BRP PRESENTS ITS FOURTH QUARTER AND FULL-YEAR 2025 RESULTS
PR Newswire
VALCOURT, QC, March 26, 2025
Highlights for FY25 Q4
-- As expected, revenues of $2,097.6 million, a decrease of 19.7% compared
to last year, resulting from continued softer demand and the Company's
objective to reduce network inventory;
-- Net loss of $44.5 million, a decrease of 114.7% compared to last year;
-- Normalized EBITDA [1] of $239.8 million, a decrease of 44.6% compared to
last year;
-- Normalized diluted earnings per share [1] [2] of $0.98 in line with
expectations, a decrease of $1.80 per share, and diluted earnings per
share of $(0.60), a decrease of $4.55 per share, compared to last year;
-- North American retail sales decreased by 21% compared to last year,
resulting from lower industry volumes in Snowmobile and market share loss
in Off-Road Vehicles due to high non-current inventory from other OEMs;
-- The Company increased its quarterly dividend to $0.215 per share.
Highlights for FY25
-- Revenues of $7,829.7 million, a decrease of 21.4% compared to last year;
-- Achieved revised FY25 guidance adjusted for Marine businesses
discontinued operations with Normalized diluted earnings per share [1]
[2] of $4.68;
-- Provided shareholder returns through $277.0 million deployed in share
repurchases and dividend payments;
-- North American network inventory decreased by 13% compared to last year,
or 18% when excluding snowmobiles for which network inventory increased
due to lower industry retail caused by late snowfall.
Fiscal 2026 full-year guidance
-- Given the ongoing global tariff disputes and the uncertainty surrounding
any potential changes to trade regulations, the Company has decided to
defer providing financial guidance for FY26. This uncertainty has also
had a negative impact on consumer demand, making it difficult to offer
reliable projections at this time.
VALCOURT, QC, March 26, 2025 /PRNewswire/ - BRP Inc. (TSX: DOO) $(DOOO)$ today reported its financial results for the three- and twelve-month periods ended January 31, 2025. All financial information is in Canadian dollars unless otherwise noted. The complete financial results are available on SEDAR+ and EDGAR as well as in the section Quarterly Reports of BRP's website.
"BRP demonstrated its agility throughout fiscal 2025 by rapidly adapting to softer market conditions. We were the first OEM to proactively adjust shipments to reduce network inventory and we have achieved our objective. As anticipated, our leaner inventory position compared to competitors resulted in short-term market share loss but protected our dealer network and the value of our brands. In this volatile context, we have outpaced the off-road industry with our current models, which speaks highly about the attractiveness of our lineups," said José Boisjoli, President and CEO of BRP.
"Looking ahead to fiscal 2026, the ongoing global tariff disputes have created economic uncertainty, making financial projections more challenging at this time. Over the longer term, our strategic decision to double down on Powersports should allow us to solidify our industry leadership by pushing innovation further and capitalizing on growth opportunities. With a product portfolio that is second-to-none, a strong dealer network and a healthy balance sheet, we are well positioned to sustain profitable growth," concluded Mr. Boisjoli.
([1]) See "Non-IFRS Measures" section of this press release.
([2]) Earnings per share is defined as "EPS".
