- Strong revenues of $898.1 million, an 18% increase compared to the first quarter of FY2015;
- Normalized EBITDAof $91.5 million, a 62% increase compared to the same period last year;
- Net income of $83.1 million;
- Normalized net incomeof $37.2 million, a 124% increase, which resulted in a normalized diluted earnings per shareof $0.31;
- FY16 financial guidance reaffirmed; and
- 100,000thCan-Am Spyder assembled on April 22, 2015.
VALVOURT, QUEBEC – June 11, 2015 – (Motor Sports Newswire) – BRP Inc. (TSX: DOO) today reported its financial results for the three-month period ended April 30, 2015. All financial information is in Canadian dollars unless otherwise noted. The complete financial results are available at www.sedar.com.
BRP’s 2016 Can-Am off-road line-up was launched on June 3. © BRP 2015
“We were able to deliver strong results thanks to the good work our team has done in delivering all our projects. Production at our manufacturing sites was on schedule and markets reacted well to our latest product introductions,” said José Boisjoli, president and CEO.“Despite headwinds from a volatile currency situation, difficult market conditions in Russia and in Latin America and a more aggressive competitive environment, our first quarter was slightly better than planned.”
Highlights for the Three-Month Period Ended April 30, 2015
Revenues increased by $139.5 million, or 18.4%, to $898.1 million for the three-month period ended April 30, 2015, compared with $758.6 million for the corresponding period ended April 30, 2014. The revenue increase was mainly due to higher wholesale in Seasonal Products. The increase includes a favourable foreign exchange rate variation of $36 million mainly due to the strengthening of the U.S. dollar against the Canadian dollar, partially offset by the strengthening of the Canadian dollar against the euro.
Net Income data Three-month periods ended
 For a reconciliation of Net income to Normalized net income and Normalized EBITDA, see the Reconciliation Tables in the MD&A.
Normalized EBITDA and Normalized Net Income are non-IFRS measures that the Company uses to assess its operating performance. Normalized EBITDA is defined as net income before financing costs, financing income, income taxes expense (recovery), depreciation expense and normalized elements. Normalized Net Income is defined as net income before normalized elements adjusted to reflect the tax effect on these elements. See “Non-IFRS Measures” section included in the MD&A.
 Normalized earnings per share – basic and normalized earnings per share – diluted are calculated respectively by dividing the normalized net income by the weighted average number of shares – basic and the weighted average number of shares – diluted.
QUARTERLY REVIEW BY CATEGORIES
Revenues from Year-Round Products increased by $32.7 million, or 8.9%, to $398.1 million for the three-month period ended April 30, 2015, compared with $365.4 million for the corresponding period ended April 30, 2014. The increase was primarily attributable to higher volumes following the introduction of the Maverick X ds side-by-side models and the expected industry growth. The increase in revenues includes a favourable foreign exchange rate variation of $20 million.
Revenues from Seasonal Products increased by $86.6 million, or 46.9%, to $271.2 million for the three-month period ended April 30, 2015, compared with $184.6 million for the corresponding period ended April 30, 2014. The increase resulted primarily from a higher volume of PWC sold due to earlier shipments following the completion of the production ramp-up at the Querétaro, Mexico facility and from additional deliveries to sustain the expected retail increase during the upcoming season. The increase in revenues includes a favourable foreign exchange rate variation of $12 million.
Revenues from Propulsion Systems increased by $5.2 million, or 5.3%, to $102.5 million for the three-month period ended April 30, 2015, compared with $97.3 million for the corresponding period ended April 30, 2014. The increase in revenues was primarily attributable to a favourable mix of outboard engines sold due to the E-TEC G2 introduction and a favourable foreign exchange rate variation of $2 million.
PAC (Parts, Accessories, Clothing and other services)
Revenues from PAC increased by $15.0 million, or 13.5%, to $126.3 million for the three-month period ended April 30, 2015, compared with $111.3 million for the corresponding period ended April 30, 2014. The increase was mainly attributable to a higher volume of Year-Round Products and outboard engines PAC resulting from new product introduction. The increase includes a favourable foreign exchange rate variation of $2 million.
