Polaris 3Q Financial Facts

From a Polaris Industries Press Release:

Medina, MN - Polaris Industries Inc. posted a record net income of $1.74 per diluted share for the third quarter ended September 30, 2003, an 11% increase over the prior year third quarter net income of $1.57 per diluted share.
The manufacturer says net income for the third quarter 2003 was $39.5 million, a 7% increase over prior year third quarter net income of $37.1 million. Sales for the third quarter 2003 totaled a record $447.7 million, up 5% from the prior year's third quarter sales of $428.0 million.

For the nine months ended September 30, 2003, Polaris reported a 6% increase in net income to $72.9 million and a 12% increase in earnings per share to $3.24 per diluted share compared to $68.5 million or $2.89 per diluted share in the first nine months of 2002. Sales for the nine months ended September 30, 2003 totaled $1,138.8 million, up 4% from $1,089.8 million in the comparable period of 2002.

Polaris said ATV sales for the quarter increased 14% over last year's third quarter, and said dealer inventories of ATVs at September 30, 2003 are at comparable levels to a year ago. Sales of Victory motorcycles increased 27% during the third quarter 2003 compared to last year's third quarter. Year to date through September 30, 2003, sales of Victory motorcycles increased 53% from the comparable period in 2002.

PWC sales decreased 24% during the third quarter 2003 compared to the third quarter 2002, a drop the manufacturer blamed on the timing of shipments between the second and third quarter of 2003. Sales of PWC for the year-to-date period ended September 30, 2003 increased 12% from the comparable period in 2002, the company said. Snowmobile sales, as expected, decreased 16% during the third quarter 2003 compared to the third quarter 2002. Sales of snowmobiles for the year to date period ended September 30, 2003 are 36% lower than the same period last year.

Sales of Parts, Garments and Accessories (PG&A) increased 5% during the third quarter 2003 over the third quarter 2002, with sales of ATV and Victory related PG&A items showing strong double digit growth during the quarter offset somewhat by lower snowmobile PG&A sales. Finally, income from financial services increased 87% to $7.3 million in the third quarter 2003, up from $3.9 million in the third quarter 2002.

Gross profit, as a percentage of sales, was 24.4% for the third quarter 2003, an improvement from 23.9% in the comparable quarter of 2002. Polaris says net cash provided by operating activities totaled $75.2 million for the nine months ended September 30, 2003, compared to $118.8 million in the first nine months of 2002. Debt to total capital ratio was 6% at September 30, 2003 – the same level as a year ago.

For the third quarter 2003, operating expenses increased to $56.7 million or 12.7% of sales compared to $50.5 million or 11.8% of sales for the third quarter 2002. General and administrative expenses increased 26% in the third quarter 2003, and Polaris repurchased and retired nearly 154,000 shares of its common stock at a cost of $11.6 million. The total remaining shares authorized to be repurchased is approximately 2.4 million shares.

"We are increasing our previously announced sales guidance from three to five percent sales growth for the full year 2003 to four to six percent sales growth for 2003 and are narrowing our full year 2003 earnings per share guidance from the previously announced range of $4.80 to $4.90 to the current range of $4.85 to $4.90 per diluted share, a 10% to 12% increase over 2002," said Tom Tiller, president and CEO.
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George Obradovich
George Obradovich

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