MILWAUKEE, Oct. 27, 2021 /PRNewswire/
-- Harley-Davidson, Inc. ("Harley-Davidson") (NYSE: HOG)
today reported third quarter results.
"Harley-Davidson delivered a solid third quarter and we have
seen many of our Hardwire strategic initiatives perform well,
providing encouraging initial proof points of our five-year
strategy," said Jochen Zeitz,
chairman, president and CEO, Harley-Davidson. "Our teams continue
to work to mitigate the impact of the ongoing supply chain
challenges that our sector faces, however our performance
underlines that we are on course to deliver our long-term Hardwire
strategy."
Third Quarter 2021 Highlights and Results
- GAAP diluted EPS of $1.05, up
$0.27 over Q3 2020
- Total HDI revenue grew 17 percent behind increased shipments
and favorable motorcycle unit mix
- Motorcycles and Related Products (Motorcycles) segment
operating margin was 8.4 percent, which was 3.6 percentage points
better than Q3 2020; driven by unit mix, pricing and reduced
restructuring expense offsetting the cost increases across the
supply chain and the impact of EU tariffs
- Financial Services segment operating income growth of
$15 million over Q3 2020 driven by
lower interest expense
- Launched Sportster® S, the all-new Sportster motorcycle built
on the Revolution® Max platform
Third Quarter 2021 Results
Harley-Davidson, Inc.
Consolidated Financial Results
|
nm – not
meaningful
|
$ in millions
(except EPS)
|
3rd
quarter
|
9
months
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
Revenue
|
$1,365
|
$1,166
|
17%
|
$4,320
|
$3,329
|
30%
|
Net Income
|
$163
|
$120
|
36%
|
$628
|
$98
|
nm
|
GAAP Diluted
EPS
|
$1.05
|
$0.78
|
35%
|
$4.06
|
$0.64
|
nm
|
Adjusted Diluted
EPS
|
$1.18
|
$1.05
|
12%
|
$4.29
|
$1.19
|
nm
|
Q3 consolidated revenue was up 17 percent versus Q3 2020 driven
by growth in the Motorcycles segment thanks to stronger unit sales
and a favorable unit mix. Total net income growth of 36 percent was
driven by growth across both the Motorcycles and the Financial
Services segments.
Motorcycles and
Related Products Segment Results
|
nm – not
meaningful
|
$ in
millions
|
3rd
quarter
|
9
months
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
Motorcycle Shipments
(thousands)
|
47.9
|
43.0
|
12%
|
159.4
|
124.3
|
28%
|
Revenue
|
$1,161
|
$964
|
20%
|
$3,724
|
$2,733
|
36%
|
Motorcycles
|
$886
|
$684
|
29%
|
$2,932
|
$2,030
|
44%
|
Parts
& Accessories
|
$205
|
$210
|
(3)%
|
$577
|
$513
|
12%
|
General
Merchandise
|
$49
|
$49
|
0%
|
$155
|
$136
|
14%
|
Gross
Margin
|
26.7%
|
29.8%
|
(3.1) pts.
|
30.6%
|
26.1%
|
4.4 pts.
|
Operating
Income
|
$98
|
$47
|
109%
|
$511
|
$10
|
nm
|
Operating
Margin
|
8.4%
|
4.8%
|
3.6 pts.
|
13.7%
|
0.4%
|
13.3 pts.
|
Revenue from the Motorcycles segment was up significantly during
the third quarter of 2021 primarily driven by a 12 percent
increase in wholesale shipments, favorable motorcycle unit mix and
pricing. Parts & Accessories third quarter revenue was down
slightly while General Merchandise was flat to Q3 2020 as both
businesses faced strong prior year Q3 comparisons as dealers
reopened after pandemic-related closures.
Third quarter gross margin was down 3 percentage points to Q3
prior year as a margin benefit attributed from stronger volume,
profitable mix and pricing was more than offset by the negative
cost headwinds across the supply chain and higher EU tariffs (2.5
percentage point impact). Q3 operating margin finished up versus
prior year as the company's comparison period included heavier
Rewire restructuring charges.
