Segment Information

9 Months Ended

Sep. 30, 2018

Segment Reporting

The Company’s reportable segments are based on the Company’s method of internal reporting, which generally segregates the operating segments by product line, inclusive of wholegoods and PG&A. The internal reporting of these operating segments is defined based, in part, on the reporting and review process used by the Company’s Chief Executive Officer. The Company has six operating segments: 1) ORV, 2) Snowmobiles, 3) Motorcycles, 4) Global Adjacent Markets, 5) Aftermarket, and 6) Boats, and five reportable segments: 1) ORV/Snowmobiles, 2) Motorcycles, 3) Global Adjacent Markets, 4) Aftermarket, and 5) Boats.

Through June 30, 2018, the Company reported under four segments for segment reporting. However, during the third quarter ended September 30, 2018, as a result of the Boat Holdings acquisition, the Company established a new reporting segment, Boats, which includes only the results of Boat Holdings. As such, the comparative 2017 results were not required to be reclassified as the new reporting segment structure did not impact historical segments.

The ORV/Snowmobiles segment includes the aggregated results of our ORV and Snowmobiles operating segments. The Motorcycles, Global Adjacent Markets, Aftermarket, and Boats segments include the results for those respective operating segments. The Corporate amounts include costs that are not allocated to individual segments, which include incentive-based compensation and other unallocated manufacturing costs. Additionally, given the commonality of customers, manufacturing and asset management, the Company does not maintain separate balance sheets for each segment. Accordingly, the segment information presented below is limited to sales and gross profit data (in thousands):



	Three months ended September 30,						Nine months ended September 30,
	2018			2017			2018			2017
Sales
ORV/Snowmobiles	$	1,035,554		$	1,007,392		$	2,858,959		$	2,577,003
Motorcycles	155,316			155,059			458,285			473,345
Global Adjacent Markets	96,251			91,575			322,996			280,152
Aftermarket	229,973			224,700			676,859			666,928
Boats	134,321			—			134,321			—
Total sales	$	1,651,415		$	1,478,726		$	4,451,420		$	3,997,428
Gross profit
ORV/Snowmobiles	$	290,631		$	296,904		$	831,413		$	776,013
Motorcycles	19,577			10,354			60,817			11,589
Global Adjacent Markets	24,155			15,983			83,520			65,297
Aftermarket	66,092			63,239			182,291			164,721
Boats	20,253			—			20,253			—
Corporate	(19,438		)	(22,518		)	(68,367		)	(60,781		)
Total gross profit	$	401,270		$	363,962		$	1,109,927		$	956,839