Tuesday, January 26, 2016

Polaris Reports 2015 Fourth Quarter and Full Year Results

  • Full year 2015 net income was $455.4 million, or $6.75 per diluted share, in-line with Company revised expectations
  • Sales for full year 2015 increased 5% year-over-year to $4,719.3 million. Excluding currency impacts, sales increased 9%
  • Fourth quarter 2015 net income was $110.7 million, down 18% on 13% lower sales primarily due to weak retail sales in the North American oil and gas regions
  • All businesses increased market share in North America for 2015 despite a weak powersports industry
  • North American dealer inventory finished 2015 up 5%, in-line with Company guidance; ORV dealer inventory was down 4% year over year, lower than implied guidance
  • Polaris announced 2016 guidance reflecting continued currency market volatility and ongoing weak industry demand; expects full year 2016 net income to be in the range of $6.20 to $6.80 per diluted share, with sales in the range of down 2% to up 3% compared to 2015.

Polaris Industries Inc. (NYSE:PII) reported net income of $6.75 per diluted share for the year ended December 31, 2015, a two percent increase compared to $6.65 per diluted share for the year ended December 31, 2014. Net income was $455.4 million for the full year 2015, approximately flat to previous year’s net income of $454.0 million. Sales for the full year 2015 totaled a record $4,719.3 million, an increase of five percent compared to sales of $4,479.6 million for the full year 2014.

       For the fourth quarter ended December 31, 2015, Polaris reported net income of $1.66 per diluted share, a decrease of 16 percent compared to the prior year’s fourth quarter net income of $1.98 per diluted share. Net income was $110.7 million for the fourth quarter of 2015, down 18 percent from the previous fourth quarter’s net income of $135.4 million. Sales for the fourth quarter of 2015 totaled $1,105.6 million, a decrease of 13 percent over last year’s fourth quarter sales of $1,275.0 million.
       “While 2015 was a difficult year, we did manage to grow market share in each of our businesses and increased sales and earnings per share for the sixth consecutive year. That said, our performance failed to meet our earlier projections, as both external and internal challenges restrained growth and profitability. The strengthening dollar and weakening oil markets combined with an unseasonably warm winter constrained demand for off-road vehicles and snowmobiles, placing pressure on dealer inventory and forcing us to curtail shipments in the fourth quarter. While our execution to plan did not meet our historically high standards, we have taken numerous actions to position Polaris for better performance in 2016,” commented Scott Wine, Polaris’ Chairman and Chief Executive Officer.
       “Our outlook for 2016 reflects another volatile year in powersports driven by near-term growth pressures from weak end markets as the threat of a worldwide economic slowdown looms. However, we have been in this situation before, and we know how to manage through difficult economic climates. We will continue to optimize dealer inventory, aggressively manage operating costs and other risk exposures, and provide our end-consumer with products and services that exceed their expectations. Concurrently we will continue to invest in projects that accelerate future growth and our lean journey, such as the Huntsville, Alabama plant which is scheduled to begin production in the second quarter of this year. I believe we have the best team in powersports, a strong and diverse portfolio of brands and products, broad capabilities across all our disciplines, and a proven strategy that will continue to create value for our stakeholders in the years to come.”

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