Gross profit increased by $39.5 million, or 22.8%, to $212.9 million for the three-month period ended April 30, 2015, compared with $173.4 million for the corresponding period ended April 30, 2014. The gross profit increase includes a favourable foreign exchange rate variation of $6 million. Gross profit margin percentage increased by 80 basis points to 23.7% from 22.9% for the three-month period ended April 30, 2014. The increase in gross profit margin percentage was primarily due to increased volume of PWC sold, partially offset by an unfavourable mix in PWC and roadsters.
Operating expenses increased by $4.1 million, or 2.8%, to $149.1 million for the three-month period ended April 30, 2015, compared with $145.0 million for the three-month period ended April 30, 2014. This increase was mainly due to an unfavourable foreign exchange impact of $10 million.
Normalized net income reached $37.2 million, an increase of $20.6 million, which resulted in normalized diluted earnings per share of $0.31, an increase of $0.17 per share. The increase was primarily due to higher operating income, partially offset by higher income taxes expense.
Fiscal Year 2016 Guidance
BRP’s financial guidance targets as presented on March 27, 2015 are reconfirmed and remain as follows:
 Effective tax rate based on Normalized Earnings before Normalized Income Tax.
 Assuming $135M of depreciation expense compared to $113M in FY15.
The above targets are based on a number of economic and market assumptions the Company has made in preparing its Fiscal Year 2016 financial guidance, including assumptions regarding the performance of the economies in which it operates, foreign exchange currency fluctuations, market competition and tax laws applicable to its operations. The Company cautions that the assumptions used to prepare the forecasts for Fiscal Year 2016, although reasonable at the time they were made, may prove to be incorrect or inaccurate. In addition, the above forecasts do not reflect the potential impact of any non-recurring or other special items or of any new material commercial agreements, dispositions, mergers, acquisitions, other business combinations or other transactions that may be announced or that may occur after June 10, 2015. The financial impact of such transactions and non-recurring and other special items can be complex and depends on the facts particular to each of them. We therefore cannot describe the expected impact in a meaningful way or in the same way we present known risks affecting our business. Accordingly, our actual results could differ materially from our expectations as set forth in this news release. The outlook provided constitutes forward-looking statements within the meaning of applicable securities laws and should be read in conjunction with the “Caution Concerning Forward-Looking Statements” section.
Conference Call and Webcast Presentation
Today at 9 a.m. (EDT), BRP Inc. will host a conference call and webcast to discuss BRP’s FY2016 first-quarter results released this morning. The call will be hosted by José Boisjoli, president and CEO, and Sébastien Martel, CFO. A slide presentation and link to the audio webcast will be posted at http://investors.brp.com in the Event Calendar section.
To listen to the conference call by phone, for the English integral version (event number 4217419), please dial 514-861-1681 or 800-766-6630 (toll-free in North America). For the French version (event number 4217420), please dial 514-392-1478 or 866-542-4146 (toll-free in North America). Click here for international dial-in numbers.
A replay of the conference call will be available two hours after the call for 30 days following the original broadcast.
To listen to an instant replay of the call, please dial 514-861-2272 or 800-408-3053. For the English integral version, please enter the pass code 2429394. For the French translation, enter 7312904.
BRP (TSX: DOO) is a global leader in the design, development, manufacturing, distribution and marketing of powersports vehicles and propulsion systems. Its portfolio includes Ski-Doo and Lynx snowmobiles, Sea-Doo watercraft, Can-Am all-terrain and side-by-side vehicles, Can-Am Spyder roadsters, Evinrude and Rotax marine propulsion systems as well as Rotax engines for karts, motorcycles and recreational aircraft. BRP supports its line of products with a dedicated parts, accessories and clothing business. With annual sales of over CA$3.5 billion from 107 countries, the Company employs approximately 7,600 people worldwide. www.brp.com @BRPNews