Financial
Highlights
([3])
Three-month periods
ended Twelve-month periods ended
---------------- ----------------------- -----------------------------------
(in millions of
Canadian
dollars, except
per share data January January 31, January January January 31,
and margin) 31, 2025 2024 31, 2025 31, 2024 2023
---------------- ---------- ----------- ---------- ---------- -----------
Revenues $2,097.6 $2,611.5 $7,829.7 $9,963.0 $10,033.4
---------------- ---------- ----------- ---------- ---------- -----------
Gross Profit 429.4 660.5 1,773.6 2,634.0 2,499.4
---------------- ---------- ----------- ---------- ---------- -----------
Gross Profit (%) 20.5 % 25.3 % 22.7 % 26.4 % 24.9 %
---------------- ---------- ----------- ---------- ---------- -----------
Normalized
EBITDA ([1]) 239.8 432.6 1,040.0 1,793.2 1,706.3
---------------- ---------- ----------- ---------- ---------- -----------
Net Income
(Loss) (44.5) 302.8 62.7 931.7 865.4
---------------- ---------- ----------- ---------- ---------- -----------
Net Loss from
Discontinued
Operations (175.1) (114.9) (275.7) (187.2) --
---------------- ---------- ----------- ---------- ---------- -----------
Normalized Net
Income ([1]) 71.4 213.1 349.0 956.7 976.7
---------------- ---------- ----------- ---------- ---------- -----------
Diluted Earnings
(Loss) per
Share ([2]) (0.60) 3.95 0.84 11.85 10.67
---------------- ---------- ----------- ---------- ---------- -----------
Diluted
Normalized
Earnings per
Share ([1][2]) 0.98 2.78 4.68 12.17 12.05
---------------- ---------- ----------- ---------- ---------- -----------
Basic Weighted
Average Number
of Shares 73,016,543 75,475,831 73,661,874 77,166,505 79,382,008
---------------- ---------- ----------- ---------- ---------- -----------
Diluted Weighted
Average Number
of Shares 73,741,341 76,667,383 74,586,221 78,523,790 80,946,102
---------------- ---------- ----------- ---------- ---------- -----------
([1]) See "Non-IFRS Measures" section of this press release. ([2])
Earnings per share is defined as "EPS". ([3]) Figures are on a continuing
basis and prior periods reclassified accordingly, except for the
twelve-month period ended January 31, 2023.
FOURTH QUARTER RESULTS
In the context of continued softer demand and the Company's objective to reduce network inventory, its three-month period ended January 31, 2025 was marked by a decrease in the volume of shipments and revenues compared to the same period last year. The decrease in the volume of shipments, the higher sales programs due to increased promotional intensity and the decreased leverage of fixed costs as a result of reduced production have led to a decrease in the gross profit and gross profit margin compared to the same period last year. This decrease was partially offset by favourable pricing and production efficiencies.
The Company's North American retail sales were down 21% for the three-month period ended January 31, 2025. The decrease is mainly explained by lower industry volumes in Snowmobile and market share loss in Off-Road Vehicles due to high non-current inventory from other OEMs.
Revenues
Revenues decreased by $513.9 million, or 19.7%, to $2,097.6 million for the three-month period ended January 31, 2025, compared to $2,611.5 million for the corresponding period ended January 31, 2024. The decrease in revenues was primarily due to a lower volume sold across all product lines, as a result of softer demand, as well as higher sales programs. The decrease was partially offset by favourable pricing across most product lines. The decrease includes a favourable foreign exchange rate variation of $33 million.
-- Year-Round Products (54% of Q4-FY25 revenues): Revenues from Year-Round
Products decreased by $236.8 million, or 17.4%, to $1,127.1 million for
the three-month period ended January 31, 2025, compared to
$1,363.9 million for the corresponding period ended January 31, 2024. The
decrease in revenues from Year-Round Products was primarily attributable
to a lower volume of units sold across all product lines as a result of
softer demand, unfavourable product mix in SSV and higher sales programs.
The decrease was partially offset by favourable pricing across all
product lines. The decrease includes a favourable foreign exchange rate
variation of $26 million.
-- Seasonal Products (32% of Q4-FY25 revenues): Revenues from Seasonal
Products decreased by $275.0 million, or 28.9%, to $677.6 million for the
three-month period ended January 31, 2025, compared to $952.6 million for
the corresponding period ended January 31, 2024. The decrease in revenues
from Seasonal Products was primarily attributable to a lower volume of
units sold across all product lines as a result of softer demand,
unfavourable product mix in Snowmobile and higher sales programs. The
decrease was partially offset by favourable product mix on PWC and
Sea-Doo pontoon, as well as favourable pricing across all product lines.
The decrease includes a favourable foreign exchange rate variation of $2
million.
-- PA&A and OEM Engines (14% of Q4-FY25 revenues): Revenues from PA&A and
OEM Engines decreased by $2.1 million, or 0.7%, to $292.9 million for the
three-month period ended January 31, 2025, compared to $295.0 million for
the corresponding period ended January 31, 2024. The decrease in revenues
from PA&A and OEM engines was primarily attributable to softer demand in
PA&A. The decrease was partially offset by favourable product mix on OEM
engines and favourable pricing on most product lines. The decrease also
includes a favourable foreign exchange rate variation of $5 million.
North American Retail Sales
The Company's North American retail sales decreased by 21% for the three-month period ended January 31, 2025 compared to the same period last year. The decrease is mainly explained by lower industry volumes in Snowmobile and market share loss in Off-Road Vehicles due to high non-current inventory from other OEMs.
