Polaris Inc. · NYSE:PII
Polaris — Polaris Industries — Q1 2014 Earnings Presentation
24 slides from Polaris's earnings presentation, Apr 23, 2014
Slide 1: First Quarter 2014 Earnings Results
First Quarter 2014 Earnings Results April 23, 2014 POLARIS INDUSTRIES INC. Relentless MAKING OUR POWERFUL PORTFOLIO EVEN STRONGER
Slide 2: Safe Harbor
Safe Harbor Except for historical information contained herein, the matters set forth in this document, including but not limited to management’s expectations regarding 2014 sales, shipments, margins, net income and cash flow, the trend toward producing more of the Company’s own engines for its vehi
Slide 3: Scott W. Wine, Chairman & CEO
Scott W. Wine Chairman & CEO First Quarter 2014 Earnings Results April 23, 2014 POLARIS INDUSTRIES INC.
Slide 4: Q1 2014 Sales and Net Income
$75.5 $80.9 Q1 2013 Q1 2014 Q1 2014 Sales and Net Income Record 1st quarter sales and net income ORV sales up 11%; Motorcycles up 52%; PG&A up 20%; International up 44% N.A. retail sales increased 7%; ORV up high-single digits, Motorcycles up significantly New Sportsman ACE initial sales exceed expe
Slide 5: Full Year 2014 Guidance
Full Year 2014 Guidance North American retail sales growth and market share gains expected to accelerate PG&A expected to grow about 20% with Kolpin acquisition International sales projected to increase low-double digits% Continued market share gains in ORV and motorcycles Net income* projected up 1
Slide 6: Polaris Strategic Objectives
Polaris Strategic Objectives Vision & Strategy Strategic Objectives VISION STRATEGY Fuel the passion of riders, workers and outdoor enthusiasts around the world by delivering innovative, high quality vehicles, products, services and experiences that enrich their lives. Polaris will be a highly profi
Slide 7: Bennett Morgan, President & COO
Bennett Morgan President & COO First Quarter 2014 Earnings Results April 23, 2014 POLARIS INDUSTRIES INC.
Slide 8: N.A. Retail Sales & Dealer Inventory – Q1 2014
Q1-2013 Q1-2014 3% Existing Models 7% New models/ categories 3% New Dealers 13% Total Increase Polaris Q1-2014 Industry Q1-2014 N.A. Retail Sales & Dealer Inventory – Q1 2014 Dealer Inventory Remains Appropriate N.A. Dealer Inventory N.A. Powersports Retail Sales Best in Powersports Plus Polaris N.A
Slide 9: Off-Road Vehicles
SxS SxS ATV ATV FY 2013 FY 2014 Guidance SxS SxS ATV ATV Q1 2013 Q1 2014 Off-Road Vehicles All ORV product lines grew: ATVs, SxS, Commercial and Defense N.A. Polaris ORV retail sales high-single digits %; Industry mid-single digits % Polaris side-by-sides and ATVs both high-single digits RZR retail
Slide 10: Motorcycles
FY 2013 FY 2014 Guidance Motorcycles Polaris N.A. motorcycle retail sales 50% Indian significantly, re-launch momentum strong Victory retail sales mid-single digits % Indian Motorcycle distribution expanding Over 150 N.A. dealers signed; 50%+ retailing at quarter-end Victory introduced new Gunner, b
Slide 11: Indian Motorcycle Re-Launch Update
Indian Motorcycle Re-Launch Update 11 Q1-2014 Huge Presence in Daytona Dealer Locations Increasing Recent Dealer Openings Daytona Bike Week Best in Powersports PLUS Main Street Midway Demo Site Ride Now in Chandler, Arizona North America 150 Signed (50%+ retailing) 220 Indian Motorcycle Dealers Worl
Slide 12: Snowmobile Business
