Unaudited Condensed Consolidated Interim Financial Statements

BRP Inc.

For the three- and nine-month periods ended October 31, 2025 and 2024

BRP Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF NET INCOME

[Unaudited]

[in millions of Canadian dollars, except per share data]

 

										Three-month periods ended								Nine-month periods ended
		Notes								October 31, 2025				October 31, 2024				October 31, 2025				October 31, 2024
														Reclassified (Note 2)								Reclassified (Note 2)
Revenues			13								$2,250.3				$1,973.5				$5,985.4				$5,784.6
Cost of sales											1,709.1				1,538.4				4,651.7				4,428.5
Gross profit											541.2				435.1				1,333.7				1,356.1
Operating expenses
Selling and marketing											123.9				110.5				343.7				330.3
Research and development											110.1				95.7				311.5				283.2
General and administrative											101.4				67.1				275.7				240.3
Other operating expenses			14								3.2				22.5				15.9				52.1
Total operating expenses											338.6				295.8				946.8				905.9
Operating income											202.6				139.3				386.9				450.2
Financing costs			15								67.6				51.1				164.7				149.8
Financing income			15								(3.2)				(1.3)				(7.8)				(7.1)
Foreign exchange (gain) loss on long-term debt											31.2				25.8				(88.3)				107.7
Income before income taxes											107.0				63.7				318.3				199.8
Income tax expense			16								30.5				33.1				23.7				84.7
Net income from continuing operations											76.5				30.6				294.6				115.1
Net loss from discontinued operations			18								(7.7)				(23.8)				(52.2)				(108.5)
Net income											$68.8				$6.8				$242.4				$6.6
Attributable to shareholders											$69.1				$7.1				$243.6				$6.1
Attributable to non-controlling interest											$(0.3)				$(0.3)				$(1.2)				$0.5
Basic earnings per share - continuing operations			12								$1.05				$0.42				$4.05				$1.55
Diluted earnings per share - continuing operations			12								$1.04				$0.42				$4.01				$1.53
Basic loss per share - discontinued operations			12								$(0.11)				$(0.33)				$(0.71)				$(1.47)
Diluted loss per share - discontinued operations			12								$(0.10)				$(0.32)				$(0.71)				$(1.45)
Basic earnings per share			12								$0.94				$0.09				$3.34				$0.08
Diluted earnings per share			12								$0.94				$0.10				$3.30				$0.08

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

2

BRP Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF TOTAL COMPREHENSIVE INCOME (LOSS)

[Unaudited]

[in millions of Canadian dollars]

 

						Three-month periods ended												Nine-month periods ended
		Notes				October 31, 2025				October 31, 2024								October 31, 2025				October 31, 2024
Net income							$68.8				$6.8								$242.4				$6.6
Other comprehensive income (loss)
Items that will be reclassified subsequently to net income
Net changes in fair value of derivatives designated as cash flow hedges							(4.7	)			(19.3)								28.5				(67.2)
Net changes in unrealized gain (loss) on translation of foreign operations							16.3				(1.1)								81.5				0.1
Income tax (expense) recovery							1.2				5.1								(7.5	)			17.9
							12.8				(15.3)								102.5				(49.2)
Items that will not be reclassified subsequently to net income
Actuarial gains on defined benefit pension plans							0.9				1.6								11.1				3.9
Gain on fair value of restricted investments							0.4				0.1								0.4				0.4
Income tax expense							(0.5	)			(0.5)								(3.0	)			(1.3)
							0.8				1.2								8.5				3.0
Total other comprehensive income (loss)							13.6				(14.1)								111.0				(46.2)
Total comprehensive income (loss)							$82.4				$(7.3)								$353.4				$(39.6)
Attributable to shareholders							$82.5				$(6.7)								$354.4				$(40.4)
Attributable to non-controlling interest							(0.1	)			(0.6)								(1.0	)			0.8
Total comprehensive income (loss) attributable to shareholders
Continuing operations							$89.6				$17.0								$398.7				$65.7
Discontinued operations			18				(7.1	)			(23.7)								(44.3	)			(106.1)
							$82.5				$(6.7)								$354.4				$(40.4)

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

3

BRP Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

[Unaudited]

[in millions of Canadian dollars]

As at

 

