8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 29, 2009

POLARIS INDUSTRIES INC.

(Exact name of Registrant as specified in its charter)

Minnesota
(State of Incorporation) 1-11411
(Commission File Number) 41-1790959
(I.R.S. Employer Identification No.)

2100 Highway 55
Medina, Minnesota 55340
(Address of principal executive offices)
(Zip Code)

(763) 542-0500
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	Item 2.02 Results of Operations and Financial Condition.
	Item 7.01 Regulation FD Disclosure.
SIGNATURE
EXHIBIT INDEX
EX-99.1
EX-99.2

Item 2.02 Results of Operations and Financial Condition.

     On January 29, 2009, Polaris Industries Inc. (the “Company”) issued a news release announcing the Company’s fourth quarter and year-end financial results for the reporting periods ended December 31, 2008. On January 29, 2009, the Company also hosted its quarterly earnings conference call, which was accessible to the public. A recording of the conference call will be available through the end of the business day on February 5, 2009 by dialing 800-642-1687 in the U.S. and Canada or 706-645-9291 for international calls and entering passcode 42184397, and on the Company’s website, www.polarisindustries.com. A copy of the Company’s news release is furnished as Exhibit 99.1 attached hereto and a copy of the presentation materials discussed during the conference call is being furnished as Exhibit 99.2 to this Current Report on Form 8-K.

     During the earnings conference call, management discussed, among other things, certain balance sheet and cash flow items. Copies of the Company’s Consolidated Statements of Income for the years ended December 31, 2008 and December 31, 2007, Consolidated Balance Sheets as at December 31, 2008 and December 31, 2007 and its Consolidated Statements of Cash Flows for the Years Ended December 31, 2008 and December 31, 2007 are included with the news release attached as Exhibit 99.1 to this Current Report on Form 8-K. The accompanying financial statements as at and for the year ended December 31, 2008 are unaudited and neither those financial statements nor the accompanying financial statements as at and for the year ended December 31, 2007 include all information and disclosures, including footnotes, in conformity with accounting principles generally accepted in the United States for complete financial statements. Accordingly, such statements should be read in conjunction with the Company’s Annual Reports on Form 10-K for the year ended December 31, 2007, previously filed with the Securities and Exchange Commission, and the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, which will be filed with the Securities and Exchange Commission on or before March 2, 2009.

Item 7.01 Regulation FD Disclosure.

     The disclosures set forth in Item 2.02 above are hereby incorporated by reference into this Item 7.01.

     The information contained in this report is furnished and not deemed to be filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information in this Current Report shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

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SIGNATURE

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: January 29, 2009

POLARIS INDUSTRIES INC.
 

/s/ Michael W. Malone  

Michael W. Malone 

Vice President — Finance,
Chief Financial Officer and
Secretary of Polaris Industries Inc. 

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EXHIBIT INDEX

Exhibit No.		Description
	99.1	News Release dated January 29, 2009 of Polaris Industries Inc.
	99.2	Presentation materials dated January 29, 2009 of Polaris Industries Inc.

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EX-99.1

Exhibit 99.1

News Release

2100 Highway 55
Medina, MN 55340-9770

Contact:	Richard Edwards
	Polaris Industries Inc.
	763-542-0500

POLARIS REPORTS 2008 FOURTH QUARTER AND
RECORD FULL YEAR RESULTS

Fourth quarter and Full Year Highlights:

• Fourth quarter 2008 earnings per diluted share from continuing operations increased 4% to $1.11, while sales of $523.6 million were down 3% from the 2007 fourth quarter

• Full year 2008 earnings per share from continuing operations increased 13% to a record $3.50 with record sales of $1,948 million, an increase of 9% from the 2007 full year

• Gross margins improved 80 basis points for the fourth quarter. Full year 2008 gross margins also improved 80 basis points compared to the prior year periods driven primarily by a positive mix benefit of higher margin side-by-side vehicles, PG&A and international sales

• The availability of retail credit financing to Polaris consumers remained acceptable during fourth quarter 2008 with 31 percent of Polaris consumers in the United States financing purchases through the Company’s retail financing relationships with HSBC and GE and over 50 percent of consumer retail credit loan applications being approved by either HSBC or GE

• On January 22, 2009, Polaris declared a 3% increase in the regular quarterly cash dividend to $0.39 per share per quarter, marking the 14^th consecutive year of increased dividends

MINNEAPOLIS (January 29, 2009) — Polaris Industries Inc. (NYSE: PII) today reported net income from continuing operations of $1.11 per diluted share for the fourth quarter of 2008, representing a four percent increase from $1.07 per diluted share for the prior year’s fourth quarter, reflecting an eight percent reduction in the weighted average diluted shares outstanding in the 2008 period. Net income from continuing operations for the fourth quarter 2008 was $36.2 million, a decrease of five percent from the prior year’s fourth quarter net income from continuing operations of $38.0 million. Sales for the fourth quarter 2008 decreased three percent to $523.6 million, compared to last year’s fourth quarter sales of $541.4 million.

