Retailers Dick's Sporting Goods (NYSE: DKS) and Hibbett Sports (Nasdaq: HIBB) are both experiencing increasing sales, opening new stores as athletes gear up … for everything except golf, it seems. Same-store sales at both were solid.

If I thought Callaway could turn an unplayable lie into an incredible save, I would be more optimistic on the stock, but I just don't see it here. Sometimes you have to take the safe play and move on to the next shot.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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