Delaware |
1-11411 |
41-1790959 |
|||||||||||||||
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
|||||||||||||||
2100 Highway 55 |
Medina |
Minnesota |
55340 |
||||||||||||||
(Address of Principal Executive Offices) |
(Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Stock, $.01 par value per share | PII | New York Stock Exchange |
Exhibit No. | Exhibit | |||||||
Press Release dated January 28, 2025 of Polaris Inc. | ||||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL) |
Date: | January 28, 2025 | |||||||
POLARIS INC. | ||||||||
/s/ Robert P. Mack | ||||||||
Robert P. Mack | ||||||||
Chief Financial Officer |
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Fourth Quarter & Full Year 2024 Earnings Results
January 28, 2025
|
(in millions, except per share data) | ||||||||||||||||||||||||||
Quarter ended December 31, 2024 | Reported | YOY % Chg. | Adjusted* | YOY % Chg. | ||||||||||||||||||||||
Sales | $ | 1,755.4 | (23)% | $ | 1,754.7 | (23)% | ||||||||||||||||||||
Gross profit margin | 20.4 | % | -44 bps | 21.1 | % | +9 bps | ||||||||||||||||||||
Total operating expenses | $ | 318.2 | (11)% | |||||||||||||||||||||||
Net income attributable to Polaris | $ | 10.6 | (90)% | $ | 52.3 | (54)% | ||||||||||||||||||||
Net income attributable to Polaris margin | 0.6 | % | -391 bps | |||||||||||||||||||||||
Adjusted EBITDA Margin* | 9.6 | % | -66 bps | |||||||||||||||||||||||
Diluted EPS attributable to Polaris | $ | 0.19 | (90)% | $ | 0.92 | (54)% | ||||||||||||||||||||
*Note: the results and guidance in this release, including the highlights above, include references to non-GAAP operating measures, which are identified by the word “adjusted” preceding the measure. A reconciliation of GAAP / non-GAAP measures can be found at the end of this release. |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 1 |
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Fourth Quarter & Full Year 2024 Earnings Results |
Sales (in millions) |
Gross Profit Margin | ||||||||||||||||||||||||||||||||||
Q4 2024 | Q4 2023 | Change | Q4 2024 | Q4 2023 | Change | ||||||||||||||||||||||||||||||
Off Road | $ | 1,437.2 | $ | 1,916.8 | (25) | % | 21.4 | % | 21.3 | % | +9 bps | ||||||||||||||||||||||||
On Road | $ | 180.8 | $ | 229.2 | (21) | % | 9.9 | % | 13.8 | % | -391 bps | ||||||||||||||||||||||||
Marine | $ | 137.4 | $ | 143.2 | (4) | % | 17.3 | % | 17.9 | % | -65 bps | ||||||||||||||||||||||||
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 2 |
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Fourth Quarter & Full Year 2024 Earnings Results |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 3 |
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Fourth Quarter & Full Year 2024 Earnings Results |
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||||
(In Millions, Except Per Share Data), (Unaudited) | |||||||||||||||||||||||
Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
Sales | $ | 1,755.4 | $ | 2,289.2 | $ | 7,175.4 | $ | 8,934.4 | |||||||||||||||
Cost of sales | 1,397.5 | 1,812.3 | 5,708.6 | 6,974.5 | |||||||||||||||||||
Gross profit | 357.9 | 476.9 | 1,466.8 | 1,959.9 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Selling and marketing | 113.8 | 127.0 | 500.4 | 542.3 | |||||||||||||||||||
Research and development | 78.2 | 92.8 | 336.9 | 374.3 | |||||||||||||||||||
General and administrative | 126.2 | 136.9 | 436.5 | 422.8 | |||||||||||||||||||
