Polaris Inc. · NYSE:PII
Polaris — Q1 2024 Earnings Presentation
18 slides from Polaris's earnings presentation, Apr 23, 2024
Slide 1: First Quarter 2024 Earnings Presentation
First Quarter 2024 Earnings Presentation April 23, 2024
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] are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Pot
Slide 3: First Quarter 2024 Overview
First Quarter 2024 Overview Total Company Results(1) First Quarter Drivers • North America retail down 10%, +3% after excluding Q1’24 Y/Y Change Snow o Off Road: Utility up, Recreation and Snow down Sales $1,736M 20% o On Road up • Share gains in ORV, Motorcycles and Marine • Sales down due to lower
Slide 4: North America Retail Trends and Sentiment
North America Retail Trends and Sentiment • Retail Trends ORV Recreation and Utility Retail In Units o ORV Premium and Utility continue to grow -10% +14% +5% +7% +3% o ORV Recreation down for six quarters in a row o Elevated promotions that began in Q4’23 are expected to continue • Dealer Sentiment
Slide 5: New Products: Indian Scout and RANGER
New Products: Indian Scout and RANGER All-New Indian Scout Family 2025 Full-Size RANGER Lineup • Next generation Scout combines iconic American style, legendary • Refresh in RANGER core lineup, a high volume, high growth segment balance of power & control, and rider centric technology • Owner-inspir
Slide 6: Q1 2024 Financial Results
Q1 2024 Financial Results Sales Financial Highlights (Y/Y) $2,180 $1,736 • Quarterly sales of $1.7B, down 20% o Lapping channel fill in Q1’23 o Difficult Snow season o International sales down 13% o PG&A sales up 3% • Adjusted* EBITDA margin down 459 bps o Unfavorable net price, warranty expense and
Slide 7: Off Road Q1 Summary
Off Road Q1 Summary Q1 Results & Y/Y Change PII Call-outs • N.A. ORV retail up 3% Sales: $1,336M 16% o Strength in Utility while Recreation remains soft Wholegoods North America • Gained modest ORV share: unit and dollar share 22% PG&A 16% International 5% 14% • Weaker than expected Snow season due
Slide 8: On Road Q1 Summary
On Road Q1 Summary Q1 Results & Y/Y Change PII Call-outs • N.A. Indian Motorcycle retail was up modestly year-over- Sales: $277M 14% year Wholegoods North America • Indian Motorcycle gained modest share in N.A. 16% PG&A International 15% o Strong share gains continue in Mid-size 8% 14% • Internation
Slide 9: Marine Q1 Summary
Marine Q1 Summary Q1 Results & Y/Y Change PII Call-outs • Share gains led by Bennington and Hurricane Sales: $124M 53% • Positive reception to new S and SV Bennington models • Dealer inventory down 12% year-over-year • Dealers remain cautious on adding new inventory Gross Profit 15.5% 776 bps • Boat
Slide 10: Financial Position
Financial Position Operating Cash Flow Adjusted* Free Cash Flow $ in millions $ in millions Up $926 Flat Modestly $507 FY 2023 FY 2024 FY 2023 FY 2024 Expectations Expectations 2024 Capital Deployment Priorities Key Financial Metrics $ in millions #1 Priority – Organic Investment Lighter capex spend
Slide 11: Full Year 2024 Guidance & Expectations
Full Year 2024 Guidance & Expectations Total Company Sales Segment Sales 2024 Outlook Assumptions $ in Millions • No update to our initial Company outlook provided in Jan. 2024 7% to 5% Off Road MID-SINGLE DIGITS % • Ship volume lower due to retail outlook • Snow weakness adds additional pressure to
Slide 12: Closing Comments
Closing Comments • First quarter earnings performance above initial expectations • New innovation in all three segments reflects our strategic focus on Rider-Driven Innovation • Share gains in ORV, Motorcycles and Marine • Continued discipline around dealer inventory • Focused on executing identifie
Slide 13: Polaris
PssLARIS
Slide 14: Appendix
Appendix • Non-GAAP Reconciliations – Total Company • Non-GAAP Reconciliations – Net Income to Adjusted EBITDA • Non-GAAP Reconciliations – Segments / Cash Flow • 2024 Guidance Adjustments Q1’24 Earnings 4/23/24 14
Slide 15: Non-GAAP Reconciliations – Total Company
Non-GAAP Reconciliations – Total Company Reconciliation of GAAP "Reported" Results to Non-GAAP "Adjusted" Results (In Millions, Except Per Share Data; Unaudited) Three months ended March 31, Full Year 2024 2023 2023 Gross profit 330.3 469.2 1,959.9 Restructuring (3) 0.4 — 3.0 Adjusted gross profit 3
Slide 16: Non-GAAP Reconciliations – Net Income to Adjusted EBITDA
Non-GAAP Reconciliations – Net Income to Adjusted EBITDA Reconciliation of Net Income to Adjusted EBITDA (In Millions, Unaudited) Three months ended March 31, Full Year 2024 2023 2023 Sales 1,736.4 2,179.7 8,934.4 Net income 3.9 113.6 502.7 Provision for income taxes 3.8 31.6 117.7 Interest expense
Slide 17: Non-GAAP Reconciliations – Segments / Cash Flow
Non-GAAP Reconciliations – Segments / Cash Flow Reconciliation of GAAP Segment Gross Profit to Non-GAAP Reconciliation of GAAP Operating Cash Flow to Non-GAAP Segment Gross Profit Adjusted Free Cash Flow (In Millions, Unaudited) (In Millions, Unaudited) Three months ended March 31, Three months ende
Slide 18: 2024 Guidance Adjustments
2024 Guidance Adjustments 2024 adjusted guidance excludes the pre-tax effect of restructuring costs of approximately $8 million, and approximately $20 million for class action litigation-related expenses. Intangible amortization of approximately $18 million related to all acquisitions has also been