Polaris Reports Record Financial Results Again

Showing strength across all product lines Polaris Industries reported record fourth quarter and full year profits on Wednesday.  For the fourth quarter sales increased 26% from 4Q 2010 to $782.0 million and for the full year sales increased 33% from 2010 to $2,656.9 million. Other full year highlights include:

• Increased market share for all product lines
• 39% increase in international sales
• Net income of $227.6 million – 55% more than 2010.

Their Off-Road Vehicle (ORV) segment increased sales 32% over 2010 to $1.82 billion.  The segment includes ATVs and side-by-sides.  Management reports ATV unit retail sales growing upper single digits percent and side-by-side vehicle unit retail sales increasing about 20 percent over the prior year.  Polaris continues to gain market share in each segment.  Learn more:  Marketwatch.com

Earnings Call highlights:

• The overall ATV market declined low double digits for 2011 while side-by-sides increased low double digits.
• Polaris sales through their partnership with Bobcat increased 60% in 2011.
• Polaris has discontinued their Breeze LSV in light of their GEM acquisition and production of GEMs in their Spirit Lake facility has begun.
• Asia Pacific and Latin America are the key global markets
• Expectations for a slower level of growth for the company and ORV sales for the coming year.
• New products with Bobcat likely in end of 2012 or early 2013
• Strong growth in military segment expected with sales to special forces and in unmanned technology products

Learn more:  Seekingalpha.com (call transcript)

 

People On The Move

Polaris CEO joins Terex Board:  Scott Wine, CEO of Polaris Industries has joined the Board of Directors of Terex Corporation which manufactures equipment for the construction, infrastructure, quarrying, mining, shipping, transportation, refining, energy and utility industries.  Learn more:  SXSNews.com

Brenan takes new position at Kawasaki:  Russ Brenan has changed positions at Kawasaki, moving from advertising supervisor to senior advisor for government relations and public affairs.  He will represent all the companies product categories including motorcycles, all-terrain vehicles, utility vehicles, and personal watercraft.  Learn more:  UTVGuide.net

 

 

 

 

Polaris Invests In Electric Motorcycle Manufacturer Brammo

Polaris Industries is the lead investor for Brammo’s second round of financing totaling $28 million.  Existing investors Alpine Energy and Northport Investments are also involved in supporting the electric motorcycle manufacturer for this round of financing.  In total the company has raised nearly $40 million in financing since 2008.

Brammo is known for their battery and electric powertrain technology.  The investment by Polaris should not only have synergies with their motorcycle products but with their electric utility vehicles and recently acquired GEM product line.  Brammo has also partnered with Flextronics for manufacturing.  Learn more:  Techcrunch.com

Polaris Reports Record Results In 3Q

Polaris Industries continues exhibiting strong growth in a down economy, increasing sales 26% in the 3Q to reach $729.9 million and increasing net income to $67.6 million from 47.2 million year over year.  Year to date sales increased 37% to compared to last year.  Management expects full year sales to increase 32% over 2010 figures to reach over $2.5 billion.  Gains were made in a number of areas including net income, earnings per share, margins and in overseas markets, including the sluggish European market.

The Off-road division grew 25% for the quarter and 38% year to date based on gains in side-by-sides, military and international markets.  Side-by-sides business increased over 20% in the quarter for Polaris compared to “low double digits” for the North American market as a whole.  The ATV market continues to decline but Polaris is still gaining market share.  Management also reports continuing success in penetrating commercial and rental markets through their partnership with Bobcat.

Learn more:  Seekingalpha.com (conference call transcript)

Polaris Reported Record Earnings

Polaris Industries recently reported record earnings for the first quarter of 2011.  Management reported sales of $537.2 million  and net income of $47.3 million for the quarter compared to $361.7 million and $19.8 million in the first quarter of 2010.  For the full year 2011 management expects sales to increase 17%-20% compared to 2010.

I listened to the earnings conference call and here are some of the highlights as it relates to the STOV markets.

• Off-road vehicles which includes UTVs and ATVs exceeded expectations
• International sales were up 21% in part do to side by side sales increasing 50% in Europe where these vehicles are supplanting ATVs as they have been in North America
• Polaris is gaining market share in UTVs and ATVs as they outperform the market domestically and internationally.
• Management reports side by side sales increasing more than double the overall market rate
• RZR XP 900 launched in January is selling well
• Bobcat branded vehicles they supply “ramped up nicely” and is gaining retail momentum
• Military sales which includes some STOV products doubled in the first quarter
• Diesel product started nicely and is expected to slowly but steadily develop with good opportunities in the UK, military and single fuel use segments such as farming and construction
• Off-road parts, garments and accessories sales increased 22% in Q1

Learn more:  Polarisindustries.com

New Polaris Offerings For 2011

Between family vacation and the launch of our latest STOV study It’s been a few weeks since my last post so there have been some developments in the market to catch up on.  I’ll start with the introduction by Polaris of their 2011 product line.  Despite a down economy they have been able take market share and be aggressive in the product development with new vehicles targeting specific market segments and improvements to existing models.  New vehicles include the RANGER 500 EFI, RANGER CREW 500 and RANGER Diesel. The latter targets the agriculture segment where diesel is the preferred fuel.

Enhancements to current product offerings include increased power to RANGER XP 800 and RANGER XP 800 EPS, and power steering on the Polaris Pursuit Camo RANGER CREW 800. All 2011 RANGER products, with the exception of RANGER EV, will be outfitted with easy-buckle driver and passenger safety nets.

