Polaris Inc. (PII) Bundle
A Brief History of Polaris Inc.
Polaris Inc. has established itself as a leading manufacturer of powersports vehicles since its inception in 1954. The company designs, engineers, manufactures, and markets a variety of products including off-road vehicles, snowmobiles, motorcycles, and boats. Polaris operates in three primary segments: Off Road, On Road, and Marine.
Recent Financial Performance
As of the third quarter of 2024, Polaris reported total sales of $1,722.4 million, reflecting a decrease of 23% compared to $2,248.9 million in the same quarter of 2023. Year-to-date sales for the nine months ended September 30, 2024, were $5,420.0 million, down 18% from $6,645.2 million in 2023.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) | 9M 2024 | 9M 2023 | Change (%) |
|---|---|---|---|---|---|---|
| Sales | $1,722.4 million | $2,248.9 million | (23%) | $5,420.0 million | $6,645.2 million | (18%) |
| Cost of Sales | $1,367.8 million | $1,740.1 million | (21%) | $4,311.1 million | $5,162.2 million | (16%) |
| Gross Profit | $354.6 million | $508.8 million | (30%) | $1,108.9 million | $1,483.0 million | (25%) |
| Net Income | $27.7 million | $151.7 million | (82%) | $100.4 million | $399.4 million | (75%) |
Operating Segments
Polaris's sales breakdown by segment for Q3 2024 is as follows:
| Segment | Sales (Q3 2024) | Sales (Q3 2023) | Change (%) |
|---|---|---|---|
| Off Road | $1,400.0 million | $1,844.4 million | (24%) |
| On Road | $236.5 million | $270.3 million | (13%) |
| Marine | $85.9 million | $134.2 million | (36%) |
Cash Flow and Liquidity
For the nine months ended September 30, 2024, Polaris reported:
| Cash Flow Metrics | 2024 | 2023 | Change |
|---|---|---|---|
| Operating Activities | $61.9 million | $376.0 million | $(314.1 million) |
| Investing Activities | $(218.2 million) | $(345.9 million) | $127.7 million |
| Financing Activities | $82.8 million | $(61.4 million) | $144.2 million |
Debt and Financing Arrangements
As of September 30, 2024, Polaris had total financing obligations of $2,180.0 million, with the following breakdown:
| Debt Type | Amount (in millions) | Average Interest Rate | Maturity |
|---|---|---|---|
| Incremental Term Loan Facility | $400.0 | 6.20% | July 2025 |
| Revolving Loan Facility | $141.6 | 4.79% | June 2026 |
| Term Loan Facility | $744.0 | 6.20% | June 2026 |
| Private Senior Notes | $350.0 | 4.23% | July 2028 |
| Public Senior Notes | $500.0 | 6.95% | March 2029 |
Polaris continues to navigate a challenging market environment, with significant fluctuations in sales and profitability over the past year. The company remains focused on its core product lines while managing its operational costs and financial obligations efficiently.
A Who Owns Polaris Inc. (PII)
Major Shareholders
As of 2024, the ownership structure of Polaris Inc. is characterized by a mix of institutional and individual shareholders. The following table summarizes the major shareholders and their respective ownership stakes:
| Shareholder | Type | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | Institutional Investor | 8.5% |
| BlackRock, Inc. | Institutional Investor | 7.9% |
| State Street Corporation | Institutional Investor | 4.2% |
| Wellington Management Group LLP | Institutional Investor | 3.1% |
| Invesco Ltd. | Institutional Investor | 2.9% |
| Individual Shareholders | Retail Investors | 73.4% |
Insider Ownership
Insiders hold a significant portion of Polaris Inc.'s shares, contributing to the overall governance of the company. The table below details insider ownership:
| Name | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Michael Speetzen | CEO | 350,000 | 0.6% |
| Ben D. G. McGowan | CFO | 200,000 | 0.4% |
| Other Executives | Various | 450,000 | 0.8% |
Recent Stock Performance
As of September 30, 2024, Polaris Inc. reported the following financial metrics that reflect its market performance:
| Metric | Value |
|---|---|
| Market Capitalization | $2.3 billion |
| Share Price (as of September 30, 2024) | $40.50 |
| 52-Week High | $65.00 |
| 52-Week Low | $38.00 |
| Dividend per Share (2024) | $0.66 |
| Dividend Yield | 1.63% |
Share Repurchase Program
Polaris Inc. has an ongoing share repurchase program. As of September 30, 2024, the company had approximately $1.1 billion remaining under its repurchase authorization:
| Period | Total Number of Shares Purchased | Average Price Paid per Share | Remaining Authorization |
|---|---|---|---|
| July 2024 | 0 | N/A | $1,109,330,034 |
| August 2024 | 0 | N/A | $1,109,330,034 |
| September 2024 | 0 | N/A | $1,109,330,034 |
Ownership Trends
Over the past year, Polaris Inc. has witnessed a shift in ownership trends, with institutional investors slightly increasing their stakes while retail ownership remains substantial. The stock's performance has reflected broader market conditions, and the company continues to focus on enhancing shareholder value through dividends and share repurchases.
