Shareholders' Equity

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

During the six months ended June 30, 2016, Polaris paid $143,876,000 to repurchase and retire approximately 1,692,000 shares of its common stock. As of June 30, 2016, the Board of Directors has authorized the Company to repurchase up to an additional 8,679,000 shares of Polaris stock. The repurchase of any or all such shares authorized for repurchase will be governed by applicable SEC rules and dependent on management’s assessment of market conditions. Polaris paid a regular cash dividend of $0.55 per share on June 15, 2016 to holders of record at the close of business on June 1, 2016. On July 20, 2016, the Polaris Board of Directors declared a regular cash dividend of $0.55 per share payable on September 15, 2016 to holders of record of such shares at the close of business on September 1, 2016. Cash dividends declared per common share for the three and six months ended June 30, 2016 and 2015, were as follows:

	Three months ended June 30,				Six months ended June 30,
	2016		2015		2016		2015
Cash dividends declared and paid per common share	$	0.55	$	0.53	$	1.10	$	1.06

Net income per share

Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during each period, including shares earned under the Deferred Compensation Plan for Directors (“Director Plan”), the ESOP and deferred stock units under the 2007 Omnibus Incentive Plan (“Omnibus Plan”). Diluted earnings per share is computed under the treasury stock method and is calculated to compute the dilutive effect of outstanding stock options issued under the 1995 Stock Option Plan (the “Option Plan”) and certain shares issued under the Omnibus Plan. A reconciliation of these amounts is as follows (in thousands):

	Three months ended June 30,		Six months ended June 30,
	2016	2015	2016	2015
Weighted average number of common shares outstanding	64,130	66,000	64,444	66,068
Director Plan and deferred stock units	166	242	181	224
ESOP	110	82	101	84
Common shares outstanding—basic	64,406	66,324	64,726	66,376
Dilutive effect of Option Plans and Omnibus Plan	891	1,505	913	1,611
Common and potential common shares outstanding—diluted	65,297	67,829	65,639	67,987

During the three and six months ended June 30, 2016, the number of options that could potentially dilute earnings per share on a fully diluted basis that were not included in the computation of diluted earnings per share (because to do so would have been anti-dilutive) were 1,809,000 and 1,672,000, respectively, compared to 1,080,000 and 912,000 for the same periods in 2015.

Accumulated other comprehensive loss

Changes in the accumulated other comprehensive loss balance is as follows (in thousands):

	Foreign Currency Items			Cash Flow Hedging Derivatives			Accumulated Other Comprehensive Loss
Balance as of December 31, 2015	$	(64,360	)	$	1,868		$	(62,492	)
Reclassification to the income statement	—			(1,574		)	(1,574		)
Change in fair value	(1,038		)	(5,685		)	(6,723		)
Balance as of June 30, 2016	$	(65,398	)	$	(5,391	)	$	(70,789	)

The table below provides data about the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the income statement for cash flow derivatives designated as hedging instruments for the three and six months ended June 30, 2016 and 2015 (in thousands):

Derivatives in Cash Flow Hedging Relationships	Location of (Gain) Loss Reclassified from Accumulated OCI into Income	Three months ended June 30,						Six months ended June 30,
		2016			2015			2016			2015
Foreign currency contracts	Other expense, net	$	493		$	1,898		$	2,423		$	2,402
Foreign currency contracts	Cost of sales	(278		)	(1,122		)	(849		)	(2,018		)
Total		$	215		$	776		$	1,574		$	384

The net amount of the existing gains or losses at June 30, 2016 that is expected to be reclassified into the income statement within the next 12 months is expected to not be material. See Note 9 for further information regarding Polaris’ derivative activities.