Full Year results from continuing operations

     For the full year ended December 31, 2008, Polaris reported net income from continuing operations of $117.4 million, or $3.50 per diluted share, compared to $112.6 million, or $3.10 per diluted share for the year ended December 31, 2007, representing a 13 percent increase on a per diluted share basis. Sales for the full year 2008 totaled $1,948.3 million, an increase of nine percent compared to sales of $1,780.0 million for the full year 2007.

     “In 2008, we delivered record sales and earnings per share and gained market share in every one of our businesses, despite a weakening operating environment and unprecedented volatility in the world’s financial markets,” stated Scott Wine, Chief Executive Officer. “We met our expectations for the year, which we believe is a testament to a solid strategic vision, a culture of persistent innovation and unrelenting focus on execution. In addition to our record financial performance, we made progress on our operational excellence initiatives of getting our products to market faster and delivering higher quality

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products at a lower cost. Dealer inventory levels declined further in 2008 although more progress is needed given the current economic environment. We maintained growth in several of our businesses in 2008 including parts, garments and accessories, military, international and particularly in side-by-sides where we became the market share leader in the side-by-side industry during 2008.”

     “During the fourth quarter the retail sales trends for the powersports industry and Polaris weakened significantly as the overall economic environment continued to deteriorate. These retail sales trends for each of the industries and geographic markets in which Polaris competes are expected to remain soft for much, if not all, of 2009. As a result, we will be more conservative with our production and shipment expectations for 2009” said Wine.

     Wine continued, “2009 will undoubtedly be a challenging year. However, we have the financial strength, flexibility and variable cost structure to adapt quickly to challenges, while at the same time investing in new and existing growth opportunities to position us effectively for when the economy improves. Despite the dampened outlook for the upcoming year, we will continue to leverage our innovation, speed to market and flexible manufacturing capability to gain market share while striving to improve our net margins. We have the plans in place to effect change in the areas we can control, such as costs, quality and assisting dealers in further reducing their inventory levels.”

2009 Business Outlook

     Full year 2009 earnings from continuing operations are expected to be in the range of $2.50 to $3.00 per diluted share, which is down when compared to the record 2008 results of net income from continuing operations of $3.50 per diluted share. Sales are expected to decline 15 to 23 percent for the full year 2009. For our seasonally lower first quarter 2009, earnings from continuing operations are expected to be in the range of $0.15 to $0.25 per diluted share, compared to net income from continuing operations of $0.55 per diluted share for the first quarter 2008, resulting from a projected sales decline of 20 to 25 percent in the first quarter 2009. Although Polaris is starting from a position of strength with flexible manufacturing operations, good market penetration, innovative products, a strong balance sheet and consistent cash flow generation, the Company is making adjustments, such as the recent announcement of a reduction in the Company’s workforce accomplished by the first quarter 2009, reduction of production capacity and reducing operating expenses, in order to respond to the weakening retail demand.

Retail credit financing availability for Polaris consumers

     Availability of retail credit financing sources is important to Polaris’ customers to assist in purchasing the Company’s products. Polaris has relationships with HSBC Bank (“HSBC”) and GE Money Bank (“GE”) to provide retail revolving and installment financing credit, respectively, to United States consumers. The availability of retail credit to Polaris consumers remains at acceptable levels as measured by approval and penetration rates. During the fourth quarter 2008, over 50 percent of consumer retail credit loan applications from Polaris customers were approved by either HSBC or GE, and 31 percent of Polaris retail customers in the United States financed their Polaris product purchases through HSBC or GE. The 2008 fourth quarter approval rate of over 50 percent was similar to the fourth quarter in 2007 and the penetration rate of 31 percent was lower than the 37 percent penetration rate

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realized in the 2007 fourth quarter resulting from the tighter retail credit markets. For the 2008 full year, the approval rate was 53 percent, which represented an increase over the full year 2007 rate, and the full year 2008 penetration rate of 39 percent was slightly higher than the full year 2007 rate. The credit markets are expected to remain uncertain in 2009 given the sequentially weaker fourth quarter 2008 trends in retail credit availability, but the Company remains optimistic that retail credit will be available for Polaris consumers with an acceptable credit history. Additionally, beginning in February 2009, Polaris has established a relationship with an additional retail credit provider, Sheffield Financial, to provide installment retail credit loans for the purchase of Polaris products.

