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m 2 0 0 1 5 4 0 3 2 3 2 5 5 4 8 2 5 2 0 8 0 € 0 ¥ € € ¥ ¥ ¥ ¥ C www.PowersportsBusiness.com finance Powersports Business • August 12, 2013 • 11 Polaris reports record Q2 results, 12% sales growth Citing net income that's up 15 percent to $80 million and North American sales rising 11 percent year-over-year in the second quarter, Polaris raised its earnings guidance for full year 2013 to a range of $5.20 to $5.30 per diluted share, which is up 18-20 percent over 2012 based on anticipated 2013 sales growth of 13-15 percent. While ATVs, side-by-side vehicles and PG&A sales demonstrated particular strength, economic headwinds in Europe and less-thanfavorable weather conditions in late spring and early summer impacted the company's results during the second quarter. "My take is that we had a good, but not great, first half, and certainly expect faster and more share gains in the second half," Polaris chairman and CEO Scott Wine said on the company's earnings Scott Wine conference call with analysts. "One of the fun aspects of leading Polaris is the competitive nature of our business. Our success has brought out the best in our rivals, and we recognize that our model year '14 products will launch into a heightened competitive environment." With the re-launch of the Indian brand and an all-new RZR side-by-side, Wine added that upcoming new products are set to bolster results in the remainder of 2013. "Having ridden our new vehicles and seen the marketing plans, I have to say that I like our chances in this battle," he said. "And this dealer meeting's lineup is only a small part of a longrange product plan that should position us well for the future." Sales for the second quarter 2013 totaled a record $844.8 million, an increase of 12 percent over last year's second quarter sales of $755.4 million. "We are pleased with the strength of our brands and the performance of our team, as they overcame unusually wet weather conditions across North America and sluggish international consumer demand to once again deliver record results," Wine said. "Retail sales to consumers in North America rose 11 percent in the second quarter, accelerating from softer first quarter results and sequentially reducing dealer inventory ahead of perhaps the most eagerly anticipated new product launch in the company's history. We also gained market share in our Off-Road Vehicle business, despite increasing competitive pressure. In addition, we expanded gross margin by 120 basis points, driven in large part by increased selling prices and continued product cost reduction efforts." "The second half of 2013 will be a momentous time for Polaris. In the coming weeks we will introduce some of the most exciting products in our history, which we expect will accelerate retail growth for the remainder of the year and beyond. The much anticipated re-launch of Indian Motorcycles has finally arrived, just a few short years after we purchased the brand in 2011. The motorcycles are gorgeous, the distribution channel is developing nicely and on August 3rd at the motorcycle rally in Sturgis, South Dakota, we will officially bring choice, in the form of the oldest American motorcycle company, back to the motorcycle riding community. …" pSB Wolters Kluwer launches fair lending training for dealers Minneapolis-based Wolters Kluwer Financial Services has launched a new comprehensive fair lending training program targeted to the automotive, recreational vehicle, marine and powersports industries. Developed as a response to increased lender pressure and industry scrutiny of fair lending practices within the dealer marketplace, the training provides dealers with a comprehensive program to educate finance department personnel and equip them with fair lending standards needed to help them ensure compliance and maintain strong lender relationships. In March, the Consumer Financial Protection Bureau published CFPB Bulletin 2013-02, Indirect Auto Lending and Compliance with the Equal Credit Opportunity Act. Since then, the CFPB has issued subpoenas in an expansive probe into indirect auto lending practices, and the justice department is investigating auto dealers for their rate markup practices, hinting that further legal action targeting dealers directly may be on the horizon. It has prompted a great deal of analysis, discussion and concern within the network of dealers and their lender relationships. "While dealers generally fall outside the jurisdiction of the CFPB, recent developments have made it clear the lenders they work with will not escape the scrutiny of regulatory bodies which enforce ECOA compliance. These lenders are certainly starting to exert pressure on dealers to find ways to demonstrate that they are in compliance with fair lending regulations," said Chip Zyvoloski, senior attorney, indirect lending with Wolters Kluwer Financial Services. "Our fair lending training is designed to help dealers comply with the law, protect them from risk and at the same time provide them with a way to demonstrate ongoing compliance to their lender relationships." The training program educates and tests users on key fair lending regulations, and provides them with a customizable fair lending policy to use in their dealership for ongoing operational compliance. PSB P08x11-PSB10-Finance.indd 11 7/31/13 2:43 PM