Shareholders' Equity

3 Months Ended

Mar. 31, 2020

Shareholders’ Equity

During the three months ended March 31, 2020, Polaris paid $48.8 million to repurchase approximately 0.6 million shares of its common stock. As of March 31, 2020, the Board of Directors has authorized the Company to repurchase up to an additional 2.6 million million 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 $0.62 per share on March 16, 2020 to holders of record at the close of business on March 2, 2020.

Cash dividends declared and paid per common share for the three months ended March 31, 2020 and 2019, were as follows:



	Three months ended March 31,
	2020		2019
Cash dividends declared and paid per common share	$	0.62	$	0.61

Net income (loss) per share

Basic income (loss) 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”) and the ESOP and deferred stock units under the 2007 Omnibus Incentive Plan (“Omnibus Plan”). Diluted income (loss) per share is computed under the treasury stock method and is calculated to compute the dilutive effect of outstanding stock options and certain shares issued under the Omnibus Plan. A reconciliation of these amounts is as follows (in millions):



	Three months ended March 31,
	2020	2019
Weighted average number of common shares outstanding	61.4	61.0
Director Plan and deferred stock units	0.2	0.2
ESOP	0.3	0.1
Common shares outstanding—basic	61.9	61.3
Dilutive effect of Omnibus Plan	—	0.7
Common and potential common shares outstanding—diluted	61.9	62.0

During the three months ended March 31, 2020, the number of options that were not included in the computation of diluted income (loss) per share because the option exercise price was greater than the market price, and therefore, the effect would

have been anti-dilutive, was 5.2 million compared to 4.4 million for the same period in 2019. As a result of the Company’s net loss during the first quarter of 2020, an additional 0.7 million of outstanding stock options and certain share-based awards under the Omnibus Plan were not included in the computation of diluted income (loss) per share because the effect would have been anti-dilutive.

Accumulated other comprehensive loss

Changes in the accumulated other comprehensive loss balance are as follows (in millions):



	Foreign Currency Translation			Cash Flow Hedging Derivatives			Retirement Plan and Other Activity			Accumulated Other Comprehensive Loss
Balance as of December 31, 2019	$	(63.3	)	$	(6.1	)	$	(3.3	)	$	(72.7	)
Reclassification to the statement of income	—			—			0.1			0.1
Change in fair value	(25.1		)	(10.3		)	—			(35.4		)
Balance as of March 31, 2020	$	(88.4	)	$	(16.4	)	$	(3.2	)	$	(108.0	)

The table below provides data about the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the statements of income for cash flow derivatives designated as hedging instruments for the three months ended March 31, 2020 and 2019 (in millions):



Derivatives in Cash Flow Hedging Relationships and Other Activity	Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income	Three months ended March 31,
		2020			2019
Foreign currency contracts	Other expense, net	$	—		$	1.2
Foreign currency contracts	Cost of sales	0.5			0.1
Interest rate contracts	Interest expense	(0.5		)	—
Retirement plan activity	Operating expenses	(0.1		)	(0.1		)
Total		$	(0.1	)	$	1.2

The net amount of the existing gains or losses at March 31, 2020 that is expected to be reclassified into the statements of income (loss) within the next 12 months is not expected to be material. See Note 9 for further information regarding derivative activities.