	Fourth Quarter ended							Full Year ended
Product line Information	December 31,							December 31,
(in thousands)	2008		2007		Change			2008		2007		Change
Off-Road Vehicles	$	319,758	$	336,750		-5	%	$	1,305,758	$	1,194,556		9	%
Snowmobiles		95,192		80,202		19	%		205,257		179,244		15	%
Victory Motorcycles		21,847		36,122		-40	%		93,600		113,151		-17	%
Parts, Garments & Accessories		86,806		88,341		-2	%		343,639		293,058		17	%
Total Sales	$	523,603	$	541,415		-3	%	$	1,948,254	$	1,780,009		9	%

     ORV (off-road vehicles) sales in the 2008 fourth quarter, which included both core ATV (all-terrain vehicles) and RANGER™ side by side vehicles, decreased five percent from the fourth quarter 2007. This decrease reflects the weakening consumer retail environment in North America, as dealers continued to reduce core ATV orders in an effort to further reduce dealer inventory levels. As a result, core ATV dealer inventory levels in North America finished 18 percent lower at the end of the fourth quarter 2008 than at the end of the fourth quarter 2007. Additionally, the Company experienced a decline in international ORV sales in the 2008 fourth quarter, where the weakening economic environment and currency rates negatively impacted Polaris sales. The Company’s newer products have been well received by consumers, including the redesigned RANGER™ utility vehicle, the RANGER RZR™ and RZR S models and the all new Sportsman XPs. Full year 2008 sales of ORVs increased nine percent over last year, a direct result of the success of the RANGER™ line of side-by-side vehicles. Given the growth in the Company’s side-by-side business worldwide and core ATVs in Europe in 2008, Polaris is now the market share leader in off road vehicles in both North America and Europe.

     Snowmobile sales increased 19 percent during the 2008 fourth quarter compared to the prior year’s fourth quarter. The fourth quarter 2008 increase in sales reflects the benefit of product mix changes related to the timing of shipments of new models within the year. For the full year 2008, snowmobile sales increased 15 percent compared to the prior year reflecting lower beginning snowmobile dealer inventory levels in 2008 compared to the prior year and good snowfall during last years riding season. Polaris continues to invest in new product innovation for snowmobiles, as evidenced by the recent introduction of a new model for next season called the RUSH, which has an all new PRO-RIDE™ chassis that provides terrain dominating control and a smoother ride through all types of terrain.

     Sales of Victory motorcycles decreased 40 percent and 17 percent during the 2008 fourth quarter and full year, respectively, compared to the same periods in 2007. Trends in the North American motorcycle industry retail sales for heavyweight cruiser and touring motorcycles weakened significantly during the fourth quarter.

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     Parts, Garments, and Accessories sales decreased two percent during the 2008 fourth quarter compared to last year’s fourth quarter driven primarily by weak consumer spending and a strong 2007 fourth quarter as the Company shipped new parts and accessories related to new products introduced in 2007 for Victory motorcycles and RANGER™ side-by-side vehicles. PG&A sales for the full year 2008 increased 17 percent over 2007 to a record $343.6 million due to higher snowmobile and side-by-side related PG&A sold in 2008 compared to 2007.

     Gross profit, as a percentage of sales, was 22.8 percent for the 2008 fourth quarter, an increase of 80 basis points from 22.0 percent for the fourth quarter of 2007. Gross profit dollars increased slightly to $119.2 million for the 2008 fourth quarter compared to $119.0 million for the fourth quarter of 2007. The increase in the gross profit margin percentage during the 2008 fourth quarter resulted primarily from favorable product mix change as the Company sold more side-by-side vehicles, which typically have higher margins, and a decrease in core ATV promotional costs incurred during the fourth quarter, partially offset by an unfavorable movement in currency rates. For the full year 2008, gross profit, as a percentage of sales, improved 80 basis points to 22.9 percent compared to 22.1 percent for the full year 2007. The increase in the gross profit margin percentage for the full year 2008 was the result of favorable product mix from higher sales of side-by-side vehicles, PG&A and international sales and higher selling prices, offset somewhat by higher commodity and transportation costs during the 2008 full year compared to 2007.

     Operating expenses for the fourth quarter 2008 increased four percent to $68.2 million compared to $65.8 million for the fourth quarter of 2007. Operating expenses as a percentage of sales increased to 13.0 percent for the fourth quarter 2008 from 12.2 percent in the fourth quarter of 2007. Higher advertising and selling costs are the primary contributors to the increase in operating expenses in dollars and as a percentage of sales for the fourth quarter 2008. For the full year 2008, operating expenses increased eight percent to $284.1 million from $262.3 million in 2007 primarily due to higher advertising, product launch costs and research and development expenses for several key new product introductions in 2008. As a percentage of sales, operating expenses decreased for full year 2008 to 14.6 percent of sales compared to 14.7 percent of sales for the full year 2007.

