Arctic Cat Reports 8 Cents EPS in Fiscal 2003 First Quarter
THIEF RIVER FALLS, Minn.--July 25, 2002--Arctic Cat Inc. :| -- | Sales and earnings meet expectations |
| -- | Strong sales growth in snowmobiles (6 percent) and PG&A (37 percent) |
| -- | Company expects 10 percent increase in fiscal 2003 earnings per share |
Arctic Cat Inc. today reported results for the fiscal 2003 first quarter ended June 30, 2002.
Net sales for the fiscal 2003 first quarter were $78.3 million compared to $77.8 million for the same period last year. Net earnings for the quarter were $1.97 million, or 8 cents per diluted share, versus $1.96 million, or 8 cents per diluted share, for the first quarter of fiscal 2002.
"We are pleased net sales and earnings came in at the high end of our stated expectations in the first quarter," said Christopher A. Twomey, Arctic Cat's president and chief executive officer.
Sales of parts, garments and accessories (PG&A) in the 2003 first quarter rose 37 percent to $10.4 million versus $7.5 million in the prior-year quarter, primarily due to the timing of shipments. Snowmobile sales grew 6 percent to $48.8 million versus $46.2 million for the same period last year. The company moved some first-quarter ATV (all-terrain vehicles) shipments into the second quarter to better match the retail selling season for 2003 models. As a result, sales of ATVs decreased to $19.1 million versus $24.1 million in the year-ago period.
Commented Twomey: "Sales of our snowmobiles and parts, garments and accessories offset the shift of ATV sales from the first quarter to the second quarter. Late in the quarter, we unveiled our new ATV model lineup at our 2003 model dealer show. We continued to expand our ATV line to 16 models, which includes four new models, as well as new colors, new levels of performance and a revolutionary new rack system called the MultiRack Platform that will change the way our customers use their ATVs. In addition, we introduced a two rider concept vehicle (TRV), a concept sport performance ATV and the first ATV approved for street use in Europe. We are encouraged by the enthusiastic response of our dealers and remain confident that we will be able to attain our ATV growth targets for fiscal 2003."
During the quarter, the company repurchased 719,000 shares of common stock. Since 1996, Arctic Cat has repurchased over 7.7 million shares under three share repurchase authorizations. The company plans to continue to buy back shares of Arctic Cat stock in the coming quarters.
Outlook
"Our goal continues to be 10 percent earnings per share growth in fiscal 2003," said Twomey. "We expect that our growth will come from a 10 percent annual increase in ATV sales, as we add new models to our line-up and gain market share. We also anticipate a 10 percent annual increase in parts, garments and accessories sales. Snowmobile sales are expected to decline 7 to 10 percent this fiscal year as dealers order conservatively, due to last year's poor snow conditions. We remain focused on continually improving our operating efficiency in order to achieve our EPS goal."
The company anticipates 2003 second-quarter net sales will be in the range of $200 million to $208 million, compared to $211.1 million for the same period last year. Net earnings for the second quarter are estimated between 85 to 90 cents per diluted share versus 84 cents per diluted share in the prior-year quarter.
For the fiscal year ended March 31, 2003, Arctic Cat continues to anticipate net sales in the range of $556 million to $570 million. Diluted earnings per share are estimated to increase approximately 10 percent and be in the range of $1.30 to $1.34.
Conference Call
Arctic Cat will host a conference call to discuss the first quarter results at 10:30 a.m. CT (11:30 a.m. ET) on Thursday, July 25. To access the replay, dial (800) 633-8284, conference ID #20760203. The replay will be available from noon CT on Thursday, July 25, until 5 p.m. CT on Friday, July 26. The conference call also will be Webcast. To access this Webcast, go to the corporate portion of the company's Web site at www.arctic-cat.com, and click on the conference call icon. A replay of the Webcast will be archived on Arctic Cat's Web site for 30 days following the call.
Arctic Cat Inc. designs, engineers, manufactures and markets snowmobiles and all-terrain vehicles (ATVs) under the Arctic Cat(R) brand name, as well as related parts, garments and accessories. Its common stock is traded on the Nasdaq National Market under the ticker symbol "ACAT." More information about Arctic Cat and its products is available on the Internet at www.arctic-cat.com.
Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements. The Company's Annual Report, as well as the Report on Form 10-K and future filings with the Securities and Exchange Commission, the Company's press releases and oral statements made with the approval of an authorized executive officer, contain forward-looking statements that reflect the Company's current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. The words "aim," "believe," "expect," "anticipate," "intend," "estimate" and other expressions that indicate future events and trends identify forward-looking statements. Actual future results and trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to: product mix and volume; competitive pressure on sales and pricing; increase in material or production cost which cannot be recouped in product pricing; changes in the sourcing of engines from Suzuki; warranty expenses; foreign currency exchange rate fluctuations; product liability claims and other legal proceedings in excess of insured amounts; environmental and product safety regulatory activity; effects of the weather; overall economic conditions; and consumer demand and confidence.
ARCTIC CAT INC.
Financial Highlights
(Unaudited, 000s omitted, except per share amounts)
Three Months Ended
June 30,
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2002 2001
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Net Sales $78,283 $77,821
Cost of Goods Sold 59,440 58,945
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Gross Profit 18,843 18,876
Selling, General and Administrative Expenses 16,325 16,732
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Operating Profit 2,518 2,144
Other Income:
Interest Income 378 726
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Earnings Before Income Taxes 2,896 2,870
Income Tax Expense 927 913
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Net Earnings $1,969 $1,957
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Net Earnings Per Share
Basic $0.09 $0.08
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Diluted $0.08 $0.08
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Weighted Average Shares Outstanding
Basic 23,003 23,823
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Diluted 23,324 24,188
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Selected Balance Sheet Data: 06/30/02 06/30/01
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Cash and Short-term Investments $26,421 $32,962
Accounts Receivable, net 38,398 46,176
Inventories, net 108,423 108,214
Total Assets 252,351 256,491
Accounts Payable 32,192 36,197
Long-term Debt 0 0
Shareholders' Equity 167,701 170,467
Three Months Ended
June 30,
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Product Line Information 2002 2001 Incr%
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Snowmobiles $48,804 $46,187 6%
All-terrain Vehicles 19,115 24,090 -21%
Parts, Garments & Accessories 10,364 7,544 37%
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Total Sales $78,283 $77,821 1%
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