Shareholders' Equity

3 Months Ended

Mar. 31, 2021

Shareholders’ Equity

During the three months ended March 31, 2021, Polaris paid $299.1 million to repurchase approximately 2.5 million shares of its common stock. As of March 31, 2021, the Board of Directors has authorized the Company to repurchase up to an additional 0.1 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 and subject to the restrictions on share repurchases set forth in the incremental amendment.

The Company paid a regular cash dividend of $0.63 per share on March 15, 2021 to holders of record at the close of business on March 1, 2021. Cash dividends declared and paid per common share for the three months ended March 31, 2021 and 2020, were as follows:


	Three months ended March 31,
		2021		2020
Cash dividends declared and paid per common share		$	0.63	$	0.62

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”), 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 share-based awards issued under the Omnibus Plan. A reconciliation of these amounts is as follows (in millions):


	Three months ended March 31,
		2021	2020
Weighted average number of common shares outstanding		61.6	61.4
Director Plan and deferred stock units		0.3	0.2
ESOP		0.1	0.3
Common shares outstanding—basic		62.0	61.9
Dilutive effect of restricted stock units		0.6	—
Dilutive effect of stock option awards		0.8	—
Common and potential common shares outstanding—diluted		63.4	61.9

During the three months ended March 31, 2021, 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 1.0 million compared to 5.2 million for the same period in 2020. As a result of the Company’s net loss during the three months ended March 31, 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, 2020	$	(39.1)	$	(15.5)	$	(3.8)	$	(58.4)
Reclassification to the statement of income	—		2.1		0.1		2.2

Change in fair value	(15.6)		(0.7)		—		(16.3)
Balance as of March 31, 2021	$	(54.7)	$	(14.1)	$	(3.7)	$	(72.5)

The table below provides the amount of gains and losses, net of tax, reclassified from accumulated other comprehensive loss into the statements of income (loss) for cash flow derivatives designated as hedging instruments and retirement plan activity for the three months ended March 31, 2021 and 2020 (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,
			2021		2020
Foreign currency contracts	Other (income) expense, net		$	(0.7)	$	—
Foreign currency contracts	Cost of sales		0.6		0.5
Interest rate contracts	Interest expense		(2.0)		(0.5)
Retirement plan activity	Operating expenses		(0.1)		(0.1)
Total			$	(2.2)	$	(0.1)

The net amount of the existing gains or losses at March 31, 2021 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.