BRP Reports Record Q4 and Fiscal Year 2017 Results


BRP Inc. reported its financial results for the three- and twelve-month periods ended January 31, 2017. Record revenues of $1,305.3 million were reported for the fourth quarter of FY2017, an 18 percent increase.

“The fourth quarter has always been the busiest of the year, in terms of sales and shipments, and our execution was flawless,” says José Boisjoli, BRP’s President and CEO. “We are seeing great momentum with the retail sales of Can-Am Defender and Maverick X3 side-by-side vehicles and Sea-Doo watercraft, which have contributed to this year’s great results.”

Boisjoli says the positive results come despite challenging market conditions. “We have completed a record quarter and a record year in difficult market conditions, and I firmly believe that our success is largely due to the quality of our team, and the diversification of our product offering, geographic sales and manufacturing footprint,” he explains. “I am very proud of the BRP team for the excellence of its work, and I remain convinced that our focus on our strategic priorities is key to achieving our objectives and delivering our FY18 guidance.”

Quick Highlights for Fiscal Year 2017 vs. FY2016:

  • Record revenues of $4,172 million for FY2017, a 9.0 percent increase
  • Gross profit of $1,009 million representing 24.2 percent of revenues, an increase of $95 million and 30 basis points respectively
  • Normalized EBITDA of $503 million, a 9.0 percent increase
  • The addition of 70 new dealers to BRP’s North American powersports dealer network, 55 to its Evinrude dealer network and the signing of 13 outboard supply agreements with boat manufacturers.

Highlights for the Three- and 12-Month Periods Ended January 31, 2017

Revenues increased by $196.5 million, or 17.7 percent, to $1,305.3 million for the three-month period ended January 31, 2017, compared with $1,108.8 million for the corresponding period ended January 31, 2016. The revenue increase was mainly due to higher wholesale in seasonal products and year-round products, partially offset by an unfavourable foreign exchange rate variation of $48 million related largely to the decrease of the US dollar and the euro against the Canadian dollar.

Gross profit increased by $49.7 million, or 17.4 percent, to $335.6 million for the three-month period ended January 31, 2017, compared with $285.9 million for the corresponding period ended January 31, 2016. The gross profit increase includes an unfavourable foreign exchange rate variation of $24 million. Gross profit margin percentage decreased by 10 basis points to 25.7 percent from 25.8 percent for the three-month period ended January 31, 2016. The decrease in gross profit margin percentage was primarily due to higher sales program costs in year-round products and an unfavourable foreign exchange variation, mostly offset by a favourable product mix in side-by-side vehicle (SSV) and snowmobile.

Revenues increased by $342.3 million, or 8.9 percent, to $4,171.5 million for the twelve-month period ended January 31, 2017, compared with $3,829.2 million for the corresponding period ended January 31, 2016. The revenue increase was primarily attributable to higher wholesale of year-round products and seasonal products and a favourable foreign exchange rate variation of $12 million mainly due to the strengthening of the US dollar against the Canadian dollar.

Gross profit increased by $94.7 million, or 10.4 percent, to $1,008.9 million for the twelve-month period ended January 31, 2017, compared with $914.2 million for the corresponding period ended January 31, 2016. The gross profit increase includes an unfavourable foreign exchange rate variation of $24 million. Gross profit margin percentage increased by 30 basis points to 24.2 percent from 23.9 percent for the twelve-month period ended January 31, 2016. The increase in gross profit margin percentage was primarily due to a favourable product mix in SSV, Spyder vehicles and personal watercraft (PWC) as well as general price increases, partially offset by higher sales programs costs and an unfavourable foreign exchange variation.

Year-Round Products

Revenues from year-round products increased by $44.7 million, or 9.3 percent, to $527.3 million for the three-month period ended January 31, 2017, compared with $482.6 million for the corresponding period ended January 31, 2016. The increase resulted from a higher volume and a favourable product mix of SSV sold following the introduction of the Can-Am Maverick X3 and Defender models. The increase was partially offset by lower wholesale in Can-Am Spyder vehicles and an unfavourable foreign exchange rate variation of $27 million.

Seasonal Products

Revenues from Seasonal Products increased by $132.8 million, or 37.2 percent, to $489.5 million for the three-month period ended January 31, 2017, compared with $356.7 million for the corresponding period ended January 31, 2016. The increase resulted primarily from snowmobile due to a higher volume mainly attributable to later shipments this year and to a favourable mix. The increase was partially offset by an unfavourable foreign exchange rate variation of $13 million.

Propulsion Systems

Revenues from Propulsion Systems increased by $12.5 million, or 12.6 percent, to $111.5 million for the three-month period ended January 31, 2017, compared with $99.0 million for the corresponding period ended January 31, 2016. The increase in revenues was mainly attributable to a higher volume of motorcycle engines sold and a favourable mix of outboard engines sold. The increase was partially offset by an unfavourable foreign exchange rate variation of $4 million.

PAC (Parts, Accessories, Clothing and other services)

Revenues from PAC increased by $6.5 million, or 3.8 percent, to $177.0 million for the three-month period ended January 31, 2017, compared with $170.5 million for the corresponding period ended January 31, 2016. The increase was mainly attributable to a higher volume of SSV PAC sold following the introduction of the Can-Am Maverick X3 and to a higher volume of snowmobile PAC sold. The increase was partially offset by an unfavourable foreign exchange rate variation of $4 million.

Operating expenses decreased by $42.4 million, or 20.1 percent, to $168.2 million for the three-month period ended January 31, 2017, compared with $210.6 million for the three-month period ended January 31, 2016. This decrease was mainly due to a non-cash impairment charge of $70.3 million recorded last year related to the outboard engines cash generating unit. The decrease was partially offset by higher selling and marketing and general and administrative expenses for continued product investments.

BRP achieves annual sales of CA$4.2 billion from more than 100 countries. The company employs approximately 8,700 people worldwide.

Additional financial results shared in this article are available at www.sedar.com as well as in the Quarterly Reports section of BRP’s website.