Skip to main content

The maker of Ski-Doo snowmobiles and Sea-Doo watercraft unveiled an aggressive strategy that aims to deliver annual revenue growth of 10 per cent a year, to $9.5-billion by fiscal 2025.

katie Sadie/The Globe and Mail

BRP Inc. is doubling down on efforts to win customers for its off-road vehicles and boats over the next five years, betting it can steal more sales from rivals as consumers continue to make big purchases despite recession fears.

The Valcourt, Que., maker of Ski-Doo snowmobiles and Sea-Doo watercraft unveiled an aggressive strategy Tuesday that aims to deliver annual revenue growth of 10 per cent a year, to $9.5-billion by fiscal 2025. The company believes it can generate a 15-per-cent increase in normalized earnings every year over the same time, to $7.50 a share.

“We believe there is still significant market share opportunity within our industry,” BRP chief executive José Boisjoli told investors and analysts gathered in Florida. “We have a solid momentum.”

Story continues below advertisement

Mr. Boisjoli is trying to convince investors that the party’s not over for BRP after a spectacular share price run from 2016 to early September, 2018. The shares have lost some ground since but have climbed about 25 per cent over the past two months on the back of strong results.

Hitting its new financial targets hinges on BRP’s plan to accelerate the growth of its Can-Am brand off-road vehicles, particularly side-by-sides, where the driver sits beside the passenger instead of in front. Since entering the side-by-side business in 2010, BRP has capitalized on a steady stream of product introductions to seize the No. 2 market share position behind rival Polaris Inc.

Desjardins Capital Markets analyst Benoit Poirier estimates BRP held a 17-per-cent share of the side-by-side market in 2018, which should grow to 20 per cent by 2020. BRP on Tuesday said it wants to win a 30-per-cent share by 2025.

BRP said it intends to push harder into nascent markets for side-by-side vehicles, such as Australia, Russia and Scandinavia. The company said it will increase spending on new products and technology to build share, and will need a second production facility dedicated to side-by-sides to achieve the 30-per-cent target.

A decision to add a new plant could come within the next 12 months, BRP vice-president Sandy Scullion said. “We believe that making that investment sooner rather than later will be a wise move,” he said.

BRP’s jump back into boat manufacturing is another key piece of its financial targets. The company has bought three aluminum boat-builders since getting back into the business last year, including pontoon watercraft maker Triton Industries Inc., and wants to make a mark in the sector with new technology that better integrates the engine into the hull of the boat to increase space for users.

In issuing their financial goals, BRP executives said they are assuming current economic conditions persist. And they said they are not assuming any competitors will exit outright from the industry. A recession, depending on its severity, could delay the company’s plans but won’t derail them, Mr. Boisjoli said.

Story continues below advertisement

“They are not seeing anything that concerns them just yet,” Morningstar analyst Jaime Katz said of the economic premise underlying the BRP plan. “The consumer is still strong. And so until you see the crack in the armour there, you want to assume that this is sort of normal.”

No one should presume that BRP’s rivals will cede share without a fight, Ms. Katz said. BRP needs to make sure it is introducing truly differentiated products that will stand out from competitors’ offerings when it manoeuvres into new vehicle categories, she said.

To sustain its sales growth past 2025, Mr. Boisjoli said, BRP is thinking about solutions to respond to consumers who want to rent vehicles instead of buying. The company also continues to explore the potential for electric versions of its gasoline-powered vehicles as part of a broader plan for sustainable development, he said.

“The day that the demand will be there, we will be ready," Mr. Boisjoli said. “We don’t know exactly when. We don’t know exactly where we’ll start. But the message I want to convey is we’re working for the long term."

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter
To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies