Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 21, 2020 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-11411 | |
Entity Incorporation, State or Country Code | MN | |
Entity Tax Identification Number | 41-1790959 | |
Entity Address, Address Line One | 2100 Highway 55, | |
Entity Address, City or Town | Medina | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55340 | |
City Area Code | 763 | |
Local Phone Number | 542-0500 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 61,338,503 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | POLARIS INC. | |
Entity Central Index Key | 0000931015 | |
Current Fiscal Year End Date | --12-31 | |
NEW YORK STOCK EXCHANGE, INC. [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $.01 par value | |
Trading Symbol | PII | |
Security Exchange Name | NYSE |
Significant Accounting Policies
Significant Accounting Policies Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles | ||
Net cash provided by (used for) operating activities | $ (309,700) | $ (202,900) |
Transamerican Auto Parts | Vehicles And Boats | Minimum | ||
Product Warranty Liability [Line Items] | ||
Period of warranties provided by Polaris | 6 months | |
Transamerican Auto Parts | Vehicles And Boats | Maximum | ||
Product Warranty Liability [Line Items] | ||
Period of warranties provided by Polaris | 10 years |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 544,400 | $ 157,100 |
Trade receivables, net | 195,200 | 190,400 |
Inventories, net | 1,026,400 | 1,121,100 |
Prepaid expenses and other | 103,500 | 125,900 |
Income taxes receivable | 14,200 | 32,500 |
Total current assets | 1,883,700 | 1,627,000 |
Property and equipment, net | 873,700 | 899,800 |
Investment in finance affiliate | 72,000 | 110,600 |
Deferred tax assets | 184,700 | 93,300 |
Goodwill and other intangible assets, net | 1,092,000 | 1,490,200 |
Operating lease assets | 105,400 | 110,200 |
Other long-term assets | 101,200 | 99,400 |
Total assets | 4,312,700 | 4,430,500 |
Current liabilities: | ||
Current portion of debt, finance lease obligations and notes payable | 536,500 | 166,700 |
Accounts payable | 545,600 | 450,200 |
Accrued expenses: | ||
Compensation | 127,100 | 184,500 |
Warranties | 134,200 | 136,200 |
Sales promotions and incentives | 132,600 | 189,900 |
Dealer holdback | 138,600 | 145,800 |
Other | 249,800 | 213,900 |
Current operating lease liabilities | 35,300 | 34,900 |
Income taxes payable | 7,900 | 5,900 |
Total current liabilities | 1,907,600 | 1,528,000 |
Long-term income taxes payable | 20,000 | 28,100 |
Finance lease obligations | 14,200 | 14,800 |
Long-term debt | 1,377,300 | 1,512,000 |
Deferred tax liabilities | 3,300 | 4,000 |
Long-term operating lease liabilities | 72,400 | 77,900 |
Other long-term liabilities | 150,500 | 143,900 |
Total liabilities | 3,545,300 | 3,308,700 |
Deferred compensation | 14,200 | 13,600 |
Shareholders’ equity: | ||
Preferred stock $0.01 par value per share, 20.0 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock $0.01 par value per share, 160.0 shares authorized, 61.3 and 61.4 shares issued and outstanding, respectively | 600 | 600 |
Additional paid-in capital | 921,300 | 892,800 |
Retained earnings (accumulated deficit) | (69,300) | 287,300 |
Accumulated other comprehensive loss, net | (99,600) | (72,700) |
Total shareholders’ equity | 753,000 | 1,108,000 |
Noncontrolling interest | 200 | 200 |
Total equity | 753,200 | 1,108,200 |
Total liabilities and equity | $ 4,312,700 | $ 4,430,500 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 160,000,000 | 160,000,000 |
Common stock, shares issued | 61,300,000 | 61,400,000 |
Common stock, shares outstanding | 61,300,000 | 61,400,000 |
Consolidated Statements Of Inco
Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Sales | $ 1,511,800 | $ 1,779,300 | $ 2,917,000 | $ 3,275,000 |
Cost of Goods and Services Sold | 1,179,100 | 1,342,900 | 2,291,400 | 2,486,100 |
Gross profit | 332,700 | 436,400 | 625,600 | 788,900 |
Operating expenses: | ||||
Selling and marketing | 119,600 | 140,600 | 269,800 | 269,900 |
Research and development | 66,800 | 76,400 | 145,200 | 143,500 |
General and administrative | 87,900 | 104,100 | 166,400 | 197,000 |
Goodwill and Intangible Asset Impairment | 379,200 | 0 | 379,200 | 0 |
Total operating expenses | 653,500 | 321,100 | 960,600 | 610,400 |
Operating income (loss) | (295,400) | 135,100 | (289,900) | 217,000 |
Non-operating expense: | ||||
Interest expense | 17,900 | 20,600 | 34,100 | 41,000 |
Equity in loss of other affiliates | 0 | 500 | 0 | 1,100 |
Other (income) expense, net | 800 | (300) | 1,700 | (3,800) |
Income (loss) before income taxes | (314,100) | 114,300 | (325,700) | 178,700 |
Provision for income taxes | (78,700) | 26,200 | (84,900) | 42,200 |
Net income (loss) | (235,400) | 88,100 | (240,800) | 136,500 |
Net loss attributable to noncontrolling interest | 0 | 100 | 0 | 100 |
Net income (loss) | $ (235,400) | $ 88,200 | $ (240,800) | $ 136,600 |
Basic net income per share (in dollars per share) | $ (3.82) | $ 1.44 | $ (3.90) | $ 2.23 |
Diluted net income per share (in dollars per share) | $ (3.82) | $ 1.42 | $ (3.90) | $ 2.20 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 61,600 | 61,400 | 61,700 | 61,400 |
Diluted (in shares) | 61,600 | 62,200 | 61,700 | 62,100 |
Income from financial services | ||||
Sales | $ 25,400 | $ 19,800 | $ 45,100 | $ 38,500 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ (235,400) | $ 88,100 | $ (240,800) | $ 136,500 |
Other comprehensive income, net of tax: | ||||
Foreign currency translation adjustments | 10,500 | 2,900 | (14,600) | (800) |
Unrealized loss on derivative instruments | (2,100) | (4,000) | (12,400) | (6,500) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 0 | 100 | 100 | (500) |
Comprehensive income (loss) | (227,000) | 87,200 | (267,700) | 128,800 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest | 0 | 100 | 0 | 100 |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest | $ (227,000) | $ 87,100 | $ (267,700) | $ 128,700 |
Consolidated Statements of Equi
Consolidated Statements of Equity Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid- In Capital | Retained Earnings | AOCI Attributable to Parent [Member] | Non Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2018 | 60,900 | |||||
Beginning balance at Dec. 31, 2018 | $ 867,000 | $ 600 | $ 808,000 | $ 121,100 | $ (63,000) | $ 300 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Employee stock compensation (in shares) | 200 | |||||
Employee stock compensation | 12,100 | 12,100 | ||||
Deferred compensation | (1,800) | (1,500) | (300) | |||
Proceeds from stock issuances under employee plans (in shares) | 0 | |||||
Proceeds from stock issuances under employee plans | 3,200 | $ 0 | 3,200 | |||
Cash dividends declared | (37,100) | (37,100) | ||||
Repurchase and retirement of common shares (in shares) | (100) | |||||
Repurchase and retirement of common shares | (6,200) | $ 0 | (1,000) | (5,200) | ||
Other activity | 0 | 600 | (600) | |||
Net income | 48,400 | 48,400 | ||||
Other comprehensive loss | (6,100) | (6,100) | ||||
Ending balance (in shares) at Mar. 31, 2019 | 61,000 | |||||
Ending balance at Mar. 31, 2019 | 879,500 | $ 600 | 820,800 | 127,500 | (69,700) | 300 |
Beginning balance (in shares) at Dec. 31, 2018 | 60,900 | |||||
Beginning balance at Dec. 31, 2018 | 867,000 | $ 600 | 808,000 | 121,100 | (63,000) | 300 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 136,500 | |||||
Ending balance (in shares) at Jun. 30, 2019 | 61,100 | |||||
Ending balance at Jun. 30, 2019 | 952,100 | $ 600 | 844,600 | 177,500 | (70,800) | 200 |
Beginning balance (in shares) at Mar. 31, 2019 | 61,000 | |||||
Beginning balance at Mar. 31, 2019 | 879,500 | $ 600 | 820,800 | 127,500 | (69,700) | 300 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Employee stock compensation (in shares) | 0 | |||||
Employee stock compensation | 22,100 | 22,100 | ||||
Deferred compensation | (1,800) | (1,200) | (600) | |||
Proceeds from stock issuances under employee plans (in shares) | 100 | |||||
Proceeds from stock issuances under employee plans | 3,000 | $ 0 | 3,000 | |||
Cash dividends declared | (37,300) | (37,300) | ||||
Repurchase and retirement of common shares (in shares) | 0 | |||||
Repurchase and retirement of common shares | (400) | $ 0 | (100) | (300) | ||
Net income | 88,100 | 88,200 | (100) | |||
Other comprehensive loss | (1,100) | (1,100) | ||||
Ending balance (in shares) at Jun. 30, 2019 | 61,100 | |||||
Ending balance at Jun. 30, 2019 | 952,100 | $ 600 | 844,600 | 177,500 | (70,800) | 200 |
Beginning balance (in shares) at Dec. 31, 2019 | 61,400 | |||||
Beginning balance at Dec. 31, 2019 | 1,108,200 | $ 600 | 892,800 | 287,300 | (72,700) | 200 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Employee stock compensation (in shares) | 400 | |||||
Employee stock compensation | 11,900 | $ 0 | 11,900 | |||
Deferred compensation | 6,900 | (500) | 7,400 | |||
Proceeds from stock issuances under employee plans (in shares) | 0 | |||||
Proceeds from stock issuances under employee plans | 2,300 | 2,300 | ||||
Cash dividends declared | (38,000) | (38,000) | ||||
Repurchase and retirement of common shares (in shares) | (600) | |||||
Repurchase and retirement of common shares | (48,800) | $ 0 | (8,100) | (40,700) | ||
Net income | (5,400) | (5,400) | 0 | |||
Other comprehensive loss | (35,300) | (35,300) | ||||
Ending balance (in shares) at Mar. 31, 2020 | 61,200 | |||||
Ending balance at Mar. 31, 2020 | 1,001,800 | $ 600 | 898,400 | 210,600 | (108,000) | 200 |
Beginning balance (in shares) at Dec. 31, 2019 | 61,400 | |||||
Beginning balance at Dec. 31, 2019 | $ 1,108,200 | $ 600 | 892,800 | 287,300 | (72,700) | 200 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Repurchase and retirement of common shares (in shares) | (600) | |||||
Repurchase and retirement of common shares | $ (49,300) | |||||
Net income | (240,800) | |||||
Ending balance (in shares) at Jun. 30, 2020 | 61,300 | |||||
Ending balance at Jun. 30, 2020 | 753,200 | $ 600 | 921,300 | (69,300) | (99,600) | 200 |
Beginning balance (in shares) at Mar. 31, 2020 | 61,200 | |||||
Beginning balance at Mar. 31, 2020 | 1,001,800 | $ 600 | 898,400 | 210,600 | (108,000) | 200 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Employee stock compensation (in shares) | 0 | |||||
Employee stock compensation | 19,800 | $ 0 | 19,800 | |||
Deferred compensation | (7,500) | (1,400) | (6,100) | |||
Proceeds from stock issuances under employee plans (in shares) | 100 | |||||
Proceeds from stock issuances under employee plans | 4,600 | 4,600 | ||||
Cash dividends declared | (38,000) | (38,000) | ||||
Repurchase and retirement of common shares (in shares) | 0 | |||||
Repurchase and retirement of common shares | (500) | $ 0 | (100) | (400) | ||
Net income | (235,400) | (235,400) | ||||
Other comprehensive loss | 8,400 | 8,400 | ||||
Ending balance (in shares) at Jun. 30, 2020 | 61,300 | |||||
Ending balance at Jun. 30, 2020 | $ 753,200 | $ 600 | $ 921,300 | $ (69,300) | $ (99,600) | $ 200 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Operating Activities: | ||
Net income | $ (240,800) | $ 136,500 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 127,100 | 111,900 |
Noncash compensation | 31,700 | 34,200 |
Noncash income from financial services | (11,900) | (15,500) |
Deferred income taxes | (92,600) | (5,900) |
Other, net | 0 | 1,100 |
Changes in operating assets and liabilities: | ||
Trade receivables | (6,200) | (26,900) |
Inventories | 91,800 | (159,100) |
Accounts payable | 95,300 | 72,000 |
Accrued expenses | (77,800) | 19,000 |
Income taxes payable/receivable | 12,000 | 30,800 |
Prepaid expenses and others, net | 1,900 | 4,800 |
Net cash provided by operating activities | 309,700 | 202,900 |
Investing Activities: | ||
Purchase of property and equipment | (88,100) | (137,200) |
Investment in finance affiliate, net | 50,600 | 10,200 |
Acquisition of businesses, net of cash acquired | 0 | 1,800 |
Net cash used for investing activities | (37,500) | (128,800) |
Financing Activities: | ||
Borrowings under debt arrangements / finance lease obligations | 1,288,700 | 1,788,600 |
Repayments under debt arrangements / finance lease obligations | (1,054,900) | (1,853,500) |
Repurchase and retirement of common shares | (49,300) | (6,500) |
Cash dividends to shareholders | (76,000) | (74,400) |
Proceeds from stock issuances under employee plans | 6,900 | 6,200 |
Net cash provided by (used for) financing activities | 115,400 | (139,600) |
Impact of currency exchange rates on cash balances | (3,100) | (100) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 384,500 | (65,600) |
