Category Archives: Sales figures

BRP Announces Quarterly Earnings Results

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The Maverick XRS DPS as well as other Can Am Maverick and Commander side-by-side models helped power BRP earnings in the last quarter.

The Maverick XRS DPS as well as other Can Am Maverick and Commander side-by-side models helped power BRP earnings in the last quarter.

BRP Inc., manufacturer of Can-Am side-by-sides and other power sports products announced their FY14 third quarter results for the period ended October 31, 2013 (Figures in Canadian dollars). The management reported record quarterly revenues of $866.0 million, an increase of 18% compared to the corresponding period of FY2013 Net income of $48.2 million, an increase of 52% compared to the third quarter FY2013.  Revenues from Year-Round Products increased by $2.2 million, or 0.9%, to $249.6 million for the three-month period ended October 31, 2013, up from $247.4 million for the corresponding period ended October 31, 2012. The increase is primarily due to higher wholesale and a favourable product mix in side-by-side vehicles, for an increase of approximately 38% compared with the corresponding period ended October 31, 2012. The increase was mainly offset by a 20% reduction in ATV sales. Other highlights from the earnings call with a focus on side-by-sides include:

  • Year-to-date, BRP registered growth of 13% in year-round products, primarily driven by significant growth in side-by-side, a market BRP only entered in late 2010.
  • Year-to-date, side-by-side revenue is up 35% driven by eight new models under the Commander and Maverick product lines.
  • Company remains on track for to add 35-40 new dealers in North America by the end of our fiscal year 2014, and continue to focus on the US South and Southwest regions. They are also on track for 200 to 300 new dealers over the next four years.
  • International revenues have grown 15% in large part to the increasing popularity of side-by-side products
  • The US side-by-side industry is up low-double digit thus far in season 2014, while BRP retail continues to significantly outpace the industry.
  •  Management reports that they started deliveries of the Maverick Max in June; the Maverick XMR, the mud-ready vehicle, in October; and the XC model, Maverick XC model, also in October. “Then we have a very good momentum worldwide with our side-by-side business, and we are outpacing the industry every quarter, and we’re very happy with that.”
  • BRP continues to track on plan for our full-year revenue and normalized EBITDA guidance.

Learn more:  BRP Earnings Call Transcript 

John Deere Reports Q4 2013 Financial Results

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John Deere RSX850i

John Deere RSX850i utility vehicle

John Deere, manufacturer of the Gator utility vehicles, recently announced their quarterly earnings for the fourth quarter of fiscal year 2013. Net income attributable to Deere & Company was $806.8 million for the fourth quarter ended October 31, compared with $687.6 million for the same period last year.
For fiscal 2013, net income attributable to Deere & Company was $3.537 billion compared with $3.065 billion in 2012.

While it is difficult to isolate the sales figures for Gator utility vehicles because of all the other products the company sells, management reported that sales for the agriculture and turf division under which Gator sales fall decreased 4 percent for the quarter primarily due to lower shipment volumes and the unfavorable effects of currency translation, partially offset by price realization. However, sales increased 7 percent for the full year largely due to higher shipment volumes and price realization, partially offset by the unfavorable effects of currency translation. Operating profit was $996 million for the quarter and $4.680 billion for the year, compared with $931 million and $3.921 billion, respectively, in 2012.

For 2014 the industry retail sales of turf and utility equipment in the U.S. and Canada are projected to be up about 5% in 2014. Management reports that “Market conditions are improving in tandem with the slow economic recovery. Also the pent-up demand seen in late 2013 is expected to continue, mainly benefiting the riding lawn equipment and utility vehicle segments.”

Learn more: Seekingalpha.com (Earnings call transcript)

 

LSVs Show Strength in Government & Commercial Markets

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A six passenger transport vehicle from Cruise Car with a solar array on the roof for battery recharging.

Cruise Car out of Sarasota, FL reports growing sales on the strength of orders for  government and commercial markets. The company manufacturers golf cars and low speed vehicles for transport and utility. A key differentiator for the company is their Sunray Solar Roof Canopy which uses solar power to recharge vehicle batteries. They also feature an aluminum chassis and AC electric motors. According to management the company has been successful selling vehicles to military installations and last month was awarded a contract to supply fleets of shuttles and light utility runabouts to VA Hospitals and VA Cemeteries nationwide. Hotels and resorts are also an important market segment for the company. Many of the vehicles they sell to these markets are LSVs which can be used on public roads. Learn more:  HeraldTribune.com

Comment:  The companies success confirms with what we have been hearing from dealers around the country. Namely that STOVs and in particular LSVs are selling well in the commercial and government markets. The military and other government sectors are attracted in part to the fact that the vehicles are electric powered, whether to reduce fuel costs and/or meet sustainability goals. This is also true of the college/market where they can be used for personnel transport or light utility work around campus. The safety features of LSV compliant vehicles are appealing to buyers as well.

