Polaris Inc. · NYSE:PII
Polaris — Q1 2020 Earnings Presentation
24 slides from Polaris's earnings presentation, Apr 28, 2020
Slide 1: First Quarter 2020 Earnings Results
First Quarter 2020 Earnings Results April 28, 2020
Slide 2: Safe Harbor & Non-GAAP Measures
SAFE HARBOR & NON-GAAP MEASURES Except for historical information contained herein, the matters set forth in this presentation, including management’s expectations regarding the impact of the COVID-19 pandemic and the Company’s ability to manage the economic environment resulting from the COVID-19 p
Slide 3: Scott W. Wine, Chairman & CEO
Scott W. Wine Chairman & CEO First Quarter 2020 Earnings Results April 28, 2020
Slide 4: Priorities Through the Crisis
Priorities Through the Crisis Employee Safety Polaris Viability Dealer Health / Relationship Shareholders and Stakeholders Polaris is Com m itted to Being a Custom er Centric, Highly Efficient Grow th Com pany Q1'20 PII Earnings 4
Slide 5: First Quarter 2020 Summary
First Quarter 2020 Summary COVID-19 crisis very fluid and dynamic – top of mind daily Employee health and safety remains our first and foremost priority Q1 performance in first 2½ months ahead of projections Demand slowed last two weeks of March but less than anticipated Taking steps to maintain ade
Slide 6: COVID-19 Response Actions To-Date
COVID-19 Response Actions To-Date Reduce working capital Liquidity Postpone capital expenditures / tooling Expand line of credit Accelerating Sunburst savings Organizational realignment Operations Plant optimizations / shutdowns Alter delivery service levels to meet demand Reduce/delay program spend
Slide 7: Leading Through the Crisis: Employees/Communities
Leading Through the Crisis: Employees/Communities Employees Communities Donations Partnerships Social Distancing COVID-19 Site Resources Travel/Visitor Restrictions Site Contingency Plans COVID-19 Volunteer Assistance Remote Interviews Cleaning, Quarantine Protocols Work from Home processes Good Hyg
Slide 8: Q1 2020 North American Powersports Retail Sales
Q1 2020 North American Powersports Retail Sales Q1’20 N.A. Powersports Retail(1) Q1’20 Polaris Retail Sales by Business JANUARY – FEBRUARY 1H MARCH 2H MARCH Q1’20 Off-Road Vehicles high-single digits % +5% +5% -40% -8% Side-by-Sides high-single digits % ATVs high-single digits % Motorcycles low-sing
Slide 9: Leading Through the Crisis: Dealer Health
Leading Through the Crisis: Dealer Health N.A. Dealer Inventory Dealer Closures Dealer Support Actions 2018-2019 Qtrs Ended Q1'19 Interest free flooring and interest +8% payment coverage 2019-2020 Qtrs Ended Q1'20 Retail rewards adjustments to support cash flow Closed Polaris Acceptance deferment pr
Slide 10: Leading Through the Crisis: Customer Support
Leading Through the Crisis: Customer Support Improved Site Navigation and Content COVID-19 Support Website Enhancements Find a Dealer Customer Support (Call + Self Help) Information on Financing Support SnowCheck Extended to May 1 Added Flexibility for Dealers Taking Orders/Deposits via Phone Key Pr
Slide 11: Leading Through the Crisis: Operations/Cost Actions
Leading Through the Crisis: Operations/Cost Actions Plant Operations / Cost Reductions Plant Operations fall under CISA’s essential operations definition Select plants are operational; demand/supplier availability driving current production levels Health & safety of employees remains top priority Pr
Slide 12: Mike Speetzen, EVP & CFO
Mike Speetzen EVP & CFO First Quarter 2020 Earnings Results April 28, 2020
Slide 13: Q1 2020 Financial Results
Q1 2020 Financial Results Sales Net Income Earnings Per Share $ in billions $ in millions YoY % Chg. $1.405 Billion ($5) Million ($0.09) GAAP 6% y/y N/M N/M 6% $1,496 $1,405 $67 ADJUSTED* $1.08 YoY % Chg. 1% 80% 80% $14 $0.22 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 *See GAAP/Non-GAAP Reconci
Slide 14: Q1 2020 Financial Position & Liquidity Profile
Q1 2020 Financial Position & Liquidity Profile Capital Summary March 2020 Liquidity Profile $ in millions $ in millions Variance to March 2020 March 2019 Cash $424 +180% Debt /Capital Lease Obligations $2,164 +3% Shareholders’ Equity $1,002 +14% Total Capital $3,166 +6% Credit Revolver – Capacity $7
Slide 15: Financial Services Arrangements
Financial Services Arrangements Financial Services Income by Category Wholesale Credit Retail Credit Contracts Written* $ in millions $ in millions $ in millions Receivable Balance – U.S. Dealers 5% $20 $244 $19 $1,423 $220 $1,391 $1,404 Other Activities Performance Finance $1,272 $1,272 Wholesale F
Slide 16: Q1 2020 Sales & Gross Profit Margins by Segment
Q1 2020 Sales & Gross Profit Margins by Segment ORV/Snowmobiles Motorcycles Global Adjacent Markets Aftermarket Boats 5% $868 $824 8% 7% 6% $221 $202 16% $185 $118 $127 $105 $98 $155 Q1 2019 Sales ($M) Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Off-Road Commercia
Slide 17: Scott W. Wine, Chairman & CEO
Scott W. Wine Chairman & CEO First Quarter 2020 Earnings Results April 28, 2020
Slide 18: Closing Comments
Closing Comments First, keep our employees safe – social distancing, etc. Support / win competitive battle for our dealers Execute precautionary recession plan measures Maintain strong balance sheet, liquidity and capital resources Protect key product development programs Accelerate strategic sourci
Slide 19: Q&A First Quarter 2020 Earnings Results
Q&A First Quarter 2020 Earnings Results April 28, 2020
Slide 20: Appendix
Appendix Q1 2020 Gross Profit Margin Q1 2020 Supplemental Sales – International/PG&A Q1 2020 Non-GAAP Reconciliations Q1'20 PII Earnings 20
Slide 21: Gross Profit Margin – Q1 2020
Gross Profit Margin – Q1 2020 Q1 2020 Gross Profit Margin – GAAP* Q1 2020 Gross Profit Margin – Adjusted* 23.6% 24.0% 20.8% 21.2% Q1 2019 Q1 2020 Q1 2019 Q1 2020 GAAP* GAAP* Adjusted* Adjusted* Q1 2019 Q1 2020 Q1 2019 Q1 2020 Segments Segments GAAP* GAAP* Adjusted* Adjusted* ORV/Snow 27.7% 24.5% ORV
Slide 22: Q1 2020 Supplemental Sales – International & PG&A
Q1 2020 Supplemental Sales – International & PG&A Q1 2020 International Sales ($ millions) Sales by Segment Sales by Region 11% International Europe, $203 $182 ORV / Snow Motorcycles Middle East Latin America 17% flat and Africa 19% 13% Global Adjacent Markets Asia Pacific 7% 15% Q1 2019 Q1 2020 Q1
Slide 23: Non-GAAP Reconciliations
Non-GAAP Reconciliations NON-GAAP RECONCILIATIONS Reconciliation of GAAP "Reported" Results to Non-GAAP "Adjusted" Results (In Millions, Except Per Share Data; Unaudited) Three months ended March 31, (In Millions, Unaudited) Three months ended March 31, Key Definitions: This presentation contains ce
Slide 24: First Quarter 2020 Earnings Results
First Quarter 2020 Earnings Results April 28, 2020