Polaris 2006 Annual Report Download - page 8

PAGE 4 2006 POLARIS INDUSTRIES INC. ANNUAL REPORT
As a result, dealer inventory levels remained
too high for the year. The decline in volume,
coupled with higher promotional incentives,
led to lower gross margins.
In addition, we were not successful in completing
phase two of the KTM acquisition, which was
important to our long-term goal of building a
larger, more global company.
Finally, and perhaps most importantly, we learned
some important lessons from the mistakes of
2006, and we have incorporated that thinking
into our plan for the next three years.
In a nutshell, we are expecting a continued
tough overall market environment and planning
on Polaris being more competitive. In 2007,
we intend to get the business back on track,
specifically by improving the competitiveness
of our ATV and snowmobile businesses, and
by assisting dealers in reducing their inventory
of ATVs, which should be back to acceptable
levels by mid-year. We will also continue to
work hard to reduce our costs, and enter two
new growth segments, the luxury touring
segment of the motorcycle market and the
recreational segment of the side-by-side utility
market, in early 2007. Results in 2008 and
2009 should benefit from each of these actions.
THE GOALS:
• $2.2 billion in sales by 2009
• $150 million in net income by 2009
• $4.25 earnings per share by 2009
1. WIN IN THE CORE
• Grow market share in snowmobiles and ATVs.
• Leverage PG&A and financial services to deliver
superior total value.
2. DELIVER OPERATIONAL EXCELLENCE
• Industry-leading quality in every product line.
• Greater than 5 percent productivity gains every year.
• A lean enterprise, driven by robust, simple designs
and a lean supply chain.
3. GROW BY $500 MILLION BY 2009
• Victory – Obtain 5 percent market share in cruiser
and touring segments.
• RANGER – Dominate utility and recreational
side-by-side market.
• International – Expand global presence by
$50 million.
• Expand military opportunity.
• Enter at least one new adjacent market segment.
SUPPORTED BY:
PEOPLE AND CULTURE
• Externally focused employee owners with a can-do
drive to consistently deliver outstanding results.
• The best team in powersports.
• Passion to ride and win.
TECHNOLOGY
• Consistent, flawless introduction of compelling
new products.
• Class-leading ride and handling.
• Controlling our destiny in powertrains.
• Class-leading information technology.
BRAND
• Ever-improving brand awareness and image
through stronger, better and bigger dealer network.
• Consistent advertising and brand support.