-- North American Year-Round Products retail sales decreased on a percentage
basis in the low-teens range compared to the three-month period ended
January 31, 2024. The North American Year-Round Products industry sales
decreased on a percentage basis in the low-single digits over the same
period.
-- North American Seasonal Products retail sales decreased on a percentage
basis in the low-thirties range compared to the three-month period ended
January 31, 2024. The North American Seasonal Products industry sales
decreased on a percentage basis in the mid-twenties range over the same
period.
Gross profit
Gross profit decreased by $231.1 million, or 35.0%, to $429.4 million for the three-month period ended January 31, 2025, compared to $660.5 million for the three-month period ended January 31, 2024. Gross profit margin percentage decreased by 480 basis points to 20.5% for the three-month period ended January 31, 2025, compared to 25.3% for the three-month period ended January 31, 2024. The decreases in gross profit and gross profit margin percentage were the result of a lower volume of units sold, higher sales programs, decreased leverage of fixed costs as a result of reduced production, and higher warranty costs. The decreases were partially offset by favourable pricing across most product lines and production efficiencies. The decrease in gross profit includes a favourable foreign exchange rate variation of $2 million.
Operating Expenses
Operating expenses decreased by $12.8 million, or 3.9%, to $317.4 million for the three-month period ended January 31, 2025, compared to $330.2 million for the three-month period ended January 31, 2024. The decrease in operating expenses was mainly attributable to lower G&A expenses due to cost optimization and lower R&D expenses. The decrease was partially offset by higher restructuring and reorganization costs. The decrease in operating expenses includes an unfavourable foreign exchange rate variation of $9 million.
Normalized EBITDA ([1])
Normalized EBITDA ([1]) decreased by $192.8 million, or 44.6%, to $239.8 million for the three-month period ended January 31, 2025, compared to $432.6 million for the three-month period ended January 31, 2024. The decrease in normalized EBITDA ([1]) was primarily due to lower gross profit.
Net Income (Loss)
Net income (loss) decreased by $347.3 million, or 114.7%, to $(44.5) million for the three-month period ended January 31, 2025, compared to $302.8 million for the three-month period ended January 31, 2024. The decrease in net income was primarily due to a lower operating income, resulting from a lower gross profit and an unfavourable foreign exchange rate variation on the U.S. denominated long-term debt. The decrease was partially offset by a lower income tax expense.
Net Loss from Discontinued Operations
Net loss increased by $60.2 million, or 52.4%, to $(175.1) million for the three-month period ended January 31, 2025, compared to $(114.9) million for the three-month period ended January 31, 2024. The increase in net loss was primarily due to an impairment charge taken on the Marine businesses assets held for sale during the three-month period ended January 31, 2025.
([1]) See "Non-IFRS Measures" section of this press release.
TWELVE-MONTH PERIOD ENDED JANUARY 31, 2025
Revenues
Revenues decreased by $2,133.3 million, or 21.4%, to $7,829.7 million for the twelve-month period ended January 31, 2025, compared to $9,963.0 million for the corresponding period ended January 31, 2024. The decrease in revenues was primarily due to a lower volume sold across all product lines, as a result of softer demand, the Company's focus on reducing network inventory levels, as well as higher sales programs. The decrease was partially offset by favourable product mix across most product lines and favourable pricing across all product lines. The decrease includes a favourable foreign exchange rate variation of $94 million.
Normalized EBITDA ([1])
Normalized EBITDA ([1]) decreased by $753.2 million, or 42.0%, to $1,040.0 million for the twelve-month period ended January 31, 2025, compared to $1,793.2 million for the twelve-month period ended January 31, 2024. The decrease in Normalized EBITDA ([1]) was primarily due to a lower gross profit.
Net Income
Net income decreased by $869.0 million, or 93.3%, to $62.7 million for the twelve-month period ended January 31, 2025, compared to $931.7 million for the twelve-month period ended January 31, 2024. The decrease in net income was primarily due to lower operating income, resulting from a lower gross profit and an unfavourable foreign exchange rate variation on the U.S. denominated long-term debt. The decrease was partially offset by a lower income tax expense.
