MILWAUKEE, July 27,
2023 /PRNewswire/ -- Harley-Davidson, Inc.
("Harley-Davidson," "HDI," or the "Company"), (NYSE: HOG)
today reported second quarter 2023 results.
"Harley-Davidson showed continued progress in delivery of our
Hardwire strategy this quarter, despite the macro-economic
conditions affecting both the business and our customers. Following
the production suspension we experienced late in the quarter
impacting motorcycle shipments, we achieved retail growth for the
quarter in addition to a strong increase in gross margin," said
Jochen Zeitz, Chairman, President
and CEO, Harley-Davidson. "We are confident in our ability to
navigate near-term headwinds and remain optimistic on the future,
most notably following the successful launch of our game-changing
CVO's and the highly attended gathering of our community during our
anniversary year, reinforcing the enduring power of the brand."
Second Quarter 2023 Highlights and Results
- Strategy remains grounded in desirability and
profitability
- 120th Anniversary events in Budapest and Milwaukee reinforced overall brand
strength
- Introduced two new CVO motorcycles, as well as new models in
the Enthusiast and Icons collections
- HDMC Gross Margin of 34.8%, an increase of 400 basis
points
- HDMC Revenue declined 4%, behind a 10% decrease in wholesale
shipments related to an unplanned production suspension
- HDFS Revenue increased 19% on higher interest income and
increased investment income
- Delivered diluted EPS of $1.22
- Company revises full year 2023 outlook
First Half 2023 Highlights and Results
- Achieved HDMC Operating Income Margin of 19.2%, an increase of
240 basis points
- HDMC Revenue was up 8 percent versus prior year driven by a 2
percent increase in wholesale motorcycle unit shipments
- Delivered diluted EPS of $3.27,
up 12 percent
- Repurchased $156 million of
shares (4.1 million shares) on a discretionary basis
Second Quarter 2023 Results
Harley-Davidson, Inc. Consolidated Financial
Results
$ in millions
(except EPS)
|
2nd
quarter
|
2023
|
2022
|
Change
|
Revenue
|
$1,446
|
$1,469
|
-2 %
|
Operating
Income
|
$221
|
$278
|
-20 %
|
Net Income Attributable
to HDI
|
$178
|
$216
|
-18 %
|
Diluted EPS
|
$1.22
|
$1.46
|
-16 %
|
Consolidated revenue was down 2 percent in the second quarter,
driven by a revenue decline of 4 percent at HDMC, which was
partially offset by revenue growth of 19 percent at HDFS.
Consolidated operating income in the second quarter was down 20
percent, driven by a decline of 8 percent at HDMC, a decline of 31
percent at HDFS, and an operating loss of $32 million in the LiveWire segment. Consolidated
operating income margin in the second quarter was 15.3 percent
compared to 18.9 percent in the second quarter a year ago.
Harley-Davidson Motor Company (HDMC) – Results
$ in
millions
|
2nd quarter
|
2023
|
2022
|
Change
|
Motorcycle Shipments
(thousands)
|
42.9
|
47.9
|
-10 %
|
Revenue
|
$1,198
|
$1,254
|
-4 %
|
Motorcycles
|
$891
|
$935
|
-5 %
|
Parts
& Accessories
|
$216
|
$214
|
1 %
|
Apparel
|
$66
|
$77
|
-14 %
|
Licensing
|
$5
|
$12
|
-57 %
|
Other
|
$20
|
$16
|
31 %
|
Gross Margin
|
34.8 %
|
30.9 %
|
4.0 pts.
|
Operating
Income
|
$194
|
$211
|
-8 %
|
Operating
Margin
|
16.2 %
|
16.8 %
|
-0.6
pts.
|
Second quarter global motorcycle shipments decreased 10 percent,
due to an unplanned production suspension that occurred in Q2.
Revenue was down 4 percent, with global pricing partially
offsetting unit declines. Parts & Accessories revenue was up 1
percent driven by improved digital efforts, while Apparel revenue
was down 14 percent compared to a strong Q2 period last year, as
the bulk of seasonal product sales occurred in Q2 last year,
compared to Q1 of this year.
Second quarter gross margin was up 4.0 points behind pricing,
cost productivity, and shipment mix, more than offsetting the
negative impacts from reduced volume and foreign currency. Second
quarter operating income margin fell by 0.6 points due to higher
operating expense, including higher people costs and marketing
spend.
Harley-Davidson Retail Motorcycle Sales
(excludes LiveWire units)
Motorcycles
(thousands)
|
2nd
quarter
|
2023
|
2022
|
Change
|
North
America
|
35.1
|
34.7
|
1 %
|
EMEA
|
8.1
|
8.7
|
-6 %
|
Asia Pacific
|
7.5
|
6.0
|
24 %
|
Latin
America
|
0.8
|
0.8
|
4 %
|
Worldwide
Total
|
51.5
|
50.2
|
3 %
|
Global retail motorcycle sales in the second quarter were up 3
percent versus prior year. North
America retail performance was up 1 percent, driven by
strength in our core categories such as Grand American Touring and
Cruiser, but offset by declines in the Sport motorcycle segment,
following the discontinuation of legacy Sportster models in
North America at the end of 2022.
