Bombardier Recreational Products Inc. Announced Year End 2004 Results.Business Editors SAINT-BRUNO, Quebec--(BUSINESS WIRE)--May 28, 2004 Bombardier Recreational Products Inc. (BRP BRP Bombardier Recreational Products, Inc. BRP Blue Ribbon Panel BRP Bioengineering Research Partnership BRP Business Resumption Plan BRP Business Recovery Plan BRP Bathroom Privileges BRP Bronx River Parkway (New York) ), today announced its financial results for the fiscal year ended January January: see month. 31, 2004. On December December: see month. 18, 2003, in a transaction sponsored by Bain Capital Bain Capital LLC is a Boston, Massachusetts-based private equity firm founded in 1984 by Mitt Romney, the former Governor of Massachusetts, and two other partners from the consulting firm Bain & Company: T. Coleman Andrews III and Eric Kriss. , the Bombardier family, La Caisse Caisse, a French word, may refer to:
Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. (CDP CDP (cytidine diphosphate): see cytosine. (1) (Certificate in Data Processing) An earlier award for the successful completion of an examination in hardware, software, systems analysis, programming, management and accounting, ), a newly created entity named Bombardier Recreational Products Inc. (BRP) acquired from Bombardier Inc. its recreational products business. The financial results described and presented below represent the combined results of the recreational products business of Bombardier Inc. from February February: see month. 1, 2003 to December 18, 2003 and the results of BRP from December 19, 2003 to January 31, 2004 ("combined year"). For the combined year 2004, consolidated revenues were stable at $2.5 billion Cdn compared to last year, which is mainly due to BRP's decision to lower dealer inventories and shift watercraft production into the early part of fiscal year 2005. Consolidated Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become , adjusted for certain items and impacts related to purchase accounting, amounts to $193.1 million for the combined year 2004, compared to $181.1 million for the previous year, an improvement of 6.6%. BRP reported a net income of $12.7 million for the combined year 2004 compared to $114.8 million last year. This reduction arises mainly by the fair valuing of the assets, liabilities and foreign exchange contracts on December 18, 2003, as required at the time of acquisition of the recreational products business, by a decision to postpone post·pone tr.v. post·poned, post·pon·ing, post·pones 1. To delay until a future time; put off. See Synonyms at defer1. 2. To place after in importance; subordinate. watercraft production and deliveries and by higher warranty costs related to the recall of model year 1992 to 1996 watercraft fuel tanks. In addition, fiscal year 2003 was positively impacted by changes in estimates related to the acquisition of the assets of the outboard Not built in. Outboard devices are external to the main unit. Contrast with inboard. See offboard. engine business of Outboard Marine The Outboard Marine Corporation was a maker of boat motors and maintenance supplies, they also owned several lines of boats such as Chris Craft. They are now owned by Bombardier. Corporation as well as a change in accounting policies related to sales promotions and incentive programs. "We are excited by our 2004 product introductions and we are now ready to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. our leadership position in the snowmobile snowmobile, vehicle designed to travel over snow, ice, and similar surfaces that offer limited traction and weight-supporting capability. As the performance of the vehicle depends to a large extent on keeping its weight as low as possible, there is no enclosure for and watercraft markets. Our highly diversified diversified (di·verˑ·s portfolio of innovative products including the 2-up Max family of ATVs and our Evinrude(R) E-TEC(TM) outboard engine technology continue to be well accepted by our customers," said Jose Boisjoli, President and Chief Executive Officer. "Based on our product offering and our strong position in the market place, we look at fiscal year 2005 with confidence," he added. Snowmobile sales have increased by 13% compared to 2003 despite lower shipments in order to reduce dealer inventory level. This is mainly due to BRP's exciting line-up based on the REV(TM) platform, which has been a great success ever since it was launched in 2002. With these positive results, BRP, with Ski-Doo(R) and Lynx lynx, name given to several related small, ferocious members of the cat family. All have small heads, tufted ears, and heavy bodies with long legs and short tails. All are primarily terrestrial, although they are able to climb trees. (TM) snowmobiles, remains the number one manufacturer in the world. Watercraft sales have decreased by 22% compared to fiscal year 2003. This is the result of BRP's decision to shift watercraft production and deliveries to the early part of fiscal year 2005, to better match retail activities. However, Sea-Doo(R) watercraft continue to be the world leader with exciting, high performance and cleaner products. With the introduction of the RXP RXP