     Income from financial services decreased 59 percent to $4.0 million in the 2008 fourth quarter from $9.7 million in the fourth quarter of 2007. For the full year 2008, Income from financial services decreased 53 percent to $21.2 million compared to $45.3 million in 2007. The decrease was primarily due to the Company’s revolving retail credit provider, HSBC, eliminating the volume-based fee income payment to Polaris as of March 1, 2008.

     Interest expense decreased to $1.8 million for the 2008 fourth quarter compared to $2.9 million for the 2007 fourth quarter. For the full year 2008, interest expense decreased to $9.6 million compared to $15.1 million in 2007. The decrease in interest expense is due to lower interest rates on the Company’s bank borrowings during the 2008 periods.

     Non-operating other income was $2.9 million in the fourth quarter of 2008 compared to $1.1 million of expense in the fourth quarter of 2007. For the full year 2008, non-operating other income was $4.0 million compared to $2.7 million of income for the same period last year. The increase in income for the 2008 fourth quarter and full year was primarily due to the weakening U.S. dollar and the resulting

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effects on Canadian dollar hedging activities and foreign currency transactions related to the foreign subsidiaries.

     The Income tax provision for the fourth quarter and full year 2008 periods was recorded at a rate of 35.3 percent and 33.7 percent of pretax income, respectively, compared to 35.8 percent and 33.9 percent for the respective periods in 2007.

Financial Position and Cash Flow

     Net cash provided by operating activities from continuing operations decreased 17 percent to $176.2 million for the year ended December 31, 2008 compared to $213.2 million for the full year 2007. The decrease in net cash provided by operating activities for the full year 2008 was primarily due to lower accrued expenses, higher trade receivables from increased sales from international operations, as well as the timing of estimated income tax payments compared to the same period in 2007. Total debt was $200.0 million at December 31, 2008 and leaves $250.0 million of borrowing capacity available under the Company’s $450 million banking arrangement. The Company’s debt-to-total capital ratio was 59 percent at December 31, 2008, compared to 54 percent at the end of 2007. Cash and cash equivalents were $27.1 million at December 31, 2008 compared to $63.3 million for the prior period.

Share Repurchase Activity

     During the fourth quarter 2008 the Company reduced its share repurchase activity and repurchased and retired only 0.2 million shares of its common stock, bringing the total shares repurchased to 2.5 million shares for the year ended December 31, 2008 at a total cost of $107.2 million. Since inception of the share repurchase program in 1996, approximately 33.7 million shares have been repurchased. As of December 31, 2008, the Company has authorization from its Board of Directors to repurchase up to an additional 3.8 million shares of Polaris stock. However, the Company currently anticipates that it will be less aggressive with the share repurchase program during 2009 until more visibility related to the direction of the overall economic environment emerges.

Polaris’ Board of Directors Increases Dividend for 2009

     On January 22, 2009, the Company announced that its Board of Directors approved a three percent increase in the regular quarterly cash dividend, representing the 14th consecutive year of increased dividends, effective with the 2009 first quarter dividend payment. The first quarter dividend of $0.39 per share will be payable on February 17, 2009 to shareholders of record at the close of business on February 3, 2009.

Conference Call and webcast presentation to be Held

     Today at 9:00 AM (CST) Polaris Industries Inc. will host a conference call and webcast to discuss Polaris’ fourth quarter and full year 2008 earnings results released this morning. Interested persons can access the webcast and slide presentation via the company’s website at www.polarisindustries.com/irhome and clicking the associated link. The webcast presentation will remain accessible on the website for one week.

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     You may also listen to the call by dialing 800-374-6475 in the U.S. and Canada or 973-200-3967 for International calls. Please reference Conference ID #42184397. An audio replay of the conference call will be available approximately two hours after the call concludes for a one-week period by dialing 800-642-1687 in the U.S. and Canada or 706-645-9291 Internationally.

About Polaris

     With annual 2008 sales of $1.9 billion, Polaris designs, engineers, manufactures and markets off road vehicles (ORVs), including all-terrain vehicles (ATVs) and the Polaris RANGER™, snowmobiles and Victory motorcycles for recreational and utility use.

     Polaris is a recognized leader in the snowmobile industry; and one of the largest manufacturers of ORVs in the world. Victory motorcycles, established in 1998 and representing the first all-new American-made motorcycle from a major company in nearly 60 years, are rapidly making impressive in-roads into the cruiser and touring motorcycle marketplace. Polaris also enhances the riding experience with a complete line of Pure Polaris apparel, accessories and parts, available at Polaris dealerships.

