(Reuters) - Polaris Industries Inc PII.N reported a higher-than-expected quarterly profit on Wednesday, lifted by strong demand for its snowmobiles, motorcycles and other off-road and specialty vehicles in every region outside Europe.
The Minneapolis-based company also raised its forecast for full-year earnings, the third time it has done so this year.
Like Harley-Davidson Inc HOG.N, which reported results on Tuesday, and a number of other U.S. companies that have opened their books in recent days, Polaris said the strengthening U.S. dollar continues to pose a significant challenge to its financial results.
During the third quarter, the U.S. dollar rose an average of 7.74 percent against the currencies of its major trading partners.
But in a measure of Polaris’s operating efficiency and pricing power, the company reported it was still able to post double-digit percentage sales growth in every region outside Europe.
As a result, the company now expects to report a profit of $6.55 to $6.65 a share from continuing operations in 2014, up from a previous forecast of $6.48 to $6.58.
“They just keep finding new ways to grow,” said Morningstar analyst Jaime Katz.
Polaris said third-quarter net income from continuing operations rose to $140.8 million, or $2.06 a share, from $116.9 million, or $1.64 a share, a year earlier.
On that basis, analysts on average expected a profit of $2.02 a share, according to Thomson Reuters I/B/E/S.
Overall sales rose 18 percent to $1.3 billion, led by a 12 percent increase in North America, and a 48 percent and a 37 percent growth in Latin America and the Asia Pacific region, respectively. Sales in Europe were the laggard in the quarter, rising just 1 percent.
Polaris, which has been aggressively moving beyond all-terrain vehicles and snowmobiles and targeting Harley-Davidson’s stranglehold on the market for pricey cruiser and touring motorcycles, said revenue from its Polaris and Indian brand bikes rose 28 percent in the quarter.
In addition to challenging Harley in the heavyweight motorcycle market, Polaris this year introduced a smaller motorcycle called the Scout and a three-wheel bike called the Slingshot.
The company, which has successfully debuted dozens of new products in recent year, said customer pre-orders for the Slingshot -- which will retail for between $19,999 and $23,999 and begin to ship within 30 days -- were unusually strong.
The fourth quarter will be a big test for Polaris, which has a long track record for beating its own projections. That’s because year-to-date its motorcycle sales are up only 62 percent -- short of its 65 to 75 percent growth target.
The company's shares, which have risen more than 500 percent over the past five years, lapping the Standard & Poor's 500 stock index .SPX more than six times during that period, were down about 2 percent in mid-morning trading.
Reporting by James B. Kelleher in Chicago; Editing by Lisa Von Ahn and Andrew Hay
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