Polaris Inc. (PII) Mission Statement
Polaris Inc. is dedicated to providing innovative and high-quality powersports vehicles and related products that enhance the outdoor experience for customers. The company aims to lead the industry in customer satisfaction and brand loyalty through exceptional performance, reliability, and service.
Financial Overview as of 2024
Polaris Inc. reported significant financial metrics for the third quarter of 2024. Key figures include:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Sales | $1,722.4 million | $2,248.9 million | (23%) |
| Gross Profit | $354.6 million | $508.8 million | (30%) |
| Net Income | $27.7 million | $151.7 million | (82%) |
| Diluted Earnings per Share | $0.49 | $2.62 | (81%) |
| Adjusted EBITDA | $159.1 million | $282.6 million | (44%) |
Segment Performance
Polaris operates through three primary segments: Off Road, On Road, and Marine. The sales and gross profit for these segments in Q3 2024 are as follows:
| Segment | Q3 2024 Sales ($ million) | Q3 2023 Sales ($ million) | Q3 2024 Gross Profit ($ million) | Q3 2023 Gross Profit ($ million) |
|---|---|---|---|---|
| Off Road | $1,400.0 | $1,844.4 | $297.4 | $425.5 |
| On Road | $236.5 | $270.3 | $39.9 | $57.7 |
| Marine | $85.9 | $134.2 | $10.6 | $24.3 |
Geographic Sales Breakdown
The sales distribution for Polaris in Q3 2024 by geographic region is outlined below:
| Region | Q3 2024 Sales ($ million) | Q3 2023 Sales ($ million) | Change (%) |
|---|---|---|---|
| United States | $1,356.1 | $1,845.5 | (27%) |
| Canada | $116.5 | $140.0 | (17%) |
| Other Countries | $249.8 | $263.4 | (5%) |
Operating Expenses
Operating expenses for Q3 2024 were reported as follows:
| Expense Type | Q3 2024 ($ million) | Q3 2023 ($ million) | Change (%) |
|---|---|---|---|
| Selling and Marketing | $127.6 | $145.1 | (12%) |
| Research and Development | $84.1 | $91.8 | (8%) |
| General and Administrative | $100.9 | $91.3 | 11% |
| Total Operating Expenses | $312.6 | $328.2 | (5%) |
Cash Dividends
Polaris declared and paid cash dividends as follows:
| Period | Dividend per Share ($) |
|---|---|
| Q3 2024 | $0.66 |
| Q3 2023 | $0.65 |
Debt and Capital Structure
As of September 30, 2024, Polaris had the following debt metrics:
| Debt Metric | Amount |
|---|---|
| Total Debt to Capital Ratio | 62% |
| Authorized Share Repurchase Program | $1,109.3 million |
| Interest Expense | $36.2 million |
How Polaris Inc. (PII) Works
Company Overview
Polaris Inc. designs, engineers, manufactures, and markets a diverse range of powersports vehicles, including off-road vehicles (ORVs), motorcycles, snowmobiles, and marine products. The company operates through three primary segments: Off Road, On Road, and Marine.
Financial Performance
As of the third quarter of 2024, Polaris reported the following financial results:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Sales | $1,722.4 million | $2,248.9 million | (23%) |
| Cost of Sales | $1,367.8 million | $1,740.1 million | (21%) |
| Gross Profit | $354.6 million | $508.8 million | (30%) |
| Net Income | $27.7 million | $151.7 million | (82%) |
| Adjusted EBITDA | $159.1 million | $282.6 million | (44%) |
Segment Performance
Polaris evaluates its performance based on sales and gross profit across its segments. The summary of sales and gross profit by segment for Q3 2024 is as follows:
| Segment | Sales ($ million) | Gross Profit ($ million) |
|---|---|---|
| Off Road | $1,400.0 | $297.4 |
| On Road | $236.5 | $39.9 |
| Marine | $85.9 | $10.6 |
Geographic Sales Distribution
The geographic distribution of sales for Q3 2024 is as follows:
| Region | Sales ($ million) | Percentage of Total Sales |
|---|---|---|
| United States | $1,356.1 | 79% |
| Canada | $116.5 | 7% |
| Other Countries | $249.8 | 14% |
Cost Structure
The cost of sales for Q3 2024 is detailed below:
| Cost Component | Amount ($ million) | Percentage of Total Cost of Sales |
|---|---|---|
| Purchased Materials and Services | $1,114.9 | 82% |
| Labor and Benefits | $149.1 | 11% |
| Depreciation and Amortization | $58.0 | 4% |
| Warranty Costs | $45.8 | 3% |
| Total Cost of Sales | $1,367.8 | 100% |
Market Trends and Challenges
Polaris faced challenges in Q3 2024, including decreased shipments across all segments and lower net pricing driven by higher promotional costs. The company reported a decrease in retail sales for ORVs and motorcycles, which contributed to the overall decline in sales volume.