		Notes				October 31, 2025				January 31, 2025
										Reclassified (Note 2)
Cash and cash equivalents							$250.1				$180.7
Trade and other receivables							647.7				633.5
Income taxes and investment tax credits receivable							151.8				140.4
Other financial assets			4				39.3				82.1
Inventories			5				1,964.9				1,774.1
Other current assets			6				68.8				63.9
Assets classified as held for sale			18				128.0				292.7
Total current assets							3,250.6				3,167.4
Investment tax credits receivable							22.6				23.6
Other financial assets			4				50.6				26.6
Property, plant and equipment							1,899.4				1,938.8
Intangible assets							629.3				603.8
Right-of-use assets							220.8				182.8
Deferred income taxes							434.2				345.7
Other non-current assets			6				3.9				4.7
Total non-current assets							3,260.8				3,126.0
Total assets							$6,511.4				$6,293.4
Trade payables and accruals							$1,616.6				$1,231.4
Provisions			7				741.2				797.1
Other financial liabilities			8				75.7				86.2
Income tax payable							19.5				44.3
Deferred revenues							62.2				71.3
Current portion of long-term debt			9				50.1				53.8
Current portion of lease liabilities							54.8				47.1
Other current liabilities							8.2				—
Liabilities associated to assets classified as held for sale			18				17.0				83.2
Total current liabilities							2,645.3				2,414.4
Long-term debt			9				2,488.4				2,871.3
Lease liabilities							192.9				158.2
Provisions			7				112.4				147.3
Other financial liabilities			8				90.9				80.2
Deferred revenues							80.2				95.3
Employee future benefit liabilities							204.2				194.0
Deferred income taxes							68.3				58.8
Other non-current liabilities							52.0				27.1
Total non-current liabilities							3,289.3				3,632.2
Total liabilities							5,934.6				6,046.6
Equity							576.8				246.8
Total liabilities and equity							$6,511.4				$6,293.4

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

4

BRP Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

[Unaudited]

[in millions of Canadian dollars]

 

For the nine-month period ended October 31, 2025

 

		Attributed to shareholders
			Capital Stock (Note 10	)			Contributed surplus				Retained earnings (losses	)			Translation of foreign operations				Cash-flow hedges				Total				Non-controlling interests				Total equity
Balance as at January 31, 2025			$251.0				$83.0				$(37.3	)			$(21.5	)			$(33.9	)			$241.3				$5.5				$246.8
Net income (loss)			—				—				243.6				—				—				243.6				(1.2	)			242.4
Other comprehensive income			—				—				8.5				81.3				21.0				110.8				0.2				111.0
Total comprehensive income (loss)			—				—				252.1				81.3				21.0				354.4				(1.0	)			353.4
Dividends			—				—				(47.1	)			—				—				(47.1	)			—				(47.1	)
Issuance of subordinate shares (Note 10)			16.8				(4.2	)			0.6				—				—				13.2				—				13.2
Stock-based compensation			—				16.7	[a]			—				—				—				16.7				—				16.7
Special long-term incentive program (Note 11)			—				(9.6	)			—				—				—				(9.6	)			—				(9.6	)
Other			—				—				—				—				—				—				3.4				3.4
Balance as at October 31, 2025			$267.8				$85.9				$168.3				$59.8				$(12.9	)			$568.9				$7.9				$576.8
[a] Includes $0.1 million of income tax expense.   For the nine-month period ended October 31, 2024
		Attributed to shareholders
			Capital Stock (Note 10	)			Contributed surplus				Retained earnings				Translation of foreign operations				Cash-flow hedges				Total				Non-controlling interests				Total equity
Balance as at January 31, 2024			$248.5				$71.8				$443.1				$0.6				$44.9				$808.9				$5.0				$813.9
Net income			—				—				6.1				—				—				6.1				0.5				6.6
Other comprehensive income (loss)			—				—				3.0				(0.2	)			(49.3	)			(46.5	)			0.3				(46.2	)
Total comprehensive income (loss)			—				—				9.1				(0.2	)			(49.3	)			(40.4	)			0.8				(39.6	)
Dividends			—				—				(46.5	)			—				—				(46.5	)			—				(46.5	)
Issuance of subordinate shares			18.3				(4.7	)			—				—				—				13.6				—				13.6
Repurchase of subordinate shares			(16.6	)			—				(202.0	)			—				—				(218.6	)			—				(218.6	)
Stock-based compensation			—				13.7	[a]			—				—				—				13.7				—				13.7
Balance as at October 31, 2024			$250.2				$80.8				$203.7				$0.4				$(4.4	)			$530.7				$5.8				$536.5

^[a] Includes $0.8 million of income tax recovery.