Cash, cash equivalents and restricted cash at beginning of period | 196,300 | 193,100 |
Cash, cash equivalents and restricted cash at end of period | 580,800 | 127,500 |
Noncash Activity: | ||
Leased assets obtained for operating lease liabilities | 12,400 | 8,100 |
Supplemental Cash Flow Information: | ||
Interest paid on debt borrowings | 35,400 | 41,500 |
Income taxes paid (refunded) | (8,400) | 14,900 |
Total | 580,800 | 127,500 |
Goodwill and Intangible Asset Impairment | $ 379,200 | $ 0 |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity During the six months ended June 30, 2020, Polaris paid $49.3 million to repurchase approximately 0.6 million shares of its common stock. As of June 30, 2020, the Board of Directors has authorized the Company to repurchase up to an additional 2.6 million shares of Polaris stock. The repurchase of any or all such shares authorized for repurchase will be governed by applicable SEC rules and dependent on management’s assessment of market conditions and subject to the restrictions on share repurchases set forth in the incremental amendment. Polaris paid a regular cash dividend of $0.62 per share on June 15, 2020 to holders of record at the close of business on June 5, 2020. Cash dividends declared and paid per common share for the three and six months ended June 30, 2020 and 2019, were as follows: Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Cash dividends declared and paid per common share $ 0.62 $ 0.61 $ 1.24 $ 1.22 Net income (loss) per share Basic income (loss) per share is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during each period, including shares earned under the Deferred Compensation Plan for Directors (“Director Plan”) and the ESOP and deferred stock units under the 2007 Omnibus Incentive Plan (“Omnibus Plan”). Diluted income (loss) per share is computed under the treasury stock method and is calculated to compute the dilutive effect of outstanding stock options and certain share-based awards issued under the Omnibus Plan. A reconciliation of these amounts is as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Weighted average number of common shares outstanding 61.3 61.1 61.3 61.1 Director Plan and deferred stock units 0.2 0.2 0.2 0.2 ESOP 0.1 0.1 0.2 0.1 Common shares outstanding—basic 61.6 61.4 61.7 61.4 Dilutive effect of Omnibus Plan — 0.8 — 0.7 Common and potential common shares outstanding—diluted 61.6 62.2 61.7 62.1 During the three and six months ended June 30, 2020, the number of options that were not included in the computation of diluted income (loss) per share because the option exercise price was greater than the market price, and therefore, the effect would have been anti-dilutive, was 5.3 million and 5.2 million, respectively, compared to 4.0 million and 4.1 million for the same periods in 2019. As a result of the Company’s net loss during the three and six month periods ended June 30, 2020, an additional 0.5 million and 0.6 million of outstanding stock options and certain share-based awards under the Omnibus Plan were not included in the computation of diluted income (loss) per share because the effect would have been anti-dilutive. Accumulated other comprehensive loss Changes in the accumulated other comprehensive loss balance are as follows (in millions): Foreign Currency Translation Cash Flow Retirement Plan and Other Activity Accumulated Other Balance as of December 31, 2019 $ (63.3) $ (6.1) $ (3.3) $ (72.7) Reclassification to the statement of income — (0.7) 0.1 (0.6) Change in fair value (14.6) (11.7) — (26.3) Balance as of June 30, 2020 $ (77.9) $ (18.5) $ (3.2) $ (99.6) The table below provides data about the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the statements of income (loss) for cash flow derivatives designated as hedging instruments for the three and six months ended June 30, 2020 and 2019 (in millions): Derivatives in Cash Flow Hedging Relationships and Other Activity Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Foreign currency contracts Other expense, net $ 3.5 $ 0.9 $ 3.5 $ 2.1 Foreign currency contracts Cost of sales (1.2) 0.2 (0.7) 0.3 Interest rate contracts Interest expense (1.6) (0.1) (2.1) (0.1) Retirement plan activity Operating expenses — — (0.1) (0.1) Total $ 0.7 $ 1.0 $ 0.6 $ 2.2 The net amount of the existing gains or losses at June 30, 2020 that is expected to be reclassified into the statements of income (loss) within the next 12 months is not expected to be material. See Note 9 for further information regarding derivative activities. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Schedule of cash dividends declared per common share | Cash dividends declared and paid per common share for the three and six months ended June 30, 2020 and 2019, were as follows: Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Cash dividends declared and paid per common share $ 0.62 $ 0.61 $ 1.24 $ 1.22 |
Schedule of reconciliation of weighted average number of shares | A reconciliation of these amounts is as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Weighted average number of common shares outstanding 61.3 61.1 61.3 61.1 Director Plan and deferred stock units 0.2 0.2 0.2 0.2 ESOP 0.1 0.1 0.2 0.1 Common shares outstanding—basic 61.6 61.4 61.7 61.4 Dilutive effect of Omnibus Plan — 0.8 — 0.7 Common and potential common shares outstanding—diluted 61.6 62.2 61.7 62.1 |
Schedule of changes in accumulated other comprehensive income (loss) balances | Changes in the accumulated other comprehensive loss balance are as follows (in millions): Foreign Currency Translation Cash Flow Retirement Plan and Other Activity Accumulated Other Balance as of December 31, 2019 $ (63.3) $ (6.1) $ (3.3) $ (72.7) Reclassification to the statement of income — (0.7) 0.1 (0.6) Change in fair value (14.6) (11.7) — (26.3) Balance as of June 30, 2020 $ (77.9) $ (18.5) $ (3.2) $ (99.6) |
Schedule of gains and losses, net of tax, reclassified from accumulated other comprehensive income into the income statement for cash flow derivatives designated as hedging instruments | The table below provides data about the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the statements of income (loss) for cash flow derivatives designated as hedging instruments for the three and six months ended June 30, 2020 and 2019 (in millions): Derivatives in Cash Flow Hedging Relationships and Other Activity Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Foreign currency contracts Other expense, net $ 3.5 $ 0.9 $ 3.5 $ 2.1 Foreign currency contracts Cost of sales (1.2) 0.2 (0.7) 0.3 Interest rate contracts Interest expense (1.6) (0.1) (2.1) (0.1) Retirement plan activity Operating expenses — — (0.1) (0.1) Total $ 0.7 $ 1.0 $ 0.6 $ 2.2 |
Shareholders' Equity Additional
Shareholders' Equity Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Repurchase and retirement of common stock | $ 500 | $ 400 | $ 49,300 | |
Repurchase and retirement of common stock (shares) | 600,000 | |||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 2,600,000 | 2,600,000 | ||
Cash dividend paid during period, per share (in dollars per share) | $ 0.62 | $ 0.61 | $ 1.24 | $ 1.22 |
Common stock excluded from calculation of diluted earnings per share (shares) | 5,300,000 | 4,000,000 | 5,200,000 | 4,100,000 |
Omnibus Incentive Plan | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Common stock excluded from calculation of diluted earnings per share (shares) | 500,000 | 600,000 |
Significant Accounting Polici_2
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of presentation. The accompanying unaudited consolidated financial statements of Polaris Inc. (“Polaris” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and, therefore, do not include all information and disclosures of results of operations, financial position and changes in cash flow in conformity with accounting principles generally accepted in the United States for complete financial statements. Accordingly, such statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 previously filed with the Securities and Exchange Commission (“SEC”). In the opinion of management, such statements reflect all adjustments (which include only normal recurring adjustments) necessary for a fair presentation of the financial position, results of operations, equity, and cash flows for the periods presented. Due to the seasonality trends for certain products and to certain changes in production and shipping cycles, results of such periods are not necessarily indicative of the results to be expected for the complete year. Reclassifications. Certain reclassifications of previously reported segment gross profit amounts have been made to conform to the current year presentation. The reclassifications had no impact on the consolidated balance sheets, statements of income (loss), comprehensive income (loss), equity, or cash flows, as previously reported. See further information in Note 10. Fair value measurements. Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The Company utilizes the market approach to measure fair value for its non-qualified deferred compensation assets and liabilities, and the income approach for foreign currency contracts and interest rate contracts. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities, and for the income approach, the Company uses significant other observable inputs to value its derivative instruments used to hedge foreign currency and interest rate transactions. Assets and liabilities measured at fair value on a recurring basis are summarized below (in millions): Fair Value Measurements as of June 30, 2020 Asset (Liability) Total Level 1 Level 2 Level 3 Non-qualified deferred compensation assets $ 47.7 $ 47.7 $ — $ — Total assets at fair value $ 47.7 $ 47.7 $ — $ — Non-qualified deferred compensation liabilities $ (47.7) $ (47.7) $ — $ — Foreign exchange contracts, net (2.9) — (2.9) — Interest rate contracts, net (21.5) — (21.5) Total liabilities at fair value $ (72.1) $ (47.7) $ (24.4) $ — Fair Value Measurements as of December 31, 2019 Asset (Liability) Total Level 1 Level 2 Level 3 Non-qualified deferred compensation assets $ 48.9 $ 48.9 $ — $ — Total assets at fair value $ 48.9 $ 48.9 $ — $ — Non-qualified deferred compensation liabilities $ (48.9) $ (48.9) $ — $ — Foreign exchange contracts, net (0.1) (0.1) Interest rate contracts, net (8.0) — (8.0) — Total liabilities at fair value $ (57.0) $ (48.9) $ (8.1) $ — Fair value of other financial instruments. The carrying values of the Company’s short-term financial instruments, including cash and cash equivalents, trade receivables and short-term debt, including current maturities of long-term debt, finance lease obligations and notes payable, approximate their fair values. At June 30, 2020 and December 31, 2019, the fair value of the Company’s long-term debt, finance lease obligations and notes payable was approximately $2,045.5 million and $1,769.3 million, respectively, and was determined primarily using Level 2 inputs, including quoted market prices or discounted cash flows based on quoted market rates for similar types of debt. The carrying value of long-term debt, finance lease obligations and notes payable including current maturities was $1,928.0 million and $1,693.5 million as of June 30, 2020 and December 31, 2019, respectively. Inventories. Inventory costs include material, labor and manufacturing overhead costs, including depreciation expense associated with the manufacture and distribution of the Company’s products. Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value. The major components of inventories are as follows (in millions): June 30, 2020 December 31, 2019 Raw materials and purchased components $ 402.3 $ 344.6 Service parts, garments and accessories 316.6 357.0 Finished goods 376.9 476.2 Less: reserves (69.4) (56.7) Inventories $ 1,026.4 $ 1,121.1 Product warranties. The Company typically provides a limited warranty for its vehicles and boats for a period of six months to ten years, depending on the product. Polaris provides longer warranties in certain geographical markets as determined by local regulations and customary practice and may also provide longer warranties related to certain promotional programs. The Company’s standard warranties require the Company, generally through its dealer network, to repair or replace defective products during such warranty periods. The warranty reserve is established at the time of sale to the dealer or distributor based on management’s best estimate using historical rates and trends. The Company records these amounts as a liability in the consolidated balance sheet until they are ultimately paid. Adjustments to the warranty reserve are made based on actual claims experience in order to properly estimate the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. The warranty reserve includes the estimated costs related to recalls, which are accrued when probable and estimable. Factors that could have an impact on the warranty reserve include the following: changes in manufacturing quality, shifts in product mix, changes in warranty coverage periods, impacts on product usage (including weather), product recalls and changes in sales volume. The activity in the warranty reserve during the periods presented was as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Balance at beginning of period $ 132.8 $ 116.2 $ 136.2 $ 121.8 Additions to reserve related to acquisitions — 8.8 — 8.8 Additions charged to expense 29.8 36.9 54.0 62.9 Warranty claims paid, net (28.4) (29.1) (56.0) (60.7) Balance at end of period $ 134.2 $ 132.8 $ 134.2 $ 132.8 New accounting pronouncements. Financial instruments. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which replaces existing incurred loss impairment guidance and establishes a single allowance framework for financial assets carried at amortized cost. The Company adopted Topic 326 on January 1, 2020, using a modified retrospective transition method. The adoption of Topic 326 did not have a material impact on the Company’s consolidated financial position, results of operations, equity or cash flows. Fair Value Measurement. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which amends ASC 820 to eliminate, modify, and add certain disclosure requirements for fair value measurements. The Company adopted ASU 2018-13 on January 1, 2020. The adoption of ASU 2018-13 did not have a material impact on the Company’s disclosures. There are no other new accounting pronouncements that are expected to have a significant impact on the Company’s consolidated financial statements. |
Revenue Recognition (Notes)
Revenue Recognition (Notes) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue Recognition [Abstract] | |
Revenue Recognition, Sales of Goods [Policy Text Block] | Note 2. Revenue Recognition The following tables disaggregate the Company’s revenue by major product type and geography (in millions): Three months ended June 30, 2020 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 737.3 $ 118.3 $ 62.4 — $ 132.2 $ 1,050.2 PG&A 215.6 23.0 15.5 $ 207.5 — 461.6 Total revenue $ 952.9 $ 141.3 $ 77.9 $ 207.5 $ 132.2 $ 1,511.8 Revenue by geography United States $ 795.6 $ 90.2 $ 39.1 $ 198.8 $ 129.7 $ 1,253.4 Canada 52.8 4.2 0.1 8.7 2.5 68.3 EMEA 62.8 26.5 37.2 — — 126.5 APLA 41.7 20.4 1.5 — — 63.6 Total revenue $ 952.9 $ 141.3 $ 77.9 $ 207.5 $ 132.2 $ 1,511.8 Three months ended June 30, 2019 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 864.2 $ 169.5 $ 98.6 — $ 182.4 $ 1,314.7 PG&A 185.1 27.3 23.3 $ 228.9 — 464.6 Total revenue $ 1,049.3 $ 196.8 $ 121.9 $ 228.9 $ 182.4 $ 1,779.3 Revenue by geography United States $ 871.8 $ 120.2 $ 58.1 $ 219.2 $ 177.3 $ 1,446.6 Canada 74.3 10.4 2.1 9.7 5.1 101.6 EMEA 65.8 48.7 60.9 — — 175.4 APLA 37.4 17.5 0.8 — — 55.7 Total revenue $ 1,049.3 $ 196.8 $ 121.9 $ 228.9 $ 182.4 $ 1,779.3 Six months ended June 30, 2020 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 1,382.0 $ 228.1 $ 139.8 — $ 286.7 $ 2,036.6 PG&A 394.6 39.8 36.4 $ 409.6 — 880.4 Total revenue $ 1,776.6 $ 267.9 $ 176.2 $ 409.6 $ 286.7 $ 2,917.0 Revenue by geography United States $ 1,478.3 $ 168.0 $ 87.6 $ 392.8 $ 281.1 $ 2,407.8 Canada 104.8 8.8 1.6 16.8 5.6 137.6 EMEA 124.8 55.9 84.9 — — 265.6 APLA 68.7 35.2 2.1 — — 106.0 Total revenue $ 1,776.6 $ 267.9 $ 176.2 $ 409.6 $ 286.7 $ 2,917.0 Six months ended June 30, 2019 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 1,565.1 $ 271.8 $ 183.3 — $ 367.2 $ 2,387.4 PG&A 351.7 42.9 43.6 $ 449.4 — 887.6 Total revenue $ 1,916.8 $ 314.7 $ 226.9 $ 449.4 $ 367.2 $ 3,275.0 Revenue by geography United States $ 1,580.7 $ 188.1 $ 109.8 $ 430.8 $ 358.1 $ 2,667.5 Canada 125.9 16.4 3.2 18.6 9.1 173.2 EMEA 144.5 79.4 112.3 — — 336.2 APLA 65.7 30.8 1.6 — — 98.1 Total revenue $ 1,916.8 $ 314.7 $ 226.9 $ 449.4 $ 367.2 $ 3,275.0 With respect to wholegood vehicles, boats, and parts, garments and accessories (“PG&A), revenue is recognized when the Company transfers control of the product to the customer (or distributor). With respect to services provided by the Company, revenue is recognized upon completion of the service or over the term of the service agreement in proportion to the costs expected to be incurred in satisfying the obligations over the term of the service period. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. Sales, value add, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. Incidental items that are immaterial in the context of the contract are recognized as expense. The expected costs associated with the Company’s limited warranties and field service bulletin actions are recognized as expense when the products are sold. The Company recognizes revenue for vehicle service contracts that extend mechanical and maintenance coverage beyond the Company’s limited warranties over the life of the contract. Revenue from goods and services transferred to customers at a point-in-time accounts for the majority of the Company’s revenue. Revenue from products or services transferred over time is discussed in the deferred revenue section. ORV/Snowmobiles, Motorcycles and Global Adjacent Markets segments Wholegood vehicles and parts, garments and accessories. For the majority of wholegood vehicles PG&A, the Company transfers control and recognizes a sale when it ships the product from its manufacturing facility, distribution center, or vehicle holding center to its customer (primarily dealers and distributors). The amount of consideration the Company receives and revenue it recognizes varies with changes in marketing incentives and rebates it offers to its dealers and their customers. Sales returns are not material. The Company adjusts its estimate of revenue at the earlier of when the most likely amount of consideration it expects to receive changes or when the consideration becomes fixed. Depending on the terms of the arrangement, the Company may also defer the recognition of a portion of the consideration received because it has to satisfy a future obligation (e.g., free extended service contracts). The Company uses an observable price to determine the stand-alone selling price for separate performance obligations. The Company has elected to recognize the cost for freight and shipping when control over vehicles, parts, garments or accessories has transferred to the customer as an expense in cost of sales. Extended Service Contracts. The Company sells separately-priced service contracts that extend mechanical and maintenance coverages beyond its base limited warranty agreements to vehicle owners. The separately priced service contracts range from 12 months to 84 months. The Company primarily receives payment at the inception of the contract and recognizes revenue over the term of the agreement in proportion to the costs expected to be incurred in satisfying the obligations under the contract. Aftermarket segment The Company’s Aftermarket products are sold through dealer, distributor, retail, and e-commerce channels. The Company transfers control and recognizes a sale when products are shipped or delivered to its customer. The amount of consideration the Company receives and revenue it recognizes varies with changes in marketing incentives and rebates it offers to its customers and their customers. When the Company gives its customers the right to return eligible parts and accessories, it estimates the expected returns based on an analysis of historical experience. The Company adjusts its estimate of revenue at the earlier of when the most likely amount of consideration it expects to receive changes or when the consideration becomes fixed. Service revenue. The Company offers installation services for parts that it sells. Service revenues are recognized upon completion of the service. Depending on the terms of the arrangement, the Company may also defer the recognition of a portion of the consideration received because it has to satisfy a future obligation (e.g., extended service contracts). The Company uses an observable price to determine the stand-alone selling price for separate performance obligations. The Company has elected to recognize the cost for freight and shipping when control over parts, garments or accessories has transferred to the customer as an expense in cost of sales. Boats segment Boats. The Company transfers control and recognizes a sale when it ships the product from its manufacturing facility or distribution center to its customer (primarily dealers). The amount of consideration the Company receives and revenue it recognizes varies with changes in marketing incentives and rebates it offers to its dealers and their customers. Sales returns are not material. The Company adjusts its estimate of revenue at the earlier of when the most likely amount of consideration it expects to receive changes or when the consideration becomes fixed. The Company has elected to recognize the cost for freight and shipping when control over boats has transferred to the customer as an expense in cost of sales. Deferred revenue The Company finances its self-insured risks related to extended service contracts (“ESCs”). The premiums for ESCs are primarily recognized in income in proportion to the costs expected to be incurred over the contract period. Warranty costs are recognized as incurred. The Company expects to recognize approximately $32.4 million of the unearned amount over the next 12 months and $57.4 million thereafter. The activity in the deferred revenue reserve during the periods presented was as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Balance at beginning of period $ 85.6 $ 63.5 $ 81.6 $ 59.9 New contracts sold 13.6 11.5 26.8 21.4 Less: reductions for revenue recognized (9.4) (7.3) (18.6) (13.6) Balance at end of period (1) $ 89.8 $ 67.7 $ 89.8 $ 67.7 |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation The amount of compensation cost for share-based awards recognized during a period is based on the portion of the awards that are ultimately expected to vest. The Company estimates forfeitures at the time of grant and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company analyzes historical data to estimate pre-vesting forfeitures and records share-based compensation expense for those awards expected to vest. Total share-based compensation expenses were comprised as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Option awards $ 5.9 $ 6.8 $ 9.6 $ 8.1 Other share-based awards 15.4 14.9 17.2 24.5 Total share-based compensation before tax 21.3 21.7 26.8 32.6 Tax benefit 5.1 5.2 6.4 7.8 Total share-based compensation expense included in net income (loss) $ 16.2 $ 16.5 $ 20.4 $ 24.8 In addition to the above share-based compensation expenses, Polaris sponsors a qualified non-leveraged employee stock ownership plan (ESOP). Shares allocated to eligible participants’ accounts vest at various percentage rates based on years of service and require no cash payments from the recipient. |
Financing Agreement