Harley-Davidson
Retail Motorcycle Sales
|
Motorcycles
(thousands)
|
3rd
quarter
|
9
months
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
North
America
|
33.9
|
33.2
|
2%
|
114.8
|
92.0
|
25%
|
EMEA
|
9.4
|
11.2
|
(16)%
|
24.6
|
29.9
|
(18)%
|
Asia
Pacific
|
6.5
|
7.6
|
(15)%
|
18.3
|
20.3
|
(10)%
|
Latin
America
|
1.0
|
1.8
|
(41)%
|
2.6
|
4.8
|
(45)%
|
Worldwide
Total
|
50.8
|
53.8
|
(6)%
|
160.3
|
147.0
|
9%
|
Global retail motorcycle sales in the third quarter (down 6
percent to prior year) were impacted by the strategic decisions
made as part of the Rewire strategy, including the exit of
unprofitable product segments and markets, as well as, macro supply
chain challenges, including slower shipping times to the
international markets.
Q3 North America retail
performance was up over last year, offset by declines across
international markets.
Financial Services
Segment Results
|
$ in
millions
|
3rd
quarter
|
9
months
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
Revenue
|
$205
|
$202
|
2%
|
$596
|
$596
|
(0)%
|
Operating
Income
|
$107
|
$91
|
17%
|
$320
|
$119
|
169%
|
Financial Services segment operating income was up over prior
year in the third quarter, primarily driven by lower interest
expense.
Other Results
Harley-Davidson generated $926
million of cash from operating activities year-to-date in
2021. Cash and cash equivalents were $2.1
billion at the end of the third quarter, down $1.5 billion to the end of Q3 2020 as the company
has brought down cash balances.
Tax Rate - The company's year-to-date effective tax rate was 23
percent.
Dividends - The company paid cash dividends of $0.15 per share in Q3 2021.
Outlook
For the full-year 2021, the company now expects:
- Financial Services segment operating income growth of 95 to 105
percent, an increase from the previously communicated range of 75
to 85 percent.
- Capital expenditures of $135
million to $150 million, a
decrease from the previously communicated range of $190 million to $225
million.
Additionally, our full-year 2021 Motorcycles segment guidance
remains unchanged relative to prior guidance. The company continues
to expect:
- Motorcycles segment revenue growth to be 30 to 35 percent.
- GAAP Motorcycles segment operating income margin of 6 to 8
percent given the EU's decision to keep the current tariff at 31
percent while tariff negotiations occur.
Cash allocation priorities remain to first fund growth through
The Hardwire initiatives, then to pay dividends, and the company
may also choose to execute discretionary share repurchases.
Company Background
Harley-Davidson, Inc. is the
parent company of Harley-Davidson Motor Company and Harley-Davidson
Financial Services. Our vision: Building our legend and leading our
industry through innovation, evolution and emotion. Our mission:
More than building machines, we stand for the timeless pursuit of
adventure. Freedom for the soul. Our ambition is to maintain our
place as the most desirable motorcycle brand in the world. Since
1903, Harley-Davidson has defined motorcycle culture by delivering
a motorcycle lifestyle with distinctive and customizable
motorcycles, experiences, motorcycle accessories, riding gear and
apparel. Harley-Davidson Financial Services provides financing,
insurance and other programs to help get riders on the road.
www.harley-davidson.com.
Webcast
Harley-Davidson will discuss its
financial results and outlook on an audio webcast at 8:00 a.m.
CT today. The webcast login and supporting slides can be accessed
at http://investor.harley-davidson.com/news-and-events/events-and-presentations.
The audio replay will be available by approximately 10:00 a.m. CT.
Non-GAAP Disclosure
This press release includes
financial measures that have not been calculated in accordance with
U.S. generally accepted accounting principles (GAAP) and are
therefore referred to as non-GAAP financial measures. The non-GAAP
measures described below are intended to be considered by users as
supplemental information to the equivalent GAAP measures, to aid
investors in better understanding the company's financial results.