Polaris Q3 2013 Earning Results Summary

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Polaris Ranger and RZR lines helped drive 3Q ORV sales

Polaris Industries once again had a strong quarter as sales surpassed $1 billion for the first time in the company’s history. The following are some highlights from the earnings call with a focus on the side-by-side market and small vehicle business.

  • Quarterly sales increased 25% to $1.1 billion
  • Third quarter net income from continuing operations rose 24% to $116.9 million
  • Off-Road Vehicles (ORV) which includes side-by-sides and ATVs posted a 23% gain and PG&A jumped 37%
  • Year to date ORV sales increased 12%
  • Polaris North American side-by-side retail sales improved low teens percent, and the side-by-side industry was estimated to have grown in the low double digits.
  • Key drivers included higher demand for the Ranger line, RZR XP 1000 and the new XP 4.
  •  The Polaris ORV Commercial business was up double digits in the third quarter, led by the new Brutus product rollout and sales to Bobcat. However sales were slower than expected and more marketing resources are being put into the effort as dealers have to adapt to the business to business sales process.
  • Small vehicle revenue increased over $21 million and 188% for the third quarter, due primarily to the Aixam purchase. Year-to-date, revenue was up 136%.
  • For the GEM line  retail sales are up over 50% through the third quarter and year to date as the dealer network and B2B sales efforts gained traction. The company just introduced the new eM1400 electric utility vehicle as well.
  • Aixam had a good quarter expanding share of the European quadricycle market share lead in the third quarter and year-to-date as retail sales remained roughly flat while the overall market declined upper single digits.
  • Goupil revenue grew nicely year-over-year, and year-to-date, customer orders are up double digits.  
  • In Europe the ORV industry remains relatively weak, with third quarter and year-to-date sales down about 12%. Polaris is building on its market share leadership position, with third quarter retail sales about flat and year-to-date retail sales down low single digits.
Looking forward:
  • Management increased the full year sales guidance to up 15% to 16% over 2012.
  • Sales of Off-Road Vehicles are expected to increase in the 11% to 12% range, up from prior guidance, with retail sales of side-by-side vehicles and ATVs continuing to outpace the overall market in both North America and internationally.
  • Competition has increased in the ORV market.
  • Management expects ORV market share to increase in 2013 but at a slower rate than recent years.
  •  For small vehicles, sales are expected to increase over 150% for the full year 2013.
  •  Monterrey, Mexico plant will deliver well over half of Polaris’s side-by-side volume in 2014.
  • In India the Eicher partnership is moving ahead with a plant under construction in Jaipur, India for a late 2014 launch of a new vehicle solution for that market.
  • More resources will be put into the Brutus sales efforts as the longer purchase cycle in the business to business market has tempered sales expectations. Efforts will likely focus on “…some of our most capable and committed subset of our existing Polaris ORV channel.”

Learn more: Seekingalpha.com (earnings call transcript)

BRP Earnings Call Highlights – FY 2014 Q2

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The Can Am Maverick Side-by-Side helped drive quarterly sales growth for BRP

BRP, manufacturer of Can Am side-by-sides and other products recently reported its financial results for the three and six-month periods ended July 31, 2013. What follows are some of the highlights with a focus on utility vehicles.

  • Revenues excluding sport boat figures increased to $620.9 CAN compared to $583.1 for the same quarter last year
  • Revenue for the quarter are up 6.5% in year over year comparison excluding sport boat sales.
  • Growth, in part, was driven by sales of the Maverick side-by-side
  • International sales up 14% with the off road vehicle segment which includes ATVs and side-by-sides up 35%
  • Solid performance for side-by-sides in Europe, Australia and Latin America.
  • 35 to 40 new dealers in North America this year
  • North America side-by-side industry grew mid double digit with BRP growing more than 30% in the 2013 season ending june 30 with a particularly strong 2nd quarter
  • 50% growth in ORV parts and accessories with good growth in Maverick parts and accessories sales
  • White Mavericks proved more popular than yellow Mavericks resulting in a change in production
  • Just started shipping the Maverick 4 seater which has received good comments and strong orders from dealers
  • Of all their products which includes the Spyder, snowmobiles, personal watercraft, ATVs and side-by-sides the side-by-sides stand out as a strong driver with an overall market that is outpacing the other product categories
  • Management remarked that although there have been a number of new product introductions in the UTV market, nothing is a game-changer and they believe their products are very competitive

 

 

Insights from the Texas UTV Market

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Dealers expect new introductions like the Yamaha Viking will help continue the strong growth in the UTV market.

