Despite challenging conditions in its domestic market, US powersports manufacturer Polaris Industries has achieved some recovery in the first half of 2019. BDN financial editor Roger Willis reports.
For this six-month period, total revenue rose by 17% to £2.628bn. Operating profit was 5.5% up to £174.2m. However, net profit dropped by 7.8% to £109.7m.
The company provided much more detailed figures for its second quarter, covering April through to June. Three-monthly revenue added 18.4% to £1.428m and operating profit grew by 10.3% to £108.4m. But again net profit declined, 4.6% down to £70.8m. As usual, the biggest Q2 contributory segment comprised mainly off-road vehicles (quadbikes and side-by-side ATVs) plus snowmobiles, delivering a 5.9% revenue rise to £842.1m.
Polaris said ORV turnover improved owing to higher prices, although North American retail sales volume fell slightly.
Motorcycle revenue in Q2 stacked on 14.8% to £157.9m. This was predominantly driven by Indian wholesale strength, particularly the new FTR1200 model which had begun shipping to dealers worldwide in the quarter, overwhelming a drop in Slingshot trike shipments. But once again, higher pricing concealed the fact that North American retail volume during Q2 for Indian was reduced by a “high single-digit percentage”.
In both ORV and motorcycle operations, Polaris cited increased export tariff costs as having an impact on profitability.