The company believes that these non-GAAP measures provide useful
perspective on underlying business results and trends, and a means
to assess period-over-period results. These non-GAAP measures
should not be considered as a substitute for, or superior to,
measures of financial performance prepared in accordance with GAAP.
These non-GAAP measures may not be the same as similarly titled
measures used by other companies due to possible differences in
method and in items or events being adjusted.
The non-GAAP measures included in this press release are
adjusted net income and adjusted diluted EPS. These non-GAAP
measures exclude restructuring plan costs and the impact of
European Union (EU) tariffs. Restructuring plan costs include
restructuring expenses as presented in the consolidated statements
of operations. The impact of EU tariffs includes incremental EU
tariffs imposed beginning in 2018 on the company's products shipped
from the U.S. and, beginning in 2021, on the company's products
shipped from Thailand. These
non-GAAP measures, as well as a reconciliation of the comparable
GAAP measure to these non-GAAP measures, are included later in this
press release.
Cautionary Note Regarding Forward-Looking
Statements
The company intends that certain matters
discussed in this press release are "forward-looking statements"
intended to qualify for the safe harbor from liability established
by the Private Securities Litigation Reform Act of 1995. These
forward-looking statements can generally be identified as such
because the context of the statement will include words such as the
company "believes," "anticipates," "expects," "plans," "may,"
"will," "estimates," "targets," "intends," "forecasts," "sees," or
words of similar meaning. Similarly, statements that describe or
refer to future expectations, future plans, strategies, objectives,
outlooks, targets, guidance, commitments, or goals are also
forward-looking statements. Such forward-looking statements are
subject to certain risks and uncertainties that could cause actual
results to differ materially, unfavorably or favorably, from those
anticipated as of the date of this press release. Certain of such
risks and uncertainties are described below. Shareholders,
potential investors, and other readers are urged to consider these
factors in evaluating the forward-looking statements and are
cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements included in this press
release are only made as of the date of this press release, and the
company disclaims any obligation to publicly update such
forward-looking statements to reflect subsequent events or
circumstances.
Important factors that could affect future results and cause
those results to differ materially from those expressed in the
forward-looking statements include, among others, the following:
(i) the COVID-19 pandemic, including the length and severity of the
pandemic across the globe and the pace of recovery following the
pandemic; and (ii) the company's ability to: (A) execute its
business plans and strategies, including The Hardwire and the
evolution of LiveWire as a standalone brand, successfully execute
its remodeled approach to supply and inventory management, and
strengthen its existing business while allowing for desirable
growth; (B) mitigate the impact of the revocation of the Binding
Origin Information ("BOI") decisions that allowed the company to
supply its European Union market with certain of its motorcycles
produced at its Thailand
operations at a reduced tariff rate and favorably resolve risks and
uncertainties related to the revocation of the BOI decisions
including, among other: (1) uncertainties regarding the quantity
and mix of motorcycles that the company imports into the EU; (2)
whether the company will be granted temporary relief from the
effect of the revocation of the BOI decisions; (3) whether the
company will be successful in appealing the revocation of the BOI
decisions; (4) uncertainties regarding the size and duration of the
EU tariffs; and (5) whether and to what extent the company
determines to attempt to pass on the impact of the revocation to
dealers and its success in doing so; (C) manage supply chain and
logistics issues, including quality issues, unexpected
interruptions or price increases caused by supplier volatility, raw
material shortages or natural disasters, and longer shipping times
and increased logistics costs, including by successfully
implementing pricing surcharges; (D) invest in electric vehicle
("EV") technology required to lead the transformation of
motorcycling and leverage its engineering expertise, manufacturing
footprint, supply chain infrastructure, and global logistics
capabilities in the EV sector (E) accurately analyze, predict and
react to changing market conditions and successfully adjust to
shifting global consumer needs and interests; (F) successfully
access the capital and/or credit markets on terms that are
acceptable to the company and within its expectations; (G)
