Arctic Cat Ices Guidance

Guidance looks weak.
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The Arctic Cat

(ACAT)

swung to a fourth-quarter loss, as a mild winter held down snowmobile sales.

The Arctic Cat lost $592,000, or 3 cents a share, in the quarter, compared with earnings of $2.7 million, or 13 cents a share, a year ago. Sales were $153.3 million, down from $157 million a year ago. On average, analysts surveyed by Thomson First Call were forecasting a loss of 4 cents a share on sales of $154.4 million.

By segment, sales of all-terrain vehicles were $126.8 million in the fourth quarter, up from $117.1 million a year ago, while sales of snowmobiles were $140,000 in the latest period, down from $10.9 million a year ago.

"While our ATV sales grew, our fourth-quarter results were negatively affected by poor snowfall in the East and Midwest that reduced sales of snowmobiles and snow-related parts, garments and accessories, coupled with increased sales incentive programs on snowmobiles and ATVs," The Arctic Cat said.

The Arctic Cat guided to a loss of 27 cents to 31 cents a share, including 2 cents of stock-options expense, on sales of $85 million to $95 million in the first quarter ending June 30. Analysts were forecasting earnings of 1 cent a share on sales of $111.9 million.

For the year, The Arctic Cat expects to earn $1.13 to $1.19 a share, including 7 cents or 8 cents of options expense, on sales of $754 million to $776 million. Analysts were expecting earnings of $1.32 a share on sales of $763.8 million.

"For its fiscal year ending March 31, 2007, Arctic Cat anticipates shifting production of its significant new snowmobile models and related revenue and earnings into the second and third fiscal quarters," it said.