BRP Inc. (NASDAQ:DOOO) Q1 2023 Earnings Conference Call June 3, 2022 9:00 AM ET

Company Participants

Philippe Deschênes - Investor Relations

José Boisjoli - President and Chief Executive Officer

Sébastien Martel - Chief Financial Officer

Conference Call Participants

Craig Kennison - Baird

Robin Farley - UBS

Martin Landry - Stifel GMP

George Doumet - Scotiabank

Xian Siew - BNP Paribas

Joe Altobello - Raymond James

Benoit Poirier - Desjardins

Joseph Spak - RBC Capital Markets

Cameron Doerksen - National Bank Financial

Fred Wightman - Wolfe Research

Brian Morrison - TD Securities

Chris Hodson - Edgewater Research

Brandon Rolle - D.A. Davidson

Gerrick Johnson - BMO Capital Markets

Operator

Good morning, ladies and gentlemen. Welcome to the BRP Inc.’s FY ‘23 First Quarter Results Conference Call. For participants who use the telephone line, it is recommended to turn off the sound on your device. I would now like to turn the meeting over to Mr. Philippe Deschênes. Please go ahead, Mr. Deschênes.

Philippe Deschênes

Thank you, Julie. Good morning and welcome to BRP’s conference call for the first quarter of fiscal year ‘23. Joining me this morning are José Boisjoli, President and Chief Executive Officer and Sébastien Martel, Chief Financial Officer.

Before we move to the prepared remarks, I would like to remind everyone that certain forward-looking statements will be made during the call and that actual results could differ from those implied in these statements. The forward-looking information is based on certain assumptions and is subject to risks and uncertainties and I invite you to consult BRP’s MD&A for a complete list of these. Also during the call, reference will be made to supporting slides and you can find the presentation on our website at brp.com under the Investor Relations section.

So with that, I will turn the call over to José.

José Boisjoli

Thank you, Philippe. Good morning, everyone and thank you for joining us. Our team once again demonstrated our ability to succeed in a tough environment. We outperformed the industry in terms of retail and delivered better than expected financial results for the quarter despite supply chain disruption. This solid performance put us in a good position to deliver strong growth for the year as we remain focused on achieving our guidance, which call for a revenue increase of 24% to 29% and EPS growth of 11% to 14% after accounting for the recently completed SIB.

Let’s turn to Slide 4 for the key financial highlights of the quarter. Revenue reached $1.8 billion stable compared to last year. Still we saw solid growth for side-by-side, which was offset by lower shipment of personal watercraft and three-wheel vehicle. This shows our ability to optimize production by prioritizing certain product line based on component availability. This resulted in the highest level of off-road vehicle production in Q1, while shipment of personal watercraft and three-wheel vehicle are expected to accelerate in Q2. As anticipated, inefficiencies caused by supply chain disruption put pressure on our profitability in the quarter. Still, we offset some of that pressure to manufacturing optimization and tight expense management, resulting in a better than expected performance.