successfully carry out its global manufacturing and assembly
operations; (H) develop and introduce products, services and
experiences on a timely basis that the market accepts, that enable
the company to generate desired sales levels and that provide the
desired financial returns, including successfully implementing and
executing plans to strengthen and grow its leadership position in
Grand America Touring, large Cruiser and Trike, and growing its
complementary businesses; (I) perform in a manner that enables the
company to benefit from market opportunities while competing
against existing and new competitors; (J) prevent, detect, and
remediate any issues with its motorcycles or any issues associated
with the manufacturing processes to avoid delays in new model
launches, recall campaigns, regulatory agency investigations,
increased warranty costs or litigation and adverse effects on its
reputation and brand strength, and carry out any product programs
or recalls within expected costs and timing; (K) manage the impact
that prices for and supply of used motorcycles may have on its
business, including on retail sales of new motorcycles; (L) realize
expectations concerning market demand for electric models, which
will depend in part on the building of necessary infrastructure;
(M) successfully manage and reduce costs throughout the business;
(N) manage through changes in general economic and business
conditions, including changing capital, credit and retail markets,
and the changing political environment; (O) continue to develop the
capabilities of its distributors and dealers, effectively implement
changes relating to its dealers and distribution methods and manage
the risks that its independent dealers may have difficulty
obtaining capital and managing through changing economic conditions
and consumer demand; (P) continue to develop and maintain a
productive relationship with Zhejiang Qianjiang Motorcycle Co.,
Ltd. and launch related products in a timely manner; (Q)
maintain a productive relationship with Hero MotoCorp as a
distributor and licensee of the Harley-Davidson brand name in
India; (R) manage and predict the impact that new or adjusted
tariffs may have on the company's ability to sell products
internationally, and the cost of raw materials and components; (S)
successfully maintain a manner in which to sell motorcycles in
China and the company's ASEAN countries that does not subject its
motorcycles to incremental tariffs; (T) manage its Thailand
corporate and manufacturing operation in a manner that allows the
company to avail itself of preferential free trade agreements and
duty rates, and sufficiently lower prices of its motorcycles in
certain markets; (U) accurately estimate and adjust to fluctuations
in foreign currency exchange rates, interest rates and commodity
prices; (V) retain and attract talented employees, and eliminate
personnel duplication, inefficiencies and complexity throughout the
organization; (W) prevent a cybersecurity breach involving
consumer, employee, dealer, supplier, or company data and respond
to evolving regulatory requirements regarding data security; (X)
manage the credit quality, the loan servicing and collection
activities, and the recovery rates of HDFS' loan portfolio; (Y)
adjust to tax reform, healthcare inflation and reform and pension
reform, and successfully estimate the impact of any such reform on
the company's business; (Z) manage through the effects inconsistent
and unpredictable weather patterns may have on retail sales of
motorcycles; (AA) implement and manage enterprise-wide information
technology systems, including systems at its manufacturing
facilities; (BB) manage changes and prepare for requirements in
legislative and regulatory environments for its products, services
and operations; (CC) manage its exposure to product liability
claims and commercial or contractual disputes; (DD) continue to
manage the relationships and agreements that the company has with
its labor unions to help drive long-term competitiveness; (EE)
achieve anticipated results with respect to the company's recently
launched pre-owned motorcycle program, Harley-Davidson Certified,
and the company's H-D1 Marketplace; and (FF) accurately predict the
margins of its Motorcycles and Related Products segment in light
of, among other things, tariffs, the cost associated with product
development initiatives and the company's complex global supply
chain.
The company's operations, demand for its products, and its
liquidity could be adversely impacted by work stoppages, facility
closures, strikes, natural causes, widespread infectious disease,
terrorism, or other factors. Other factors are described in risk
factors that the company has disclosed in documents previously
filed with the Securities and Exchange Commission. Many of these
risk factors are impacted by the current changing capital, credit
and retail markets and the company's ability to manage through
inconsistent economic conditions.