     Polaris Industries Inc. trades on the New York Stock Exchange under the symbol “PII,” and the Company is included in the S&P Small-Cap 600 stock price index.

     Information about the complete line of Polaris products, apparel and vehicle accessories is available from authorized Polaris dealers or anytime from the Polaris homepage at www.polarisindustries.com.

Except for historical information contained herein, the matters set forth in this news release, including management’s expectations regarding 2009 sales, shipments, net income and cash flow, are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Potential risks and uncertainties include such factors as product offerings, promotional activities and pricing strategies by competitors; warranty expenses; foreign currency exchange rate fluctuations; effects of the KTM relationship; environmental and product safety regulatory activity; effects of weather; commodity costs; uninsured product liability claims; uncertainty in the retail and wholesale credit markets; and overall economic conditions, including inflation and consumer confidence and spending. Investors are also directed to consider other risks and uncertainties discussed in documents filed by the Company with the Securities and Exchange Commission.

(summarized financial data follows)

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POLARIS INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Data)
(Unaudited)

	For Three Months						For the Year
	Ended December 31,						Ended December 31,
	2008			2007			2008			2007
Sales	$	523,603		$	541,415		$	1,948,254		$	1,780,009
Cost of sales		404,358			422,458			1,502,546			1,386,989
Gross profit		119,245			118,957			445,708			393,020
Operating expenses
Selling and marketing		32,985			31,032			137,035			123,897
Research and development		18,341			18,829			77,472			73,587
General and administrative		16,902			15,965			69,607			64,785
Total operating expenses		68,228			65,826			284,114			262,269
Income from financial services		3,996			9,650			21,205			45,285
Operating Income		55,013			62,781			182,799			176,036
Non-operating Expense (Income):
Interest expense		1,794			2,900			9,618			15,101
Loss (Income) from manufacturing affiliates		82			(441	)		156			(471	)
Gain on sale of manufacturing affiliate shares		—			—			—			(6,222	)
Other expense (income), net		(2,904	)		1,140			(4,037	)		(2,708	)
Income before income taxes		56,041			59,182			177,062			170,336
Provision for Income Taxes		19,801			21,181			59,667			57,738
Net Income from continuing operations	$	36,240		$	38,001		$	117,395		$	112,598
Loss from discontinued operations, net of tax		—			(290	)		—			(948	)
Net Income	$	36,240		$	37,711		$	117,395		$	111,650
Basic Net Income per share
Continuing operations	$	1.13		$	1.11		$	3.58		$	3.20
Loss from discontinued operations		—			(0.01	)		—			(0.03	)
Net Income	$	1.13		$	1.10		$	3.58		$	3.17
Diluted Net Income per share
Continuing operations	$	1.11		$	1.07		$	3.50		$	3.10
Loss from discontinued operations		—			(0.01	)		—			(0.03	)
Net Income	$	1.11		$	1.06		$	3.50		$	3.07
Weighted average shares outstanding:
Basic		32,112			34,359			32,770			35,236
Diluted		32,661			35,417			33,564			36,324

All periods reflect the classification of the Marine Division results as discontinued operations.

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POLARIS INDUSTRIES INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands)

Subject to Reclassifications

	December 31, 2008			December 31, 2007
	(unaudited)
Assets
Current Assets
Cash and cash equivalents	$	27,127		$	63,281
Trade receivables, net		98,598			82,884
Inventories, net		222,312			218,342
Prepaid expenses and other		14,924			17,643
Income taxes receivable		4,521			—
Deferred tax assets		76,130			65,406
Total current assets		443,612			447,556
Property and equipment, net		215,637			204,351
Investments in finance affiliate		51,565			53,801
Investments in manufacturing affiliates		15,641			32,110
Deferred income taxes		—			5,572
Goodwill, net		24,693			26,447
Intangible and other assets, net		—			44
Total Assets	$	751,148		$	769,881
Liabilities and Shareholders’ Equity
Current Liabilities:
Accounts payable	$	115,986		$	90,045
Accrued expenses:
Compensation		56,567			55,465
Warranties		28,631			31,782
Sales promotions and incentives		75,211			79,233
Dealer holdback		80,941			83,867
Other		42,274			40,746
Income taxes payable		3,373			4,806
Current liabilities from discontinued operations		1,850			2,302
Total current liabilities		404,833			388,246
Long term income taxes payable		5,103			8,653
Deferred income taxes		4,185			—
Borrowings under credit agreement		200,000			200,000
Total liabilities	$	614,121		$	596,899
Shareholders’ Equity:
Preferred stock $0.01 par value, 20,000 shares authorized, no shares issued and outstanding		—			—
Common stock $0.01 par value, 80,000 shares authorized, 32,492 and 34,212 shares issued and outstanding	$	325		$	342
Additional paid-in capital		—			—
Retained earnings		140,559			146,763
Accumulated other comprehensive income (loss), net		(3,857	)		25,877
Total shareholders’ equity	$	137,027		$	172,982
Total Liabilities and Shareholders’ Equity	$	751,148		$	769,881

All periods reflect the classification of the Marine Division results as discontinued operations.