Net Loss from Discontinued Operations
Net loss increased by $88.5 million, or 47.3%, to $(275.7) million for the twelve-month period ended January 31, 2025, compared to $(187.2) million for the twelve-month period ended January 31, 2024. The increase in net loss was primarily due to higher operating loss resulting from a lower volume of units sold due to high network inventory and softer consumer demand in the industry. Higher sales programs, production inefficiencies and an impairment charge on the Marine businesses assets held for sale also contributed to the increase in net loss.
LIQUIDITY AND CAPITAL RESOURCES
Consolidated net cash flows generated from operating activities totaled $740.1 million for the twelve-month period ended January 31, 2025 compared to $1,658.1 million generated for the twelve-month period ended January 31, 2024. The decrease was mainly due to lower profitability and unfavourable changes in working capital, partially offset by lower income taxes paid. Changes in working capital were the result of maintaining higher provisions, compared to last year where more provisions were created due to a slowdown in demand and a sustained promotional intensity in the industry. The unfavourable changes in working capital were also the result of a reduction in trade payables and accruals, which reflected reduced production. The unfavourable changes in working capital were partially offset by a reduction in inventory levels.
The Company invested $425.5 million of its liquidity in capital expenditures for the introduction of new products and modernization of the Company's software infrastructure to support future growth.
During the twelve-month period ended January 31, 2025, the Company also returned $277.0 million to its shareholders through quarterly dividend payouts and its share repurchase programs.
Dividend
On March 25, 2025, the Company's Board of Directors declared a quarterly dividend of $0.215 per share for holders of its multiple voting shares and subordinate voting shares. The dividend will be paid on April 18, 2025 to shareholders of record at the close of business on April 4, 2025.
([1]) See "Non-IFRS Measures" section of this press release.
CONFERENCE CALL AND WEBCAST PRESENTATION
Today at 9 a.m. ET, BRP Inc. will host a conference call and webcast to discuss its FY25 fourth quarter results. The call will be hosted by José Boisjoli, President and CEO, and Sébastien Martel, CFO. To listen to the conference call by phone (event number 55768), please dial 1 800 717-1738 (toll-free in North America). Click here for International numbers.
The Company's fourth quarter FY25 webcast presentation is posted in the Quarterly Reports section of BRP's website.
About BRP
BRP Inc. is a global leader in the world of powersports products, propulsion systems and boats built on over 80 years of ingenuity and intensive consumer focus. Through its portfolio of industry-leading and distinctive brands featuring Ski-Doo and Lynx snowmobiles, Sea-Doo watercraft and pontoons, Can-Am on and off-road vehicles, Alumacraft and Quintrex boats, Manitou pontoons and Rotax marine propulsion systems as well as Rotax engines for karts and recreational aircraft, BRP unlocks exhilarating adventures and provides access to experiences across different playgrounds. The Company completes its lines of products with a dedicated parts, accessories and apparel portfolio to fully optimize the riding experience. Committed to growing responsibly, BRP is developing electric models for its existing product lines. Headquartered in Quebec, Canada, BRP had annual sales of CA$7.8 billion from over 130 countries and employed approximately 16,500 driven, resourceful people as of January 31, 2025.
www.brp.com
@BRPNews
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements in this press release, including, but not limited to, statements relating to the Company's decision to defer providing guidance for Fiscal 2026 until the situation around potential tariffs and changes to trade regulations further develops, statements relating to the declaration and payment of dividends, statements about the Company's current and future plans, prospects, expectations, including of sustained profitable growth, anticipations, estimates and intentions, results, levels of activity, performance, objectives, targets, goals or achievements, priorities and strategies, including its continued focus on reducing network inventory levels, sustained promotional intensity and proactively managing production to maintain dealer value proposition, financial position, market position, including expected market share volatility notably in light of high non-current inventory from other OEMs but expected market share gains with respect to recently introduced models, capabilities, competitive strengths, beliefs,
the prospects and trends of the industries in which the Company operates, including softer industry demand trends and sustained promotional intensity and pricing actions, the ongoing commitment to invest in research and product development activities and push the boundaries of innovation, including the expectation of regular flow of new product introductions and development of market-shaping products, the projected design, characteristics, capacity or performance of future products and their expected scheduled entry to market, expected financial requirements and the availability of capital resources and liquidity, the Company's ability to complete its process for the sale of its Marine businesses as expected and to manage and mitigate the risks associated therewith, including the ability to separate the Marine businesses within the anticipated time periods, at expected cost levels and expected proceeds, and the expected impact of the sale of the Marine businesses on the Company's ability to double down on Powersports through innovation and growth opportunities, and any other future events or developments and other statements that are not historical facts constitute forward-looking statements within the meaning of applicable securities laws. The words "may", "will", "would", "should", "could", "expects", "forecasts", "plans", "intends", "trends", "indications", "anticipates", "believes", "estimates", "outlook", "predicts", "projects", "likely" or "potential" or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking statements.
