How Did Polaris Industries’ Segments Fare in 2Q16?

In 2Q16, Polaris Industries (PII) reported sales of $1,130.8 million, a fall of 0.58% compared to the corresponding period last year.

Sales for the ORV (Off-Road Vehicle) and Snowmobile segment fell by 5.7% to $808.5 million, compared to 2Q15. ORV sales fell by 6% due to weak retail sales in North American oil markets and tough comparables in 2Q15. The company’s ORV dealer inventory fell by 8%, and North American ORV unit retail sales took a low-double-digit fall compared to 2Q15. Snowmobiles sales fell by 55% due to the timing of shipments or the off-season.

Sales in the Motorcycle segment rose 23.3% to $231.3 million as compared to 2Q15 due to strong retail sales for Indian Motorcycle, Slingshot, and Victory.

Sales in the Global Adjacent Markets segment rose by 14.2% to $91.0 million as compared to 2Q15.

The Work and Transportation segment’s wholegood sales rose by 10% due to growth in the Aixam business.

International sales outside North America rose by 5% and by 7% on a constant-currency basis.

Harley-Davidson (HOG) reported fiscal 1Q16 motorcycle and related products revenue and EPS (earnings per share) of $1,576.6 million and $1.36, which represent rises of 4.4% and 7.1%, respectively, compared to fiscal 1Q15. Harley-Davidson will announce its fiscal 2Q16 results on July 28, 2016.

Textron’s (TXT) fiscal 1Q16 total revenues and EPS rose by 4.2% and 19.6% to $3,201.0 million and $0.55, respectively, compared to fiscal 1Q15. Textron will announce its fiscal 2Q16 results on July 22, 2016.

Below are some key activities of Polaris Industries in 2Q16:

• After reports of thermal-related incidents, including fires, Polaris Industries stated it would voluntarily recall certain RZR 900 and 1000 ORVs manufactured since the model year 2013.
• On April 22, Polaris Industries announced that R.M. (Mark) Schreck would retire from Polaris Industries’ board of directors, effective immediately after the 2016 annual shareholder meeting.
• Polaris Slingshot introduced the Blue Fire SL Limited Edition in its lineup.
• Bennett Morgan, Polaris Industries’ president and chief operating officer, retired on May 16.
• Polaris Defense, a division of Polaris Industries, added high-performance MRZR turbo diesel (MRZR-D) to its MRZR ORV lineup.

The company started 3Q16 with a new appointment. Craig Scanlon has been appointed Polaris Industries’ chief marketing officer and will report to Scott W. Wine, the company’s chief executive officer and chairman.

The Vanguard S&P Mid-Cap 400 Growth ETF (IVOG) invests 0.84% of its holdings in Polaris Industries. The Guggenheim Raymond James SB-1 Equity ETF (RYJ) invests 0.73% of its holdings in the stock.

In the next part of this series, we’ll compare Polaris Industries with its peers and ETFs.