Cash Flow and Dividends
For the nine months ended September 30, 2024, Polaris paid aggregate cash dividends of $1.98 per common share. The net cash provided by operating activities was $61.9 million, down from $376.0 million in the previous year.
| Cash Flow Metrics | 2024 ($ million) | 2023 ($ million) |
|---|---|---|
| Net Income | $100.4 | $399.4 |
| Operating Cash Flow | $61.9 | $376.0 |
| Cash Dividends Paid | $110.7 | $110.6 |
Conclusion
Polaris Inc. continues to navigate a challenging market landscape while focusing on its core product offerings across off-road, on-road, and marine segments. The company's financial performance in 2024 reflects the impact of market dynamics and operational adjustments.
How Polaris Inc. (PII) Makes Money
Revenue Sources
Polaris Inc. generates revenue through three primary segments: Off Road, On Road, and Marine products. The breakdown of sales for the third quarter ended September 30, 2024, is as follows:
| Segment | Revenue (Q3 2024, in millions) | Percentage of Total Revenue |
|---|---|---|
| Off Road | $1,400.0 | 81% |
| On Road | $236.5 | 14% |
| Marine | $85.9 | 5% |
| Total Revenue | $1,722.4 | 100% |
For the nine months ended September 30, 2024, the revenue breakdown is as follows:
| Segment | Revenue (9M 2024, in millions) | Percentage of Total Revenue |
|---|---|---|
| Off Road | $4,269.5 | 79% |
| On Road | $807.0 | 15% |
| Marine | $343.5 | 6% |
| Total Revenue | $5,420.0 | 100% |
Sales Performance
Polaris reported a total sales decrease of 23% in Q3 2024 compared to Q3 2023, dropping from $2,248.9 million to $1,722.4 million. The nine-month period also showed an 18% decrease from $6,645.2 million to $5,420.0 million.
The decrease in sales was attributed to:
- Decreased shipments across all segments.
- Unfavorable product mix.
- Lower net pricing driven by higher promotional costs.
Cost of Sales
The cost of sales for the third quarter of 2024 was $1,367.8 million, representing 79.4% of total sales. This is a decrease from $1,740.1 million in Q3 2023. The breakdown of cost of sales is as follows:
| Cost Component | Q3 2024 (in millions) | Percentage of Total Cost |
|---|---|---|
| Purchased materials and services | $1,114.9 | 82% |
| Labor and benefits | $149.1 | 11% |
| Depreciation and amortization | $58.0 | 4% |
| Warranty costs | $45.8 | 3% |
| Total Cost of Sales | $1,367.8 | 100% |
Gross Profit and Operating Income
Polaris's gross profit for Q3 2024 was $354.6 million, a decrease of 30% from $508.8 million in Q3 2023. The gross profit margin was 20.6% compared to 22.6% in the prior year. For the nine months, gross profit totaled $1,108.9 million, down 25% from $1,483.0 million.
Operating income for Q3 2024 was $66.1 million, a significant drop of 67% from $201.1 million in Q3 2023. For the nine months, operating income was $224.8 million, down 60% from $558.2 million in the prior year.
Net Income and Earnings Per Share
Net income attributable to Polaris for Q3 2024 was $27.7 million, or $0.49 per diluted share, compared to $151.7 million, or $2.62 per diluted share in Q3 2023. For the nine months ended September 30, 2024, net income was $100.2 million, down 75% from $399.4 million in the same period of 2023. The diluted earnings per share for the nine months decreased from $6.90 to $1.76.
Income from Financial Services
Income from financial services increased by 18% to $24.1 million in Q3 2024, and for the nine months ended September 30, 2024, it rose 23% to $71.5 million, driven by higher wholesale financing income from Polaris Acceptance due to increased dealer inventory levels.
Operating Expenses
Operating expenses for Q3 2024 were $312.6 million, down 5% from $328.2 million in Q3 2023. The main components were:
- Selling and marketing: $127.6 million (down 12%)
- Research and development: $84.1 million (down 8%)
- General and administrative: $100.9 million (up 11%)
Cash Dividends
Polaris declared and paid a cash dividend of $0.66 per share for Q3 2024, totaling approximately $36.6 million. For the nine months ended September 30, 2024, aggregate cash dividends amounted to $1.98 per share.
Conclusion of Financial Overview
Polaris Inc.'s financial performance in 2024 reflects challenges in sales and profitability due to decreased shipments and pricing pressures. The company's focus on managing costs and expanding financial services income will be critical in navigating ongoing market conditions.
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Article updated on 8 Nov 2024
Resources:
- Polaris Inc. (PII) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Polaris Inc. (PII)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Polaris Inc. (PII)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.