BRP(US:DOOO)2025-12-04 12:01Financial Performance - For the nine-month period ended October 31, 2025, the Company completed the sales of Alumacraft and Manitou, presenting these businesses as discontinued operations[7]. - The Company reported total revenues of $2,250.3 million for the three-month period ended October 31, 2025, representing a 14.0% increase compared to $1,973.5 million in the same period last year[43]. - Total revenues for the nine-month period ended October 31, 2025, were $5,985.4 million, a 3.5% increase from $5,784.6 million in 2024[73]. - The Company’s net income for the three-month period was $76.5 million, a 150.0% increase from $30.6 million in the same period last year[41]. - Net income for the nine-month period ended October 31, 2025, increased by 156.0% to $294.6 million compared to $115.1 million in the same period in 2024[73]. - The Company reported a normalized EBITDA decrease of 8.8% to $739.6 million for the nine-month period ended October 31, 2025[82]. - Normalized EBITDA for the three-month period was CAD 325.6 million, an increase from CAD 268.4 million year-over-year[178]. - The Company’s net cash flows generated from operating activities for the nine-month period ended October 31, 2025, were $784.3 million, compared to $402.5 million in the same period of 2024, showing an increase of 95%[160]. Revenue Breakdown - Year-Round Products accounted for 58.2% of total revenues for the nine-month period ended October 31, 2025, up from 55.0% in the same period of 2024[23]. - Seasonal Products represented 25.0% of total revenues for the nine-month period ended October 31, 2025, a decrease from 29.3% in the prior year[23]. - Year-Round Products revenues increased by 22.1% to $1,265.6 million, driven by higher unit sales and a favorable product mix following new product launches[52]. - Seasonal Products revenues decreased by 1.6% to $606.2 million, mainly due to lower Snowmobile unit sales, partially offset by higher sales in PWC and Sea-Doo pontoons[55]. Operational Highlights - The Company employed approximately 16,500 employees worldwide as of the end of Fiscal 2025, selling products in over 130 countries through a network of about 2,400 dealers[21]. - The Company is managing dealer and distributor inventory financing arrangements to maintain dealer value proposition[12]. - The Company expects to maintain a regular flow of new product introductions and development of market-shaping products[12]. - North American retail sales decreased by 4% for the three-month period ended October 31, 2025, primarily due to lower Seasonal Products sales[42]. - North American network inventories decreased by 17% compared to October 31, 2024, reflecting the Company's focus on reducing inventory levels[49]. Financial Position and Cash Flow - The Company’s cash and cash equivalents at the end of the period were $250.1 million, an increase from $145.7 million at the end of the same period in 2024[104]. - Net cash flows used in investing activities decreased to $196.9 million for the nine-month period ended October 31, 2025, from $299.4 million in 2024, primarily due to lower investments in property, plant, and equipment[108]. - The company reported net cash flows used in financing activities of $533.9 million for the nine-month period ended October 31, 2025, compared to $443.1 million in 2024, largely due to a significant repayment of long-term debt[109]. - The carrying amount of assets classified as held for sale was $128.0 million as of October 31, 2025, down from $292.7 million in January 2025[100]. - The total comprehensive loss from discontinued operations for the nine-month period ended October 31, 2025, was $44.3 million, compared to $106.1 million in 2024[99]. Tax and Regulatory Matters - The Company expects to pay cash taxes in all tax jurisdictions for Fiscal 2026, except in the United States[38]. - The effective income tax rate decreased to 28.5% for Q3 2025 from 52.0% in Q3 2024, primarily due to foreign currency translation effects[63]. Research and Development - The Company is committed to developing electric models for its existing product lines, focusing on innovation and market opportunities[20]. - Research and development expenses increased by 15.0% to $110.1 million in Q3 2025, up from $95.7 million in Q3 2024[59]. Risk Management - The Company is exposed to commodity price fluctuations, with approximately 75% of its cost of sales consisting of materials used in manufacturing[29]. - The Company’s liquidity risk is managed through continuous monitoring of operating cash requirements, ensuring financial flexibility[148]. - The Company has entered into interest rate cap contracts to limit exposure to interest rate increases related to its Term Facility[151]. Internal Controls and Governance - The Company has established effective internal controls over financial reporting as of October 31, 2025[198]. - There have been no material changes in internal control over financial reporting during the nine-month period ended October 31, 2025[198]. - The Company is not aware of any significant changes to its risk factors since the last disclosure[201].