Financing Agreement | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Financing Agreement | Financing Agreements The carrying value of debt, finance lease obligations, and notes payable and the average related interest rates were as follows (in millions): Average interest rate at June 30, 2020 Maturity June 30, 2020 December 31, 2019 Revolving loan facility 2.00% July 2023 $ 49.5 $ 75.1 Term loan facility 2.43% July 2023 970.0 1,000.0 Incremental term loan 3.00% April 2021 300.0 — Senior notes—fixed rate 4.60% May 2021 75.0 75.0 Senior notes—fixed rate 3.13% December 2020 100.0 100.0 Senior notes—fixed rate 4.23% July 2028 350.0 350.0 Finance lease obligations 5.15% Various through 2029 15.4 16.1 Notes payable and other 4.24% Various through 2030 75.0 81.4 Debt issuance costs (6.9) (4.1) Total debt, finance lease obligations, and notes payable $ 1,928.0 $ 1,693.5 Less: current maturities 536.5 166.7 Total long-term debt, finance lease obligations, and notes payable $ 1,391.5 $ 1,526.8 In December 2010, the Company entered into a Master Note Purchase Agreement to issue $75 million of unsecured senior notes due May 2021 (collectively, the “Senior Notes”). The Senior Notes were issued in May 2011. In December 2013, the Company entered into a First Supplement to Master Note Purchase Agreement, under which the Company issued $100 million of unsecured senior notes due December 2020. In July 2018, the Company entered into a Master Note Purchase Agreement to issue $350 million of unsecured senior notes due July 2028. There are $175 million of the senior notes classified as current maturities in the consolidated balance sheets as of June 30, 2020. In July 2018, Polaris amended its unsecured credit agreement to increase its revolving loan facility (the “revolving loan facility”) to $700 million and increase its term loan facility (the “term loan facility”) to $1,180 million. The expiration date of the facility was extended to July 2023, and interest is charged at rates based on a LIBOR or “prime” base rate. On April 9, 2020, the Company amended the credit agreement to provide a new incremental 364-day term loan (the “incremental term loan”) in the amount of $300 million. The new incremental term loan, which was fully drawn on closing, is unsecured and matures on April 8, 2021 and can be extended for an additional 364-day term upon request of Polaris and consent by the lenders. There are no required principal payments prior to the maturity date. The amended credit agreement includes pricing provisions and a restriction on declaring dividends if certain elevated leverage metrics are met, prohibits share repurchases until the incremental term loan has been repaid, and continues to contain standard covenants with regards to mergers and consolidations, asset sales, and is subject to acceleration upon various events of default. In addition to the payment of the $300 million incremental term loan, the Company is required to make principal payments under the term loan facility of $59 million over the next 12 months. These payments are classified as current maturities in the consolidated balance sheets. The credit agreement and the amended Master Note Purchase Agreements contain covenants that require Polaris to maintain certain financial ratios, including minimum interest coverage and maximum leverage ratios. On May 26, 2020, the Company further amended the credit agreement and amended Master Note Purchase Agreement to temporarily decrease its minimum interest coverage ratio from not less than 3.00x to not less than 2.25x and temporarily increase its maximum leverage ratio from 3.50x to 4.75x on a rolling four quarter basis until March 31, 2021. Polaris was in compliance with all such covenants at June 30, 2020. Debt issuance costs are recognized as a reduction in the carrying value of the related long-term debt in the consolidated balance sheets and are being amortized to interest expense in the consolidated statements of income over the expected remaining terms of the related debt. As a component of the Boat Holdings merger agreement, Polaris has committed to make a series of deferred payments to the former owners following the closing date of the merger through July 2030. The original discounted payable was for $76.7 million, of which $66.5 million is outstanding as of June 30, 2020. The outstanding balance is included in long-term debt and current portion of long-term debt in the consolidated balance sheets. The Company has a mortgage note payable agreement for land, on which Polaris built the Huntsville, Alabama manufacturing facility in 2016. The original mortgage note payable was for $14.5 million, of which $8.5 million is outstanding as of June 30, 2020. The outstanding balance is included in long-term debt and current portion of long-term debt in the consolidated balance sheets. The payment of principal and interest for the note payable is forgivable if the Company satisfies certain job commitments over the term of the note. The Company has met the required commitments to date. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets As a result of the current market and economic conditions resulting from the COVID-19 pandemic, as well as recent financial performance and restructuring actions, we determined that the conditions indicated that indefinite lived intangible assets within the Aftermarket and Boats reporting units are more-likely-than-not impaired and performed an impairment test to compare the fair value of these indefinite lived intangible assets, consisting of certain brand/trade names, with their carrying value. These factors were also indicators during the second quarter of 2020 that it was more-likely-than-not that the fair value of the Aftermarket and Boats reporting units would be less than their respective carrying values. As a result, the Company performed quantitative goodwill impairment tests of the Aftermarket and Boats reporting units. The fair value of each brand/trade name was determined using the relief-from-royalty method. Under the quantitative goodwill impairment test, the fair value of each reporting unit was determined using a discounted cash flow analysis and a market approach. Determining the fair value of brand/trade names and the reporting units required the use of significant judgment, including royalty rates, discount rates, assumptions in the Company’s long-term business plan about future revenues and expenses, capital expenditures, and changes in working capital, which are dependent on internal forecasts, estimation of long-term growth for each reporting unit, and determination of the weighted average cost of capital. These plans take into consideration numerous factors including historical experience, anticipated future economic conditions, including the impacts from the COVID-19 pandemic, changes in raw material prices and growth expectations for the industries and end markets in which the Company participates. Inputs used to estimate these fair values included significant unobservable inputs that reflect the Company’s assumptions about the inputs that market participants would use and, therefore, the fair value assessments are classified within Level 3 of the fair value hierarchy. If the carrying amount of goodwill or brand/trade names exceed their fair value, then they are considered impaired and an impairment loss is recognized in an amount by which the carrying value exceeds fair value, not to exceed the carrying amount of the trade name or goodwill allocated to that reporting unit. As a result of this analysis, during the three months ended June 30, 2020 the Company recorded impairment charges of $108.9 million related to certain brand/trade names associated with Transamerican Auto Parts which are included in the Aftermarket reporting unit. Further, during the same period, the Company recorded impairment charges of $270.3 million related to goodwill of the Aftermarket reporting unit. Subsequent to the impairment charges recorded in the quarter, there is no remaining goodwill for the Aftermarket reporting unit. The charges are included in Goodwill and other intangible asset impairments on the consolidated statements income (loss). The impairments resulted in a $90.3 million income tax benefit (deferred tax asset) associated with the remaining tax deductible basis in goodwill and intangibles. There were no goodwill or other intangible asset impairment charges recorded related to the Boats, ORV, Snow, Global Adjacent Markets, or Motorcyles reporting units during the quarter. Goodwill and other intangible assets, net of accumulated amortization, at June 30, 2020 and December 31, 2019 are as follows (in millions): June 30, 2020 December 31, 2019 Goodwill $ 389.5 $ 659.9 Other intangible assets, net 702.5 830.3 Total goodwill and other intangible assets, net $ 1,092.0 $ 1,490.2 The changes in the carrying amount of goodwill for the six months ended June 30, 2020 were as follows (in millions): Six months ended June 30, 2020 Goodwill, beginning of period $ 659.9 Goodwill impairment (270.3) Currency translation effect on foreign goodwill balances (0.1) Goodwill, end of period $ 389.5 The components of other intangible assets were as follows ($ in millions): Total estimated life (years) June 30, 2020 December 31, 2019 Non-amortizable—indefinite lived: Brand/trade names $ 333.2 $ 442.0 Amortizable: Non-compete agreements 4 2.6 2.6 Dealer/customer related 5-20 459.9 499.5 Developed technology 5-7 9.7 12.7 Total amortizable 472.2 514.8 Less: Accumulated amortization (102.9) (126.5) Net amortized other intangible assets 369.3 388.3 Total other intangible assets, net $ 702.5 $ 830.3 Amortization expense for intangible assets was $8.8 million and $10.3 million for the three months ended June 30, 2020 and 2019, respectively, and $18.8 million and $20.5 million for the six months ended June 30, 2020 and 2019, respectively. Estimated amortization expense for the remainder of 2020 through 2025 is as follows: 2020 (remainder), $17.3 million; 2021, $33.2 million; 2022, $28.3 million; 2023, $25.7 million; 2024, $25.0 million; 2025, $25.0 million; and after 2025, $214.8 million. The preceding expected amortization expense is an estimate and actual amounts could differ due to additional intangible asset acquisitions, changes in foreign currency rates or impairment of intangible assets. |
Financial Services Arrangements
Financial Services Arrangements | 6 Months Ended |
Jun. 30, 2020 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Financial Services Arrangements | Financial Services Arrangements Polaris Acceptance, a joint venture between Polaris and Wells Fargo Commercial Distribution Finance Corporation, a direct subsidiary of Wells Fargo Bank, N.A. (“Wells Fargo”), which is supported by a partnership agreement between their respective wholly owned subsidiaries, finances substantially all of Polaris’ United States sales of snowmobiles, off-road vehicles (“ORV”), motorcycles, and related PG&A, whereby Polaris receives payment within a few days of shipment of the product. Polaris’ subsidiary has a 50 percent equity interest in Polaris Acceptance. Polaris Acceptance sells a majority of its receivable portfolio to a securitization facility (the “Securitization Facility”) arranged by Wells Fargo. The sale of receivables from Polaris Acceptance to the Securitization Facility is accounted for in Polaris Acceptance’s financial statements as a “true-sale” under Accounting Standards Codification (“ASC”) Topic 860. Polaris’ allocable share of the income of Polaris Acceptance has been included as a component of income from financial services in the accompanying consolidated statements of income. The partnership agreement, as amended and extended in August 2019, is effective through February 2027. Polaris’ total investment in Polaris Acceptance of $72.0 million at June 30, 2020 is accounted for under the equity method, and is recorded in investment in finance affiliate in the accompanying consolidated balance sheets. At June 30, 2020, the outstanding amount of net receivables financed for dealers under this arrangement was $763.6 million, which included $368.2 million in the Polaris Acceptance portfolio and $395.4 million of receivables within the Securitization Facility (“Securitized Receivables”). Polaris has agreed to repurchase products repossessed by Polaris Acceptance up to an annual maximum of 15 percent of the aggregate average month-end outstanding Polaris Acceptance receivables and Securitized Receivables during the prior calendar year. For calendar year 2020, the potential 15 percent aggregate repurchase obligation is approximately $198.3 million. Polaris’ financial exposure under this arrangement is limited to the difference between the amounts unpaid by the dealer with respect to the repossessed product plus costs of repossession and the amount received on the resale of the repossessed product. No material losses have been incurred under this agreement during the periods presented. A subsidiary of TCF Financial Corporation (“TCF”) finances a portion of Polaris’ United States sales of boats whereby Polaris receives payment within a few days of shipment of the product. Polaris has agreed to repurchase products repossessed by TCF up to a maximum of 100 percent of the aggregate outstanding TCF receivables balance. At June 30, 2020, the potential aggregate repurchase obligation was approximately $129.9 million. Polaris’ financial exposure under this arrangement is limited to the difference between the amounts unpaid by the dealer with respect to the repossessed product plus costs of repossession and the amount received on the resale of the repossessed product. No material losses have been incurred under this agreement during the periods presented. Polaris has agreements with Performance Finance, Sheffield Financial and Synchrony Bank, under which these financial institutions provide financing to end consumers of Polaris products. Polaris’ income generated from these agreements has been included as a component of income from financial services in the accompanying consolidated statements of income. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Product liability. Polaris is subject to product liability claims in the normal course of business. The Company carries excess insurance coverage for product liability claims. Polaris self-insures product liability claims before the policy date and up to the purchased insurance coverage after the policy date. The estimated costs resulting from any losses are charged to operating expenses when it is probable a loss has been incurred and the amount of the loss is reasonably estimable. The Company utilizes historical trends and actuarial analysis, along with an analysis of current claims, to assist in determining the appropriate loss reserve levels. At June 30, 2020, the Company had an accrual of $61.7 million for the probable payment of pending claims related to product liability litigation associated with Polaris products. This accrual is included as a component of other accrued expenses in the consolidated balance sheets. Litigation. The Company is a defendant in lawsuits and subject to other claims arising in the normal course of business, including matters related to intellectual property, commercial matters, and product liability claims. In addition, as of June 30, 2020, the Company is party to three putative class actions pending against the Company in the United States. Two class actions allege that certain Polaris products caused economic losses resulting from unresolved fire hazards and excessive heat hazards. The third class action alleges that Polaris violated various California consumer protection laws. The Company is unable to provide an evaluation of the likelihood that a loss will be incurred or an estimate of the range of possible loss on the putative class actions. In the opinion of management, it is unlikely that any legal proceedings pending against or involving the Company will have a material adverse effect on the Company’s financial position, results of operations, or cash flows. However, in many of these matters, it is inherently difficult to determine whether a loss is probable or reasonably possible or to estimate the size or range of the possible loss given the variety of potential outcomes of actual and potential claims, the uncertainty of future rulings, the behavior or incentives of adverse parties, and other factors outside of the control of the Company. Accordingly, the Company’s loss reserve may change from time to time, and actual losses could exceed the amounts accrued by an amount that could be material to our consolidated financial position, results of operations, or cash flows in any particular reporting period. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed by using derivative instruments are foreign currency risk and interest rate risk. Derivative contracts on various currencies are entered into in order to manage foreign currency exposures associated with certain product sourcing activities and intercompany cash flows. Interest rate swaps are entered into in order to maintain a balanced risk of fixed and floating interest rates associated with the Company’s long-term debt. The Company’s foreign currency management objective is to mitigate the potential impact of currency fluctuations on the value of its U.S. dollar cash flows and to reduce the variability of certain cash flows at the subsidiary level. The Company actively manages certain forecasted foreign currency exposures and uses a centralized currency management operation to take advantage of potential opportunities to naturally offset foreign currency exposures. The decision of whether and when to execute derivative instruments, along with the duration of the instrument, may vary from period to period depending on market conditions, the relative costs of the instruments and capacity to hedge. The duration is linked to the timing of the underlying exposure, with the connection between the two being regularly monitored. Polaris does not use any financial contracts for trading purposes. At June 30, 2020 and December 31, 2019, the Company had the following open foreign currency contracts (in millions): June 30, 2020 December 31, 2019 Foreign Currency Notional Amounts Net Unrealized Notional Amounts Net Unrealized Australian Dollar $ 5.9 $ (0.1) $ 16.0 $ (0.1) Canadian Dollar 75.3 0.7 101.4 (1.1) Mexican Peso 30.4 (3.5) 17.0 1.1 Total $ 111.6 $ (2.9) $ 134.4 $ (0.1) These contracts, with maturities through July 2021, met the criteria for cash flow hedges, and are recorded in other current assets or other current liabilities on the consolidated balance sheet. The unrealized gains or losses, after tax, are recorded as a component of accumulated other comprehensive loss in shareholders’ equity. The Company enters into interest rate swap transactions to hedge the variable interest rate payments for the term loan facility. In connection with these transactions, the Company pays interest based upon a fixed rate and receives variable rate interest payments based on the one-month LIBOR. At June 30, 2020 and December 31, 2019, the Company had the following open interest rate swap contracts (in millions): June 30, 2020 December 31, 2019 Effective Date Termination Date Notional Amounts Net Unrealized Notional Amounts Net Unrealized May 2, 2018 May 4, 2021 $ 25.0 $ (0.4) $ 25.0 $ (0.1) September 30, 2019 September 30, 2023 150.0 (13.3) 150.0 (7.7) May 3, 2019 May 3, 2020 — — 100.0 (0.2) March 3, 2020 February 28, 2023 400.0 (7.8) — — Total $ 575.0 $ (21.5) $ 275.0 $ (8.0) These contracts, with maturities through September 2023, met the criteria for cash flow hedges, and are recorded in other current assets or other current liabilities on the consolidated balance sheet. Assets and liabilities are offset in the consolidated balance sheet if the right of offset exists. The unrealized gains or losses, after tax, are recorded as a component of accumulated other comprehensive loss in shareholders’ equity. The table below summarizes the carrying values of derivative instruments as of June 30, 2020 and December 31, 2019 (in millions): Carrying Values of Derivative Instruments as of June 30, 2020 Fair Value— Fair Value— Derivative Net Derivatives designated as hedging instruments Foreign exchange contracts $ 0.7 $ (3.6) $ (2.9) Interest rate contracts — (21.5) (21.5) Total derivatives designated as hedging instruments $ 0.7 $ (25.1) $ (24.4) Carrying Values of Derivative Instruments as of December 31, 2019 Fair Value— Fair Value— Derivative Net Derivatives designated as hedging instruments Foreign exchange contracts $ 1.1 $ (1.2) $ (0.1) Interest rate contracts — (8.0) (8.0) Total derivatives designated as hedging instruments $ 1.1 $ (9.2) $ (8.1) Assets are included in prepaid expenses and other and liabilities are included in other accrued expenses on the accompanying consolidated balance sheets. Gains and losses on derivative instruments representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in the current statement of income. The amount of gains (losses), net of tax, related to the effective portions of derivative instruments designated as cash flow hedges included in accumulated other comprehensive loss for the three and six months ended June 30, 2020 were $(2.1) million and $(12.4) million, respectively, compared to $(4.0) million and $(6.5) million for the same respective periods in 2019. See Note 6 for information about the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the statements of income for derivative instruments designated as hedging instruments. The ineffective portion of foreign currency contracts was not material for the three and six month periods ended June 30, 2020. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Reporting The Company’s reportable segments are based on the Company’s method of internal reporting, which generally segregates the operating segments by product line, inclusive of wholegoods and PG&A. These results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. The internal reporting of these operating segments is defined based, in part, on the reporting and review process used by the Company’s Chief Executive Officer. The Company has six operating segments: 1) ORV, 2) Snowmobiles, 3) Motorcycles, 4) Global Adjacent Markets, 5) Aftermarket, and 6) Boats, and five reportable segments: 1) ORV/Snowmobiles, 2) Motorcycles, 3) Global Adjacent Markets, 4) Aftermarket, and 5) Boats. Beginning in the first quarter of 2020, certain costs, primarily incentive-based compensation costs, previously classified as "Corporate" in the Company's segment gross profit results were allocated to the respective operating segments results. The comparative 2019 gross profit results for ORV/Snowmobiles, Motorcycles, Global Adjacent Markets, Aftermarket, Boats, and Corporate were reclassified for comparability. The ORV/Snowmobiles segment includes the aggregated results of the Company’s ORV and Snowmobiles operating segments. The Motorcycles, Global Adjacent Markets, Aftermarket, and Boats segments include the results for those respective operating segments. The Corporate amounts include costs that are not allocated to segments, including certain unallocated manufacturing costs. Segment sales and gross profit data are summarized as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Sales ORV/Snowmobiles $ 952.9 $ 1,049.3 $ 1,776.6 $ 1,916.8 Motorcycles 141.3 196.8 267.9 314.7 Global Adjacent Markets 77.9 121.9 176.2 226.9 Aftermarket 207.5 228.9 409.6 449.4 Boats 132.2 182.4 286.7 367.2 Total sales $ 1,511.8 $ 1,779.3 $ 2,917.0 $ 3,275.0 Gross profit ORV/Snowmobiles $ 251.7 $ 297.7 $ 453.4 $ 537.8 Motorcycles 4.4 22.9 3.4 26.6 Global Adjacent Markets 16.8 33.6 43.7 63.2 Aftermarket 47.6 55.2 93.9 111.7 Boats 18.6 40.5 48.3 76.7 Corporate (6.4) (13.5) (17.1) (27.1) Total gross profit $ 332.7 $ 436.4 $ 625.6 $ 788.9 |
Significant Accounting Polici_3
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation. The accompanying unaudited consolidated financial statements of Polaris Inc. (“Polaris” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and, therefore, do not include all information and disclosures of results of operations, financial position and changes in cash flow in conformity with accounting principles generally accepted in the United States for complete financial statements. Accordingly, such statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 previously filed with the Securities and Exchange Commission (“SEC”). In the opinion of management, such statements reflect all adjustments (which include only normal recurring adjustments) necessary for a fair presentation of the financial position, results of operations, equity, and cash flows for the periods presented. Due to the seasonality trends for certain products and to certain changes in production and shipping cycles, results of such periods are not necessarily indicative of the results to be expected for the complete year. |
Fair value measurements | Fair value measurements. Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The Company utilizes the market approach to measure fair value for its non-qualified deferred compensation assets and liabilities, and the income approach for foreign currency contracts and interest rate contracts. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities, and for the income approach, the Company uses significant other observable inputs to value its derivative instruments used to hedge foreign currency and interest rate transactions. |
Inventories | Inventories. Inventory costs include material, labor and manufacturing overhead costs, including depreciation expense associated with the manufacture and distribution of the Company’s products. Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value. |
New Accounting Pronouncements | New accounting pronouncements. Financial instruments. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which replaces existing incurred loss impairment guidance and establishes a single allowance framework for financial assets carried at amortized cost. The Company adopted Topic 326 on January 1, 2020, using a modified retrospective transition method. The adoption of Topic 326 did not have a material impact on the Company’s consolidated financial position, results of operations, equity or cash flows. Fair Value Measurement. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which amends ASC 820 to eliminate, modify, and add certain disclosure requirements for fair value measurements. The Company adopted ASU 2018-13 on January 1, 2020. The adoption of ASU 2018-13 did not have a material impact on the Company’s disclosures. There are no other new accounting pronouncements that are expected to have a significant impact on the Company’s consolidated financial statements. |
