Bombardier Recreational Products Inc.

Overview Key strengths Key risks Balance sheet strength provides cushion against any macroeconomic weakness Operations exposed to volatility spurred by lower discretionary spending during economic slowdown Continued healthy retail demand for outdoor recreational vehicles through COVID-19 pandemic supports topline growth Near-term supply-chain constraints and higher input costs jeopardize current profitability levels Product diversity and consistent new product launches have led to increased market share Potential for an aggressive shareholder-friendly policy given the financial sponsor ownership S&P Global Ratings anticipates Bombardier Recreational Products Inc. (BRP) could sustain strong topline and EBITDA growth over the next 12 months, spurred by strong customer demand because consumer spending has been directed toward the purchase of recreational and off-road vehicles for travel and leisure/entertainment even

...Healthy demand for recreational vehicles could lead to stronger topline growth and EBITDA generation. S&P Global Ratings anticipates Bombardier Recreational Products Inc. (BRP) could sustain strong topline and EBITDA growth over the next 12 months, spurred by strong customer demand because consumer spending has been directed toward the purchase of recreational and off- road vehicles for travel and leisure/entertainment even during the post-pandemic recovery phase. As a result, the increased share of first-time motorized vehicle buyers (30% of customers in fiscal 2022, up from about 20% historically) has resulted in better-than- expected topline and EBITDA growth for fiscal 2022. In line with the 2022 demand trends, for 2023 lower dealer inventory levels exacerbated by slower product replenishment would continue to support pricing and, thus, BRPs topline growth. We expect BRP's demand for seasonal vehicles and marine products to further extend through the next 12-18 months adding to EBITDA...

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