Polaris Inc. · NYSE:PII
Polaris — Polaris Industries — Raymond James Institutional Investors Conference 2015
25 slides from Polaris's conference presentation, Mar 3, 2015
Slide 1: Polaris Industries Inc. – Raymond James Institutional Investors Conference
POLARIS INDUSTRIES INC. Scott W. Wine, Chairman & CEO Raymond James Institutional Investors Conference March 3, 2015
Slide 2: Polaris Industries Inc. – A Global Corporation
Polaris Industries Inc. – A Global Corporation ~7,800 Employees Worldwide 14 Manufacturing Locations 5 Research & Development Centers of Excellence ~1,850 Dealers In North America ~1,400 Dealers Outside North America >380,000 Units Shipped Worldwide in 2014 >100 Countries – Polaris Products Sold IR
Slide 3: Polaris at a Glance – Key Financial Metrics
Polaris at a Glance – Key Financial Metrics Sales Guidance Net Income* SALES UP 9% TO 12% 5-Year CAGR +19% Sales +23% $4,480 EPS* +34% $3,777 NET INCOME UP $3,210 $454 9% TO 12% $2,657 $381 $312 $1,991 $228 $147 2010 2011 2012 2013 2014 2015 Guidance EPS* $2.14 $3.20 $4.40 $5.40 $6.65 $7.22 TO $7.42
Slide 4: Polaris Strategic Objectives
Polaris Strategic Objectives Vision & Strategy Guiding Principles VISION STRATEGY Fuel the passion of riders, Polaris will be a highly profitable, customer centric, workers and outdoor enthusiasts $8B global enterprise by 2020. We will make the best Best People, Best Team around the world by deliver
Slide 5: Off-Road Vehicles
Off-Road Vehicles 2014 Sales $2,909M up15% Leading market share gainer in 2014 Largest product launch in history – 21 new models Executed ATV RFM in Q4, 2014 2015 Sales Guidance* – Up mid-single digits % Building Upon Clear Market Share Lead in ORV IR March 2015 *2014 sales reclassified to exclude
Slide 6: Snowmobiles
Snowmobiles 800 Switchback® Pro-S NEW 2016 800 Pro-RMK® 155 2015 Snowmobile of the Year ON THE AXYS® PLATFORM 2014 Sales $322M up 7% Strong season-to-date share gains thru January Snow mixed – West & East strong, Midwest weak MY’14 quality improved – #2 in NPS 2015 sales guidance – down mid-single
Slide 7: Motorcycles
Motorcycles >$500M Motorcycle Sales anticipated in 2015 2014 Sales $349M up 59% Launched Scout, Roadmaster, Magnum & Slingshot Dealers signed Indian >190/120 (signed/retailing) Slingshot ~380 Victory ~450 2nd half 2014 paint/capacity challenges improving 2015 sales guidance – up 50% to 65% Amazing
Slide 8: PG&A
PG&A PG&A Sales by Category & Product Line House Growing House Brand Brands; Portfolio Leveraging Aftermarket Brands Parts Motorcycles Small Vehicles 60,000+ Off-Road Garments Vehicles SKUs Snow Accessories Other Aftermarket Brand Portfolio 2014 Sales $742M up 21% 2,500+ SKUs Innovation ongoing >40
Slide 9: Global Adjacent Markets
Global Adjacent Markets Work & Transportation 2014 Sales $273M* up 24% Military (Small Vehicles + Commercial + Military) New Organization Work & Transportation, Military Focus on growth outside Powersports Execute M&A initiatives to accelerate growth 2015 sales guidance up 10% to 15% New Global Adj
Slide 10: Global Market Leadership
Global Market Leadership 2014 Sales by Geography Asia Pacific United States Int’l EMEA Latin America Canada 2014 Sales $685M up 16% Specialized Sports Equipment LLC in Dubai-UAE EMEA market share gains in ORV, motorcycle, snow and Aixam Poland plant producing and shipping Eicher-Polaris JV Perso
Slide 11: LEAN Enterprise is Competitive Advantage
LEAN Enterprise is Competitive Advantage Gross Profit Margin -23 bps Flat to Up +20 bps 29.4% 29.4% to 29.6% Closer Integration of Engineering & Manufacturing FY 2014 FY 2015 Processes Guidance New E.V.P. of Operations, Engineering and Lean to drive efficiency/quality Spirit Lake liquid paint output
Slide 12: Catalysts for Growth
Catalysts for Growth ORV Momentum: Innovation, execution, lifestyle brands Two $1B brands and growing Motorcycle Breakthrough: Indian bikes & dealers; Victory performance & positioning Slingshot: Unparalleled interest, unique opportunity Global Adjacent Markets: Leadership to accelerate growth Inter
Slide 13: Thank you – Questions?
€> POLARIS: Thank you Questions?