PowerSportsBusiness recently featured an article on UTV registrations around the US by state and a related article with data on UTV accessories. Texas had the largest number of registrations by far with nearly 4,500 registered in the first quarter of 2013. California was second with about 1,700. Now these numbers can be misleading because states can have a varying rules on whether or not a UTV has to be registered. In some cases it may depend on whether it is used on private or public land. So it may be hard to compare data state to state without knowing their individual regulations regarding UTV registration. What I found more interesting was the handful of interviews with Texas dealers that is included in the article. Here is my quick analysis of those interviews:

  • The solid growth in the UTV market is expected to continue
  • Growth is being driven by a number of factors including:  new product introductions, local economic factors like growing oil business and good farming conditions, and continued product switching  from ATVs to UTVs
  • While switching from ATVs is occurring a significant amount of UTV purchasers are newcomers to the market
  • Polaris is a dominant brand but others are selling well and there are indications that the Kawasaki Teryx is on the upswing
  • Whether sales are for recreation or work/utility applications depends on the location of the dealer and the dominant customer segments in their area
  • Farmers are still driving ATV sales but are also switching to UTVs
  • Accessories can frequently add $1,500 to $3,000 or more to a UTV sale
  • Roofs, windshields and winches are key accessories being purchased

 

Arctic Cat Reports Strong Quarterly Results

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Arctic Cat Wildcat Side-by-Side helps drive strong quarterly results

Arctic Cat, manufacturer of snowmobiles, ATVs and the Wildcat side-by-side, announced strong results for the first quarter ending June 30, 2013 of their 2013 fiscal year. The following are some of the highlights of the earnings call with analysts with a focus on UTV/side-by-side issues.

  • Net sales for the first quarter increased nearly 9% to 120.8 million versus 111.3 million for the same quarter last year. Sales growth was driven by increased sales across all product lines.
  • ATV and Side by Side sales increased 5% to 76.3 million versus 73 million
  • Key drivers for the sales increase were the Wildcat X high-horsepower sports Side by Side and the Wildcat four seat model, both of which started shipping during the fourth quarter of last fiscal year.
  • While retail ATV sales underperformed the overall industry, North American Side by Side retail sales experienced strong growth and gained market share with Wildcat retail sales increasing 47%.
  • The new model year 14 lineup which will include some new models that will allow Arctic Cat to enter some new market segments will be announced in a few days.
  • Arctic Cat plans to continue to launch new models each quarter of this fiscal year including the Wildcat 50 trail version that was announced last February. (The new models could be ATVs, side-by-sides or snowmobiles)
  • Management expects new products to help grow the ATV and Side by Side business between 25 and 29% for the fiscal year.
  • Expansion of our Wildcat Side by Side lineup will contribute to increased PG&A sales this fiscal year.
  • During the quarter, R&D expenses increased 18% as product development is a focus.
  • Management sees potential to grow their share of the recreational off road market and some of the new products being launched will take the company into new market segments.

Learn more:  Seekingalpha.com (earnings call transcript)

Comment:  As evidenced by Arctic Cat’s recent and planned model introductions, the competition in the UTV/side-by-side market continues to heat up. It will be interesting to see what new market segments they will be targeting. Similar to Polaris, they are looking to diversify their product line and segment coverage. Going forward the competition should be good for consumers, lowering costs and/or improving the value for their purchasing dollar with more features and better performance. For manufacturers, it may hurt profit margins and/or put more pressure on them to keep innovating and launching new models.

Polaris Reports Another Strong Quarter for Q2 2013

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Polaris Ranger XP 900 helped drive overall sales in the second quarter of 2013

Polaris Industries just announced their Q2 2013 financial results and reported another quarter of strong earnings and market share gains. The following are the highlights of the earnings call with analysts with a focus on the STOV segments.

  • Sales for the second quarter increased 12%, to a record $844.8 million driven by share gains and double-digit retail growth in North America
  • Polaris captured market share in ATVs and side-by-sides which also drove significant gains in PG&A business
  • Second quarter net income rose 15% to $80 million yielding record earnings per share of $1.13, a15% improvement over the prior year period.
  • PG&A sales increased 33% for the quarter
  • ORV segment which includes ATVs and UTVs  performed well fueled by the RANGER 900 XP and supported by RZR products.
  • Revenue for ORV was up 7%, which is less than retail as inventory was reduced in preparation for new model launches.
  • Gained North American market share in both ATVs and side-by-sides.
  • North American side-by-side retail sales strengthened in the second quarter, up double-digits percent driven by growth in both RANGER and RZR categories. In fact, both brands had their largest unit retail quarters in their history.
  • Management estimates the North American side-by-side industry also improved, growing just under 10% in the second quarter and is now up upper-single digits year-to-date.
  • Initial Brutus shipments began into over 400 Polaris commercial dealers.
  • In the military segment Polaris remains the clear #1 in ultralight tactical vehicle space with the new MRZR is selling well globally
  • Due primarily to the Aixam purchase and contributions from GEM and Goupil, small vehicle revenues increased $22 million and 190% for the second quarter. Year-to-date, sales are up 109%.
  • GEM business is improving with second quarter retail sales were up in excess of 50%. Management reports better operations for GEM and improved traction in the B2B market place, particularly in the People Mover sub-segment.
  • Goupil also had a strong second quarter with orders up over 30% and notable cost and productivity improvements in operations, driving gross margin improvements.
  • ORV PG&A sales increased 25% and small vehicles 165%.  “The attachment rate that we’ve seen on the Ranger 900 XP with the new integrated cab system is phenomenal.”
  • In Europe – Polaris’ Q2 ORV retail grew and year-to-date, is about flat in an ORV industry that remains down double digits. Polaris maintains their leading position.

