Arctic Cat reported strong sales and profits in its fiscal third quarter, buoyed by strong consumer interest in a new line-up of snowmobiles. The stock price jumped 20 percent Thursday as the company cruised past analyst expectations.
Sales of snowmobiles were up 61 percent in the quarter ending Dec.31, as orders placed by dealers last spring shipped. Last year’s snowy winter helped spur orders, as did Arctic Cat’s new line-up of 23 new snowmobiles.
"The big story this quarter is snowmobiles," said Mark Smith, an analyst at Feltl and Co. in Minneapolis.
Competitor Polaris Industries, which is based in Medina, reported earlier this week that its snowmobile sales had jumped 63 percent in the latest quarter.
"Although we believe industry retail sales will slow slightly over the next three months, we believe our retail sales will outperform the industry and we will continue to take market share," said Claude Jordan, Arctic Cat’s chief executive officer.
SkiDoo has the biggest share of the North American snowmobile market, followed by Polaris. Arctic Cat commands 22 percent of the market and is in third place, the company said at a recent presentation for analysts.
The company also shipped the first 200 units of its new Wildcat, its first recreational side-by-side, an all-terrain vehicle. Though the Wildcat had limited impact on sales in the most recent quarter, it is expected to be a significant contributor to sales in future quarters, analyst Smith said.
In the latest quarter, Arctic Cat’s net income was up 84 percent to $17 million, or 92 cents per share, blowing past Wall Street estimates of 59 cents per share. Net sales were $207 million, up 36 percent from the prior third quarter.
Management raised its fiscal 2012 revenue growth forecast to a range of 22 percent to 24 percent, from $568 million to $575 million. The company also raised earnings guidance to a range of $1.60 to $1.70 per share from the prior range of $1.10 to $1.15 per share.
Arctic Cat’s corporate office is in Plymouth, and its major manufacturing plant is in Thief River Falls.
The stock price closed at $28.58 Thursday, up $4.77 per share.