The company's ability to sell its motorcycles and related
products and services and to meet its financial expectations also
depends on the ability of the company's independent dealers to sell
its motorcycles and related products and services to retail
customers. The company depends on the capability and financial
capacity of its independent dealers to develop and implement
effective retail sales plans to create demand for the motorcycles
and related products and services they purchase from the company.
In addition, the company's independent dealers and distributors may
experience difficulties in operating their businesses and selling
Harley-Davidson motorcycles and related products and services as a
result of weather, economic conditions, the impact of COVID-19, or
other factors.
In recent years, HDFS has experienced historically low levels of
retail credit losses, but there is no assurance that this will
continue. The company believes that HDFS' retail credit losses may
increase over time due to changing consumer credit behavior, HDFS'
efforts to increase prudently structured loan approvals to
sub-prime borrowers and the favorable impact of recent federal
stimulus payments, as well as actions that the company has taken
and could take that impact motorcycle values. Refer to "Risk
Factors" under Item 1A of the company's Annual Report on Form 10-K
for the year ended December 31, 2020
filed with the SEC on February 23,
2021 and Part II, Item 1A of any subsequently filed
Quarterly Report on Form 10-Q, for a discussion of additional risk
factors and a more complete discussion of some of the cautionary
statements noted above.
### (HOG-F)
Harley-Davidson,
Inc.
|
Condensed
Consolidated Statements of Operations
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
26,
|
|
September
27,
|
|
September
26,
|
|
September
27,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
Motorcycles and
Related Products revenue
|
|
$
1,160,618
|
|
$
964,029
|
|
$
3,724,225
|
|
$
2,733,091
|
Gross
profit
|
|
310,425
|
|
287,233
|
|
1,137,961
|
|
713,781
|
Selling,
administrative and engineering expense
|
|
212,243
|
|
196,912
|
|
626,211
|
|
618,912
|
Restructuring
expense
|
|
517
|
|
43,581
|
|
731
|
|
84,586
|
Operating
income from Motorcycles and Related Products
|
|
97,665
|
|
46,740
|
|
511,019
|
|
10,283
|
|
|
|
|
|
|
|
|
|
Financial Services
revenue
|
|
204,692
|
|
201,655
|
|
595,650
|
|
596,064
|
Financial Services
expense
|
|
98,047
|
|
110,177
|
|
275,487
|
|
475,771
|
Financial Services
restructuring expense
|
|
98
|
|
334
|
|
436
|
|
1,278
|
Operating
income from Financial Services
|
|
106,547
|
|
91,144
|
|
319,727
|
|
119,015
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
204,212
|
|
137,884
|
|
830,746
|
|
129,298
|
Non-operating
expense, net
|
|
(6,723)
|
|
(4,956)
|
|
(17,053)
|
|
(19,759)
|
Income before income
taxes
|
|
197,489
|
|
132,928
|
|
813,693
|
|
109,539
|
Provision for income
taxes
|
|
34,516
|
|
12,710
|
|
185,236
|
|
11,843
|
Net income
|
|
$
162,973
|
|
$
120,218
|
|
$
628,457
|
|
$
97,696
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.06
|
|
$
0.78
|
|
$
4.09
|
|
$
0.64
|
Diluted
|
|
$
1.05
|
|
$
0.78
|
|
$
4.06
|
|
$
0.64
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares:
|
|
|
|
|
|
|
|
|
Basic
|
|
153,863
|
|
153,252
|
|
153,700
|
|
153,153
|
Diluted
|
|
155,117
|
|
153,915
|
|
154,903
|
|
153,790
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share:
|
|
$
0.15
|
|
$
0.02
|
|
$
0.45
|
|
$
0.42
|
Harley-Davidson,
Inc.