Resonate Exchange Protocol RXP Receive Positive (TM) watercraft, BRP expects to maintain its leadership position in the market place. ATV (1) (Advanced TV) An early name for the digital TV standard proposed by the Advisory Committee on Advanced Television Service (ACATS). See ACATS. See also ATV Forum. (2) (Analog TV) Refers to the NTSC, PAL and SECAM analog TV standads. sales have increased by 63% over last year due to a more complete line-up including very innovative products such as the 2-up Max family, which is gaining a higher level of acceptance in the market place. BRP's sales to Deere & Company have also contributed to these positive results. Marine engine sales have decreased by 4% over last year. This is due to the strength of the Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents versus the US dollar, which has more than offset the increase in volume of product deliveries. The E-TEC family of products enjoys high customer acceptance and is quickly making headway head·way n. 1. Forward movement or the rate of forward movement, especially of a ship. 2. Progress toward a goal. 3. The clear vertical space beneath a ceiling or archway; clearance. 4. in all of BRP's markets. In 2003, the 40-, 50-, 75- and 90-hp models were introduced. E-TEC is the latest technology combining all of the best attributes of 2-stroke and 4-stroke engines. These engines are reliable, quiet and cleaner, in addition to being powerful, fuel efficient, lightweight and requiring no dealer-scheduled maintenance for the first three years. As for the Utility Vehicles, sales declined by 15% due to lower deliveries of snowgrooming units in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. as a result of poor snow conditions during winter 2002-2003. Commenting on the overall BRP situation, Mr. Boisjoli concluded: "We are aiming at generating more synergies and reducing our global operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. through our new consolidated operational structure. A closer relationship with our dealers, a more focused marketing strategy and the identification of new sources of supply combined with our innovative, state-of-the-art families of products, give us a strong footing going forward." Bombardier Recreational Products Inc. is a world leader in design, development, manufacturing, distributing and marketing of Sea-Doo(R) watercraft and sport boats, Ski-Doo(R) and Lynx(TM) snowmobiles, Johnson(R) and Evinrude(R) outboard engines, direct injection technologies such as Evinrude E-TEC(TM), Bombardier(1) all-terrain vehicles all-ter·rain vehicle n. Abbr. ATV A small, open motor vehicle having one seat and three or more wheels fitted with large tires. It is designed chiefly for recreational use over roadless, rugged terrain. (ATV), Rotax(TM) engines and karts, as well as Bombardier(1) utility vehicles. See attached Unaudited Combined Statement of Operations See Income statement. , Unaudited Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. and Unaudited Consolidated Statement of Cash Flows. This release refers to non-GAAP financial measures, such as EBITDA and Consolidated Adjusted EBITDA. "EBITDA" is defined as earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting and may be different from non-GAAP financial measures used by other companies. Our Senior Credit Agreement and the indenture An agreement declaring the benefits and obligations of two or more parties, often applicable in the context of Bankruptcy and bond trading. The term indenture primarily describes secured contracts and has several applications in U.S. law. governing gov·ern v. gov·erned, gov·ern·ing, gov·erns v.tr. 1. To make and administer the public policy and affairs of; exercise sovereign authority in. 2. our Senior Subordinated Notes contain covenants tied to similar measures. We believe that EBITDA and Consolidated Adjusted EBITDA, adjusted for certain items and impacts resulting from purchase accounting, are a fair representation of and provide information with respect to our ability to service our debt. However, they should not be considered as substitutes for, or superior to, measures of financial performance prepared in accordance with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . This release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. with respect to our financial condition, results of operations and business. All of these forward-looking statements, which can be identified by the use of terminology such as "subject to," "believe," "expects," "may," "will," "should," "can," or "anticipates," or the negative thereof, or variations thereon there·on adv. 1. On or upon this, that, or it. 2. Archaic Following that immediately; thereupon. Adv. 1. thereon - on that; "text and commentary thereon" on it, on that , or comparable terminology, or by discussions of strategy which, although believed to be reasonable, are inherently uncertain. Factors which may materially affect such forward-looking statements include: (i) slow or negative growth in the recreational products industry; (ii) interruption INTERRUPTION. The effect of some act or circumstance which stops the course of a prescription or act of limitation's. 2. Interruption of the use of a thing is natural or civil. of business or negative impact on sales and earnings due to acts of war Tom Clancy's Op-Center: Acts of War is a technothriller by Jeff Rovin Plot introduction The mobile Regional Operations Center (ROC) in Turkey investigates a dam blown up by Kurdish terrorists. , terrorism, bio-terrorism, civil unrest Unrest is a sociological phenomenon, for instance:
adj. Not available, accessible, or at hand. un  a·vail of additional debt or equity capital; (viii) changes in
general worldwide economic and political conditions in the markets in
which BRP may compete from time to time; (ix) the inability of BRP to
gain and/or hold market share of its wholesale and/or retail customers
anywhere in the world; (x) the inability of BRP's clients to
obtain and/or renew insurance; (xi) exposure to, and expense of
defending and resolving, product liability claims and other litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute.When a person begins a civil lawsuit, the person enters into a process called litigation. ; (xii) the ability of BRP to successfully implement its business strategy; (xiii) the inability of BRP to manage its retail, wholesale, manufacturing and other operations efficiently; (xiv) consumer acceptance of BRP's products; (xv) fluctuations in foreign currencies, including the Canadian Dollar; (xvi) import-export controls on sales to foreign countries; (xvii) introduction of new federal, state, local or foreign legislation or regulation or adverse determinations by regulators anywhere in the world; (xviii) the mix of BRP's products and the profit margins thereon; and (xix) other factors beyond BRP's control. Readers are cautioned not to place undue reliance on forward-looking statements. BRP cannot guarantee future results, trends, events, levels of activity, performance or achievements. BRP does not undertake and specifically declines any obligation to update, republish re·pub·lish tr.v. re·pub·lished, re·pub·lish·ing, re·pub·lish·es 1. To publish again. 2. Law To revive (a libel or a canceled will). or revise forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" or to reflect the occurrences of unanticipated events. (R), (TM) Trademark of Bombardier Recreational Products Inc. or its affiliates. (1) Trademark of Bombardier Inc. used under license.
(millions of Canadian
dollars) Unaudited Combined Statement of Operations
Predecessor(1) BRP
Period from Period from Predecessor(1)
February 1, December 19, Fiscal Year
2003 to 2003 to Combined ended
December 18, January 31, Year January 31,
2003 2004 2004 2003
--------------------------------------------------------------------
Revenues $2,147.1 $345.0 $2,492.1 $2,476.3
Cost of sales 1,738.3 318.5 2,056.8 1,913.3
--------------------------------------------------------------------
Gross profit 408.8 26.5 435.3 563.0
--------------------------------------------------------------------
Operating expenses
Selling and
marketing 147.2 18.6 165.8 166.3
Research and
development 97.2 13.3 110.5 106.3
General and
administrative 115.7 7.9 123.6 120.6
--------------------------------------------------------------------
Total operating
expenses 360.1 39.8 399.9 393.2
--------------------------------------------------------------------
Operating Income
(loss) 48.7 (13.3) 35.4 169.8
Interest expense and
other 3.2 6.4 9.6 4.9
Accretion in
carrying value of
redeemable preferred
shares - 0.5 0.5 -
Net loss on
derivative financial
instruments - 4.5 4.5 -
Unrealized gain on
foreign exchange - (1.3) (1.3) -
--------------------------------------------------------------------
Income (loss) before
income taxes 45.5 (23.4) 22.1 164.9
Income tax expense
(recovery) 15.3 (5.9) 9.4 50.1
--------------------------------------------------------------------
Net income (loss) $30.2 $(17.5) $12.7 $114.8
--------------------------------------------------------------------
--------------------------------------------------------------------
Net income (loss) $30.2 $(17.5) $12.7 $114.8
Interest expense and
other 3.2 6.4 9.6 4.9
Accretion in the
carrying value of
redeemable preferred
shares - 0.5 0.5 -
Income tax expense
(recovery) 15.3 (5.9) 9.4 50.1
--------------------------------------------------------------------
EBIT 48.7 (16.5) 32.2 169.8
Depreciation and
amortization 91.6 14.1 105.7 97.4
--------------------------------------------------------------------
EBITDA 140.3 (2.4) 137.9 267.2
Impact of business
acquisition
Impact of fair value
increments of
inventory on cost of
sales - 22.8 22.8 -
Impact of foreign
exchange contracts
on revenue - 25.6 25.6 -
Loss on derivative
financial instrument - 7.7 7.7 -
Unrealized gain on
foreign exchange (1.3) (1.3)
Management fee - 0.4 0.4 -
Changes in estimate
related to Outboard
Marine Corporation
acquisition - - - (30.5)
Change in accounting
policy - - - (20.0)
Others - - - (35.6)
--------------------------------------------------------------------
Consolidated
Adjusted EBITDA $140.3 $52.8 $193.1 $181.1
--------------------------------------------------------------------
--------------------------------------------------------------------
(1) Predecessor represents the recreational products business of
Bombardier Inc.