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

5

BRP Inc.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

[Unaudited]

[in millions of Canadian dollars]

 

								Nine-month periods ended
		Notes						October 31, 2025				October 31, 2024
OPERATING ACTIVITIES
Net income									$242.4				$6.6
Non-cash and non-operating items:
Depreciation expense									337.3				320.1
Income tax expense									6.9				48.9
Foreign exchange (gain) loss on long-term debt									(88.3)				107.7
Interest expense and transaction costs									151.1				139.3
Unrealized foreign exchange (gain) loss on other working capital items									14.9				(30.4)
Other									7.5				27.2
Cash flows generated from operations before changes in working capital									671.8				619.4
Changes in working capital:
Decrease in trade and other receivables									16.7				149.5
Increase in inventories									(101.9)				(53.5)
Increase in other assets									(2.5)				(50.3)
Increase (decrease) in trade payables and accruals									353.2				(99.8)
Increase in other financial liabilities									16.8				14.8
Decrease in provisions									(121.4)				(17.3)
(Decrease) increase in other liabilities									7.9				(43.1)
Cash flows generated from operations									840.6				519.7
Income taxes paid, net of refunds									(56.3)				(117.2)
Net cash flows generated from operating activities									784.3				402.5
INVESTING ACTIVITIES
Additions to property, plant and equipment									(187.5)				(279.0)
Additions to intangible assets									(30.7)				(20.8)
Proceeds of disposal from Marine businesses			18						23.7				—
Other									(2.4)				0.4
Net cash flows used in investing activities									(196.9)				(299.4)
FINANCING ACTIVITIES
Increase in bank overdraft									—				15.1
Issuance of long-term debt									0.7				3.3
Long-term debt amendment fees									(4.4)				—
Repayment of long-term debt			9						(318.8)				(36.4)
Repayment of lease liabilities									(45.3)				(39.7)
Interest paid									(135.4)				(133.2)
Issuance of subordinate voting shares									12.6				13.6
Repurchase of subordinate voting shares			10						—				(215.1)
Dividends paid									(47.1)				(46.5)
Other									3.8				(4.2)
Net cash flows used in financing activities									(533.9)				(443.1)
Effect of exchange rate changes on cash and cash equivalents									16.6				(6.1)
Net increase (decrease) in cash and cash equivalents									70.1				(346.1)
Cash and cash equivalents at the beginning of period									180.0				491.8
Cash and cash equivalents at the end of period									$250.1				$145.7

The Company has elected to present a consolidated statement of cash flows that includes both continuing and discontinued operations. Amounts related to discontinued operations by operating, investing and financing activities are disclosed in Note 18.

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

6

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

1.	NATURE OF OPERATIONS

BRP Inc. (“BRP”) is incorporated under the laws of Canada. BRP’s multiple voting shares are owned by Beaudier Inc. and 4338618 Canada Inc. (collectively, “Beaudier Group”), Bain Capital Integral Investors II, L.P. (“Bain Capital”) and La Caisse de dépôt et placement du Québec (“CDPQ”), (collectively, the “Principal Shareholders”). BRP’s subordinate voting shares are listed in Canada on the Toronto Stock Exchange under the symbol DOO and in the United States on the Nasdaq Global Select Market under the symbol DOOO.

BRP and its subsidiaries (the “Company”) design, develop, manufacture and sell powersports vehicles and marine products. The Company’s Powersports segment comprises “Year-Round Products” which consists of all-terrain vehicles, side-by-side vehicles, three-wheel vehicles and electric motorcycles; “Seasonal Products” which consists of snowmobiles, personal watercraft and pontoons; and “PA&A and OEM Engines” which consists of parts, accessories and apparel (“PA&A”), engines for karts, recreational aircraft and jet boats, and other services. Additionally, the Company’s Marine segment consists of boats, pontoons, outboard engines and other services.

The Company’s products are sold mainly through a network of independent dealers, independent distributors and to original equipment manufacturers (the “Customers”). The Company distributes its products worldwide and manufactures them in Mexico, Canada, Austria, the United States, Finland, Australia and Germany.

