BRP上调全年EPS指引但关税仍压制利润，盘中反应转弱

Canadian recreational manufacturer BRP Inc. now expects a C$200 million ($145 million) net impact from US tariffs on its products exported to the US for the fiscal year, far less than initially anticipated and allowing it to increase its financial outlook.

In April, President Donald Trump’s administration made sweeping changes to its Section 232 tariffs on items made with steel, aluminum and copper. Certain products “substantially made” with those metals became subject to a 25% tax on their full value, rather than a 50% tax on only the metal content.

That led to a 25% tariff on the value of snowmobiles and many off-road vehicles, important products for BRP. At the time, the company said it expected a more than C$500 million hit for the year and suspended its fiscal year guidance for 2027. Its stock price slumped by more than 30% on the news.

But thanks to cost optimization, targeted pricing adjustments, production improvements, a lower tariff rate on all-terrain vehicles and higher demand for off-road vehicles, the net tariff exposure will represent about C$225 million on an annualized basis next year.

“The mitigation efforts are working,” Raymond James Financial Inc. analyst Joseph Altobello told BNN Bloomberg Television, adding that BRP has also been gaining market share. “They’re coming out with some really nice products, some products that are resonating very well in the marketplace. And second, I think they’ve got some really nice relationships with dealers across North America.”

The Valcourt, Quebec-based manufacturer reinstated its guidance in May. Its second-quarter earnings report released Thursday estimates revenues for fiscal year 2027 will reach between C$5.5 billion and C$5.6 billion, and net income will be between C$160 million and C$195 million, or less than half of what was expected before the April tariffs.

Chief Financial Officer Sebastien Martel said this outlook does not “reflect the full earnings potential” of the business. “Over time, we expect our earnings to better reflect this potential as we continue expanding our plan and as the trade environment becomes more stable and predictable.”

BRP reported a normalized diluted loss per share of 18 Canadian cents during the second quarter ended July 31, beating estimates from analysts surveyed by Bloomberg. It also said it expects normalized earnings per share to be down by 50% to 60% year over year in the third quarter due to tariffs.

Shares rose at the open Thursday in Toronto before falling as much as 4.3%. The stock, which is down more 12% since the beginning of the year, traded at C$84.64 as of 11:37 a.m.

BRP’s situation is in line with what Bank of Canada Governor Tiff Macklem said Wednesday about Canadian businesses, which “are adapting to tariffs, new technology and increased uncertainty.”

The company said the latest 50% tariffs on some Canadian goods, under the never-before-used Section 338 provision of the US Tariff Act of 1930, affects only one of its products, the three-wheeled motorcycle Can-Am Spyder.