Overall company sales declined 24% in second quarter
Polaris Industries reports its snowmobile sales increased
23% in the second quarter compared to the same period a year ago. It was the
lone bright spot in the quarterly report.
[overall] dealer floor traffic continues to be weak. Creating demand is one of our
key priorities for the remainder of the year," said Scott Wine Polaris's
CEO, during a conference call.
Polaris says snowmobile sales hit $7.4 million in the second
quarter, up from $6.0 million in the same period of 2008. Sales for the first
six months, ending June 30, were up 1% to $15.5 million from a year earlier.
Polaris says the second quarter is historically a low
quarter for snowmobile shipments, as deliveries to dealers ramp up in the
second half of the calendar year. In addition, the Rush will not begin shipping
to dealers until the third quarter.
"Model year 2010
North American dealer orders were within our expectations while international
orders were slightly lower than our expectations, largely due to pressures in
the Russian market," said Bennett Morgan, president and chief operating
As Polaris had expected, overall sales declined 24% in the
second quarter. Sales were $345.9 million, down from $455.7 million in last
year's second quarter. Six month sales were down 22% to $657 million from $844
Cash flow provided
by operating activities was $24.4 million for the second quarter compared to
$53.3 million in the quarter last year. Polaris ties the decrease in cash flow to
a decrease in net income and in the dealer holdback of product.
"Our expectations for 2009 remain unchanged and we expect
our core markets to remain very challenging, particularly in the motorcycle
business," Wine said.
For the full year Polaris expects overall sales to be down
20% compared with 2008.
For the quarter Polaris saw a 25% decline in Off-Road
Vehicles division sales at $261.7 compared to $350.3 million last year. ATVs
sales were down 30%.
Sales of Victory Motorcycles in the quarter dropped 55% to
$10.492 million from $23.409 million in last year's second quarter. Parts,
Garments & Accessory sales dropped the least, slipping 13% to $66.248
million from $75.991 million in the period last year.
In an effort to boost sales, Polaris introduced an electric
neighborhood vehicle, the Polaris Breeze, in its new On-Road Division. The
Breeze is a electric-powered vehicle which is designed for golfing,
neighborhood riding, or carrying cargo for consumers in planned communities.
"While we recognize the current economic environment remains
challenging, we believe these new product introductions will provide Polaris
and our dealers with a definite competitive advantage as the macro-economic
environment eventually recovers," Wine said.