The RANGER RZR line will have even more razor sharp performance with a new look that increases cooling airflow by 29 percent, provides a 30 percent improvement in range and delivers increased performance as a result. The RANGER RZR 800 will receive six percent more power with the addition of the 800 H.O. engine and be more trail-friendly with new rear rack extenders.  RANGER RZR S 800 will feature new big bore shocks, be the first stock vehicle to feature ITP 900 XCT tires and will be available in two premium painted editions along with a standard edition, which will receive a new lower price. For razor sharp performance for four, Polaris will offer the RANGER RZR 4 800in two Robby Gordon packages, a painted black and red limited edition and a power steering version that includes Robby Gordon-inspired graphics.

The company also launched the civilian version of their EV LSV which originally targeted the government market and added new parts and accessories for vehicles across the product line.  Learn more:  Motorsportsnewswire.wordpress.com

Related articles by Zemanta

• Polaris to Realign Manufacturing Operations (eon.businesswire.com)

STOV Manufacturers Report Earnings

In the past few weeks a number of publicly traded STOV manufacturers have reported earnings. While the economic downturn has significantly impacted the market, both Polaris and Arctic Cat report gaining market share in ATVs and UTVs during this time. Both companies have also embarked on programs to develop more frequent dealer ordering cycles to reduce dealer inventories and better react to market demands by creating a more desirable model mix at the retail point of sale.

Arctic Cat reported that through the first half of the year the ATV sales declined 20% but in the side by side market some segments have actually shown growth. Artic Cat reports gaining market share in both the ATV and UTV markets.

Learn more: Seekingalpha.com

Polaris reported in their earnings call with analysts that the ATV market was down more than 15% while the side by side market was making some gains. Management expects the economic recovery to be choppy. Polaris reports taking market share in the ATV and UTV markets while Honda and Yamaha are struggling. The LSV market has been smaller than expected in the short term, but management expects it to be a growing niche market that they are taking the time to learn before developing growth strategies.

Polaris is also starting to roll out vehicles for their partnership with Bobcat. The initial dealer reception to the vehicles has been positive. An offshoot of that development program was the addition of diesel powered vehicles in the Polaris line-up targeting work customers in North America and global markets as well as the military market where diesel is the fuel of choice. Yanmar is providing Polaris with diesel engines. The electric Ranger LSV serves the military market as well. During the call management also noted that some production had been moved to Mexico since much of their growth in the US is occurring in the southern part of the country.

Learn more: Polaris Industries

New Vehicle Introductions from Case IH & Polaris

Case IH compact Scout UTV

Case IH has introduced a new lineup of Scout utility vehicles targeting the farm segment.  The lineup includes a compact, two-passenger 14-hp (10-kW) gasoline-powered version and an XL version, which is available in two- and four-passenger configurations, with 23-hp (17-kW) gas or 20-hp (15-kW) diesel engines.  Learn more:  SAE.org

Ranger Crew 800 Limited Edition - Sunset Red with electronic power steering

Polaris Industries has introduced a new lineup of limited edition utility vehicles.  Beyond cosmetic upgrades such a new paint schemes some models include performance upgrades such as the Ranger Crew and Ranger RZR with electronic power steering and a 50-inch Ranger RZR with a premium Walker Evans shock package. 2010 Limited Edition models include:

• 2010 RANGER 800 XP EPS LE-Sage Green
• 2010 RANGER 800 XP LE-Turbo Silver
• 2010 RANGER 800 XP EPS LE-Nuclear Sunset
• 2010 RANGER 800 XP LE-Browning Edition with Pursuit® Camo
• 2010 RANGER 800 CREW LE-Sunset Red with Electronic Power Steering
• 2010 RANGER 800 CREW LE-Sunset Red with Electronic Power Steering
• 2010 RANGER RZR LE-Walker Evans
• 2010 RANGER RZR LE-Pearl White
• 2010 RANGER RZR S LE-Purple Thunder

Learn more:  UTVweekly.com

Polaris Defense Introduces LSV For Military Market

New Polaris EV LSV For The Military Market

Earlier this week Polaris Industries Defense division introduced the Polaris EV LSV which is targeting the military market and other government agencies.  The vehicle is based on the Range EV utility vehicle.  Key features besides basic LSV requirements include:

• 48 volt AC induction motor with 30 horsepower
• 50 mile range and 25 mph top speed
• Three driving modes:  High for speed, Low for towing and hauling, and Max for maximum range
• 1,000-pound payload capacity
• 1,250 lbs. of towing capacity

The Polaris EV LSV will enable the company to bid for the contracts that the various US Armed Forces have started to award for LSVs.  These contracts could be for as many as 30,000 vehicles over the next 5 to 10 years. Columbia ParCar has won contracts for almost 1,000 LSVs in the past year.  In presentations for investors Polaris has pointed to the military market a an important growth driver for the company.  Learn more:  PolarisIndustries.com

On a related  note, in October, 2009 Polaris Defense was awarded a $2.4 million contract by the National Guard Bureau for their Ranger 800 Crew utility vehicles.  This contract probably represents about 200 vehicles.  Learn more:  MSN.com

Comment: This vehicle introduction continues a trend of utility vehicle manufacturers making their rough terrain utility vehicles LSV compliant.  Others that have done so previously include Bad Boy Enterprises, Stealth, HuntVe and Titan.  You might consider these crossover LSVs.  Although this market is in part driven by recent government tax cuts, I believe the need is real for a versatile vehicle that can handle rough terrain as well as street duties.  While Polaris is targeting the military market, their vehicle can easily be sold into this crossover market on the consumer side. – Marc Cesare