Forward-looking statements are presented for the purpose of assisting readers in understanding certain key elements of the Company's current objectives, goals, targets, strategic priorities, expectations and plans, and in obtaining a better understanding of the Company's business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes; readers should not place undue reliance on forward-looking statements contained herein. Forward-looking statements, by their very nature, involve inherent risks and uncertainties and are based on a number of assumptions, both general and specific, as further described below.
Many factors could cause the Corporation's actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors, which are discussed in greater detail under the heading "Risk Factors" of the Corporation's management's discussion and analysis for Fiscal 2025 ("the 2025 MD&A") for the fiscal year ended on January 31, 2025 and in other continuous disclosure materials filed from time to time with Canadian securities regulatory authorities and the Securities and Exchange Commission: the impact of adverse economic conditions including in the context of easing but still elevated interest and inflation rates; any decline in social acceptability of the Corporation and its products, including in connection with the broader adoption of electrical or low-emission products; high levels of indebtedness; any unavailability of additional capital; any supply problems, termination or interruption of supply arrangements or increases in the cost of materials; the inability to attract, hire and retain key employees, including members of the Corporation's management team or employees who possess specialized market knowledge and technical skills; any failure of information technology systems, security breach or cyber-attack, or difficulties with the implementation of new systems, including the difficulties in the continued implementation of its ERP system; the Corporation's reliance on international sales and operations including heightened concerns for global trade tensions with escalation in tariffs and other retaliatory measures; the Corporation's inability to successfully execute its growth strategy; fluctuations in foreign currency exchange rates; unfavourable weather conditions and climate change more generally; the seasonal nature of the Corporation's business and some of its products; the Corporation's reliance on a network of independent dealers and distributors; any inability of dealers and distributors to secure adequate access to capital; any inability to comply with product safety, health, environmental, privacy matters and noise pollution laws; the Corporation's large fixed cost base; any failure to compete effectively against competitors or any failure to meet consumers' evolving expectations; any failure to maintain an effective system of internal control over financial reporting and to produce accurate and timely financial statements; any inability to maintain and enhance the Corporation's reputation and brands; any significant product liability claim; any significant product repair and/or replacement due to product warranty claims or product recalls; any failure to carry proper insurance coverage; the Corporation's inability to successfully manage inventory levels; any intellectual property infringement and litigation; the Corporation's inability to successfully execute its manufacturing strategy or to adjust to fluctuating customer demand as a result of manufacturing capacity constraints; increased freight and shipping costs or disruptions in transportation and shipping infrastructure; any failure to comply with covenants in financing and other material agreements; any changes in tax laws and unanticipated tax liabilities; any impairment in the carrying value of goodwill and intangibles with indefinite useful life and trademarks; any deterioration in relationships with employees; pension plan liabilities; natural disasters; volatility in the market price for the Subordinate Voting Shares; the Corporation's conduct of business through subsidiaries; the significant influence of Beaudier Group and Bain Capital; and future sales of Subordinate Voting Shares by Beaudier Group, Bain Capital, directors, officers or senior management of the Corporation. These factors are not intended to represent a complete list of the factors that could affect the Corporation; however, these factors should be considered carefully. Unless otherwise stated, the forward-looking statements contained in this press release are made as of the date of this press release and the Company has no intention and undertakes no obligation to update or revise any forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable securities regulations. In the event that the Company does update any forward-looking statements contained in this press release, no inference should be made that the Company will make additional updates with respect to that statement, related matters or any other forward-looking statement. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
KEY ASSUMPTIONS
The Company made a number of economic, market and operational assumptions in preparing and making certain forward-looking statements contained in this Press Release, including without limitation the following assumptions: softer industries in both Seasonal and Year-Round Products and a continuously challenging macroeconomic environment; expected market share volatility; main currencies in which the Company operates will remain at near current levels; levels of inflation, which are expected to continue to ease; there will be no significant changes in tax laws or treaties applicable to the Company; the Company's margins are expected to continue to be pressured by lower volumes; the supply base will remain able to support product development and planned production rates on commercially acceptable terms in a timely manner; the absence of unusually adverse weather conditions, especially in peak seasons. BRP cautions that its assumptions may not materialize, and that the currently challenging macroeconomic and geopolitical environment in which it evolves may render such assumptions, although believed reasonable at the time they were made, subject to greater uncertainty. Specifically, these assumptions do not incorporate the imposition of wide-ranging U.S. tariffs on all imports from Canada and Mexico and potential retaliatory tariffs. Given the fast-evolving situation and the high degree of uncertainty around the duration of a potential trade war, it is difficult to predict how the effects would flow through the economy. New tariffs could significantly affect the outlooks for economic growth, consumer spending, inflation and the Canadian dollar.
