Arctic Cat Inc. says net sales totaled $159.6 million for the fiscal 2008 third quarter ended Dec. 31, down 30.1 percent from $228.1 million in the same period last year. The net loss for the quarter was $10.5 million, or $0.58 per diluted share, versus prior-year third quarter net earnings of $8.2 million, or $0.43 per diluted share.
Sales of Arctic Cat snowmobiles were $60.0 million in the 2008 third quarter, down from $106.4 million in the same period last year, reflecting the company's planned reduction in snowmobile production during the current fiscal year. The company says early season snowfall in key regions during December generated "strong" retail snowmobile sales and, combined with the company's planned lower snowmobile production in its current fiscal year, helped reduce dealer inventories.
Sales of Arctic Cat ATVs totaled $70.1 million, down from $91.8 million in the prior-year third quarter. Arctic Cat says the Prowler utility vehicle and ATVs with large-displacement engines continued to be beneficial contributors to the company's ATV business.
Parts, garments and accessories (PG&A) sales were essentially flat at $29.5 million compared to $29.9 million in the prior-year third quarter. The OEM says snowmobile PG&A sales increased as a result of early season snowfalls, offsetting a decline in ATV PG&A sales.
Arctic Cat's net sales for the first nine months of its fiscal year, ended Dec. 31, totaled $452.7 million, down 25.8 percent from net sales of $609.9 million in the same period last year. The company reported a net loss of $3.7 million, or $0.20 per diluted share, versus net earnings of $23.6 million, or $1.22 per diluted share, in the previous nine-month period.
Arctic Cat's snowmobile sales for the nine months ended Dec. 31 totaled $168.9 million compared to $248.8 million in the prior-year period; ATV sales were $207.4 million, down from $285.8 million; and PG&A sales totaled $76.4 million, up from $75.3 million in the year-ago period.
Arctic Cat anticipates sales for the fourth quarter ending March 31 to range from $192 million to $212 million, compared to $172.6 million for the same period last year. The increase is primarily attributable to planned fourth-quarter ATV sales to dealers. Net earnings in the fourth quarter are estimated to be between $0.21 and $0.25 per diluted share. The company reported a net loss of $1.6 million, or $0.08 per diluted share, in the prior-year quarter.
Arctic Cat expects sales for the full year ending March 31 to be in the range of $645 million to $665 million, down from net sales of $782.4 million in fiscal 2007. Earnings per diluted share for the 2008 fiscal year are now estimated to be between $0.01 and $0.05 versus year-ago diluted earnings per share of $1.15.
As previously announced, Arctic Cat lowered its fiscal 2008 production of snowmobiles by about 30 percent and ATVs by about 10 percent in an effort to align dealer inventory with consumer demand. The company says it now also plans to continue to reduce ATV production for fiscal 2008 in order to align dealer inventories with demand.
"We are disappointed in the company's performance,? says Christopher A. Twomey, Arctic Cat's chairman and CEO. ?After seven years of record growth, we anticipated that fiscal 2008 would be a difficult year when we took strategic action to reduce dealers' snowmobile inventories. Compounding this was an industrywide challenging retail ATV market, which continued to deteriorate through the third quarter.
"We remain committed to aligning inventories with demand, leveraging our efficiency and strategic sourcing initiative, and maintaining our competitiveness and technology leadership through innovative new products and features."