Significant Accounting Polici_4
Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are summarized below (in millions): Fair Value Measurements as of June 30, 2020 Asset (Liability) Total Level 1 Level 2 Level 3 Non-qualified deferred compensation assets $ 47.7 $ 47.7 $ — $ — Total assets at fair value $ 47.7 $ 47.7 $ — $ — Non-qualified deferred compensation liabilities $ (47.7) $ (47.7) $ — $ — Foreign exchange contracts, net (2.9) — (2.9) — Interest rate contracts, net (21.5) — (21.5) Total liabilities at fair value $ (72.1) $ (47.7) $ (24.4) $ — Fair Value Measurements as of December 31, 2019 Asset (Liability) Total Level 1 Level 2 Level 3 Non-qualified deferred compensation assets $ 48.9 $ 48.9 $ — $ — Total assets at fair value $ 48.9 $ 48.9 $ — $ — Non-qualified deferred compensation liabilities $ (48.9) $ (48.9) $ — $ — Foreign exchange contracts, net (0.1) (0.1) Interest rate contracts, net (8.0) — (8.0) — Total liabilities at fair value $ (57.0) $ (48.9) $ (8.1) $ — |
Schedule of major components of inventories | The major components of inventories are as follows (in millions): June 30, 2020 December 31, 2019 Raw materials and purchased components $ 402.3 $ 344.6 Service parts, garments and accessories 316.6 357.0 Finished goods 376.9 476.2 Less: reserves (69.4) (56.7) Inventories $ 1,026.4 $ 1,121.1 |
Schedule of activity in the warranty reserve | The activity in the warranty reserve during the periods presented was as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Balance at beginning of period $ 132.8 $ 116.2 $ 136.2 $ 121.8 Additions to reserve related to acquisitions — 8.8 — 8.8 Additions charged to expense 29.8 36.9 54.0 62.9 Warranty claims paid, net (28.4) (29.1) (56.0) (60.7) Balance at end of period $ 134.2 $ 132.8 $ 134.2 $ 132.8 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue Recognition [Abstract] | |
Disaggregation of Revenue | The following tables disaggregate the Company’s revenue by major product type and geography (in millions): Three months ended June 30, 2020 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 737.3 $ 118.3 $ 62.4 — $ 132.2 $ 1,050.2 PG&A 215.6 23.0 15.5 $ 207.5 — 461.6 Total revenue $ 952.9 $ 141.3 $ 77.9 $ 207.5 $ 132.2 $ 1,511.8 Revenue by geography United States $ 795.6 $ 90.2 $ 39.1 $ 198.8 $ 129.7 $ 1,253.4 Canada 52.8 4.2 0.1 8.7 2.5 68.3 EMEA 62.8 26.5 37.2 — — 126.5 APLA 41.7 20.4 1.5 — — 63.6 Total revenue $ 952.9 $ 141.3 $ 77.9 $ 207.5 $ 132.2 $ 1,511.8 Three months ended June 30, 2019 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 864.2 $ 169.5 $ 98.6 — $ 182.4 $ 1,314.7 PG&A 185.1 27.3 23.3 $ 228.9 — 464.6 Total revenue $ 1,049.3 $ 196.8 $ 121.9 $ 228.9 $ 182.4 $ 1,779.3 Revenue by geography United States $ 871.8 $ 120.2 $ 58.1 $ 219.2 $ 177.3 $ 1,446.6 Canada 74.3 10.4 2.1 9.7 5.1 101.6 EMEA 65.8 48.7 60.9 — — 175.4 APLA 37.4 17.5 0.8 — — 55.7 Total revenue $ 1,049.3 $ 196.8 $ 121.9 $ 228.9 $ 182.4 $ 1,779.3 Six months ended June 30, 2020 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 1,382.0 $ 228.1 $ 139.8 — $ 286.7 $ 2,036.6 PG&A 394.6 39.8 36.4 $ 409.6 — 880.4 Total revenue $ 1,776.6 $ 267.9 $ 176.2 $ 409.6 $ 286.7 $ 2,917.0 Revenue by geography United States $ 1,478.3 $ 168.0 $ 87.6 $ 392.8 $ 281.1 $ 2,407.8 Canada 104.8 8.8 1.6 16.8 5.6 137.6 EMEA 124.8 55.9 84.9 — — 265.6 APLA 68.7 35.2 2.1 — — 106.0 Total revenue $ 1,776.6 $ 267.9 $ 176.2 $ 409.6 $ 286.7 $ 2,917.0 Six months ended June 30, 2019 ORV / Snowmobiles Motorcycles Global Adj. Markets Aftermarket Boats Total Revenue by product type Wholegoods $ 1,565.1 $ 271.8 $ 183.3 — $ 367.2 $ 2,387.4 PG&A 351.7 42.9 43.6 $ 449.4 — 887.6 Total revenue $ 1,916.8 $ 314.7 $ 226.9 $ 449.4 $ 367.2 $ 3,275.0 Revenue by geography United States $ 1,580.7 $ 188.1 $ 109.8 $ 430.8 $ 358.1 $ 2,667.5 Canada 125.9 16.4 3.2 18.6 9.1 173.2 EMEA 144.5 79.4 112.3 — — 336.2 APLA 65.7 30.8 1.6 — — 98.1 Total revenue $ 1,916.8 $ 314.7 $ 226.9 $ 449.4 $ 367.2 $ 3,275.0 |
Deferred Revenue, by Arrangement, Disclosure | The activity in the deferred revenue reserve during the periods presented was as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Balance at beginning of period $ 85.6 $ 63.5 $ 81.6 $ 59.9 New contracts sold 13.6 11.5 26.8 21.4 Less: reductions for revenue recognized (9.4) (7.3) (18.6) (13.6) Balance at end of period (1) $ 89.8 $ 67.7 $ 89.8 $ 67.7 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of share-based compensation expenses | Total share-based compensation expenses were comprised as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Option awards $ 5.9 $ 6.8 $ 9.6 $ 8.1 Other share-based awards 15.4 14.9 17.2 24.5 Total share-based compensation before tax 21.3 21.7 26.8 32.6 Tax benefit 5.1 5.2 6.4 7.8 Total share-based compensation expense included in net income (loss) $ 16.2 $ 16.5 $ 20.4 $ 24.8 |
Financing Agreement (Tables)
Financing Agreement (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt and Capital Lease Obligations | The carrying value of debt, finance lease obligations, and notes payable and the average related interest rates were as follows (in millions): Average interest rate at June 30, 2020 Maturity June 30, 2020 December 31, 2019 Revolving loan facility 2.00% July 2023 $ 49.5 $ 75.1 Term loan facility 2.43% July 2023 970.0 1,000.0 Incremental term loan 3.00% April 2021 300.0 — Senior notes—fixed rate 4.60% May 2021 75.0 75.0 Senior notes—fixed rate 3.13% December 2020 100.0 100.0 Senior notes—fixed rate 4.23% July 2028 350.0 350.0 Finance lease obligations 5.15% Various through 2029 15.4 16.1 Notes payable and other 4.24% Various through 2030 75.0 81.4 Debt issuance costs (6.9) (4.1) Total debt, finance lease obligations, and notes payable $ 1,928.0 $ 1,693.5 Less: current maturities 536.5 166.7 Total long-term debt, finance lease obligations, and notes payable $ 1,391.5 $ 1,526.8 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets and goodwill | Goodwill and other intangible assets, net of accumulated amortization, at June 30, 2020 and December 31, 2019 are as follows (in millions): June 30, 2020 December 31, 2019 Goodwill $ 389.5 $ 659.9 Other intangible assets, net 702.5 830.3 Total goodwill and other intangible assets, net $ 1,092.0 $ 1,490.2 |
Schedule of changes in carrying amount of goodwill | The changes in the carrying amount of goodwill for the six months ended June 30, 2020 were as follows (in millions): Six months ended June 30, 2020 Goodwill, beginning of period $ 659.9 Goodwill impairment (270.3) Currency translation effect on foreign goodwill balances (0.1) Goodwill, end of period $ 389.5 |
Schedule of components of other intangible assets | The components of other intangible assets were as follows ($ in millions): Total estimated life (years) June 30, 2020 December 31, 2019 Non-amortizable—indefinite lived: Brand/trade names $ 333.2 $ 442.0 Amortizable: Non-compete agreements 4 2.6 2.6 Dealer/customer related 5-20 459.9 499.5 Developed technology 5-7 9.7 12.7 Total amortizable 472.2 514.8 Less: Accumulated amortization (102.9) (126.5) Net amortized other intangible assets 369.3 388.3 Total other intangible assets, net $ 702.5 $ 830.3 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of open foreign currency contracts | At June 30, 2020 and December 31, 2019, the Company had the following open foreign currency contracts (in millions): June 30, 2020 December 31, 2019 Foreign Currency Notional Amounts Net Unrealized Notional Amounts Net Unrealized Australian Dollar $ 5.9 $ (0.1) $ 16.0 $ (0.1) Canadian Dollar 75.3 0.7 101.4 (1.1) Mexican Peso 30.4 (3.5) 17.0 1.1 Total $ 111.6 $ (2.9) $ 134.4 $ (0.1) |
Schedule of open interest rate swap contracts | At June 30, 2020 and December 31, 2019, the Company had the following open interest rate swap contracts (in millions): June 30, 2020 December 31, 2019 Effective Date Termination Date Notional Amounts Net Unrealized Notional Amounts Net Unrealized May 2, 2018 May 4, 2021 $ 25.0 $ (0.4) $ 25.0 $ (0.1) September 30, 2019 September 30, 2023 150.0 (13.3) 150.0 (7.7) May 3, 2019 May 3, 2020 — — 100.0 (0.2) March 3, 2020 February 28, 2023 400.0 (7.8) — — Total $ 575.0 $ (21.5) $ 275.0 $ (8.0) |
Schedule of carrying values of derivative instruments | The table below summarizes the carrying values of derivative instruments as of June 30, 2020 and December 31, 2019 (in millions): Carrying Values of Derivative Instruments as of June 30, 2020 Fair Value— Fair Value— Derivative Net Derivatives designated as hedging instruments Foreign exchange contracts $ 0.7 $ (3.6) $ (2.9) Interest rate contracts — (21.5) (21.5) Total derivatives designated as hedging instruments $ 0.7 $ (25.1) $ (24.4) Carrying Values of Derivative Instruments as of December 31, 2019 Fair Value— Fair Value— Derivative Net Derivatives designated as hedging instruments Foreign exchange contracts $ 1.1 $ (1.2) $ (0.1) Interest rate contracts — (8.0) (8.0) Total derivatives designated as hedging instruments $ 1.1 $ (9.2) $ (8.1) |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | egment sales and gross profit data are summarized as follows (in millions): Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019 Sales ORV/Snowmobiles $ 952.9 $ 1,049.3 $ 1,776.6 $ 1,916.8 Motorcycles 141.3 196.8 267.9 314.7 Global Adjacent Markets 77.9 121.9 176.2 226.9 Aftermarket 207.5 228.9 409.6 449.4 Boats 132.2 182.4 286.7 367.2 Total sales $ 1,511.8 $ 1,779.3 $ 2,917.0 $ 3,275.0 Gross profit ORV/Snowmobiles $ 251.7 $ 297.7 $ 453.4 $ 537.8 Motorcycles 4.4 22.9 3.4 26.6 Global Adjacent Markets 16.8 33.6 43.7 63.2 Aftermarket 47.6 55.2 93.9 111.7 Boats 18.6 40.5 48.3 76.7 Corporate (6.4) (13.5) (17.1) (27.1) Total gross profit $ 332.7 $ 436.4 $ 625.6 $ 788.9 |
Significant Accounting Polici_5
Significant Accounting Policies Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | $ 48,900 | |
Debt and Capital Lease Obligations | $ 1,928,000 | 1,693,500 |
Estimate of Fair Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term Debt, Fair Value | 2,045,500 | 1,769,300 |
Reported Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt and Capital Lease Obligations | 1,928,000 | 1,693,500 |
Fair value, measurements, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | 48,900 | |
Total assets at fair value | 47,700 | |
Non-qualified deferred compensation liabilities | (48,900) | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | (72,100) | (57,000) |
Fair value, measurements, recurring | Supplemental Employee Retirement Plans, Defined Benefit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Non-qualified deferred compensation assets | 47,700 | 48,900 |
Non-qualified deferred compensation liabilities | (47,700) | |
Fair value, measurements, recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 47,700 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | (47,700) | (48,900) |
Fair value, measurements, recurring | Level 1 | Supplemental Employee Retirement Plans, Defined Benefit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Non-qualified deferred compensation assets | 47,700 | 48,900 |
Non-qualified deferred compensation liabilities | (47,700) | (48,900) |
Fair value, measurements, recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 0 | 0 |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | (24,400) | (8,100) |
Foreign Exchange Contract | Fair value, measurements, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | (2,900) | (100) |
Foreign Exchange Contract | Fair value, measurements, recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | (100) | |
Interest rate swap | Fair value, measurements, recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | (21,500) | (8,000) |
Interest rate swap | Fair value, measurements, recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange contracts, net | (8,000) | |
Designated as Hedging Instrument | Prepaid Expenses and Other Current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value— Assets | 700 | 1,100 |
Designated as Hedging Instrument | Prepaid Expenses and Other Current Assets | Foreign Exchange Contract | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Asset | 2,900 | |
Fair Value— Assets | 700 | 1,100 |
Designated as Hedging Instrument | Prepaid Expenses and Other Current Assets | Interest rate swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value— Assets | 0 | $ (8,000) |
Derivative Liability, Fair Value, Gross Liability | $ 21,500 |
Significant Accounting Polici_6
Significant Accounting Policies Major Components of Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||