Looking ahead:

  • Future Sales of Off-Road Vehicles are expected to increase in the 8% to 10% range with retail sales of side-by-side vehicles and ATVs outpacing the overall market in North America and internationally
  • ORV market share is expected to continue to increase in 2013
  • For small vehicles, which includes the GEM and Goupil businesses, along with the recently acquired Aixam Mega, sales are expected to increase well over 100% for the full year 2013.
  • Both GEM and Goupil are expected to increase sales for the full year over last year total company sales increase in the range of 13% to 15% for the full year 2013.
  • Management is not feeling pricing pressure in the UTV market as they are confident that the Polaris brand/product can garner a price premium
  • Process improvement in small vehicle operations are improving quality and delivery as well as reducing costs. Management feels they are positioned very well in this space for strong growth.
  • The Bobcat dealer network has lagged Polaris in the commercial utility segment and the sell through of the Brutus vehicles will be slower than consumer vehicles because of the slower commercial vehicle buying cycle.
  • Management was even more upbeat than usually about the 2014 models that will be announced at the dealer meeting in a few days.

Learn more:  Seekingalpha.com (Earnings call transcript)

Comment:  Polaris management continues to execute on their strategic plans very well. They are setting the industry standard for inventory management, operational efficiency and product development and innovation. In an increasingly competitive market it will be interesting to see what features and innovations their new models will have.

Quadski Maker Gibbs Looks to Expand

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Quadski from Gibbs Sports Amphibians

Gibbs Sports Amphibians, the manufacturer of the Quadski, is planning to launch to new models and expand their dealer network.  The Quadski is an amphibious vehicle that converts from an ATV to a PWC in less than five seconds. Gibbs currently has five dealers for the Quadski but expects to have one hundred dealers by the end of 2014. They will need the increased distribution as the company expects to produce 1,000 Quadskis this year. Gibbs is also looking to export their product to international markets.

The Quadski costs about $40,000 and is available in blue, black, yellow, silver and red. It is powered by a 175 hp BMW Motorrad engine and can reach speeds of 45 mph on land or in the water.  In addition to the Quadski, Gibbs is planning on launching new consumer, commercial and military products over the next 18 months. Learn more:  Powersportsbusiness.com

Comment:  Selling 1,000 of these vehicles at $40,000 apiece is an ambitious goal, especially as a purely leisure vehicle. On the other hand, law enforcement and military organizations might find this to be a compelling technology for specific applications and could help meet that goal. The Quadski does represent the continuing innovation and product advancements in the STOV market. Lately the versatility of the vehicles has been a focus, whether it is convertible seating in the Honda Pioneer UTV, the ability to use various work attachments in the Polaris/Bobcat Brutus or now the ability to travel on land or water. It is the versatility of STOVs and the ability to match the vehicle to an application or specific set of applications that has helped the market grow strongly in an overall slow economic recovery.

BRP Earnings Call Summary

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Can Am Maverick Side-by-Side

BRP, manufacturer of Can-Am products including Maverick and Commander UTVs, recently had an IPO and is now a publicly traded company.  They reported their first quarter earnings several weeks back and here are some of the highlights with a focus on UTV related information.

  • 12% growth in comparable revenue to Q1 fiscal year 2013, which was driven primarily by a 27% growth rate in year-round products, mainly coming from strong side-by-side revenues and increased roadster sales.
  • Double digit retail growth for combined Can-Am Recreational Side-by-Side and Spyder.
  • Deliveries of the new Maverick Side-by-Side vehicle began with in the first quarter very good sell-through at the dealership.
  • On the retail side, the US recreational side-by-side industry grew high single digits, while our North American side-by-side sales grew high double digit.
  • Reported revenues of C$804 million, an increase of 5.5% over the same period in fiscal ’13, representing a record level for the Company in the first quarter.
  • Have added 35 to 40 dealers in the South and Southwestern US as part of a plant to add 200 to 300 dealers in the same areas within the next four years.