NON-IFRS MEASURES
This press release makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. The Company uses non-IFRS measures including the following:
Non-IFRS measures Definition Reason for use
------------------------ ----------------------- -----------------------
Normalized EBITDA Net income before Assist investors in
financing costs, determining the
financing income, financial performance
income tax expense of the Company's
(recovery), operating activities on
depreciation expense a consistent basis by
and normalized excluding certain
elements. non-cash elements such
as depreciation
expense, impairment
charge, foreign
exchange gain or loss
on the Company's
long-term debt
denominated in U.S.
dollars and foreign
exchange gain or loss
on certain of the
Company's lease
liabilities. Other
elements, such as
restructuring and
wind-down costs,
non-recurring gain or
loss and
acquisition-related
costs, may be excluded
from net income in the
determination of
Normalized EBITDA as
they are considered not
being reflective of the
operational performance
of the Company.
------------------------ ----------------------- -----------------------
Normalized net income Net income before In addition to the
normalized elements financial performance
adjusted to reflect the of operating
tax effect on these activities, this
elements measure considers the
impact of investing
activities, financing
activities and income
taxes on the Company's
financial results.
------------------------ ----------------------- -----------------------
Normalized income tax Income tax expense Assist investors in
expense adjusted to reflect the determining the tax
tax effect on expense relating to the
normalized elements and normalized items
to normalize specific explained above, as
tax elements they are considered not
being reflective of the
operational performance
of the Company.
------------------------ ----------------------- -----------------------
Normalized effective tax Based on Normalized net Assist investors in
rate income before determining the
Normalized income tax effective tax rate
expense including the
normalized items
explained above, as
they are considered not
being reflective of the
operational performance
of the Company.
------------------------ ----------------------- -----------------------
Normalized earnings per Calculated by dividing Assist investors in
share -- diluted the Normalized net determining the
income by the weighted normalized financial
average number of performance of the
shares -- diluted Company's activities on
a per share basis.
------------------------ ----------------------- -----------------------
Free cash flow Cash flows from Assist investors in
operating activities assessing the Company's
less additions to PP&E liquidity generation
and intangible assets abilities that could be
available for
shareholders, debt
repayment and business
combination, after
capital expenditure
------------------------ ----------------------- -----------------------
The Company believes non-IFRS measures are important supplemental measures of financial performance because they eliminate items that have less bearing on the Company's financial performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS measures. The Company also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of companies, many of which present similar metrics when reporting their results. Management also uses non-IFRS measures in order to facilitate financial performance comparisons from period to period, prepare annual operating budgets, assess the Company's ability to meet its future debt service, capital expenditure and working capital requirements and also as a component in the determination of the short-term incentive compensation for the Company's employees. Because other companies may calculate these non-IFRS measures differently than the Company does, these metrics are not comparable to similarly titled measures reported by other companies.
The Company refers the reader to the tables below for the reconciliations of the non-IFRS measures presented by the Company to the most directly comparable IFRS measure.
