Financial Data and Key Metrics Changes - The company reported revenue of $1.9 billion, a 4% increase year-over-year, primarily driven by stronger ORV shipments, offset by lower personal watercraft deliveries [6][22] - Normalized EBITDA was $213 million, and normalized EPS was $0.92, which included approximately $0.35 from tax credits recorded in the quarter [6][22] - Free cash flow from continuing operations reached $100 million, with over $270 million in cash at the end of the quarter, indicating strong financial flexibility [22] Business Line Data and Key Metrics Changes - North American powersports retail decreased by 11%, with Canada showing a 4% growth driven by ORV, while the U.S. experienced a 15% decline [7][8] - Year-round product revenue increased by 13% to $1.1 billion, driven by higher ORV shipments following last year's inventory reduction plan [15] - Seasonal product revenues decreased by 13% to $470 million, mainly due to a planned reduction in personal watercraft shipments [18] Market Data and Key Metrics Changes - Retail in Latin America grew by 22%, led by strong ORV performance, while Asia Pacific saw a 5% increase, marking the first growth in two years [8][9] - EMEA experienced a 13% decline in retail, consistent with industry trends [8] - The overall global industry trend showed slight improvement compared to previous quarters [9] Company Strategy and Development Direction - The company is focused on maintaining operational efficiency and managing shipments to improve network inventory positions [21][25] - A definitive agreement for the sale of Manitou was announced, expected to close in the coming weeks [6] - The introduction of new products, including the Can Am Defender, is aimed at capturing market share and enhancing dealer profitability [11][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the second half of the year, citing improved visibility on expected deliveries and a strong product lineup [25][29] - The macroeconomic environment remains uncertain, but the company is well-positioned to capitalize on market opportunities [25][29] - The guidance for revenues is set between $8.15 billion and $8.3 billion, with normalized EBITDA expected to be between $1.04 billion and $1.09 billion [27] Other Important Information - The company has successfully reduced dealer inventory by 20% year-over-year, positioning itself to better align wholesale with retail [23][24] - The tariff impact for the year is estimated at $90 million, reflecting increased tariffs on steel, aluminum, and copper [27][50] - Management emphasized the importance of innovation and technology in sustaining profitable growth [30] Q&A Session Summary Question: What are the tariff scenarios being contemplated? - Management is in constant dialogue with Canadian and Mexican authorities regarding tariff regulations and believes they can adapt to any changes [33][36] Question: Can you elaborate on the current versus non-current inventory situation? - The company noted that most OEMs are cautious with shipments, and they are encouraged by the improved inventory ratios [41][44] Question: What is the outlook for retail sales in the second half? - Management expects retail to improve in the second half, particularly in ORV, driven by new product introductions and a cleaner inventory environment [46][70] Question: How does the company plan to mitigate tariff exposure? - Mitigation efforts include sourcing adjustments and production shifts to minimize tariff impacts [37][50] Question: What is the expected revenue profile outlook? - The company anticipates a recovery in revenue as inventory aligns with retail, with a potential tailwind of $400 million to $500 million from destocking [53][102] Question: What are the expectations for EPS growth in the coming years? - Management believes the company has the capacity to grow EPS significantly, depending on industry dynamics and macroeconomic conditions [97][99]

BRP (DOOO) Q2 2026 Earnings Call August 29, 2025 09:00 AM ET Speaker0Good morning, ladies and gentlemen. Welcome to the BRP Inc. FY twenty twenty six Second Quarter Results Conference Call. I would now like to turn the meeting over to Mr. Philippe Deschaine.Please go ahead, Mr. Deschaine.Speaker1Thank you, Joelle. Good morning, and welcome to BRP's conference call for the 2026. Joining me this morning are Jose Borjade, President and Chief Executive Officer and Sebastien Martel, Chief Financial Officer. Befo ...