Raw materials and purchased components | $ 402,300 | $ 344,600 |
Service parts, garments and accessories | 316,600 | 357,000 |
Finished goods | 376,900 | 476,200 |
Less: reserves | (69,400) | (56,700) |
Inventories | $ 1,026,400 | $ 1,121,100 |
Significant Accounting Polici_7
Significant Accounting Policies Activity in Polaris Accrued Warranty Reserve (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||||
Deferred tax liabilities | $ 3,300 | $ 3,300 | $ 4,000 | ||
Activity in Product Warranty Reserve [Roll Forward] | |||||
Balance at beginning of period | 132,800 | $ 116,200 | 136,200 | $ 121,800 | |
Additions charged to expense | 29,800 | 36,900 | 54,000 | 62,900 | |
Warranty claims paid, net | (28,400) | (29,100) | (56,000) | (60,700) | |
Balance at end of period | 134,200 | 132,800 | 134,200 | 132,800 | |
Standard Product Warranty Accrual, Additions from Business Acquisition | $ 0 | $ 8,800 | $ 0 | $ 8,800 |
Significant Accounting Polici_8
Significant Accounting Policies Deferred Revenue (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | |
Deferred Revenue Arrangement [Line Items] | ||||||||
Deferred Revenue | $ 89,800,000 | $ 67,700,000 | $ 89,800,000 | $ 67,700,000 | $ 85,600,000 | $ 81,600,000 | $ 63,500,000 | $ 59,900,000 |
New contracts sold | 13,600,000 | 11,500,000 | 26,800,000 | 21,400,000 | ||||
Less: reductions for revenue recognized | (9,400,000) | (7,300,000) | (18,600,000) | (13,600,000) | ||||
Deferred Revenue, Current | 32,400,000 | 28,800,000 | 32,400,000 | 28,800,000 | ||||
Deferred Revenue, Noncurrent | $ 57,400,000 | $ 38,900,000 | $ 57,400,000 | $ 38,900,000 |
Revenue Recognition (Narrative)
Revenue Recognition (Narrative) (Details) - USD ($) | 6 Months Ended | |||||
Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | |
Deferred Revenue Arrangement [Line Items] | ||||||
Deferred Revenue | $ 89,800,000 | $ 85,600,000 | $ 81,600,000 | $ 67,700,000 | $ 63,500,000 | $ 59,900,000 |
Deferred Revenue, Current | 32,400,000 | 28,800,000 | ||||
Deferred Revenue, Noncurrent | $ 57,400,000 | $ 38,900,000 | ||||
Minimum | ||||||
Deferred Revenue Arrangement [Line Items] | ||||||
Extended service warranty period | 12 months | |||||
Maximum | ||||||
Deferred Revenue Arrangement [Line Items] | ||||||
Extended service warranty period | 84 months |
Revenue Recognition (Contract R
Revenue Recognition (Contract Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 1,511,800 | $ 1,779,300 | $ 2,917,000 | $ 3,275,000 |
ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 952,900 | 1,049,300 | 1,776,600 | 1,916,800 |
Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 141,300 | 196,800 | 267,900 | 314,700 |
Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 77,900 | 121,900 | 176,200 | 226,900 |
Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 207,500 | 228,900 | 409,600 | 449,400 |
Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 132,200 | 182,400 | 286,700 | 367,200 |
Wholegoods | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,050,200 | 1,314,700 | 2,036,600 | 2,387,400 |
Wholegoods | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 737,300 | 864,200 | 1,382,000 | 1,565,100 |
Wholegoods | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 118,300 | 169,500 | 228,100 | 271,800 |
Wholegoods | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 62,400 | 98,600 | 139,800 | 183,300 |
Wholegoods | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Wholegoods | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 132,200 | 182,400 | 286,700 | 367,200 |
PG&A | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 461,600 | 464,600 | 880,400 | 887,600 |
PG&A | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 215,600 | 185,100 | 394,600 | 351,700 |
PG&A | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 23,000 | 27,300 | 39,800 | 42,900 |
PG&A | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 15,500 | 23,300 | 36,400 | 43,600 |
PG&A | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 207,500 | 228,900 | 409,600 | 449,400 |
PG&A | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
UNITED STATES | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,253,400 | 1,446,600 | 2,407,800 | 2,667,500 |
UNITED STATES | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 795,600 | 871,800 | 1,478,300 | 1,580,700 |
UNITED STATES | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 90,200 | 120,200 | 168,000 | 188,100 |
UNITED STATES | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 39,100 | 58,100 | 87,600 | 109,800 |
UNITED STATES | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 198,800 | 219,200 | 392,800 | 430,800 |
UNITED STATES | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 129,700 | 177,300 | 281,100 | 358,100 |
CANADA | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 68,300 | 101,600 | 137,600 | 173,200 |
CANADA | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 52,800 | 74,300 | 104,800 | 125,900 |
CANADA | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 4,200 | 10,400 | 8,800 | 16,400 |
CANADA | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 100 | 2,100 | 1,600 | 3,200 |
CANADA | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 8,700 | 9,700 | 16,800 | 18,600 |
CANADA | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 2,500 | 5,100 | 5,600 | 9,100 |
EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 126,500 | 175,400 | 265,600 | 336,200 |
EMEA | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 62,800 | 65,800 | 124,800 | 144,500 |
EMEA | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 26,500 | 48,700 | 55,900 | 79,400 |
EMEA | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 37,200 | 60,900 | 84,900 | 112,300 |
EMEA | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
EMEA | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
APLA | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 63,600 | 55,700 | 106,000 | 98,100 |
APLA | ORV/Snowmobiles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 41,700 | 37,400 | 68,700 | 65,700 |
APLA | Motorcycles | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 20,400 | 17,500 | 35,200 | 30,800 |
APLA | Global Adjacent Markets | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,500 | 800 | 2,100 | 1,600 |
APLA | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
APLA | Boats | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue Recognition (Deferred R
Revenue Recognition (Deferred Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue Recognition [Abstract] | ||||
Balance at beginning of period | $ 85,600 | $ 63,500 | $ 81,600 | $ 59,900 |
New contracts sold | 13,600 | 11,500 | 26,800 | 21,400 |
Less: reductions for revenue recognized | (9,400) | (7,300) | (18,600) | (13,600) |
Balance at end of period | $ 89,800 | $ 67,700 | $ 89,800 | $ 67,700 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Business Acquisition [Line Items] | ||||
Sales | $ 1,511,800 | $ 1,779,300 | $ 2,917,000 | $ 3,275,000 |
Gross profit | $ 332,700 | $ 436,400 | $ 625,600 | $ 788,900 |
Senior Unsecured Notes 4.23% Due July 2028 | Senior Notes | ||||
Business Acquisition [Line Items] | ||||
Stated interest rate | 4.23% | 4.23% |
Acquisitions - Summary of Asset
Acquisitions - Summary of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||
Goodwill | $ 389,500 | $ 659,900 |
Share-Based Compensation Expens
Share-Based Compensation Expenses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Option awards | $ 5,900 | $ 6,800 | $ 9,600 | $ 8,100 |
Other share-based awards | 15,400 | 14,900 | 17,200 | 24,500 |
Total share-based compensation before tax | 21,300 | 21,700 | 26,800 | 32,600 |
Tax benefit | 5,100 | 5,200 | 6,400 | 7,800 |
Total share-based compensation expense included in net income (loss) | $ 16,200 | $ 16,500 | $ 20,400 | $ 24,800 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Detail) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Share-based Payment Arrangement [Abstract] | |
Unrecognized compensation cost related to unvested share-based equity awards | $ 100,100 |
Weighted average period of recognition of unvested share-based equity awards | 1 year 6 months 10 days |
Unrecognized compensation cost related to unvested share-based equity awards, stock options | $ 23,300 |
Unrecognized compensation cost related to unvested share-based equity awards, restricted stock | $ 76,800 |
Financing Arrangements, Interes
Financing Arrangements, Interest Rates and Maturities (Details) - USD ($) | Jun. 30, 2020 | Apr. 09, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||||
Effective interest rate | 5.15% | |||
Finance Lease, Liability | $ 15,400,000 | $ 16,100,000 | ||
Debt issuance costs | (6,900,000) | (4,100,000) | ||
Total debt, finance lease obligations, and notes payable | 1,928,000,000 | 1,693,500,000 | ||
Less: current maturities | 536,500,000 | 166,700,000 | ||
Total long-term debt, finance lease obligations, and notes payable | $ 1,391,500,000 | 1,526,800,000 | ||
364 Day Term Loan | ||||
Debt Instrument [Line Items] | ||||
Average interest rate at June 30, 2020 | 3.00% | |||
Line of Credit, Current | $ 300,000,000 | |||
Debt face amount | $ 300,000,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt, Weighted Average Interest Rate | 2.00% | |||
Senior Notes | Senior Unsecured Notes 4.60% Due May 2021 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.60% | |||
Long-term debt | $ 75,000,000 | 75,000,000 | ||
Senior Notes | Senior Unsecured Notes 3.13% Due December 2020 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.13% | |||
Long-term debt | $ 100,000,000 | 100,000,000 | ||
Senior Notes | Senior Unsecured Notes 4.23% Due July 2028 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.23% | |||
Long-term debt | 350,000,000 | $ 350,000,000 | ||
Notes payable and other | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.24% | |||
Long-term debt | $ 75,000,000 | 81,400,000 | ||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving loan facility | $ 49,500,000 | 75,100,000 | ||
Term loan | ||||
Debt Instrument [Line Items] | ||||
Average interest rate at June 30, 2020 | 2.43% | |||
Revolving loan facility | $ 970,000,000 | $ 1,000,000,000 |
Financing Agreement - Additiona
Financing Agreement - Additional Information (Detail) - USD ($) | Apr. 09, 2020 | Dec. 31, 2013 | Dec. 31, 2010 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 31, 2018 | Jul. 02, 2018 | Dec. 31, 2015 |
Debt Instrument [Line Items] | |||||||||
Repayments of principal in next twelve months | $ 175,000,000 | ||||||||
364 Day Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt term | 364 days | ||||||||
Debt face amount | $ 300,000,000 | ||||||||
Debt extension term | 364 days | ||||||||
Required principal repayments before maturity | $ 0 | ||||||||
Senior Notes | Senior Unsecured Notes 4.60% Due May 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Proceeds from Issuance of Debt | $ 75,000,000 | ||||||||
Long-term debt | 75,000,000 | $ 75,000,000 | |||||||
Senior Notes | Senior Unsecured Notes 3.13% Due December 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Proceeds from Issuance of Debt | $ 100,000,000 | ||||||||
Long-term debt | 100,000,000 | 100,000,000 | |||||||
Senior Notes | Senior Unsecured Notes 4.23% Due July 2028 | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | 350,000,000 | $ 350,000,000 | |||||||
Notes payable, other | Boat Holdings, LLC | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | 66,500,000 | $ 76,700,000 | |||||||
Notes payable to banks | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | 75,000,000 | 81,400,000 | |||||||
Notes payable to banks | Mortgages [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | 8,500,000 | $ 14,500,000 | |||||||
Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 700,000,000 | ||||||||
Revolving loan facility | 49,500,000 | 75,100,000 | |||||||
Repayments of principal in next twelve months | 59,000,000 | ||||||||
Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 1,180,000,000 | ||||||||
Revolving loan facility | $ 970,000,000 | $ 1,000,000,000 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | |
Goodwill [Roll Forward] | |||
Goodwill, beginning of period | $ 659,900 | ||
Goodwill, Impairment Loss | $ 270,300 | 270,300 | |
Currency translation effect on foreign goodwill balances | (100) | ||
Goodwill, end of period | 389,500 | 389,500 | |
Intangible Assets, Net (Excluding Goodwill) | 702,500 | 702,500 | $ 830,300 |
Intangible Assets, Net (Including Goodwill) | $ 1,092,000 | $ 1,092,000 | $ 1,490,200 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets Components of Other Intangible Assets (Detail) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Amortizable: | ||