|
Reconciliation of
GAAP Amounts to Non-GAAP Amounts
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
26,
|
|
September
27,
|
|
September
26,
|
|
September
27,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Net income excluding
restructuring plan costs and the impact of EU tariffs
|
|
|
|
|
|
|
|
|
Net income
(GAAP)
|
|
$
162,973
|
|
$
120,218
|
|
$
628,457
|
|
$
97,696
|
Restructuring plan
costs
|
|
615
|
|
43,915
|
|
1,167
|
|
85,864
|
Impact of EU
tariffs
|
|
25,562
|
|
1,825
|
|
44,281
|
|
17,732
|
Tax effect of
adjustments(a)
|
|
(5,563)
|
|
(4,091)
|
|
(10,126)
|
|
(19,333)
|
Adjustments net of
tax
|
|
20,614
|
|
41,649
|
|
35,322
|
|
84,263
|
Adjusted net income
(non-GAAP)
|
|
$
183,587
|
|
$
161,867
|
|
$
663,779
|
|
$
181,959
|
|
|
|
|
|
|
|
|
|
Diluted EPS excluding
restructuring plan costs and the impact of EU tariffs
|
|
|
|
|
|
|
|
|
Diluted EPS
(GAAP)
|
|
$
1.05
|
|
$
0.78
|
|
$
4.06
|
|
$
0.64
|
Adjustments net of
tax, per share
|
|
0.13
|
|
0.27
|
|
0.23
|
|
0.55
|
Adjusted diluted EPS
(non-GAAP)
|
|
$
1.18
|
|
$
1.05
|
|
$
4.29
|
|
$
1.19
|
|
|
|
|
|
|
|
|
|
(a) The
income tax effect has been computed using the estimated income tax
rate for these adjustments
|
|
|
|
|
Harley-Davidson,
Inc.
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
|
|
September
26,
|
|
December
31,
|
|
September
27,
|
|
|
|
|
2021
|
|
2020
|
|
2020
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
2,061,303
|
|
$
3,257,203
|
|
$
3,560,950
|
Accounts receivable, net
|
|
|
|
282,627
|
|
143,082
|
|
232,845
|
Finance receivables, net
|
|
|
|
1,540,822
|
|
1,509,539
|
|
1,701,478
|
Inventories, net
|
|
|
|
475,314
|
|
523,497
|
|
322,375
|
Restricted cash
|
|
|
|
153,873
|
|
131,642
|
|
160,155
|
Other current assets
|
|
|
|
194,481
|
|
280,470
|
|
178,931
|
|
|
|
|
4,708,420
|
|
5,845,433
|
|
6,156,734
|
|
|
|
|
|
|
|
|
|
Finance receivables,
net
|
|
|
|
5,322,436
|
|
4,933,469
|
|
5,142,014
|
Other long-term
assets
|
|
|
|
1,168,948
|
|
1,231,699
|
|
1,233,527
|
|
|
|
|
$
11,199,804
|
|
$
12,010,601
|
|
$
12,532,275
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
$
982,068
|
|
$
848,118
|
|
$
850,385
|
Short-term deposits
|
|
|
|
92,626
|
|
79,965
|
|
29,999
|
Short-term debt
|
|
|
|
749,620
|
|
1,014,274
|
|
1,227,763
|
Current portion of long-term debt, net
|
|
|
|
1,605,798
|
|
2,039,597
|
|
2,109,284
|
|
|
|
|
3,430,112
|
|
3,981,954
|
|
4,217,431
|
|
|
|
|
|
|
|
|
|
Long-term debt,
net
|
|
|
|
4,876,292
|
|
5,932,933
|
|
6,171,676
|
Other long-term
liabilities
|
|
|
|
559,506
|
|
372,929
|
|
373,270
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
2,333,894
|
|
1,722,785
|
|
1,769,898
|
|
|
|
|
$
11,199,804
|
|
$
12,010,601
|
|
$
12,532,275
|
Harley-Davidson,
Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months
ended
|
|
|
|
|
|
|
September
26,
|
|
September
27,
|
|
|
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
|
|
|
$
925,551
|
|
$
1,135,068
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
|
|
|
(61,476)
|
|
(92,295)
|
Finance
receivables, net
|
|
|
|
|
|
(476,556)