Total operating expenses | 318.2 | 356.7 | 1,273.8 | 1,339.4 | |||||||||||||||||||
Income from financial services | 26.1 | 22.5 | 97.6 | 80.4 | |||||||||||||||||||
Operating income | 65.8 | 142.7 | 290.6 | 700.9 | |||||||||||||||||||
Non-operating expense: | |||||||||||||||||||||||
Interest expense | 34.3 | 32.8 | 137.0 | 125.0 | |||||||||||||||||||
Other expense (income), net | 19.3 | (10.9) | 12.8 | (44.5) | |||||||||||||||||||
Income before income taxes | 12.2 | 120.8 | 140.8 | 620.4 | |||||||||||||||||||
Provision for income taxes | 1.4 | 17.5 | 29.6 | 117.7 | |||||||||||||||||||
Net income | 10.8 | 103.3 | 111.2 | 502.7 | |||||||||||||||||||
Net (income) loss attributable to noncontrolling interest | (0.2) | 0.1 | (0.4) | 0.1 | |||||||||||||||||||
Net income attributable to Polaris Inc. | $ | 10.6 | $ | 103.4 | $ | 110.8 | $ | 502.8 | |||||||||||||||
Net income per share attributable to Polaris Inc. common shareholders: | |||||||||||||||||||||||
Basic | $ | 0.19 | $ | 1.82 | $ | 1.96 | $ | 8.80 | |||||||||||||||
Diluted | $ | 0.19 | $ | 1.81 | $ | 1.95 | $ | 8.71 | |||||||||||||||
Weighted average shares outstanding: | |||||||||||||||||||||||
Basic | 56.3 | 56.8 | 56.5 | 57.1 | |||||||||||||||||||
Diluted | 56.6 | 57.2 | 56.8 | 57.7 |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 4 |
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Fourth Quarter & Full Year 2024 Earnings Results |
CONSOLIDATED BALANCE SHEETS | |||||||||||
(In Millions), (Unaudited) | |||||||||||
December 31, 2024 | December 31, 2023 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 287.8 | $ | 367.8 | |||||||
Trade receivables, net | 192.3 | 306.4 | |||||||||
Inventories, net | 1,741.5 | 1,810.5 | |||||||||
Prepaid expenses and other | 395.7 | 198.0 | |||||||||
Income taxes receivable | 15.1 | 9.0 | |||||||||
Total current assets | 2,632.4 | 2,691.7 | |||||||||
Property and equipment, net | 1,186.7 | 1,201.5 | |||||||||
Investment in finance affiliate | 136.7 | 141.1 | |||||||||
Deferred tax assets | 384.6 | 295.9 | |||||||||
Goodwill and other intangible assets, net | 936.2 | 906.4 | |||||||||
Operating lease assets | 127.2 | 143.9 | |||||||||
Other long-term assets | 121.4 | 135.8 | |||||||||
Total assets | $ | 5,525.2 | $ | 5,516.3 | |||||||
Liabilities and Equity | |||||||||||
Current liabilities: | |||||||||||
Current financing obligations | $ | 434.3 | $ | 54.0 | |||||||
Accounts payable | 562.8 | 713.1 | |||||||||
Accrued expenses | 1,259.7 | 1,123.6 | |||||||||
Other current liabilities | 36.4 | 43.1 | |||||||||
Total current liabilities | 2,293.2 | 1,933.8 | |||||||||
Long-term financing obligations | 1,638.1 | 1,854.4 | |||||||||
Other long-term liabilities | 293.4 | 297.0 | |||||||||
Total liabilities | $ | 4,224.7 | $ | 4,085.2 | |||||||
Deferred compensation | 6.4 | 10.3 | |||||||||
Equity: | |||||||||||
Total shareholders’ equity | 1,289.9 | 1,418.4 | |||||||||
Noncontrolling interest | 4.2 | 2.4 | |||||||||
Total equity | 1,294.1 | 1,420.8 | |||||||||
Total liabilities and equity | $ | 5,525.2 | $ | 5,516.3 |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 5 |
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Fourth Quarter & Full Year 2024 Earnings Results |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
(In Millions), (Unaudited) | |||||||||||
Twelve months ended December 31, | |||||||||||
2024 | 2023 | ||||||||||
Operating Activities: | |||||||||||
