Polaris Industries (NYSE: PII) reported Q3 EPS of $2.66, $0.47 better than the analyst estimate of $2.19. Revenue for the quarter came in at $1.95 billion versus the consensus estimate of $1.93 billion.

Financial and Operational Highlights

• Third quarter reported and adjusted sales increased 10% to $1,955 million and $1,953 million, respectively
• Third quarter reported net income was $2.66 per share; adjusted net income for the same period was $2.85 per share
• North American retail sales increased 15% for the quarter compared to last year led by strength in ORV, Motorcycles and Snow. Boats retail sales were also strong during the quarter.
• Gross profit margin for the third quarter was 27.3%, up 270 basis points over prior year. Adjusted gross profit margin was 27.5%, up 260 basis points versus last year primarily due to positive product mix and lower promotional costs
• Dealer inventory levels decreased 55% given continued strong retail sales growth
• Polaris' liquidity profile remains solid with debt/EBITDA at 2.45 times and total liquidity of $1.5 billion at quarter end
• Polaris raising full year 2020 sales and adjusted earnings guidance with full year adjusted earnings in the range of $7.15 to $7.30 per diluted share and full year sales up in the range of 2% to 3%

CEO Commentary

Our continued strength in the third quarter reflects the broad-based consumer demand for our industry leading Powersports products, and tremendous execution by our Polaris team and dealers. Their focus and determination enabled Polaris to generate double-digit sales increases in ORV, Motorcycles and Boats, which were somewhat limited by supply chain capacity constraints. I am extremely proud of the diligent and efficient efforts of our team to mitigate these supplier disruptions and drive a three-year high in quarterly gross profit margins. Demand has remained strong to start the fourth quarter and we expect our sales and earnings momentum to continue for the rest of the year. This pushes our expectations for overall Company performance to exceed our pre-Covid-19 targets for 2020, demonstrating our confidence in the team to accelerate production as we manage through continued challenges. Thanks to the dedication, innovation and customer-centric work of our entire Polaris team, whom we are working relentlessly to keep safe, we are realizing tremendous progress from our strategic investments in supply chain and digital transformation, electrification, and breakthrough product development programs. I am very optimistic about the future growth and profitability prospects for Polaris and our stakeholders.

-- Scott Wine, Chairman and Chief Executive Officer of Polaris Inc.

GUIDANCE:

Polaris Industries sees FY2020 EPS of $7.15-$7.30, versus the consensus of $6.63.

For earnings history and earnings-related data on Polaris Industries (PII) click here.