|
|
(143,093)
|
Other
investing activities
|
|
|
|
|
|
2,485
|
|
334
|
Net cash used by
investing activities
|
|
|
|
|
|
(535,547)
|
|
(235,054)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of medium-term notes
|
|
|
|
|
|
-
|
|
1,396,602
|
Repayments of
medium-term notes
|
|
|
|
|
|
(1,400,000)
|
|
(1,400,000)
|
Proceeds from
securitization debt
|
|
|
|
|
|
1,169,910
|
|
2,064,450
|
Repayments of
securitization debt
|
|
|
|
|
|
(1,013,820)
|
|
(735,885)
|
Net (decrease)
increase in unsecured commercial paper
|
|
|
|
|
|
(261,978)
|
|
509,978
|
Net increase
in credit facilitites
|
|
|
|
|
|
-
|
|
150,000
|
Borrowings of
asset-backed commercial paper
|
|
|
|
|
|
27,406
|
|
225,187
|
Repayments of
asset-backed commercial paper
|
|
|
|
|
|
(206,671)
|
|
(236,846)
|
Net increase
in deposits
|
|
|
|
|
|
210,144
|
|
29,992
|
Dividends
paid
|
|
|
|
|
|
(69,316)
|
|
(65,002)
|
Repurchase of
common stock
|
|
|
|
|
|
(11,545)
|
|
(7,895)
|
Issuance of
common stock under employee stock option plans
|
|
|
|
|
|
4,324
|
|
96
|
Net cash (used)
provided by financing activities
|
|
|
|
|
|
(1,551,546)
|
|
1,930,677
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
|
|
|
|
(11,050)
|
|
6,071
|
|
|
|
|
|
|
|
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
|
|
|
|
$
(1,172,592)
|
|
$
2,836,762
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash:
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash, beginning of period
|
|
|
|
|
|
$
3,409,168
|
|
$
905,366
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
|
|
|
|
|
(1,172,592)
|
|
2,836,762
|
Cash, cash
equivalents and restricted cash, end of period
|
|
|
|
|
|
$
2,236,576
|
|
$
3,742,128
|
|
|
|
|
|
|
|
|
|
Reconciliation of
cash, cash equivalents and restricted cash on the Consolidated
balance sheets to the Consolidated statements of cash
flows:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
$
2,061,303
|
|
$
3,560,950
|
Restricted
cash
|
|
|
|
|
|
153,873
|
|
160,155
|
Restricted
cash included in Other long-term assets
|
|
|
|
|
|
21,400
|
|
21,023
|
Cash, cash
equivalents and restricted cash per the Consolidated statements of
cash flows
|
|
|
|
$
2,236,576
|
|
$
3,742,128
|
Motorcycles and
Related Products Revenue and Motorcycle Shipment Data
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
26,
|
|
September
27,
|
|
September
26,
|
|
September
27,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
MOTORCYCLES AND
RELATED PRODUCTS REVENUE (in thousands)
|
|
|
|
|
|
|
|
|
Motorcycles
|
|
$
885,626
|
|
$
684,344
|
|
$
2,931,669
|
|
$
2,030,447
|
Parts &
accessories
|
|
204,506
|
|
209,808
|
|
577,035
|
|
513,201
|
General
merchandise
|
|
49,424
|
|
49,356
|
|
155,378
|
|
136,321
|
Licensing
|
|
8,481
|
|
8,894
|
|
22,865
|
|
21,826
|
Other
|
|
12,581
|
|
11,627
|
|
37,278
|
|
31,296
|
|
|
$
1,160,618
|
|
$
964,029
|
|
$
3,724,225
|
|
$
2,733,091
|
|
|
|
|
|
|
|
|
|
U.S. MOTORCYCLE
SHIPMENTS
|
|
27,919
|
|
25,284
|
|
104,190
|
|
69,359
|
|
|
|
|
|
|
|
|
|
WORLDWIDE MOTORCYCLE
SHIPMENTS
|
|
|
|
|
|
|
|
|
Grand American Touring(a)
|
|
21,988
