cats secondquarter results meet expectations

Arctic Cat's president and CEO, Chris Twomey said about the fiscal results, "As expected, Arctic Cat's second-quarter sales slightly decreased due to moderately lower dealer orders related to poor snow conditions last year.

Snowmobile customer interest remains strong as evidenced by the 22 percent increase in extra-early orders that we experienced this year. We continue to invest in our snowmobile business and believe that a normal snow season will lead to significant future sales increases. We intend to maintain our strong market position and are prepared to take advantage of this product line's growth and opportunities."

"For the year, we expect that the growth of our ATV sales will offset an anticipated decline in snowmobile sales."

Currently, sales of ATVs comprise 36 percent of Arctic Cat's total revenue, with snowmobiles accounting for 49 percent of revenue. Sales of parts, garments and accessories account for the remainder.

"Our business mix continues to shift toward a larger percentage of ATV sales, as part of our strategic growth plan," said Twomey. "The ATV market is rapidly growing and serves to insulate us from weather-related snowmobile demand.

By year-end, we expect ATVs to account for nearly 40 percent of our total revenue and more than 50 percent of units produced."

Net sales for the quarter were $192,854,000 compared to $205,507,000 for the same period last year. Net earnings were $18,606,000, or 76 cents per diluted share, for the second quarter compared to adjusted net earnings of $19,071,000, or 74 cents per diluted share, reported for the second quarter of fiscal 2000.