During the nine-month period ended October 31, 2025, the Company completed the sales of Alumacraft and Manitou. Consequently, these businesses are presented as discontinued operations, and the associated assets and liabilities are disposed as at October 31, 2025 (Note 18).

During the three-month period ended April 30, 2025, the Company decided that its Marine PA&A business was no longer for sale. Following this decision, Marine PA&A business is presented as continued operations and the associated assets and liabilities are no longer held for sale as at October 31, 2025. Prior periods have been reclassified accordingly.

As announced on October 17, 2024, Telwater (Quintrex, Stacer, Savage and Yellowfin) remains under the sale process. Consequently, this business is presented as discontinued operations and the associated assets and liabilities as held for sale as at October 31, 2025 (Note 18).

The Company’s headquarters is located at 726 Saint-Joseph Street, Valcourt, Québec, J0E 2L0.

 

2.	BASIS OF PRESENTATION

These unaudited condensed consolidated interim financial statements for the three- and nine-month periods ended October 31, 2025 and 2024 have been prepared using accounting policies consistent with IFRS^® Accounting Standards as issued by the International Accounting Standards Board (“IFRS”) and in accordance with IAS 34 “Interim Financial Reporting”. These unaudited condensed consolidated interim financial statements for the three- and nine-month periods ended October 31, 2025 and 2024 follow the same accounting policies as the audited consolidated financial statements for the year ended January 31, 2025 and, as such, should be read in conjunction with them.

 

7

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

 

 

2.	BASIS OF PREPARATION [CONTINUED]

The preparation of these unaudited condensed consolidated interim financial statements in accordance with the Company’s accounting policies requires management to make estimates and judgments that can affect the reported amounts of assets and liabilities, related amounts of revenues and expenses, other comprehensive income and disclosures made. The Company’s best estimates are based on the information, facts and circumstances available at the time estimates are made. Management uses historical experience and information, general economic conditions and trends, as well as assumptions regarding probable future outcomes as the basis for determining estimates. Actual results could differ from the estimates used and such differences could be significant.

These unaudited condensed consolidated interim financial statements include the financial statements of BRP and its subsidiaries. BRP controls all of its subsidiaries that are wholly owned through voting equity interests, except for BRP Commerce & Trade (Shanghai) Company Limited in China and LVHA Manufacturing Company Limited in Vietnam for which a non-controlling interest of 20% and 35% respectively are recorded upon consolidation, and Pinion GmbH in Germany for which there is a non-controlling interest of 20%. BRP is also part of a joint venture located in Austria. All inter-company transactions and balances have been eliminated upon consolidation.

The Company’s revenues and operating income experience substantial fluctuations from quarter to quarter. In general, wholesale of the Company’s products are higher in the period immediately preceding and during their particular season of use. However, the mix of product sales may vary considerably from time to time as a result of changes in seasonal and geographic demand, the introduction of new products and models and production scheduling for particular types of products.

On December 3, 2025, the Board of Directors of the Company approved these unaudited condensed consolidated interim financial statements for the three- and nine-month periods ended October 31, 2025 and 2024.

Discontinued operations and assets and liabilities held for sale

The assets of a disposal group are classified as held for sale when their carrying amount will be recovered principally through a sale transaction rather than through continuing use. Assets must be available for immediate sale in their present condition and a sale transaction must be highly probable. The assets of a disposal group classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee benefits and financial assets which are specifically exempt from this measurement requirement.

A disposal group qualifies as discontinued operations if it is a component of the entity that either has been disposed of, or is classified as held for sale, and represents a separate major line of business or geographical area of operations, is part of a single coordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. Classification as a discontinued operation occurs at the earlier of the date on which an operation meets the criteria to be classified as held-for-sale or disposal.

The assets of a disposal group classified as held for sale are presented separately from the other assets in the consolidated statement of financial position. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the consolidated statement of financial position.

 

8

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

 

 

2.	BASIS OF PREPARATION [CONTINUED]

The non-current assets of a disposal group are not depreciated or amortized while they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be recognized.

Discontinued operations are excluded from the results of continuing operations and are presented as a single amount of net income from discontinued operations in the consolidated income statement and a single amount of comprehensive income from discontinued operations in the consolidated statement of comprehensive income.

When an operation is classified as a discontinued operation, the comparative consolidated income statement is reclassified as if the operation had been discontinued from the beginning of the comparative year.

