Issue link: https://read.dmtmag.com/i/730410
FINANCIAL BRP Inc. (TSX: DOO) reported its financial results for the three- and six-month periods ended July 31. All financial information is in Canadian dollars unless otherwise noted. "I am pleased with the second quarter of fiscal 2017 that has registered strong retail sales worldwide, particularly for Sea-Doo PWC and Can-Am off-road vehicles," said José Boisjoli, president and CEO. "We have good momen- tum with the Can-Am Defender models, intro- duced last September, and with the positive reception of the most recent product launches, such as the Evinrude E-TEC G2 engines or the Can-Am Maverick X3 vehicle." "The rigorous focus on our strategic plan and our team's solid execu- tion, around the world and across all functions, are paying off," Boisjoli added. "Our manufac- turing operations are progressing as planned, allowing us to accelerate the pace of product intro- ductions as promised. We are aligned on our strategic priorities, and I am confident that we will reach our objectives." Revenues increased by $44.0 million, or 5.4 percent, to $856.1 million for the three- month period ended July 31, 2016, compared with $812.1 million for the corresponding period ended July 31, 2015. The revenue increase was mainly due to higher wholesale in Year-Round Products and to a favorable foreign exchange rate variation of $20 million related largely to the strengthening of the U.S. dollar and the euro against the Canadian dollar. Gross profit increased by $2.6 million, or 1.5 percent, to $172.0 million for the three-month period ended July 31, 2016, compared with $169.4 million for the cor- responding period ended July 31, 2015. The gross profit increase includes an unfavorable foreign exchange rate variation of $3 million. Gross profit margin percentage decreased by 80 basis points to 20.1 percent from 20.9 per- cent for the three-month period ended July 31, 2015. The decrease in gross profit mar- gin percentage was primarily due to higher production costs and an unfavorable foreign exchange variation, partially offset by a favor- able product mix in year-round products and lower sales programs costs. Revenues increased by $75.8 million, or 4.4 percent, to $1,786.0 million for the six- month period ended July 31, 2016, compared with $1,710.2 million for the correspond- ing period ended July 31, 2015. The revenue increase was primarily attributable to a favorable foreign exchange rate variation of $60 million mainly due to the strengthening of the U.S. dol- lar and the euro against the Canadian dollar and to higher wholesale of seasonal products. Gross profit decreased by $16.2 million, or 4.2 percent, to $366.1 million for the six- month period ended July 31, 2016, compared with $382.3 million for the correspond- ing period ended July 31, 2015. The gross profit decrease includes an unfavorable for- eign exchange rate variation of $13 million. Gross profit margin percentage decreased by 190 basis points to 20.5 percent from 22.4 percent for the six-month period ended July 31, 2015. The decrease in gross profit margin percentage was primarily due to an unfavorable foreign exchange variation and higher sales program costs, partially offset by a favorable product mix in year-round products and PWC, as well as a general price increase. Revenues from year-round products increased by $27.9 million, or 9.3 per- cent, to $326.3 million for the three-month period ended July 31, 2016, compared with $298.4 million for the corresponding period ended July 31, 2015. The increase resulted from a higher volume of SSV sold following the introduction of the Can-Am Defender model, a higher wholesale in ATV and a favorable for- eign exchange rate variation of $7 million. The increase was partially offset by lower wholesale in roadsters. Revenues from seasonal products increased by $17.1 million, or 6.5 percent, to $280.5 mil- lion for the three-month period ended July 31, 2016, compared with $263.4 million for the BRP grows revenue, profit in fiscal second quarter 18 • October 3, 2016 • Powersports Business www.PowersportsBusiness.com STOCK MARKET WATCH DEALER FINANCIAL SNAPSHOT AUGUST 2016 Same Store Sales for 1,584 CDK Global Recreation dealers were down 0.6 percent overall in comparison to August 2015 sales. All five regions experienced growth in service, with the Midwest increasing the most, up 7.2 percent. The Northeast, Northwest, West and South all decreased in major unit sales, with the West seeing the biggest difference, down 3.5 percent from 2015. PARTS SALES 695 dealers were up, while 889 were down in parts sales. SERVICE SALES In service, 917 dealers were up, and 641 were down. MAJOR UNIT SALES Major unit sales saw 721 dealers up and 729 dealers down. NORTHWEST -0.2% Parts Department 5.3% Service Department -1.4% Major Units -0.4% Overall MIDWEST -7.6% Parts Department 5.1% Service Department 1.2% Major Units -0.2% Overall NORTHEAST -7.0% Parts Department 5.2% Service Department -2.6% Major Units -1.8% Overall SOUTH -5.4% Parts Department 5.6% Service Department -0.5% Major Units -0.2% Overall WEST -1.7% Parts Department 7.2% Service Department -3.5% Major Units -0.9% Overall UNITED STATES -4.9% Parts Department 5.8% Service Department -1.1% Major Units -0.6% Overall Stock Price Percent Company Ticker 9/9/16 Change Universal Technical Institute UTI $2.40 11.1% Deere & Company DE $82.23 6.8% TCF Financial Corporation TCB $14.56 5.6% Bridgestone Corp. ADR BRDCY $17.55 5.5% Assurant, Inc. AIZ $89.23 4.7% Brunswick Corp. BC $45.30 -7.5% Arctic Cat, Inc. ACAT $14.12 -8.1% MarineMax, Inc. HZO $18.71 -8.4% Polaris Industries, Inc. PII $80.84 -14.8% Spy Inc. XSPY $0.12 -31.7% POWERSPORTS BUSINESS WINNERS AND LOSERS See BRP, Page 19 MARKET WATCH Change 9/9/16 from 8/12 % Change Powersports Business Index 231.720 -16.97 -6.83% Dow Jones Index 157.304 -4.27 -2.64% S&P 500 Index 144.823 -3.83 -2.58% Source: Wells Fargo Securities LLC 0 50 100 150 200 250 300 1/22/16 2/19/16 3/11/16 4/8/16 4/29/16 5/20/16 6/17/16 7/22/16 8/12/16 9/9/16 PSB INDEXED VALUE DOW JONES INDEXED S&P 500 INDEXED STOCK MARKET ACTIVITY FOR MORE ON THE SAME STORE SALES DATA For more information on this report and other industry data, contact: cdkrecreation.com/dataservices JOSÉ BOISJOLI