Polaris Industries reported financial results for the third quarter of 2015, with sales increasing 12% to $1.45 billion and income increasing 10% to $155 million. The following are some of the key points from the earnings call related to the utility vehicle market:

• From CEO Scott Wine “…the off-road vehicle space is quite healthy, as competitive activity is more intense than in any time in my seven years with Polaris.”
• ORV sales which includes UTVs and ATVs grew only 3% in the quarter
• Market headwinds from the oil and agricultural sectors as well as Canada
• ORV sales were led by global RZR shipments and stronger U.S. sales, partially offset by continued weakness in Canada, along with unfavorable international currencies.
• ORV sales were up 5% year to date
• Polaris gained share in both UTVs/side-by-sides and ATVs
• Side-by-side retail grew low single digits which slightly outpaced the industry
• New product introductions from many manufacturers is intensifying competition
• The sport utility market has been stronger than the recreational utility market for side-by-sides for Polaris and the industry
• Global Adjacent Market third quarter revenues increased 10% and year-to-date revenue is up 4%.
  • European Work and Transportation declined mid-single-digits percent, due primarily to currency weakness and some softness in Goupil and Mega.
  • The European quadricycle industry remains flat year-to-date with Aixam retail up modestly and increasing market share.
  • Third quarter defense revenue increased over 50%, driven by strong momentum for MRZRs and increasing international demand.
  • Year-to-date defense sales are up high-20%s.
• International revenue increased 1% in the third quarter with strong growth in Indian and RZR brands and in the Latin American region, but somewhat offset by weak currencies, which led to revenue declines in Europe and Australia.
• Multix, the new product through a joint venture with Eicher Motors, is now in market and initial consumer satisfaction is encouraging.
• Construction of the the Huntsville, AL ORV manufacturing plant is on schedule to start production in Q2 2016 with a focus on creating production capacity for the Ranger product line.
• From CEO Scott Wine, “While competitive offerings and promotional efforts expand, we anticipate slightly slower growth in the powersports industry in general, and the side-by-side segment in particular.”
• Global Adjacent Markets will look for appropriate acquisitions.

Learn more:  Seekingalpha.com (Earnings call transcript)