Net income | $ | 111.2 | $ | 502.7 | |||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 286.3 | 258.9 | |||||||||
Noncash compensation | 49.2 | 57.4 | |||||||||
Noncash income from financial services | (53.8) | (41.5) | |||||||||
Deferred income taxes | (86.7) | (86.8) | |||||||||
Intangible asset and investment impairment | 29.5 | — | |||||||||
Other, net | 0.1 | (0.8) | |||||||||
Changes in operating assets and liabilities: | |||||||||||
Trade receivables | 103.4 | 49.0 | |||||||||
Inventories | 39.5 | 115.1 | |||||||||
Accounts payable | (141.8) | (143.8) | |||||||||
Accrued expenses | 158.8 | 217.1 | |||||||||
Income taxes payable/receivable | (11.0) | 18.6 | |||||||||
Prepaid expenses and other, net | (216.5) | (20.1) | |||||||||
Net cash provided by operating activities | 268.2 | 925.8 | |||||||||
Investing Activities: | |||||||||||
Purchase of property and equipment | (261.7) | (412.6) | |||||||||
Distributions from (investment in) finance affiliate, net | 58.2 | (6.5) | |||||||||
Investments in and distributions from other affiliates | (4.7) | (20.2) | |||||||||
Acquisition of developed technology assets | (62.7) | — | |||||||||
Acquisition of business, net of cash acquired | — | (22.7) | |||||||||
Net cash used for investing activities of continuing operations | (270.9) | (462.0) | |||||||||
Financing Activities: | |||||||||||
Borrowings under financing obligations | 3,694.6 | 2,770.0 | |||||||||
Repayments under financing obligations | (3,528.8) | (2,928.2) | |||||||||
Repurchase and retirement of common shares | (82.7) | (178.6) | |||||||||
Cash dividends to shareholders | (147.7) | (147.3) | |||||||||
Cash dividend to noncontrolling interest | (0.6) | — | |||||||||
Proceeds from stock issuances under employee plans | 6.0 | 52.8 | |||||||||
Net cash used for financing activities | (59.2) | (431.3) | |||||||||
Impact of currency exchange rates on cash balances | (18.0) | 10.7 | |||||||||
Net (decrease) increase in cash, cash equivalents and restricted cash | (79.9) | 43.2 | |||||||||
Cash, cash equivalents and restricted cash at beginning of period | 382.9 | 339.7 | |||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 303.0 | $ | 382.9 | |||||||
The following presents the classification of cash, cash equivalents and restricted cash within the consolidated balance sheets: | |||||||||||
Cash and cash equivalents | $ | 287.8 | $ | 367.8 | |||||||
Other long-term assets | 15.2 | 15.1 | |||||||||
Total | $ | 303.0 | $ | 382.9 |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 6 |
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Fourth Quarter & Full Year 2024 Earnings Results |
NON-GAAP RECONCILIATION OF RESULTS | |||||||||||||||||||||||
(In Millions, Except Per Share Data), (Unaudited) | |||||||||||||||||||||||
Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
Sales | $ | 1,755.4 | $ | 2,289.2 | $ | 7,175.4 | $ | 8,934.4 | |||||||||||||||
Restructuring (3) |
(0.7) | — | (0.7) | — | |||||||||||||||||||
Adjusted sales | 1,754.7 | 2,289.2 | 7,174.7 | 8,934.4 | |||||||||||||||||||
Gross profit | 357.9 | 476.9 | 1,466.8 | 1,959.9 | |||||||||||||||||||
Restructuring (3) |
11.6 | 3.0 | 18.7 | 3.0 | |||||||||||||||||||
Adjusted gross profit | 369.5 | 479.9 | 1,485.5 | 1,962.9 | |||||||||||||||||||
Income before income taxes | 12.2 | 120.8 | 140.8 | 620.4 | |||||||||||||||||||
Distributions from other affiliates (1) |