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POLARIS INDUSTRIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

Subject to Reclassification

	For the Year Ended
	December 31,
	2008			2007
Operating Activities:
Net income before cumulative effect of accounting change	$	117,395		$	111,650
Net loss from discontinued operations		—			948
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		66,112			62,093
Noncash compensation		18,558			19,759
Noncash income from financial services		(4,604	)		(5,268	)
Noncash expense (income) from manufacturing affiliates		157			(46	)
Deferred income taxes		(966	)		(10,276	)
Changes in current operating items:
Trade receivables		(15,714	)		(19,069	)
Inventories		(3,970	)		12,191
Accounts payable		25,941			(10,627	)
Accrued expenses		(7,469	)		38,648
Income taxes payable/receivable		(9,504	)		9,519
Prepaid expenses and others, net		(9,730	)		3,644
Net cash provided by continuing operations		176,206			213,166
Net cash flow (used for) discontinued operations		(452	)		(3,008	)
Net cash provided by operating activities		175,754			210,158
Investing Activities:
Purchase of property and equipment		(76,575	)		(63,747	)
Investments in finance affiliate, net		6,840			7,096
Proceeds from sale of shares of manufacturing affiliate		—			77,086
Net cash provided by (used for) investing activities		(69,735	)		20,435
Financing Activities:
Borrowings under credit agreement		786,000			368,000
Repayments under credit agreement		(786,000	)		(418,000	)
Repurchase and retirement of common shares		(107,167	)		(103,100	)
Cash dividends to shareholders		(49,602	)		(47,739	)
Tax effect of proceeds from stock based compensation exercises		12,865			2,232
Proceeds from stock issuances under employee plans		1,731			11,729
Net cash used for financing activities		(142,173	)		(186,878	)
Net increase (decrease) in cash and cash equivalents		(36,154	)		43,715
Cash and cash equivalents at beginning of period		63,281			19,566
Cash and cash equivalents at end of period	$	27,127		$	63,281

All periods reflect the classification of the Marine Division results as discontinued operations.

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EX-99.2

Exhibit 99.2

Polaris Industries Inc. 4th Quarter & Full-Year 2008 Earnings Results January 29, 2009

Safe Harbor Today's presentation includes statements which should be considered forward-looking for the purposes of the private securities reform act of 1995. Additional information concerning these factors that may influence results can be found in our 2007 annual report and 2007 Form 10-K, which are on file with the SEC.

2007 2008 2007 2008 2008 Full Year Results Diluted EPS * $3.10 $3.50 +13% $1,780.0 $1,948.3 +9% Total Company Sales ($ in millions) * From continuing operations. Record Sales & EPS

ORV Snow Victory PG&A 2007 $1,780.0 +9% +15% - -17% +17% 2008 $1,948.3 2007 Total Company 2008 Total Company 2008 Full Year Sales Geographic Sales % Change in Total Company Sales United States Canada Other Foreign Countries Sales 1371 273 304.2 0 Volume Product Mix & Price Currency Total Canada +18% $273.0 Total Company Sales Sales by Product line ORV Snowmobiles Victory PG&A Sales 1305.8 205.3 93.6 343.6 0 - -2% +11% 0% +9% United States +6% $1,371.1 Int'l +18% $304.2 ORV +9% $1,305.8 Snow +15% $205.3 PG&A +17% $343.6 Victory $93.6 - -17% ($ in millions) ORV (Off-Road Vehicles) = ATV & SxS Combined

0.2% - -0.3% 0.4% - -1.5% 0.1% 0.8% 07 Net Margin 07 Net Margin Gross Profit Financial Services Interest Expense Non-Operating Incom 2008 Full Year Earnings Gross profit margins improved 80 basis points Financial Services income decreased $24.1 million Net margin expansion - focal point for 2009 and beyond Net Income as a Percent of Sales* Net Income* $112.6 $117.4 +4% * From continuing operations. Gross Margin Op Expense Financial Services Interest Expense Non-Op Income Income Taxes 6.3% 6.0% 2007 2008 2007 2008

2007 2008 2007 2008 $541.4 Fourth Quarter 2008 Results Revenue down with weak retail sales environment Snow stands out, +19% EPS met expectations Currency impact turned negative Diluted EPS * Total Company Sales ($ in millions) * From continuing operations. $523.6 - -3% $1.07 $1.11 +4%