Reconciliation Tables ([2])
The following tables present the reconciliation of non-IFRS measures compared to their respective IFRS measures:
Three-month periods
ended Twelve-month periods ended
(in millions of
Canadian January January 31, January January January 31,
dollars) 31, 2025 2024 31, 2025 31, 2024 2023
---------------- --------- ----------- --------- ---------- -----------
Net income $(44.5) $302.8 $62.7 $931.7 $865.4
Normalized
elements
Foreign exchange
(gain) loss on
long-term debt
and lease
liabilities 103.4 (97.5) 212.1 10.8 92.4
Cybersecurity
incident costs
([3]) (12.5) -- (12.5) -- 25.5
Gain on NCIB -- -- -- (4.8) (1.8)
Past service
costs ([4]) -- -- -- -- 4.3
Impairment
charge ([5]) -- -- 9.4 -- --
Costs related to
business
combinations
([6]) (7.9) 2.5 2.7 11.1 8.3
Border crossing
crisis ([7]) -- -- -- 6.2 --
Restructuring
and related
costs ([8]) 41.8 3.9 76.8 4.1 --
Transaction
costs on
long-term debt
([9]) -- 2.7 -- 22.7 1.0
Other elements
([10]) 1.2 1.0 2.1 1.3 (3.2)
Income tax
adjustment ([1]
[11]) (10.1) (2.3) (4.3) (26.4) (15.2)
---------------- --------- ----------- --------- ---------- -----------
Normalized net
income ([1]) 71.4 213.1 349.0 956.7 976.7
---------------- --------- ----------- --------- ---------- -----------
Normalized
income tax
expense ([1]) 17.7 80.2 94.0 300.1 315.7
Financing costs
adjusted ([1]) 48.4 46.9 198.2 185.1 113.9
Financing income
adjusted ([1]) (0.9) (2.9) (8.0) (11.8) (4.2)
Depreciation
expense
adjusted ([1]) 103.2 95.3 406.8 363.1 304.2
---------------- --------- ----------- --------- ---------- -----------
Normalized
EBITDA ([1]) $239.8 $432.6 $1,040.0 $1,793.2 $1,706.3
---------------- --------- ----------- --------- ---------- -----------
([1]) See "Non-IFRS Measures" section.
([2]) Figures are on a continuing basis and prior periods reclassified
accordingly, except for the twelve-month period ended January 31,
2023.
([3]) During Fiscal 2023, the Company incurred costs related to a
cybersecurity incident. These costs are mainly comprised of recovery
costs, idle costs such as direct labor during shutdown period, etc.
During Fiscal 2025, the Company received insurance payments in
relation to this cybersecurity incident.
([4]) Effective December 31, 2022, BRP approved an ad-hoc adjustment to be
granted to retirees and surviving spouses of the Canadian Pension Plan
for Employees of BRP who retired prior to 2017. The impact of this
ad-hoc increase is recognized as a past service cost during the year
ended January 31, 2023.
([5]) During Fiscal 2025, the Company recognized an impairment charge of
$9.4 million on unutilized assets.
([6]) Transaction costs, depreciation of intangible assets and re-evaluation
of a non-controlling interest related to business combinations.
([7]) During Fiscal 2024, the Company incurred incremental transport and
idle costs such as direct labor, which were related to mitigation
strategies implemented to handle the border crossing slowdown between
Juarez, Mexico, where the Company has three factories, and El Paso,
Texas, USA.
([8]) During the twelve-month period ended January 31, 2025, the Company
recorded restructuring costs of $76.8 million, which includes
severance packages to employees as part of workforce reduction,
contract exit costs and supplier claims related to restructuring
activities.
([9]) Derecognition of unamortized transaction costs related to the
repricing of Term Loan B-2 and refinancing of Term Loan B-1 in Fiscal
2024.
([10]) Other elements include insurance recovery on destroyed equipment
related to the Juarez 2 fire recorded in Fiscal 2023 and professional
fees associated with secondary offerings and other transactions.
([11]) Income tax adjustment is related to the income tax on Normalized
elements subject to tax and for which income tax has been recognized
and to the adjustment related to the impact of foreign currency
translation from Mexican operations.
The following table ([2]) presents the reconciliation of items as included in the Normalized net income ([1]) and Normalized EBITDA ([1]) compared to respective IFRS measures as well as the Normalized EPS -- basic and diluted ([1]) calculation.
