Textron weighs options for off-road vehicles, pauses production

(Reuters) – Textron is exploring strategic alternatives to its Powersports product line due to continued weak demand, the Cessna jet maker said on Wednesday.

The Powersports unit, part of the Textron Specialized Vehicles business under the Industrial segment, manufactures snowmobiles and recreational off-road vehicles, as well as parts and accessories for those vehicles under the Arctic Cat brand.

“TSV has begun pausing production of its powersports products as management reviews strategic alternatives for the company,” Textron said in a filing.

The Providence, Rhode Island-based company announced a restructuring plan in November 2023 to reduce operating costs.

This plan includes, among other things, a reduction in the workforce at TSV, where the company expects that demand for certain powersports products will remain low.

As a result of the production shutdown and contract termination costs, Textron now expects total pre-tax special charges from the restructuring plan to range between $190 million and $205 million, up from the previously announced range of $165 million to $170 million.

The stock valuation tax is expected to reduce 2024 adjusted earnings by approximately 12 cents to 16 cents per share. stock. These charges will be recorded in the fourth quarter of 2024.

In October, Textron forecast full-year 2024 adjusted earnings to range between $5.40 and $5.60 per share.

(This story has been corrected to set the adjusted earnings forecast at between $5.40 and $5.60 per share, not $1.40 and $1.49, in Section 8)

(Reporting by Aatreyee Dasgupta in Bengaluru; Editing by Tasim Zahid)