2007 ORV Snow Victory PG&A 2008 Fourth Quarter 2008 Sales Geographic Sales Q4 % Change in Q4 2008 Total Company Sales United States Canada Other Foreign Countries Sales 1371 273 255 0 Volume Product Mix & Price Currency Total Q4 Sales by Product line ORV Snowmobiles Victory PG&A Sales 319.8 95.2 21.8 86.8 0 - -20% +21% - -4% - -3% Fourth Quarter 2008 $541.4 - -5% +19% - -40% - -2% $523.6 Canada +21% $76.6 United States - -5% $378.6 Int'l - -15% $68.4 ORV - -5% $319.8 Snow +19% $95.2 PG&A - -2% $86.8 Victory $21.8 - -40% Total Company Total Company

2007 2008 $38.0 $36.2 - -5% Fourth Quarter 2008 Earnings Net income within expectations Gross profit margins improved 80 basis points Finance Services income decreased $5.7 million Net Income as a Percent of Sales * Net Income * * From continuing operations. Gross Margin Op Expense Financial Services Interest Expense Non-Op Income Income Taxes 2007 2008 7.0% 6.9% 0.8% - -0.8% - -1.0% 0.2% 0.6% 0.1%

North American Retail Sales - 2008 ATVs, Side by sides, Motorcycle and Snowmobiles, combined North American retail sales deteriorated throughout Q4 International also declined in Q4 Polaris gained market share in all businesses in 2008 for 2nd year in row Industry Polaris Industry Polaris Industry Polaris Sales -0.13 -0.06 0 -0.25 -0.19 0 -0.16 -0.09 0 % change from prior year First nine months ended September 30 Fourth quarter Full Year Industry Polaris Note: Side-by-side industry retail sales are Polaris estimates - -16% - -9% - -25% - -19% - -11% - -6% Units

North American Dealer Inventory All Products Dealer inventory down 7% at year-end 2008; not enough Core ATVs and motorcycles require further reductions MVP key to sustainable reductions 2009 dealer inventory levels are expected to significantly decline once again Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Units 2006 Actual 2007 Actual 2008 Actual

2008 Summary Highlights: Record sales and EPS Sales up 9% EPS up 13% Share gains in every business International operations grew 18% Industry leading new products Sportsman XP; RZR S; RANGER HD; 800 Assault/Dragon Operational Excellence delivered Improved quality • Increased speed to market • MVP Dealer inventories declined by 7% Gross profit margin expansion of 80 bpts Disappointments Q4 retail sales decline; Victory below expectations Credit environment was tough Finance income down $24M Retail credit availability concerns Factory inventory too high Share price declined

2006 2007 2008 2009 Operational Excellence 21.7% 22.1% 22.9% Cost - Gross Profit Margin Expansion Supply chain lead time reduction of 50% New product development cycle time reduced by 37% MVP go to market dealer business model Lean expansion NPS improved in 3 of 4; industry leading in Victory & SxS Speed to Market Quality - Net Promoter Score Up to +130 bpts - -25% - -15% 36% faster than '06 - -5% Goals 2006 2007 2008 2009 Guidance

Off-Road Vehicle Division $1.195B $1.306B - -17% to -25% - -20% to -35% Polaris Revenue ($000's) - -22% N.A. Off-Road Vehicle Industry +9% 67% of Total Polaris Sales #1 Market Share in ORV in N.A. & Europe New Sportsman XP & Ranger selling well Consolidated into ORV Division Improve cost synergies & market effectiveness Guidance Note: Side-by-side industry retail sales are Polaris estimates Projection

2007 2008 2009 Guidance Snowmobile Division $179M $205M - -10% to -20% Polaris Revenue ($000's) - -20% N.A. Snowmobile Industry +15% 10% of Total Polaris Sales Gained Share in 2008; #2 Significant Quality Improvement +20% Launched RUSH in 2009 Industries only progressive rate rear suspension Good snow conditions throughout NA Dealer Inventory down 4% STD For season ended March 31 2005 2006 2007 2008 2009E

2007 2008 2009 2005 2006 2007 2008 2009 Victory Division $113M - -25% to -40% - -15% to -25% Polaris Revenue ($000's) - -9% N.A. Motorcycle Industry 1400cc+ - -17% $94M 5% of Total Polaris Sales Industry leader in ownership satisfaction Gained share for 5th year in a row Aggressive supply reduction to improve dealer business model Global expansion - Australia, Germany Focused on "retail acceleration" + share - -4% +6% +4% Retail 0% to -10% Guidance Projection

