BRP Inc. has released its financial results for the three-month period ended April 30, 2022. All financial information is in Canadian dollars unless otherwise indicated. Complete financial results are available on SEDAR and EDGAR as well as in the Quarterly Reports section of BRP’s website.
“Our first quarter results once again demonstrate BRP’s ability to operate effectively in a challenging environment
environment. Demand for our products remains robust and our focus on operational execution has allowed us to further extend our market leadership,” said José Boisjoli, President and CEO.
BRP said it has experienced a continued level of supply chain disruptions and inefficiencies in a
increasingly inflationary environment compared to the first quarter of fiscal 2022 and the fourth
quarter of fiscal 2022. As a result, this limited the Company’s ability to meet consumer demand and
replenish dealer inventory and, in turn, further limit product availability in the network compared to
optimal seasonal levels. These supply chain disruptions, which are expected to last through fiscal year 2023, have also resulted in an increase in the number of substantially completed units awaiting missing components.
Despite these challenges, BRP said it has optimized the shipment of missing components to its dealership
network which has resulted in a high conversion rate of substantially completed units available for retail and
revised its production schedule based on seasonality and component availability. The company
implemented strategic pricing initiatives aimed at reducing inflationary pressures, which mitigated
impact on the profitability of the Company. The slightly higher revenues achieved for the first quarter of the fiscal year
2023 versus the first quarter of fiscal 2022 was further supported by strong SSV distribution,
demonstrating sustained consumer interest.
Revenues remained stable at $1,809.3 million for the three-month period ended April 30, 2022, compared to
$1,808.6 million for the corresponding period ended April 30, 2021. These results were primarily due to favorable pricing across all product lines, primarily offset by an unfavorable product mix throughout the year and
lower volume of seasonal products due to supply chain disruptions. The increase was partly offset by a
unfavorable change in the exchange rate of $27 million.
Marine segment revenue increased $4.8 million, or 3.8%, to $132.2 million for the three-month period ended April 30, 2022, from $127.4 million for the corresponding period ended April 30, 2021. The increase is primarily attributable to a favorable revenue mix of units sold, as well as favorable pricing. The increase was partially offset by a lower volume of units and PA&A sold due to supply chain disruptions.
Gross profit decreased $87.6 million, or 16.2%, to $454.4 million for the three-month period ended April 30, 2022, from $542.0 million for the corresponding period ended April 30, 2021. Gross profit margin percentage decreased by 490 basis points to 25.1% compared to 30.0% for the three-month period ended April 30, 2021. The decreases are the result of increased logistics, raw material and labor costs due to inefficiencies related to supply chain disruptions, as well as increased warranty costs. The declines were partially offset by favorable pricing combined with weaker sales programs due to a strong retail environment and limited product availability, as well as a favorable outcome on a claim for inventory-related insurance. The decreases include an unfavorable change in foreign exchange rates of $9 million.
“Given our team’s ability to make progress on our strategic priorities and our agility in managing a tighter supply chain environment, we remain confident of delivering another strong year in FY23 with expected revenue growth of 24% to 29% and normalized EPS growth of 11% to 14%,” concluded Boisjoli.
BRP’s complete results for the first quarter of FY23 are available here.