Three-month periods
ended Twelve-month periods ended
----------------
(in millions of
Canadian
dollars, except January January 31, January January January 31,
per share data) 31, 2025 2024 31, 2025 31, 2024 2023
---------------- ---------- ----------- ---------- ---------- -----------
Depreciation
expense
reconciliation
Depreciation
expense $104.6 $96.9 $412.6 $368.9 $310.4
Depreciation of
intangible
assets related
to business
combinations (1.4) (1.6) (5.8) (5.8) (6.2)
Depreciation
expense
adjusted $103.2 $95.3 $406.8 $363.1 $304.2
---------------- ---------- ----------- ---------- ---------- -----------
Income tax
expense
reconciliation
Income tax
expense $7.6 $77.9 $89.7 $273.7 $300.5
Income tax
adjustment
([3]) 10.1 2.3 4.3 26.4 15.2
---------------- ---------- ----------- ---------- ---------- -----------
Normalized
income tax
expense ([1]) $17.7 $80.2 $94.0 $300.1 $315.7
---------------- ---------- ----------- ---------- ---------- -----------
Financing costs
reconciliation
Financing costs $48.4 $49.6 $198.2 $208.0 $114.8
Transaction
costs on
long-term debt -- (2.7) -- (22.7) (1.0)
Other -- -- -- (0.2) 0.1
---------------- ---------- ----------- ---------- ---------- -----------
Financing costs
adjusted $48.4 $46.9 $198.2 $185.1 $113.9
---------------- ---------- ----------- ---------- ---------- -----------
Financing income
reconciliation
Financing income $(0.9) $(2.9) $(8.0) $(16.6) $(6.0)
Gain on NCIB -- -- -- 4.8 1.8
Financing income
adjusted $(0.9) $(2.9) $(8.0) $(11.8) $(4.2)
---------------- ---------- ----------- ---------- ---------- -----------
Normalized EPS -
basic ([1])
calculation
Normalized net
income ([1]) $71.4 $213.1 $349.0 $956.7 $976.7
Non-controlling
interests 0.4 0.3 (0.1) (1.1) (1.5)
Weighted average
number of
shares - basic 73,016,543 75,475,831 73,661,874 77,166,505 79,382,008
---------------- ---------- ----------- ---------- ---------- -----------
Normalized EPS -
basic ([1]) $0.98 $2.83 $4.74 $12.38 $12.29
---------------- ---------- ----------- ---------- ---------- -----------
Normalized EPS -
diluted ([1])
calculation
Normalized net
income ([1]) $71.4 $213.1 $349.0 $956.7 $976.7
Non-controlling
interests 0.4 0.3 (0.1) (1.1) (1.5)
Weighted average
number of
shares -
diluted 73,741,341 76,667,383 74,586,221 78,523,790 80,946,102
---------------- ---------- ----------- ---------- ---------- -----------
Normalized EPS -
diluted ([1]) $0.98 $2.78 $4.68 $12.17 $12.05
---------------- ---------- ----------- ---------- ---------- -----------
([1]) See "Non-IFRS Measures" section.
([2]) Figures are on a continuing basis and prior periods reclassified
accordingly, except for the twelve-month period ended January 31,
2023.
([3]) Income tax adjustment is related to the income tax on Normalized
elements subject to tax and for which income tax has been recognized
and to the adjustment related to the impact of foreign currency
translation from Mexican operations.
The following table presents the reconciliation of consolidated net cash flows generated from operating activities to free cash flow ([1]) .
Twelve-month periods ended
----------------------------------------------
January 31, January 31,
(in millions of Canadian dollars) 2025 2024
---------------------------------------------- ------------- -------------
Net cash flows generated from operating
activities $740.1 $1,658.1
Additions to property, plant and equipment (396.6) (548.4)
Additions to intangible assets (29.8) (37.4)
---------------------------------------------- ------------- -------------
Free cash flow ([1]) $313.7 $1,072.3
---------------------------------------------- ------------- -------------
Free cash flow from continuing operations
([1]) $453.8 $1,321.2
Free cash flow from discontinued operations
([1]) $(140.1) $(248.9)
---------------------------------------------- ------------- -------------
([1]) See "Non-IFRS Measures" section.
View original content to download multimedia:https://www.prnewswire.com/news-releases/brp-presents-its-fourth-quarter-and-full-year-2025-results-302411464.html
SOURCE BRP Inc.
/CONTACT: For media enquiries: Émilie Proulx, Media Relations, medias@brp.com; For investor relations: Philippe Deschênes, Investor Relations, Tel.: 450.532.6462, philippe.deschenes@brp.com
(END) Dow Jones Newswires
March 26, 2025 06:00 ET (10:00 GMT)
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