Slide 14: Appendices
Appendices Slide 5-Year Financial Performance 16 N.A. Retail Sales & Dealer Inventory – Full Year 2014 17 New Product Introductions (MY’15 & Early MY’16) 18 Slingshot 19 2015 Full Year Detailed Guidance 20 2015 Gross Profit Margin Guidance 21 Major Foreign Currencies for Polaris 22 Balance Sheet and
Slide 15: 5-Year Financial Performance
5-Year Financial Performance Sales & Net Income Return on Assets Return on Invested Capital 5-Year CAGR Sales = 23% 41% 42% 42% 42% 23% 24% 24% Net Income* = 35% $4,480 20% 33% $3,777 16% $3,210 13% $2,657 $6.65 21% $1,991 $5.40 9% 9% 9% 12% 15% 14% $4.40 7% 11% $3.20 12% $2.14 6% 6% 7% 6% 7% 8% 4%
Slide 16: N.A. Retail Sales & Dealer Inventory – FY 2014
N.A. Retail Sales & Dealer Inventory – FY 2014 N.A. Powersports Market Share & Retail Sales N.A. Dealer Inventory Market Share Retail Sales +16% 4% Existing Models +12% 8% New models/ categories 4% New Dealers +5% 16% Total Increase 2010 2011 2012 2013 2014 Polaris Industry 2013 2014 Consolidated Ma
Slide 17: NEW MY'15 & Early '16 Products
NEW MY’15 & Early ’16 Products PG&A 6 NEW Motorcycles 21 NEW Off-Road Vehicles ETX 570 570 DIESEL HST 900 TRAIL, 50” S 900, 60” XP 1000 ETX XP 1000 TOURING FULL SIZE 570 SP 4 900 CREW 570 CREW 900-6 XP 1000 TOURING XP900 CREW 570 900 XC EDITION XP 4 1000 ACE 570 X2 570 FULL SIZE High Lifter Edition
Slide 18: Slingshot
Slingshot Unveiled July 2014 2 models: Base & Premium (SL) $19,999 - $23,999 MSRP (U.S.) ~380 dealers signed and committed Shipments began in November 2014 Extremely high initial interest >1 billion media impressions in first 4 weeks Retailed >1,000 Units in Nov/Dec 2014 Assembly in Spirit Lake, Iow
Slide 19: 2015 Full Year Guidance
2015 Full Year Guidance METRIC GUIDANCE Sales Components Off-Road Vehicles Up mid-single digits % (reclassified 2014 actuals) Snowmobiles Down mid-single digits % Motorcycles Up 50% to 65% Global Adjacent Markets Up 10% to 15% (reclassified 2014 actuals) PG&A Up high-teens % International Up low-sin
Slide 20: 2015 Gross Profit Margin Guidance
2015 Gross Profit Margin Guidance Actual Guidance METRIC FY 2014 FY 2015 Prior period 29.7% 29.4% Production volume/capacity Product cost reduction efforts Commodity costs Currency rates Higher selling prices Product mix New plant start-up costs Warranty costs Depreciation/Tooling amortization Sales
Slide 21: Major Foreign Currencies for Polaris
Major Foreign Currencies for Polaris ∆ in Avg. ∆ to 2014 FY 2015 Impact Approximate Rate 2013 Avg. Rate Exposure 2015 vs. Currency Exposure to 2014 in Jan. 2015 Hedged* 2014 Canadian Dollar (CAD) Long ~$400M -7% -10% ~10% Negative Euro (EUR) Net Long ~$150M Flat -15% 0% Negative Australian Dollar (A
Slide 22: Balance Sheet and Liquidity Profile
Balance Sheet and Liquidity Profile $ In millions Fav / (UnFav) (except per share and rate data) FY 2014 FY 2013 2015 Full Year Guidance Cash $137.6 49% Increase Debt / Capital lease obligations $226.1 21% Unchanged Credit facility $350.0 Flat Unchanged Factory inventory $565.7 (35%) Improved Turns
Slide 23: Global Manufacturing Operations
Global Manufacturing Operations Chanas & Aix-les-Bains FRANCE Aixam Mega Roseau Bourran MINNESOTA FRANCE Goupil Opole Snow, ATV, SxS POLAND Osceola Shanghai, CHINA Spirit Lake & Milford ATV, SxS WISCONSIN (Feb. 18, 2015) IOWA Hammerhead Engines Motorcycles, SxS, ACE, GEM Cuyahoga Falls OHIO Riversid
Slide 24: Customer Profiles
Customer Profiles OFF-ROAD VEHICLES MOTORCYCLES SNOWMOBILES Avg. 49 43 44 47 52 25 to 55 42 Age Income ~$100k ~$100k ~$90k ~$90k ~$100-$125k ~$150k ~$90k Male / 95% / 5% 90% / 10% 90% / 10% 75% / 25% 90% / 10% 90% / 10% 90% / 10% Female Primary Mostly Work Mostly Play Work & Play Rec/Trail Cruising
Slide 25: 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 2015 sales, shipments, margins, net income and cash flow, the opportunities for expansion and diversification of the Company’s busi
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