— | (1.4) | — | (1.4) | |||||||||||||||||||
Acquisition-related costs (2) |
0.2 | 0.6 | 1.4 | 1.3 | |||||||||||||||||||
Restructuring (3) |
12.7 | 6.8 | 35.2 | 8.2 | |||||||||||||||||||
Intangible amortization (5) |
4.4 | 4.4 | 17.7 | 17.7 | |||||||||||||||||||
Class action litigation expenses (6) |
1.6 | 3.1 | 7.0 | 8.5 | |||||||||||||||||||
Intangible asset and investment impairment (7) |
29.5 | — | 29.5 | — | |||||||||||||||||||
Adjusted income before income taxes | 60.6 | 134.3 | 231.6 | 654.7 | |||||||||||||||||||
Net income attributable to Polaris Inc. | 10.6 | 103.4 | 110.8 | 502.8 | |||||||||||||||||||
Distributions from other affiliates (1) |
— | (1.4) | — | (1.4) | |||||||||||||||||||
Acquisition-related costs (2) |
0.1 | 0.5 | 1.0 | 1.0 | |||||||||||||||||||
Restructuring (3) |
9.7 | 5.2 | 26.8 | 6.3 | |||||||||||||||||||
Intangible amortization (5) |
3.4 | 3.4 | 13.5 | 13.5 | |||||||||||||||||||
Class action litigation expenses (6) |
1.2 | 2.3 | 5.4 | 6.4 | |||||||||||||||||||
Intangible asset and investment impairment (7) |
27.3 | — | 27.3 | — | |||||||||||||||||||
Adjusted net income attributable to Polaris Inc.(8) |
$ | 52.3 | $ | 113.4 | $ | 184.8 | $ | 528.6 | |||||||||||||||
Diluted EPS attributable to Polaris Inc. | $ | 0.19 | $ | 1.81 | $ | 1.95 | $ | 8.71 | |||||||||||||||
Distributions from other affiliates (1) |
— | (0.02) | — | (0.02) | |||||||||||||||||||
Acquisition-related costs (2) |
— | 0.01 | 0.02 | 0.02 | |||||||||||||||||||
Restructuring (3) |
0.17 | 0.09 | 0.47 | 0.11 | |||||||||||||||||||
Intangible amortization (5) |
0.06 | 0.05 | 0.24 | 0.23 | |||||||||||||||||||
Class action litigation expenses (6) |
0.02 | 0.04 | 0.09 | 0.11 | |||||||||||||||||||
Intangible asset and investment impairment (7) |
0.48 | — | 0.48 | — | |||||||||||||||||||
Adjusted EPS attributable to Polaris Inc. (8) |
$ | 0.92 | $ | 1.98 | $ | 3.25 | $ | 9.16 | |||||||||||||||
Adjusted sales | $ | 1,754.7 | $ | 2,289.2 | $ | 7,174.7 | $ | 8,934.4 | |||||||||||||||
Net income | $ | 10.8 | $ | 103.3 | $ | 111.2 | $ | 502.7 | |||||||||||||||
Provision for income taxes | 1.4 | 17.5 | 29.6 | 117.7 | |||||||||||||||||||
Interest expense | 34.3 | 32.8 | 137.0 | 125.0 | |||||||||||||||||||
Depreciation | 73.5 | 67.6 | 264.4 | 241.2 | |||||||||||||||||||
Intangible amortization (4) |
6.0 | 4.4 | 21.9 | 17.7 | |||||||||||||||||||
Distributions from other affiliates (1) |
— | (1.4) | — | (1.4) | |||||||||||||||||||
Acquisition-related costs (2) |
0.2 | 0.6 | 1.4 | 1.3 | |||||||||||||||||||
Restructuring (3) |
10.9 | 6.8 | 33.4 | 8.2 | |||||||||||||||||||
Class action litigation expenses (6) |
1.6 | 3.1 | 7.0 | 8.5 | |||||||||||||||||||
Intangible asset and investment impairment (7) |
29.5 | — | 29.5 | — | |||||||||||||||||||
Adjusted EBITDA | $ | 168.2 | $ | 234.7 | $ | 635.4 | $ | 1,020.9 | |||||||||||||||
Adjusted EBITDA Margin | 9.6 | % | 10.3 | % | 8.9 | % | 11.4 | % | |||||||||||||||
(1) Represents distributions received related to an impaired investment held by the Company |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 7 |
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Fourth Quarter & Full Year 2024 Earnings Results |
(2) Represents adjustments for integration and acquisition-related expenses | |||||||||||||||||||||||
(3) Represents adjustments for corporate restructuring and the wind down of the FTR product line within the Company's On Road segment | |||||||||||||||||||||||
