ARCTIC CAT INITIATES ALL-TERRAIN VEHICLE RECALL
Company to make gear-case repairs through dealerships;
Warranty expense will lead to one-time pre-tax charge of approximately $5.4 million
MINNEAPOLIS–Sep. 30, 2014– Arctic Cat Inc. (Nasdaq: ACAT) announced today that it is voluntarily recalling its all-terrain vehicles (ATVs) manufactured in 2008 and a portion of the models produced in 2009; a component in the front gear box may not meet the company’s standards. There are no confirmed reports of serious injuries traced to the front gear case.
“Consumer safety is at the top of Arctic Cat’s values,” said Chairman and Chief Executive Officer Chris Twomey. “We ask ATV owners of affected models to stop riding their vehicles and to bring them to one of our dealers, so we can make the necessary repairs free of charge, and allow users to ride their ATVs again as soon as possible.”
This recall affects an estimated 35,386 ATVs from the 2008 model year and 4,495 ATVs from the 2009 model year. All registered owners of the affected ATVs will be notified by direct mail. A toll-free number is available for consumers to call with any questions: US 1-800-279-6851, CANADA 1-800-373-0717.
The company will record a charge of approximately $5.4 million pretax (about $3.5 million after-tax, or $0.27 per diluted share) to cover warranty expense for the ATV repairs. Arctic Cat plans to take the non-recurring charge in the 2015 fiscal second quarter ending today, September 30, 2014.
About Arctic Cat
Arctic Cat Inc. designs, engineers, manufactures and markets all-terrain vehicles (ATVs), side-by-sides and snowmobiles under the Arctic Cat® brand name, as well as related parts, garments and accessories. Its common stock is traded on the NASDAQ Global Select Market under the ticker symbol “ACAT.” More information about Arctic Cat and its products is available at www.arcticcat.com.
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements. The Company’s Annual Report, as well as the Report on Form 10-K, its Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission, the Company’s press releases and oral statements made with the approval of an authorized executive officer, contain forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. The words “aim,” “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that indicate future events and trends identify forward-looking statements including statements related to our fiscal 2015 outlook, business strategy, benefits of our co-branding partnership with Yamaha and expected product demand. Actual future results and trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to: product mix and volume; competitive pressure on sales, pricing and sales incentives; increase in material or production cost which cannot be recouped in product pricing; unexpected delays in the introduction of new products; changes in the sourcing of engines; interruption of dealer floorplan financing; warranty expenses and product recalls; foreign currency exchange rate fluctuations; product liability claims and other legal proceedings in excess of reserves or insured amounts; environmental and product safety regulatory activity; effects of the weather; general economic conditions and political changes; interest rate changes; consumer demand and confidence; and those set forth in the Company’s Annual Report on Form 10-K for the year ended March 31, 2014, under heading “Item 1A. Risk Factors.” The Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Source: Arctic Cat Inc.
Arctic Cat Inc.
Tim Delmore, 763-354-1791
Chief Financial Officer
Shawn Brumbaugh, 612-455-1754