|
|
17,230
|
|
79,485
|
|
52,656
|
Cruiser(b)
|
|
16,531
|
|
14,775
|
|
52,117
|
|
42,660
|
Adventure Touring
|
|
4,507
|
|
-
|
|
8,555
|
|
-
|
Sportster®/ Street
|
|
4,915
|
|
10,978
|
|
19,262
|
|
29,009
|
|
|
47,941
|
|
42,983
|
|
159,419
|
|
124,325
|
|
|
|
|
|
|
|
|
|
(a)Includes CVOTMand
Trike
|
|
|
|
|
|
|
|
|
(b)Includes Softail® and
LiveWire®
|
|
|
|
|
|
|
|
|
Motorcycles and
Related Products Gross Profit
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
The estimated impact
of significant factors affecting the comparability of gross profit
from 2020 to 2021 were as follows (in millions):
|
|
|
|
Three months
ended
|
|
|
|
Nine months
ended
|
|
|
|
|
|
|
|
|
|
|
|
2020 gross
profit
|
|
$
287
|
|
|
|
$
714
|
|
|
Volume
|
|
32
|
|
|
|
203
|
|
|
Price and sales
incentives, net of related costs
|
|
15
|
|
|
|
39
|
|
|
Foreign currency
exchange rates and hedging
|
|
8
|
|
|
|
33
|
|
|
Shipment
mix
|
|
44
|
|
|
|
169
|
|
|
Raw material
prices
|
|
(25)
|
|
|
|
(46)
|
|
|
Manufacturing and
other costs
|
|
(51)
|
|
|
|
26
|
|
|
|
|
23
|
|
|
|
424
|
|
|
2021 gross
profit
|
|
$
310
|
|
|
|
$
1,138
|
|
|
Financial Services -
Finance Receivables Allowance for Credit Losses
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
26,
|
|
September
27,
|
|
September
26,
|
|
September
27,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Balance, beginning of
period
|
|
$
358,811
|
|
$
411,015
|
|
$
390,936
|
|
$
198,581
|
Cumulative effect of
change in accounting(a)
|
|
-
|
|
-
|
|
-
|
|
100,604
|
Provision for credit
losses
|
|
11,208
|
|
7,835
|
|
4,935
|
|
178,433
|
Charge-offs, net of
recoveries
|
|
(14,185)
|
|
(10,148)
|
|
(40,037)
|
|
(68,916)
|
Balance, end of
period
|
|
$
355,834
|
|
$
408,702
|
|
$
355,834
|
|
$
408,702
|
|
|
|
|
|
|
|
|
|
(a)On
January 1, 2020, the Company adopted ASU 2016-13 and increased the
allowance for loan loss through Retained Earnings, net of income
taxes, to establish an allowance that represents expected lifetime
credit losses on the finance receivable portfolios at date of
adoption.
|
Worldwide Retail
Sales of Harley-Davidson Motorcycles(a)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
United
States
|
|
31,699
|
|
31,304
|
|
107,421
|
|
86,376
|
Canada
|
|
2,158
|
|
1,915
|
|
7,403
|
|
5,668
|
Total North
America
|
|
33,857
|
|
33,219
|
|
114,824
|
|
92,044
|
EMEA
|
|
9,389
|
|
11,184
|
|
24,580
|
|
29,878
|
Asia
Pacific
|
|
6,484
|
|
7,631
|
|
18,263
|
|
20,271
|
Latin
America
|
|
1,048
|
|
1,768
|
|
2,620
|
|
4,760
|
Total worldwide retail
sales
|
|
50,778
|
|
53,802
|
|
160,287
|
|
146,953
|
|
|
|
|
|
|
|
|
|
(a)Data
source for retail sales figures shown above is new sales warranty
and registration information provided by Harley-Davidson dealers
and compiled by the Company. The Company must rely on information
that its dealers supply concerning new retail sales, and the
company does not regularly verify the information that its dealers
supply. This information is subject to revision.
|
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SOURCE Harley-Davidson, Inc.