(4) Represents amortization expense for intangible assets acquired through business combinations and asset acquisitions | |||||||||||||||||||||||
(5) Represents amortization expense for intangible assets acquired through business combinations | |||||||||||||||||||||||
(6) Represents adjustments for certain class action litigation-related expenses | |||||||||||||||||||||||
(7) Represents impairment charges related to other intangible assets associated with the Company's Off Road segment and an impairment charge related to an investment held by the Company | |||||||||||||||||||||||
(8) The Company used its estimated statutory tax rate of 23.8% for the non-GAAP adjustments in 2024 and 2023, except for non-deductible items |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 8 |
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Fourth Quarter & Full Year 2024 Earnings Results |
RECONCILIATION OF GAAP OPERATING CASH FLOW TO NON-GAAP FREE CASH FLOW | ||||||||||||||
(In Millions), (Unaudited) | ||||||||||||||
Twelve months ended December 31, | ||||||||||||||
2024 | 2023 | |||||||||||||
Net cash provided by operating activities | $ | 268.2 | $ | 925.8 | ||||||||||
Purchase of property and equipment | (261.7) | (412.6) | ||||||||||||
Distributions from (investment in) finance affiliate, net | 58.2 | (6.5) | ||||||||||||
Adjusted free cash flow | $ | 64.7 | $ | 506.7 | ||||||||||
NON-GAAP RECONCILIATION OF SEGMENT RESULTS | |||||||||||||||||||||||
(In Millions), (Unaudited) | |||||||||||||||||||||||
Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||||||||||
SEGMENT GROSS PROFIT | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
Off Road segment gross profit | $ | 307.9 | $ | 409.0 | $ | 1,160.5 | $ | 1,531.6 | |||||||||||||||
Restructuring (1) |
0.2 | — | 4.3 | — | |||||||||||||||||||
Adjusted Off Road segment gross profit | 308.1 | 409.0 | 1,164.8 | 1,531.6 | |||||||||||||||||||
On Road segment gross profit | 18.0 | 31.7 | 179.4 | 240.4 | |||||||||||||||||||
Restructuring (2) |
11.2 | — | 11.2 | — | |||||||||||||||||||
Adjusted On Road segment gross profit | 29.2 | 31.7 | 190.6 | 240.4 | |||||||||||||||||||
Marine segment gross profit | 23.7 | 25.7 | 80.6 | 169.0 | |||||||||||||||||||
Restructuring (1) |
0.1 | 0.3 | 0.1 | 0.3 | |||||||||||||||||||
Adjusted Marine segment gross profit | 23.8 | 26.0 | 80.7 | 169.3 | |||||||||||||||||||
Corporate segment gross profit | 8.3 | 10.5 | 46.3 | 18.9 | |||||||||||||||||||
Restructuring (1) |
0.1 | 2.7 | 3.1 | 2.7 | |||||||||||||||||||
Adjusted Corporate segment gross profit | 8.4 | 13.2 | 49.4 | 21.6 | |||||||||||||||||||
Total gross profit | 357.9 | 476.9 | 1,466.8 | 1,959.9 | |||||||||||||||||||
Total adjustments | 11.6 | 3.0 | 18.7 | 3.0 | |||||||||||||||||||
Adjusted total gross profit | $ | 369.5 | $ | 479.9 | $ | 1,485.5 | $ | 1,962.9 | |||||||||||||||
(1) Represents adjustments for corporate restructuring | |||||||||||||||||||||||
(2) Represents adjustments for corporate restructuring and the wind down of the FTR product line within the Company's On Road segment |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 9 |
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Fourth Quarter & Full Year 2024 Earnings Results |
NON-GAAP ADJUSTMENTS | ||
Fourth Quarter & Full Year 2024 Results & 2025 Full Year Guidance |
Investor Contact: J.C. Weigelt 763-542-0525 | Media Contact: Jess Rogers 763-513-3445 | Page 10 |