Polaris Inc.

Good morning and welcome to the Polaris third quarter 2020 earnings conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to Richard Edwards, Vice President, Investor Relations. Please go ahead.

Thank you, Gary, and good morning, everyone. Thank you for joining us for our 2020 Third Quarter Earnings Call. A slide presentation is accessible at our website at ir.polaris.com, which has additional information for this morning's call. Scott Wine, our Chairman and Chief Executive Officer, and Mike Speetzen, our Chief Financial Officer, have remarks summarizing the quarter, and then we'll take some questions. During the call, we will be discussing various topics which should be considered forward-looking for the purposes of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projections in the forward-looking statements. You can refer to our 2019 10-K for additional details regarding these risks and uncertainties. All references to the third quarter 2020 actual results are reported on an adjusted non-GAAP basis unless otherwise noted. Please refer to our Reg G reconciliation schedules at the end of this presentation for the gap to non-gap adjustments. Now we'll turn it over to our CEO, Scott Wynne. Scott?

Thanks, Richard. Good morning, and thank you for joining us. Nearly 10 months into this year that continues to present serious and surprising challenges, I remain inspired and impressed by the dedication and execution of this Polaris team. Their safety is always our number one priority. It is never compromised as we accelerate production to meet rising demand. We will mostly review the resulting financials this morning, but the combination of agility, teamwork, and creativity that is driving those numbers is much more noteworthy. Consumer interest in power sports stayed at record levels throughout the quarter, as our dealers continue to attract new customers. Winning the competitive battle now is as much about availability as it is innovation, so our emphasis is temporary shiflet from demand creation to demand fulfillment. All Polaris businesses are outperforming our internal expectations as our factories and supply chain ramp to replenish dealer inventories. The investments in talent and tools we made to execute factory choice and supply chain transformation are paying off, allowing us to manage, not fight, the several dozen suppliers that are still working to recover. In stark contrast to a year earlier, we ended the third quarter with total liquidity at an all-time high. Mike Speetzen and his team have dramatically improved our cash management capabilities, which is a nice boost to a business that historically generates a lot of cash. Between our strong year-to-date results and improving outlook for the fourth quarter, we are raising our full-year earnings per share guidance, which now sits above our original targets for 2020. Third quarter North American retail sales were up a healthy 15%. But our internal analysis suggests that it could have been double that if we'd been able to accelerate production faster. A good example is our boat business, which achieved 50-plus percent retail growth as they efficiently ramped production and out-shipped their competition. Availability hurt our off-road vehicle market share, which was down slightly, but motorcycles, boats, and snow each gained share in the quarter. Indian continues to outperform globally while posting record market share performance in North America. With our recently introduced model year 2021 vehicles and an exciting lineup still to come, extensive customer-focused brand building and improved factory output, I am confident that Steve Minetto and his team will get our off-road vehicle business back to gaining market share in the fourth quarter and the year ahead. Strong vehicle demand and overall ridership increases are supporting record sales for Polaris PG&A and improving growth and profitability at TAP. North American dealer inventory declined slightly sequentially, but 55% year over year, leading to off-road vehicle DSO at its lowest level in decades. The coordination amongst our production, logistics, and sales team to maximize retail sales in this constrained environment is impressive and constantly improving as we strive to reach targeted inventory levels. This close collaboration is one of many reasons we are enjoying record dealer sentiment scores, leading the composite ranking in more individual categories than any other OEM. We expect to begin replenishing dealer inventory in the fourth quarter and continuation teams. Not unexpectedly, some of our suppliers are not yet capable of meeting the same rapid demand spikes So Ken Fussell and his team are aggressively working to accelerate their output. The number of suppliers past due is almost three times the normal rate, and a moderately high number of those suppliers are limiting production. But we are tightly managing them to limit impact. The path to more normal production rhythm is very clear, with our Offroad Vehicle Build Plan ramping up nearly 50% year over year in the fourth quarter. With new and diverse customers driving the majority of our growth and expanding the categories they increasingly invite their friends and colleagues to the sport, we are encouraged by the potential persistence of overall demand strength. Polaris Adventures is evidence of this, with rides running at roughly twice the 2019 levels since May. While Polaris is not unique in benefiting from this new customer growth, the approach Pam Kermish and her team are taking to cultivate and engage them should extend our leadership position with these important demographics. I have probably opined enough on the partnership with Zero Motorcycles, but knowing the product plans and the opportunity we have to both disrupt the industry and earn our next billion dollars in electric vehicle sales significantly more quickly and enjoyably than the first, it is worth highlighting again this morning. When I asked Chris Musso to lead our electrification initiative a year ago, we had bold ambitions but no clear plan. He built the team, refined the strategy, and orchestrated the zero relationship that other OEMs had tried but failed to cultivate. With that foundation established, Chris has decided to leave Polaris at the end of November to return to Denver and McKenzie for an opportunity that is important for him and his family. We are a better company for his contributions to both electrification and off-road vehicles and wish him well in his next chapter. As our electrification efforts transition from strategy to execution, Mike Donahue, our Chief Technicolosser, will add that responsibility. Mike's leadership roles at Tesla, Bright Automotive, and other electric vehicle manufacturers, along with his experience with Alta Motors, provide him with the unique skill set necessary to achieve our goal of leading the power sports industry in electrification. I will now turn it over to our Chief Financial Officer, Mike Speetzen, who will update you on our financial results and plans.