BRP Inc. reported impressive financial results for the first quarter of fiscal year 2027, with earnings per share (EPS) of CAD 1.83, significantly exceeding the forecasted CAD 0.82. The company’s revenue reached CAD 2.4 billion, surpassing expectations by 55.84%. Following the earnings announcement, BRP Inc.’s stock increased by 8.98% in pre-market trading, reflecting positive investor sentiment.
BRP Inc. delivered a robust performance in Q1 FY2027, with a 30% year-over-year increase in revenue and a nearly threefold increase in normalized EPS. The company successfully navigated tariff challenges and demonstrated strong growth across its product categories, particularly in the Off-Road Vehicle (ORV) and All-Terrain Vehicle (ATV) segments.
BRP Inc.’s actual EPS of CAD 1.83 far exceeded the forecast of CAD 0.82, resulting in a surprise of 123.17%. The company also surpassed revenue forecasts by 55.84%, achieving CAD 2.4 billion compared to the expected CAD 1.54 billion. This significant beat underscores the company’s strong operational performance and ability to capitalize on market opportunities.
Following the earnings report, BRP Inc.’s stock rose by 8.98% in pre-market trading, reaching CAD 63.24. This upward movement indicates strong investor confidence in the company’s financial health and strategic direction. Despite being below its 52-week high, the stock’s performance suggests potential for further growth.
BRP Inc. revised its full-year FY2027 guidance, projecting revenue between CAD 9.125 billion and CAD 9.375 billion and normalized EBITDA between CAD 925 million and CAD 975 million. The company anticipates a gross tariff impact of CAD 500-550 million for the year but remains optimistic about its growth prospects due to strong business trends and strategic initiatives.
José Boisjoli, BRP Inc.’s CEO, stated, "Our performance in Q1 reflects our ability to adapt and thrive in a challenging environment. We are committed to driving growth through innovation and operational excellence." He emphasized the company’s focus on mitigating tariff impacts while maintaining long-term growth investments.
During the earnings call, analysts inquired about the company’s tariff mitigation strategies and the impact of macroeconomic conditions on future performance. Executives highlighted ongoing efforts to optimize operations and maintain competitive positioning, while also addressing concerns about potential future tariff impacts.
Benoit Poirier, Analyst, Desjardins Capital Markets4: Good morning, ladies and gentlemen. Welcome to the BRP Inc.’s Q1 fiscal year 2027 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.
Benoit Poirier, Analyst, Desjardins Capital Markets5: Thank you, Sylvie. Good morning and welcome to BRP’s conference call for the first quarter of fiscal year 2027. Joining me this morning are Denis Le Vot, 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 the actual results could differ from those statements. The forward-looking information is based on certain assumptions and is subject to risk and uncertainty, 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. With that, I’ll turn the call over to José Boisjoli.
Denis Le Vot, President and Chief Executive Officer, BRP Inc.: Thank you, Philippe. Good morning, everyone, and thank you for joining us. We delivered a solid performance in the first quarter with financial results ahead of expectations and experienced sustained retail momentum across our key segments. As you know, the quarter was marked by a significant shift in the North American tariff landscape. While this created uncertainty and led us to suspend our fiscal 2027 guidance, our team have moved quickly to identify several mitigation measures to partially offset the impact on our business. Those measures include further optimization of our direct costs and overhead, a thorough review of our value chain to unlock efficiency, and targeted pricing adjustments. In addition, we continue to engage with government and key stakeholders to bring forward the impact of the current situation on the industry and consumers in general.
Looking ahead, we are focused on navigating these headwinds while also protecting our long-term growth prospects. Although the geopolitical and trade environment remains volatile, we are issuing a revised full-year guidance that incorporates both positive trends in our business and net tariff costs. Sébastien will share more details later in the presentation. Now let’s look at financial results on slide number four. We ended the first quarter with revenue of CAD 2.4 billion, normalized EBITDA of CAD 334 million, and normalized EPS of CAD 1.83. These results exceeded our expectation driven by stronger volumes, disciplined cost management, and a more favorable promotional environment despite the early impact of incremental tariffs. We also generated strong free cash flow of more than CAD 360 million, surpassing last year’s level, underscoring the resilience of our operating model and our prudent approach to capital management. Let’s turn to our network inventory position on slide number five.
Dealer inventory remains healthy, down 3% compared to the same period last year, reflecting improved alignment between wholesale shipment and retail demand, particularly in ORV. Product mix also improved with lower snowmobile inventory at the end of the season and better personal watercraft availability ahead of the peak retail period. We believe inventory is near optimal level. We are well positioned to capture market opportunities and remain disciplined in protecting profitability for both BRP and our dealers. Turning to global retail trends on slide number six. Market dynamics in North America were consistent with the previous quarter, excluding snowmobile, which lacked a strong quarter last year. The industry grew low single digits, while BRP was up 2%. In line with our strategy, ORV remained the primary growth driver, particularly in the utility and premium segments. Let’s look at other regions.
In EMEA, trends improved despite a still relatively muted macroeconomic environment. Our retail increased by 10% in line with the industry. We saw growth across most of our product categories, supported by a stronger end of the snowmobile season in Scandinavia, as well as improved demand for PWC and ORV in key European markets. In Latin America, our retail grew by 7%, with record first quarter performance in both Brazil and Mexico, driven by continued strength in ORV. In Asia Pacific, the industry grew low single digits, supported by strong ATV demand partially offset by a late-season decline in PWC. Given our higher exposure on PWC, we trailed the industry with retail down 4%. Overall, we are pleased with our retail performance, particularly in ORV, which delivers strong results across most regions. Now let’s focus on our North American performance, beginning with side by side on slide number seven.
The industry remained healthy, growing mid-single digits, supported by the utility segment and continued adoption of cab units. Can-Am sustained its strong momentum driven by the success of the new Defender HD11, equipped with a new Rotax engine boasting 95 horsepower and best-in-class towing and cargo capacity, setting a new standard in the industry. We once again outpaced the market with retail high single digits, including low teen % growth in the utility segment. More importantly, we gained over three points of market share in premium current units. This shows that our commitment to innovation can drive retail growth and contribute positively to profitability. Turning to ATVs on slide number eight, while the industry declined low single digits during the quarter, we outperformed with retail up low single digits and reached the number one position in the North American industry in April for the first time ever.
We continue to benefit from the rollout of our new platform across our lineup, contributing to more than 3 points of market share gain in current units during the first quarter. With continued traction with dealers, ongoing network development initiatives, and a robust pipeline of upcoming product launches, we are confident in our ability to sustain our ORV growth to further expand our market share. Turning to slide nine to cover snowmobile, the 2026 season ended in late March with industry retail up low single digits. As anticipated, since other OEM entered the season with elevated level of non-current inventory, industry retail was driven by heavily discounted units. In this context, we trailed the industry slightly, given our disciplined approach to inventory management.
That said, by maintaining pricing integrity rather than chasing discounted volume, we achieved a record market share over 70% in current units and reduced our network inventory by 40%, putting us in a healthy position. Our new products and features introduced in February allowed us to once again elevate winter adventure. To name a few, a new Rotax 600RR E-TEC engine with class-leading power, completely redesigned Sea-Doo, Skandic, and Tundra models, as well as a Lynx Shredder RE model up to 12 pounds lighter. This led us to have one of our most successful spring pre-order campaign ever. We are now well-aligned to increase shipments and drive growth in the next season. Let’s turn to slide 10 for an overview of our retail performance in other product categories for which the first qua