VALCOURT, Quebec – Side-by-sides and snowmobiles, especially 2014 models, took off, while ATV sales slowed for BRP Inc. in the quarter ended Oct. 31, the company reported today.
A higher volume of dealer and distributor orders for 2014 snowmobile models led to sales increases in the mid 20 percent range for snowmobiles, while SxS sales saw a 38 percent boost. ATV sales were down 20 percent for the quarter following new model introductions in the comparable quarter last year, BRP said, somewhat offsetting the gains. Last year’s ATV lineup included a rollout of eight new models, bringing the company’s year-round offerings to 17 models.
“The strong performance in our third quarter was primarily driven by strong shipments of snowmobiles both in North America and international,” said BRP President and CEO Jose Boisjoli. “Our results were also buoyed by consumer enthusiasm for our year-round products led by our new models of side-by-side vehicles, which have been well received worldwide.”
The company is on pace with its plan to add 35 to 40 new dealers in the United States during this fiscal year, and recruit 200 to 300 new dealers in the next four years, targeting the south and southwest.
BRP reported revenues of $866 million for the quarter, up 18 percent from the same quarter last year. The revenue increase was driven by a 38.5 percent year-over-year increase in seasonal products, from $276.2 million last year to $382.5 million this year. That includes $61 million from a favorable currency exchange rate, with the U.S. dollar and Euro strengthening against the Canadian dollar.
All figures are in Canadian dollars, which today is equivalent to 94 cents (U.S.).
In the United States, revenue for the quarter ending Oct. 31 increased from $265 million to $342.5 million, up 29 percent. That includes a 13 percent increase in retail sales of seasonal and year-round products in the U.S. The company saw a 5 percent increase in Canada and a 17 percent increase in international revenue.
Seasonal products drove a year-over-year gross profit increase for the quarter from $177.4 million to $223.9 million. Of the $46.5 million increase, $12 million came from a favorable foreign rate exchange, the company said. Revenue from year-round products increased by 0.9 percent for the quarter, from $249.6 million last year to $247.4 million this year.
Motorcycle and personal watercraft orders were up for BRP, although watercraft sales were down for the industry as a whole, building BRP’s PWC market share in Canada and the United States.
PHOTO: Can-Am Maverick. Image courtesy BRP
Parts, garments and accessories saw a quarterly revenue increase from $128.3 million to $144.3 million. Of the $16 million increase, $5 million came from a favorable foreign exchange rate. BRP attributed the rest to an increase in year-round products business.
Propulsion systems also saw a year-over-year quarterly revenue increase from $82 million to $89.6 million. Of the $7.6 million increase, $6 million came from a favorable foreign exchange rate variation.
Operating expenses decreased by $3.9 million year-over-year for the quarter, down to $128.9 million. The quarter ending Oct. 31, 2012, including $17.1 million in restructuring costs as BRP left the sport boat business, and advertising expenses incurred with the rollout of new products.
BRP said it has also paid down its debt, from $1.05 billion on Jan. 31 to $834 billion on Oct. 31.