When a component ceases to be classified as held-for-sale, the related operations are reclassified as continued operations. The operations are presented as continued operations in the current period and prior periods are reclassified consistently.

 

9

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

 

 

3.	BUSINESS COMBINATIONS

On July 1^st, 2025, the Company completed the acquisition of 100% of the outstanding shares of Smartscale Newco AG (“Smartscale”), a subsidiary of MG Biketec GmbH for a consideration payable on the realisation of financial targets (“Contingent consideration”). The fair value of the Contingent consideration is based on management’s assessment of the likelihood to achieve the financial targets and is valued at CHF 13.3 million ($23.2 million) as at October 31, 2025. The consideration has been mostly allocated to goodwill that arises from expected synergies and future growth. Smartscale, which is located in Huttwil, Switzerland, provides comprehensive support to e-bike manufacturers and dealers by offering system components for e-bikes.

The Company’s consolidated statement of net income included the operating results of Smartscale since the acquisition date. Since July 1st, 2025, the revenues and net income of Smartscale were not significant, and had the Company acquired Smartscale at the beginning of the nine-month period ended October 31, 2025, the increase to its revenues and net income would also not have been significant.

The Company incurred acquisition-related costs of $0.8 million, which have been recorded in general and administrative expenses.

 

4.	OTHER FINANCIAL ASSETS

The Company’s other financial assets were as follows, as at:

		October 31, 2025				January 31, 2025
							Reclassified (Note 2)
Restricted investments [a]			$16.2				$14.7
Derivative financial instruments			14.3				27.3
Advances to suppliers related to property, plant and equipment			6.9				10.6
Other			52.5				56.1
Total other financial assets			$89.9				$108.7
Current			39.3				82.1
Non-current [b]			50.6				26.6
Total other financial assets			$89.9				$108.7

 

[a]	The restricted investments are publicly traded bonds that can only be used for severance payments and pension costs associated with Austrian pension plans, and are not available for general corporate use.

[b]	The non-current portion is mainly attributable to derivative financial instruments and restricted investments.

 

10

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

5.	INVENTORIES

The Company’s inventories were as follows, as at:

		October 31, 2025				January 31, 2025
							Reclassified (Note 2)
Materials and work in progress			$807.3				$709.0
Finished products			749.3				693.4
Parts, accessories and apparel			408.3				371.7
Total inventories			$1,964.9				$1,774.1

The Company recognized in the condensed consolidated interim statements of net income during the three- and nine-month periods ended October 31, 2025, a write-down on inventories of $13.8 million and $23.5 million respectively ($13.5 million and $31.3 million respectively during the three- and nine-month periods ended October 31, 2024).

 

6.	OTHER ASSETS

The Company’s other assets were as follows, as at:

		October 31, 2025				January 31, 2025
							Reclassified (Note 2)
Prepaids			$56.4				$52.6
Deferred financing cost			5.0				6.1
Other			11.3				9.9
Total other assets			$72.7				$68.6
Current			68.8				63.9
Non-current			3.9				4.7
Total other assets			$72.7				$68.6

 

7.	PROVISIONS

The Company’s provisions were as follows, as at:

 

		October 31, 2025				January 31, 2025
							Reclassified (Note 2)
Product-related			$798.1				$881.8
Restructuring			9.6				20.1
Other			45.9				42.5
Total provisions			$853.6				$944.4
Current			741.2				797.1
Non-current			112.4				147.3
Total provisions			$853.6				$944.4

 

11

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

7.	PROVISIONS [CONTINUED]

Product-related provisions include provisions for regular warranty coverage on products sold, product liability provisions and provisions related to sales programs offered by the Company to its Customers in order to support the retail activity.

The non-current portion of provisions is mainly attributable to product-related provisions.

The changes in provisions were as follows:

		Product-related				Restructuring				Other				Total
Balance as at January 31, 2025
Reclassified (Note 2)			$881.8				$20.1				$42.5				$944.4
Expensed during the period			930.1				3.1				37.4				970.6
Paid during the period			(1,027.1	)			(20.2	)			(39.0	)			(1,086.3	)
Reversed during the period			(7.2	)			(3.1	)			(0.8	)			(11.1	)
Effect of foreign currency exchange rate changes			(11.9	)			0.2				(0.1	)			(11.8	)
Unwinding of discount and effect of changes in discounting estimates			2.2				—				—				2.2
Effect of liabilities associated with assets held for sale			30.2				9.5				5.9				45.6
Balance as at October 31, 2025			$798.1				$9.6				$45.9				$853.6

 

8.	OTHER FINANCIAL LIABILITIES

The Company’s other financial liabilities were as follows, as at:

		October 31, 2025				January 31, 2025
							Reclassified (Note 2)
Dealer holdback programs and customer deposits			$56.9				$39.8
Due to Bombardier Inc.			22.6				22.7
Derivative financial instruments			19.6				64.3
Non-controlling interest liability			27.4				23.4
Contingent consideration (Note 3)			23.2				—
Other			16.9				16.2
Total other financial liabilities			$166.6				$166.4
Current			75.7				86.2
Non-current [a]			90.9				80.2
Total other financial liabilities			$166.6				$166.4

[a]	The non-current portion is mainly comprised of the amount due to Bombardier Inc. in connection with indemnification related to income taxes, the contingent consideration related to a business combination and the amount of the non-controlling interest liability.

 

12

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

9.

DEBT

Revolving Credit Facility

The Company has a Revolving Credit Facility totaling $1,500.0 million, which can also be drawn in U.S dollar or Euro equivalent. As at October 31, 2025, the Company had no outstanding amount drawn on the Revolving Credit Facility (nil as at January 31, 2025). Commitment fees on the undrawn amount of the Revolving Credit Facility, varying from 0.25% to 0.40%, were 0.30%.

The applicable interest rates are subject to a customary credit spread adjustment ranging from 0.45% to 3.00%, which varies depending on a Leverage Ratio. Based on the Leverage Ratio, the cost of borrowing as at October 31, 2025, in Canadian dollars, was either the CORRA plus 2.00% or the Canadian Prime Rate plus 1.00%. In U.S. dollars, it was either the SOFR plus 2.00%, the U.S. Base Rate plus 1.00% or the U.S. Prime Rate plus 1.00%. In Euros, it was the EURIBOR plus 2.00%.

The Company is required to maintain, under certain conditions, a minimum fixed charge coverage ratio. Additionally, the total available borrowing under the Revolving Credit Facility is subject to a borrowing base calculation representing 75% of the carrying amount of trade and other receivables plus 50% of the carrying amount of inventories. The total amount available was $1,476.5 million as at October 31, 2025.

Long-Term Debt

As at October 31, 2025 and January 31, 2025, the maturity dates, interest rates, outstanding nominal amounts and carrying amounts of long-term debt were as follows:

 

October 31, 2025

Maturity date

Contractual interest rate

Effective interest rate

Outstanding nominal amount

Carrying amount

Term Facility

Term Loan B-2

December 2029

6.38%

6.38%

U.S. $572.9

802.8

Term Loan B-3

January 2031

6.38%

6.38%

U.S. $1,156.6

1,620.7

Term Loans

Mar. 2026 to Dec. 2030

0.93% to 3.57%

2.48% to 6.50%

€74.3

115.0

Total long-term debt

$2,538.5

Current

50.1

Non-current

2,488.4

Total long-term debt

$2,538.5

 

13

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

9.	DEBT [CONTINUED]

 

January 31, 2025

Maturity date

Contractual interest rate

Effective interest rate

Outstanding nominal amount

Carrying amount

Term Facility

Term Loan B-1

May 2027

6.41%

6.61%

U.S. $465.7

$673.6

[a]

Term Loan B-2

December 2029

7.06%

7.31%

U.S. $488.8

706.9

[a]

Term Loan B-3

January 2031

7.06%

7.20%

U.S. $987.5

1,418.8

[a]

Term Loans

Mar. 2025 to Dec. 2030

0.93% to 3.89%

2.02% to 6.50%

€88.0

125.8

Total long-term debt

$2,925.1

Current

53.8

Non-current

2,871.3

Total long-term debt

$2,925.1

^[a] Net of unamortized transaction costs of nil for Term Loan B-1, nil for Term Loan B-2 and $9.4 million for Term Loan B-3.

The following table explains the changes in long-term debt during the nine-month period ended October 31, 2025:

 

						Statements of cash flows										Non-cash changes
		Carrying amount as at January 31, 2025				Issuance				Repayment						Effect of foreign currency exchange rate changes				Other				Carrying amount as at  October 31, 2025
Term Facility			$2,799.3				$—				$(296.6)						$(88.3)				$9.1				$2,423.5
Term Loans			125.8				0.7				(22.2)						8.9				1.8				115.0
Total			$2,925.1				$0.7				$(318.8)						$(79.4)				$10.9				$2,538.5

 

14

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

9.	DEBT [CONTINUED]

 

a)	Term Facility

On October 1^st, 2025 the Company amended its Term Facility by prepaying the entirety of its U.S. $465.7 million Term Loan B-1 due May 2027, and by increasing its Term Loan B-2 by U.S. $88.0 million and Term Loan B-3 by U.S. $177.0 million, resulting in a net reduction of U.S. $200.7 million of the outstanding Term Facility. As part of this amendment, the Company also repriced its Term Facility, reducing the cost of borrowing by 0.50%, with all other conditions remaining substantially the same. The Company incurred transaction costs of $4.4 million, which have been recorded in financing costs. In addition, the previous unamortized costs of $8.2 million associated to Term Loan B-3 were derecognized and recorded in financing costs.

As at October 31, 2025, the cost of borrowing under the Term Loan B-2 was as follows:

 

(i)

Term SOFR, plus 2.25% per annum, with a Term SOFR floor of 0.50%

As at October 31, 2025, the cost of borrowing under the Term Loan B-3 was as follows:

 

(i)

Term SOFR, plus 2.25% per annum, with a Term SOFR floor of 0.00%

Under the Term Facility, the cost of borrowing in U.S. Base Rate or U.S. Prime Rate cannot be lower than the cost of borrowing under SOFR.

The Company is required to repay a minimum of 0.25% of the nominal amount each quarter, less any voluntary prepayments done to date. Consequently, the Company repaid an amount of U.S. $11.8 million ($16.5 million) during the nine-month period ended October 31, 2025. Also, the Company may be required to repay a portion of the Term Facility in the event that it has an excess cash position at the end of the fiscal year and its Leverage Ratio is above a certain threshold level. As at October 31, 2025 and 2024, the Company was not required to repay any portion of the Term Facility under this requirement.

 

b)	Term Loans

During the nine-month period ended October 31, 2025, the Company entered into a term loan agreement at a favourable interest rate under an Austrian government program. This program supports research and development projects based on the Company’s incurred expenses in Austria. The term loan has a nominal amount of €0.4 million ($0.7 million) with an interest rate of 1.75% with a maturity date of June 2028.

 

15

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

10.	CAPITAL STOCK

The changes in capital stock issued and outstanding were as follows:

 

		Number of shares				Carrying Amount
Subordinate voting shares
Balance as at January 31, 2025			34,512,399				$247.9
Issued upon exercise of stock options			322,590				16.8
Issued in exchange of multiple voting shares			1,543,136				0.1
Balance as at October 31, 2025			36,378,125				$264.8
Multiple voting shares
Balance as at January 31, 2025			38,519,358				$3.1
Exchanged for subordinate voting shares			(1,543,136)				(0.1)
Balance as at October 31, 2025			36,976,222				$3.0
Total outstanding as at October 31, 2025			73,354,347				$267.8

 

a)	Normal course issuer bid program (“NCIB”)

During the nine-month period ended October 31, 2025, the Company did not repurchase subordinate voting shares under the NCIB that was announced and started during the fiscal year ended January 31, 2025.

 

b)	Secondary offering

On September 12, 2025, Bain Capital Integral Investors II, L.P. (“Bain Capital”) completed a secondary offering of 1,500,000 subordinate voting shares of the Company through an underwriter and a distribution in kind of 43,136 subordinate voting shares to certain affiliates and limited partners. Prior to such transaction, Bain Capital converted 1,543,136 multiple voting shares into an equivalent number of subordinate voting shares. The Company did not receive any of the proceeds of the secondary offering. In accordance with the terms of the registration rights agreement entered into in connection with the initial public offering of the Company’s subordinate voting shares, the Company incurred less than $1.0 million of fees and expenses related to this secondary offering.

 

16

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

11.	SHARE BASED PAYMENT PLANS

The Company has two share-based payment plans: pursuant to its stock option plan, the Company has made equity-settled stock option grants, and pursuant to its share unit plan, it has made cash-settled restricted share unit grants.

