Arctic Cat Reports Fiscal 2017 Second Quarter Results

Arctic Cat Inc. (NASDAQ:ACAT) today reported a net loss of $12.8 million, or $0.98 per share, on net sales of $164.6 million for the fiscal 2017 second quarter ended September 30, 2016. Arctic Cat ® recorded a special item totaling $1.4 million after tax, or $0.10 per share, for a product liability settlement in the fiscal 2017 second quarter. In the prior-year quarter, Arctic Cat reported net earnings of $11.2 million, or $0.85 per diluted share, on net sales of $211.2 million.

Christopher Metz, Arctic Cat's president and chief executive officer, stated: "We expected that Arctic Cat's second quarter would be challenging, as we continued to implement our turnaround strategies. However, we encountered a softer than anticipated powersports market in the quarter, with Arctic Cat's and the overall industry's sales down. We are disappointed in the company's second-quarter results, which were impacted by lower sales volumes, unfavorable product mix and a heightened promotional environment."

Commenting further, Metz said: "We made further progress on implementing our strategic growth initiatives in the fiscal 2017 second quarter. We recently signed two strategic partnerships - one during the fiscal 2017 second quarter and the other after quarter end - that we anticipate will contribute meaningfully to Arctic Cat's future revenues in fiscal 2018 and beyond. We continue to expect reporting stronger financial results in the second half of this fiscal year, driven by planned new product launches and an improved product mix."

The company's strategies to reinvigorate growth include: pursuing strategic partnerships; ramping up end-user focused new products; creating a brand marketing powerhouse; and improving Arctic Cat's dealer network.

Operating Review

Arctic Cat's fiscal 2017 second quarter net sales were down 22.0 percent to $164.6 million versus $211.2 million in the prior-year quarter. Foreign currency exchange had minimal impact on net sales in the quarter.

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