Polaris Industries Inc. (NYSE: PII) today reported record first quarter net income of $60.1 million, or $0.85 per diluted share, for the quarter ended March 31, 2012. By comparison, 2011 first quarter net income was $47.3 million, or $0.67 per diluted share. Net sales for the first quarter 2012 totaled $673.8 million, an increase of 25 percent from last year’s first quarter sales of $537.2 million.
First Quarter Highlights:
- Net income increased 27% to $60.1 million, or $0.85 per diluted share, with sales climbing 25% to $673.8 million, representing a record for first quarter sales and earnings.
- Off-Road Vehicle sales increased 30% and On-Road Vehicle sales increased 44% during the 2012 first quarter.
- North American retail sales remained strong, increasing 17% in the first quarter compared to a year ago.
- Gross profit margins expanded 60 basis points to 28.9% due to manufacturing realignment savings and lower product and warranty costs.
- Raising guidance for full year 2012 earnings to a range of $3.85 to $4.00 per diluted share, an increase of 20% to 25% over 2011 based on expected full year 2012 sales growth of 10% to 13%.
“Our record first quarter results reflect not only the continued strength of our business and solid execution of our strategy, but also a healthy start to the year for our end markets,” commented Scott Wine, Polaris’ Chief Executive Officer. “Retail sales in the North American off-road vehicle and motorcycle industries are off to their best start in years, and through our innovative products and motivated dealers, Polaris continued to gain market share. We have significant work to do, but as momentum built throughout the first quarter, we gained confidence that 2012 will be another record year for Polaris, as indicated by our increased full year sales and earnings guidance.”
“Sales increased 25 percent during the first quarter 2012, driven by robust sales of our Off-Road Vehicles and motorcycles. Customer demand for our broad array of RANGER and RANGER RZR side-by-side vehicles continues to exceed our expectations, both in North America and our international markets. Our international sales, which include the recent acquisition of Goupil, grew 20 percent for the quarter in spite of the continuing EU economic uncertainty. We are well positioned to meet this higher demand, as we have increased production at our Minnesota, Iowa and Wisconsin plants, while our Monterrey, Mexico plant continues to raise production levels. In addition, North American dealer inventories remain in line with our previous projections, with decreased ATV inventory year over year and increased side-by-side vehicle dealer inventory to meet the higher demand. Season-end snowmobile dealer inventory is higher than a year ago due to the poor snowfall, but remains at manageable levels.”
“Looking ahead, strong retail demand in the first quarter and our expectations for the remainder of the year underscores our confidence in raising our full year 2012 guidance for sales and earnings,” continued Wine. “Cash flow is expected to remain strong and our balance sheet remains solid with $286 million of cash on hand and minimal debt. Additionally, we are realizing the expected savings from our manufacturing realignment project, which provides support to our ongoing margin expansion efforts. Given our excellent start, and despite continued caution about the economy in the second half of the year and particularly the fourth quarter, we believe 2012 is shaping up to be another record year for Polaris.”
2012 Business Outlook
Based on Polaris’ performance during the 2012 first quarter and projections for the remainder of the year, the Company is increasing its 2012 full year sales and earnings guidance. The Company now expects full year 2012 earnings to be in the range of $3.85 to $4.00 per diluted share, an increase of 20 to 25 percent over earnings of $3.20 per diluted share for the full year 2011. Sales for the full year 2012 are now expected to grow in the range of 10 to 13 percent.
For a full listing of the performance summary from the first quarter and a breakdown of individual products’ performance, read the release by clicking here.