 

a)	Stock options

During the nine-month periods ended October 31, 2025 and 2024, the Company granted respectively 765,030 and 433,070 stock options to eligible officers and employees to acquire subordinate voting shares at an average exercise price of $50.44 and $98.12 respectively. The fair value of the options at the grant date was $17.49 and $39.70, respectively. Such stock options are time vesting and 25% of the options will vest on each of the first, second, third and fourth anniversary of the grant. The stock options have a ten-year term at the end of which the options expire.

 

b)	Restricted share units

During the nine-month period ended October 31, 2025, the Company granted 266,304 restricted share units at a share price of $62.87 under a special long-term incentive program. The restricted share units are subject to time-based and continued employment criteria as well as the voluntary forfeiture of a number of stock options issued in calendar years 2021, 2022 and 2023. As a result of this grant, the Company recognized in the condensed consolidated interim statements of net income an expense of $4.3 million, representing the incremental fair value of the restricted share units compared to the 2021-2023 stock options both measured at the grant date. The Company also reclassified $13.9 million from contributed surplus to other liability, representing the change from an equity to cash settled plan. To mitigate the impact of share price variation on this payment plan, the Company secured hedging contracts.

During the three-month period ended October 31, 2025, plan participants exercised 69,030 restricted share units for $6.2 million, resulting from the voluntary forfeiture of 172,575 corresponding stock options.

During the nine-month periods ended October 31, 2025 and 2024, the Company granted respectively 235,800 and 167,800 restricted share units. The restricted share units were granted to eligible employees at a share price of $51.24 and $98.67 respectively. The restricted share units that were granted during the nine-month period ended October 31, 2025 are time vesting and 33% of the units will vest on each of the first, second and third anniversary of the grant. The restricted share units granted during the nine-month period ended October 31, 2024 fully vest after three years of continuous employment from the date of the grant. The associated compensation expense and liability are recognized over the three-year vesting period. To mitigate the impact of share price variation on this payment plan, the Company secured hedging contracts.

 

17

BRP Inc.

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

For the three- and nine-month periods ended October 31, 2025 and 2024

[Unaudited]

[Tabular figures are in millions of Canadian dollars, unless otherwise indicated]

 

12.	EARNINGS PER SHARE

 

a)	Basic earnings per share

Details of basic earnings per share were as follows:

 

		Three-month periods ended												Nine-month periods ended
		October 31, 2025				October 31, 2024								October 31, 2025				October 31, 2024
Net income attributable to shareholders - continuing operations			$76.8				$30.9								$295.8				$114.6
Net loss attributable to shareholders - discontinued operations			(7.7)				(23.8)								(52.2)				(108.5)
Net income attributable to shareholders			$69.1				$7.1								$243.6				$6.1
Weighted average number of shares			73,148,123				73,003,877								73,073,841				73,878,572
Basic earnings per share - continuing operations			$1.05				$0.42								$4.05				$1.55
Basic loss per share - discontinued operations			(0.11)				(0.33)								(0.71)				(1.47)
Basic earnings per share			$0.94				$0.09								$3.34				$0.08

 

b)	Diluted earnings per share

Details of diluted earnings per share were as follows:

 

		Three-month periods ended												Nine-month periods ended
		October 31, 2025				October 31, 2024								October 31, 2025				October 31, 2024
Net income attributable to shareholders - continuing operations			$76.8				$30.9								$295.8				$114.6
Net loss attributable to shareholders - discontinued operations			(7.7)				(23.8)								(52.2)				(108.5)
Net income attributable to shareholders			$69.1				$7.1								$243.6				$6.1
Weighted average number of shares			73,148,123				73,003,877								73,073,841				73,878,572
Dilutive effect of stock options			981,840				861,275								649,890				986,395
Weighted average number of diluted shares			74,129,963				73,865,152								73,723,731				74,864,967
Diluted earnings per share - continuing operations			$1.04				$0.42								$4.01				$1.53
Diluted loss per share - discontinued operations			(0.10)				(0.32)								(0.71)				(1.45)
Diluted earnings per share			$0.94				$0.10								$3.30				$0.08

Excluded from the above calculation are 1,595,154 and 1,978,754 options for the three- and nine-month periods ended October 31, 2025, respectively (1,867,200 and 1,863,225 options for the three- and nine month periods ended October 31, 2024, respectively), which were deemed to be anti-dilutive.

 

18