FY 2013 FY 2014 Guidance Mountain Flatland Q1 2013 Q1 2014 Snowmobiles Polaris retail mid-single digits % season-end March 31, 2014 N.A. Industry just over 10% - best industry performance in 5 years Lost modest share in 2013/2014 season; pre-season snowchecks and mountains MY’14 product quality was
Slide 13: PG&A
FY 2013 FY 2014 Guidance 62% 8% 5% 20% 5% Record Q1 sales; 20% ORV sales 20%, Motorcycles 72% All categories increased sales double-digits % in Q1 Accessories 22%, Apparel 47% Expanded brands & distribution channels with Kolpin acquisition announced April 1, 2014 Long-term sourcing & operational syn
Slide 14: Commercial / Defense
Commercial / Defense. Re-established Momentum into 2014 . Revenue 60%+ Brutus Q1 retail sales improved; retail growth remains slower than expected Dedicated Commercial field sales force in 2014 Introduced RANGER Diesel HST to powersports channel National Accounts sales continue to grow, 50%+ Strong
Slide 15: Small Vehicles
FY 2013 FY 2014 Guidance Q1 2013 Q1 2014 Small Vehicles 15 Q1-2014 Small Vehicle Business Expecting Continued Growth in 2014 Small Vehicle Sales Growth Through Adjacencies Note: Includes Aixam Mega Acquisition in April 2013 Up 25% to 30% +177% $122.8 $11.1 ($ millions) GEM & Goupil sales 19%, combin
Slide 16: International
International 16 Q1-2014 Strong Start in International Market International Q1 2014 Sales Growth International Sales Q1 2013 Q1 2014 FY 2013 FY 2014 Guidance Eicher-Polaris JV Plant in Jaipur, India Up low-double digits % +29% $592.5 $114.4 EMEA +49% ASIA PACIFIC +60% LATIN AMERICA -18% Note: Includ
Slide 17: Operational Excellence
Operational Excellence LEAN initiatives driving productivity gains; +6% in Q1 RFM yielding results in motorcycles Implementing for ATVs in late 2014 Factory inventory 30% vs. 2013 due to product mix and acquisitions Polaris quality improving – #1 in NPS for Victory, SxS, ATVs 17 Q1-2014 Q1 2013 Q1 2
Slide 18: Mike Malone, V.P Finance & CFO
Mike Malone V.P Finance & CFO First Quarter 2014 Earnings Results April 23, 2014 POLARIS INDUSTRIES INC.
Slide 19: 2014 Full Year Guidance
Raised Sales and Earnings Expectations 2014 Full Year Guidance METRIC GUIDANCE Product Line Sales Off-Road Vehicles Up 9% to 11% Snowmobiles Up mid-single digits % Motorcycles Up 65% to 75% Small Vehicles Up 25% to 30% PG&A Up about 20% International Up low-double digits % Total Company Sales Up 14%
Slide 20: 2014 Gross Margin Guidance
METRIC Actual Q1 2013 Actual Q1 2014 Guidance FY 2014Prior Period 28.9% 29.0% 29.7% Production volume adjustments Product cost reduction efforts Commodity costs Currency rates Higher selling prices Product mix New Plant Start-up Costs Warranty costs Tooling amortization Sales promotional costs Contr
Slide 21: Balance Sheet & Liquidity Profile
Balance Sheet & Liquidity Profile Remains Healthy Balance Sheet and Liquidity Profile $ In millions (except per share and rate data) Q1 2014 Fav / (UnFav) Q1 2013 2014 Full Year Guidance Cash $101.8 ($279.0) Increase Debt / Capital Lease Obligations $331.8 ($225.5) Decrease Credit Facility $350.0 Fl
Slide 22: Scott W. Wine, Chairman & CEO
Scott W. Wine Chairman & CEO First Quarter 2014 Earnings Results April 23, 2014 POLARIS INDUSTRIES INC.
Slide 23: Closing Comments
Heightened Execution & Innovation Drives Improved Returns 23 Closing Comments Q1-2014 Celebrating 60 Years A “new high” for product innovation… incremental and breakthrough! On the Gas… Improving our Commercial Execution Customer experience, capacity expansion, Lean enterprise Competition Making us
Slide 24: Thank you, Questions?
POLARIS Thank you Questions?