(millions of Canadian dollars) Unaudited
Consolidated
Balance Sheet
As at January
31, 2004
----------------------------------------------------------------
ASSETS
Current Assets
Cash $196.2
Receivables, net of allowance for doubtful
accounts of $4.3 153.4
Inventories 351.8
Prepaid expenses 19.2
Deferred income taxes 69.7
Other current assets 93.1
----------------------------------------------------------------
Total current assets 883.4
Property, plant and equipment 497.9
Goodwill 92.5
Trademarks 151.1
Other intangible assets 90.7
Deferred income taxes 15.5
Other long-term assets, including restricted
investments of $12.6 64.5
----------------------------------------------------------------
$1,795.6
----------------------------------------------------------------
LIABILITIES AND SHAREHOLDER'S EQUITY
Current Liabilities
Accounts payable and accrued liabilities $640.3
Income taxes payable 9.0
Current portion of long-term debt 5.0
Other short-term liabilities 3.5
Deferred income tax 0.3
----------------------------------------------------------------
Total current liabilities 658.1
Long-term debt 635.0
Deferred income taxes 17.5
Employee future benefits liability 121.9
Redeemable preferred shares 43.2
Other long-term liabilities 30.9
Total liabilities 1,506.6
Shareholder's equity
Share capital 304.5
Deficit (17.5)
Currency translation adjustment 2.0
----------------------------------------------------------------
$1,795.6
----------------------------------------------------------------
----------------------------------------------------------------
(millions of Canadian dollars) Unaudited Consolidated Statement of
Cash Flows
Period from
December 19, 2003
to January 31, 2004
--------------------------------------------------------------------
Operating Activities
Net Loss $(17.5)
Non-Cash Items
Depreciation and Amortization 14.1
Amortization of deferred financing fees 0.8
Deferred Income Taxes (9.3)
Accretion of Preferred Shares 0.5
Unrealized gain on derivative financial instruments (3.2)
Employee future liabilities 1.7
Net change in non-cash working capital balances related to
operations 133.0
--------------------------------------------------------------------
Cash flows from operating activities 120.1
--------------------------------------------------------------------
Investing Activities
Business acquisition, net of cash acquired (757.2)
Additions to property plant and equipment (21.0)
--------------------------------------------------------------------
Cash flows from investing activities (778.2)
--------------------------------------------------------------------
Financing Activities
Issuance of common share 304.5
Issuance of long-term debt 638.0
Repayment of Long-term debt (0.5)
Retained interest of transferred receivables (40.5)
Debt issuance costs (46.1)
--------------------------------------------------------------------
Cash flows from financing activities 855.4
--------------------------------------------------------------------
Effect of exchange rates on cash and cash equivalents (1.0)
--------------------------------------------------------------------
Net increase in cash 196.2
Cash beginning of period -
--------------------------------------------------------------------
Cash end of period $196.2
--------------------------------------------------------------------
--------------------------------------------------------------------
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion