The new 50-inch Arctic Cat Wildcat is expected to ship in the second half of the fiscal year and help drive sales.
Arctic Cat sales increased a modest 4% for the quarter but side-by-side sales were strong. The following are some highlights from the earnings call with a focus on the side-by-side market.
- Net sales for the second quarter increased 4% to 238.5 million from 229 million for the same quarter last year.
- ATV sales, which includes ATVs and UTVs, increased 4% to 72.7 million driven by Wildcat and Prowler side-by-side sales.
- Parts, garments and accessory sales decreased 1% to 30.4 million from 30.8 million.
- Year-to-date net sales increased to 5.6% to 359.3 million from 340.3 million and net earnings increased 7% to 28.8 million from 27 million
- Internationally Europe remains a difficult market but sales to Australia, Mexico and some of the Middle East and Latin American countries are up.
- On a year-to-date basis ATV sales increased 4% to 149 million and parts, garments and accessory sales increased 2% to 52.3 million from 51.1 million.
- For the quarter side-by-side retail sales increased by 23% driven by significant increases in the new Wildcat models, and the new Prowler HDX500 utility model.
- There has been a net increase in the dealer network for Prowler and Wildcat product lines with the increase for the Wildcat line the largest.
- Year to date R&D expenses increased 24% as management focuses on new product development, especially for side-by-sides.
Looking forward
- Management expects sales to be in the range of 754 million to 768 million, an increase of approximately 12% to 14% versus fiscal ’13.
- Arctic Cat will launch three new Wildcat side-by-sides in the next 6 months including the previously announced 50-inch Wildcat. Shipments for the other two new Wildcats are expected to begin in Q3 with dealer orders starting in November.
- Off-road vehicles expected to be up 25% to 29% for the year.