Gross amortized other intangible assets | $ 472,200 | $ 514,800 |
Accumulated Amortization | (102,900) | (126,500) |
Net amortized other intangible assets | 369,300 | 388,300 |
Total other intangible assets, net | $ 702,500 | 830,300 |
Non-compete agreements | ||
Amortizable: | ||
Total estimated life | 4 years | |
Gross amortized other intangible assets | $ 2,600 | 2,600 |
Dealer/customer related | ||
Amortizable: | ||
Gross amortized other intangible assets | $ 459,900 | 499,500 |
Dealer/customer related | Minimum | ||
Amortizable: | ||
Total estimated life | 5 years | |
Dealer/customer related | Maximum | ||
Amortizable: | ||
Total estimated life | 20 years | |
Developed technology | ||
Amortizable: | ||
Gross amortized other intangible assets | $ 9,700 | 12,700 |
Developed technology | Minimum | ||
Amortizable: | ||
Total estimated life | 5 years | |
Developed technology | Maximum | ||
Amortizable: | ||
Total estimated life | 7 years | |
Brand/trade names | ||
Non-amortizable—indefinite lived: | ||
Non-amortizable, Net | $ 333,200 | $ 442,000 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 389,500 | $ 389,500 | $ 659,900 | ||
Total other intangible assets, net | 702,500 | 702,500 | $ 830,300 | ||
Amortization expense of intangible assets | (8,800) | $ (10,300) | 18,800 | $ 20,500 | |
Estimated Future Amortization Expense by Fiscal Year [Abstract] | |||||
Remainder of 2016 | 17,300 | 17,300 | |||
2017 | 33,200 | 33,200 | |||
2018 | 28,300 | 28,300 | |||
2019 | 25,700 | 25,700 | |||
2020 | 25,000 | 25,000 | |||
2021 | 25,000 | 25,000 | |||
After 2021 | 214,800 | $ 214,800 | |||
Deferred Income Taxes and Tax Credits | 90,300 | ||||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | $ 108,900 |
Shareholders' Equity Cash Divid
Shareholders' Equity Cash Dividends Declared Per Common Share (Details) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Equity [Abstract] | ||||
Cash dividends declared and paid per common share (in dollars per share) | $ 0.62 | $ 0.61 | $ 1.24 | $ 1.22 |
Shareholders' Equity Reconcilia
Shareholders' Equity Reconciliation of Weighted Average Number of Shares (Detail) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Equity [Abstract] | ||||
Weighted average number of common shares outstanding | 61,300 | 61,100 | 61,300 | 61,100 |
Director Plan and deferred stock units | 200 | 200 | 200 | 200 |
ESOP | 100 | 100 | 200 | 100 |
Common shares outstanding—basic | 61,600 | 61,400 | 61,700 | 61,400 |
Dilutive effect of Omnibus Plan | 0 | 800 | 0 | 700 |
Common and potential common shares outstanding—diluted | 61,600 | 62,200 | 61,700 | 62,100 |
Shareholders' Equity Changes in
Shareholders' Equity Changes in Accumulated Other Comprehensive Income (Loss) Balances (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Balance as of December 31, 2019 | $ (72,700) | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (600) | ||||
Stockholders' Equity, Other | $ 0 | ||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | $ 10,500 | $ 2,900 | (14,600) | $ (800) | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (26,300) | ||||
Balance as of June 30, 2020 | (99,600) | (99,600) | |||
Foreign Currency Items | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Balance as of December 31, 2019 | (63,300) | ||||
Balance as of June 30, 2020 | (77,900) | (77,900) | |||
Cash Flow Hedging | Foreign Exchange Contract | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Balance as of December 31, 2019 | (6,100) | ||||
Reclassification to the statement of income | (700) | ||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (11,700) | ||||
Balance as of June 30, 2020 | (18,500) | (18,500) | |||
Accumulated Defined Benefit Plans Adjustment Including Portion Attributable to Noncontrolling Interest [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Balance as of December 31, 2019 | (3,300) | ||||
Reclassification to the statement of income | 100 | ||||
Balance as of June 30, 2020 | $ (3,200) | $ (3,200) | |||
AOCI Attributable to Parent [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||
Stockholders' Equity, Other | $ 600 |
Shareholders' Equity Gains and
Shareholders' Equity Gains and Losses, Net of Tax Reclassified from Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI Into Income | $ 700 | $ 1,000 | $ 600 | $ 2,200 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 600 | |||
Foreign Exchange Contract | Other expense, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI Into Income | 3,500 | 900 | 3,500 | 2,100 |
Foreign Exchange Contract | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI Into Income | (1,200) | 200 | (700) | 300 |
Interest Rate Contract [Member] | Interest Expense [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI Into Income | 1,600 | 100 | 2,100 | 100 |
Defined Benefit Plan, Derivative [Member] | Operating Expense [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI Into Income | $ 0 | $ 0 | $ 100 | $ 100 |
Financial Services Arrangemen_2
Financial Services Arrangements - Additional Information (Detail) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Investments in and Advances to Affiliates [Line Items] | ||
Investment in affiliates | $ 72,000 | $ 110,600 |
Trade receivables, net | 195,200 | $ 190,400 |
TCF [Member] | ||
Investments in and Advances to Affiliates [Line Items] | ||
Aggregate repurchase obligation, amount | $ 129,900 | |
Polaris Acceptance | ||
Investments in and Advances to Affiliates [Line Items] | ||
Equity method investment ownership percentage | 50.00% | |
Net amount financed for dealers | $ 763,600 | |
Trade receivables, net | 368,200 | |
Aggregate repurchase obligation, amount | 198,300 | |
Securitization Facility | ||
Investments in and Advances to Affiliates [Line Items] | ||
Outstanding balance of receivables | $ 395,400 | |
TCF [Member] | Maximum | ||
Investments in and Advances to Affiliates [Line Items] | ||
Aggregate repurchase obligation, percentage | 100.00% | |
Polaris Acceptance | Maximum | ||
Investments in and Advances to Affiliates [Line Items] | ||
Aggregate repurchase obligation, percentage | 15.00% |
Investment in Other Affiliates
Investment in Other Affiliates Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Investments in and Advances to Affiliates [Line Items] | ||||
Income (loss) from equity method investments | $ 0 | $ (500) | $ 0 | $ (1,100) |
Leases (Lease Assets and Liabil
Leases (Lease Assets and Liabilities) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Document Period End Date | Jun. 30, 2020 | |
Assets | ||
Operating lease assets | $ 105,400 | $ 110,200 |
Current | ||
Operating lease liabilities | 35,300 | 34,900 |
Long-term | ||
Operating lease liabilities | 72,400 | 77,900 |
Finance lease liabilities | $ 14,200 | $ 14,800 |
Leases (Maturity of Lease Liabi
Leases (Maturity of Lease Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Finance Leases | ||
Finance Lease, Liability | $ 15,400 | $ 16,100 |
Leases (Other Information) (Det
Leases (Other Information) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Leased assets obtained in exchange for new operating lease liabilities | $ 12,400 | $ 8,100 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | Mar. 31, 2020class_action | Jun. 30, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||
Accrual for the probable payment of pending claims | $ | $ 61,700 | |
Number of putative class actions | class_action | 3 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities Open Foreign Currency Contracts (Details) - Cash Flow Hedging - Foreign Exchange Contract - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Notional Amounts (in U.S. Dollars) | $ 111,600 | $ 134,400 |
Net Unrealized Gain (Loss) | (2,900) | (100) |
Australian Dollar | ||
Derivative [Line Items] | ||
Notional Amounts (in U.S. Dollars) | 5,900 | 16,000 |
Net Unrealized Gain (Loss) | (100) | (100) |
Canadian Dollar | ||
Derivative [Line Items] | ||
Notional Amounts (in U.S. Dollars) | 75,300 | 101,400 |
Net Unrealized Gain (Loss) | 700 | (1,100) |
Mexican Peso | ||
Derivative [Line Items] | ||
Notional Amounts (in U.S. Dollars) | 30,400 | 17,000 |
Net Unrealized Gain (Loss) | $ (3,500) | $ 1,100 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities Open Interest Rate Swap Contracts (Details) - Cash Flow Hedging - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Interest rate swap | ||
Derivative [Line Items] | ||
Notional Amounts | $ 575,000 | $ 275,000 |
Net Unrealized Gain (Loss) | (21,500) | (8,000) |
Interest Rate Swap, May 2018 to May 2021 | ||
Derivative [Line Items] | ||
Notional Amounts | 25,000 | 25,000 |
Net Unrealized Gain (Loss) | (400) | (100) |
Interest Rate Swap, September 2019 to September 2023 | ||
Derivative [Line Items] | ||
Notional Amounts | 150,000 | 150,000 |
Net Unrealized Gain (Loss) | (13,300) | (7,700) |
Interest Rate Swap, May 2019 to May 2020 | ||
Derivative [Line Items] | ||
Notional Amounts | 0 | 100,000 |
Net Unrealized Gain (Loss) | 0 | (200) |
Interest Rate Swap, March 2020 to February 2023 | ||
Derivative [Line Items] | ||
Notional Amounts | 400,000 | 0 |
Net Unrealized Gain (Loss) | $ (7,800) | $ 0 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities Carrying Values of Derivative Instruments (Detail) - Designated as Hedging Instrument - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Derivative Net Carrying Value | $ (24,400) | $ (8,100) |
Foreign Exchange Contract | ||
Derivative [Line Items] | ||
Derivative Net Carrying Value | (2,900) | (100) |
Interest rate contract | ||
Derivative [Line Items] | ||
Derivative Net Carrying Value | (21,500) | (8,000) |
Prepaid Expenses and Other Current Assets | ||
Derivative [Line Items] | ||
Fair Value— Assets | 700 | 1,100 |
Prepaid Expenses and Other Current Assets | Foreign Exchange Contract | ||
Derivative [Line Items] | ||
Fair Value— Assets | 700 | 1,100 |
Prepaid Expenses and Other Current Assets | Interest rate contract | ||
Derivative [Line Items] | ||
Fair Value— Assets | 0 | (8,000) |
Fair Value— (Liabilities) | (21,500) | |
Other Current Liabilities | ||
Derivative [Line Items] | ||
Fair Value— (Liabilities) | (25,100) | (9,200) |
Other Current Liabilities | Foreign Exchange Contract | ||
Derivative [Line Items] | ||
Fair Value— (Liabilities) | $ (3,600) | $ (1,200) |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Derivative [Line Items] | ||||
Unrealized loss on derivative instruments | $ (2,100) | $ (4,000) | $ (12,400) | $ (6,500) |
Designated as Hedging Instrument | Cash Flow Hedging | ||||
Derivative [Line Items] | ||||
Unrealized loss on derivative instruments | $ (2,100) | $ (4,000) | $ (12,400) | $ (6,500) |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,511,800 | $ 1,779,300 | $ 2,917,000 | $ 3,275,000 |
Number of Operating Segments | segment | 6 | |||
Gross profit | 332,700 | 436,400 | $ 625,600 | 788,900 |
Number of Reportable Segments | segment | 5 | |||
ORV/Snowmobiles | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 952,900 | 1,049,300 | $ 1,776,600 | 1,916,800 |
Motorcycles | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 141,300 | 196,800 | 267,900 | 314,700 |
Global Adjacent Markets | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 77,900 | 121,900 | 176,200 | 226,900 |
Aftermarket | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 207,500 | 228,900 | 409,600 | 449,400 |
Boats | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 132,200 | 182,400 | 286,700 | 367,200 |
Operating segments | ORV/Snowmobiles | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 952,900 | 1,049,300 | 1,776,600 | 1,916,800 |
Gross profit | 251,700 | 297,700 | 453,400 | 537,800 |
Operating segments | Motorcycles | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 141,300 | 196,800 | 267,900 | 314,700 |
Gross profit | 4,400 | 22,900 | 3,400 | 26,600 |
Operating segments | Global Adjacent Markets | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 77,900 | 121,900 | 176,200 | 226,900 |
Gross profit | 16,800 | 33,600 | 43,700 | 63,200 |
Operating segments | Aftermarket | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 207,500 | 228,900 | 409,600 | 449,400 |
Gross profit | 47,600 | 55,200 | 93,900 | 111,700 |
Operating segments | Boats | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 132,200 | 182,400 | 286,700 | 367,200 |
Gross profit | 18,600 | 40,500 | 48,300 | 76,700 |
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Gross profit | $ (6,400) | $ (13,500) | $ (17,100) | $ (27,100) |
Uncategorized Items - pii-20200
Label | Element | Value |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | $ 36,400,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | $ 31,400,000 |