2007 2008 2009 PG&A Division $293M +17% $344M - -9% to -13% Polaris Revenue ($000's) 18% of Total Polaris Sales Sales growth in all businesses; record sales Highest margin business Innovation continues: 260 new accessories in '08 Expect to outperform WG sales in '09 2008 PG&A Revenue by Business Unit Guidance

2007 2008 2009 International Division Polaris Revenue ($000's) +18% $304M - -10% to -20% 2008 Revenue by Geography 2008 Revenue by Business Unit 16% of Total Polaris Sales #1 market share in ORV for EMEA & gaining share EMEA markets weak in '08; expect same in '09 Gaining share in Snow in '08 Increased direct presence - 50% in '08 Victory global expansion - Australia, Germany New structure focused on global expansion Guidance $258M Europe 69% ME/Africa 14% Latin America 7% Asia 1% Aus/NZ 9% Snow 12% PGA 17% Victory 3% ORV 68%

Adjacencies Military: New customer penetration Global expansion / after sale support Expanded business development resources Expecting to announce 2 new adjacencies in '09 Outside powersports On road / outside powersports Additional organic opportunities in pipeline Focus: Global Outside powersports On road +42% Polaris Defense Revenues +50% to 100% 2007 2008 2009 Guidance

2007 2008 2007 2008 Q4 2008 Q4 2008 2007 2008 2009 Other Activities Wholesale Credit Retail Financing Financial Services Income 2008 wholesale credit income $13.3 million, down 4% 2008 retail credit income $5.7 million, down 80% 2008 other activities income $2.2 million, down 31% Financial Services Income by category Retail Portfolio - HSBC and GE combined Penetration Rate Approval rate 46% Q4 2008 53% 38% 39% 51% 31% $45.3 $21.2 $ in millions Remains acceptable Down about 50% primarily due to no HSBC income in 2009 Guidance

2009 Full Year Guidance Product Line Sales Off Road Vehicles (ORV) Down 17% to 25% Snowmobiles Down 10% to 20% Victory Motorcycles Down 25% to 40% PG&A Down 9% to 13% Total Company Sales Down 15% to 23% Gross Margins Up to 130 bpts improvement Operating expenses Down significantly in dollars but up as a percent of sales Income Taxes In the range of 34.0% to 34.5% of pretax income EPS, Diluted from continuing operations $2.50 - $3.00 (-29% to -14%)

Gross Profit Margin Percentage Trends Flexible variable cost structure and timely execution drives gross margin expansion

Balance Sheet and Liquidity Profile $ In millions (except per share data) 2008 Actual 2009 Guidance Total Debt at Year-end $200.0 Approximately flat Net Debt at Year-end (debt less cash balances) $172.9 Improving Credit Facility (expires December 2011) $450.0 $450 Average debt outstanding $283.0 Similar Maximum debt outstanding $345.0 Similar Capital Expenditures $76.6 $50 to $60 Depreciation and amortization $66.1 $60 to $65 Operating cash flow $176.2 Expected to decrease approximately in line with net income Stock buyback $107.2 (2.5 million shares) Much more modest share repurchase activity to approximate benefit plan share issuances Dividend $1.52 per share $1.56 per share (+3%)

First Quarter 2009 Guidance Industry retail sales demand trends are expected to decline at least double-digits throughout 2009, and worse in first half First quarter 2008 included a $0.06 EPS benefit from retail credit income received from HSBC Q1 2009 will include severance costs for workforce reduction Total Company Sales (in millions) Diluted EPS* (in millions) 2008 2009 Sales 388.7 292 18.6 $388.7 Down 20% to 25% Actual Guidance 2008 2009 Sales 0.55 0.15 0.1 $0.55 $0.15 to $0.25 Down 73% to 55% Actual Guidance * From continuing operations.

Ready for 2009 Aligned Strategy & Structure Off-Road Vehicle Division International Team Adjacencies Attacked Costs Workforce reductions announced 460 Operating Expense reductions > $10M Manufacturing/Production costs reduced with volume Accelerated Operational Excellence Speed / Factory Adjustments Q4 2008 production cuts Productivity +8% Value Engineering > $10M Focused on Dealers / Customers Product Innovation Rush, RZR 170, Much more Process Innovation MVP / Victory Go-to Market Prepared for a Tough Year Sales -15% to -23% Contingency Plans in place

Polaris 5-Year Strategic Objectives Best in Powersports PLUS 5-8% organic growth Growth through Adjacencies $100 - 300M growth Global Market Leadership >25% of Polaris Revenue Operations is a Competitive Advantage Op Ex drives >200bpts Op Margin improvement Strong Financial Performance Sustainable, Profitable Growth A Great Future for All Stakeholders

Polaris Industries Inc. Thank you. Q & A