Growth in APAC was driven by continued strong demand across key
markets, including Japan,
China, and Australia. The decline in EMEA of 6 percent
was primarily driven by a market exit and the planned unit mix
shift towards the profitable core product segments. Growth in
Latin America was driven by modest
growth in Brazil partially offset
by weakness in Mexico.
Harley-Davidson Financial Services (HDFS) – Results
$ in
millions
|
2nd
quarter
|
2023
|
2022
|
Change
|
Revenue
|
$240
|
$203
|
19 %
|
Operating
Income
|
$59
|
$86
|
-31 %
|
HDFS' revenue was up $38 million
in the second quarter, an increase of 19%, driven primarily by
higher interest income and increased investment income. HDFS'
operating income decline of $27
million, or down 31 percent, was driven by higher interest
expense and an increased provision for credit losses. The
moderate increase in the provision for credit losses was driven by
several factors relating to the current macroeconomic environment.
Total quarter ending net finance receivables were $7.5 billion, which was up 6 percent versus prior
year, driven primarily by an increase in wholesale receivables.
LiveWire – Results
$ in
millions
|
2nd
quarter
|
2023
|
2022
|
Change
|
Electric Motorcycle
Shipments (units)
|
33
|
225
|
-85 %
|
LiveWire
ONE (units)
|
33
|
204
|
-84 %
|
Harley-Davidson LiveWire (units)
|
--
|
21
|
NM
|
Revenue
|
$7
|
$13
|
-44 %
|
Operating
Loss
|
($32)
|
($19)
|
NM
|
LiveWire revenue for the second quarter was down compared to the
same quarter in 2022, due to lower unit sales of LiveWire ONE
electric motorcycles and STACYC electric balance bikes. LiveWire
operating loss of $32 million in the
second quarter, in-line with expectations, was driven by product
development spending associated with the launch of the Del Mar
electric motorcycle.
Other Harley-Davidson, Inc. 2023 Results – through Q2
2023
- Generated $411 million of cash
from operating activities
- Effective tax rate was 24 percent
- Paid cash dividends of $48
million
- Repurchased $156 million of
shares (4.1 million shares) on a discretionary basis
- Cash and cash equivalents of $1.5
billion at the end of the quarter
- Financing raised for HDFS of $2.0
billion
2023 Financial Outlook
For the full year 2023, the Company is revising its HDMC
guidance and its LiveWire unit sales guidance and now expects:
- HDMC: revenue growth of flat to 3% and operating income margin
of 13.9 to 14.3%
- LiveWire: motorcycle unit sales of 600–1,000
For the full year 2023, the Company reaffirms the following
guidance and continues to expect:
- HDFS: operating income decline of 20 to 25%
- LiveWire: operating loss of $115
to $125 million
- Harley-Davidson, Inc.: capital investments of $225 to $250
million
New Segment Reporting Structure
LiveWire Group, Inc. ("LiveWire Group") became a separate public
company trading on the New York Stock Exchange (Ticker: LVWR) on
September 27, 2022. Harley-Davidson
has a controlling equity interest in LiveWire Group and continues
to consolidate LiveWire Group results with adjustments for
non-controlling shareholder interests. Net Income attributable to
Harley-Davidson, Inc. and EPS reflect these adjustments.
Beginning with the fourth quarter of 2022, new business segment
reporting now includes:
- Harley-Davidson Motor Company (HDMC): Group that is
accountable for the design, manufacturing, marketing and sales of
Harley-Davidson motorcycles and related products
- Harley-Davidson Financial Services (HDFS): Group that
provides motorcycle and related products financing and insurance
products and services for our dealers and retail customers
- LiveWire: Group that is accountable for the design,
marketing and sales of LiveWire electric motorcycles and related
products, including STACYC electric balance bikes
Prior period segment results have been retrospectively adjusted
based on the new segments. In addition, the consolidated results
will continue to be reflected by:
- Harley-Davidson, Inc. (HDI): Corporate entity for the
overall Company, under which HDMC, HDFS and LiveWire operate
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. Harley-Davidson also has a controlling interest in
LiveWire Group, Inc., the first publicly traded all-electric
motorcycle company in the United
States. LiveWire is the future in the making for the pursuit
of urban adventure and beyond. Drawing on its DNA as an agile
disruptor from the lineage of Harley-Davidson and capitalizing on a
decade of learnings in the EV sector, LiveWire's ambition is to be
the most desirable electric motorcycle brand in the world. Learn
more at harley-davidson.com and livewire.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.
Cautionary Note Regarding Forward-Looking
Statements
The Company intends that certain matters
discussed in this presentation and our associated comments 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," "is on track," "sees," "feels,"
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 presentation. 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.
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 Company's
ability to: (a) execute its business plans and strategies,
including The Hardwire, each of the pillars, and the evolution of
LiveWire as a standalone brand, which includes the risks noted
below; (b) manage supply chain and logistics issues, including
quality issues, availability of semiconductor chip components and
the ability to find alternative sources of those components in a
timely manner, unexpected interruptions or price increases caused
by supplier volatility, raw material shortages, inflation, war or
other hostilities, including the conflict in Ukraine, or natural disasters and longer
shipping times and increased logistics costs, including by
successfully implementing pricing surcharges; (c) realize the
expected business benefits from LiveWire operating as a separate
public company, which may be affected by, among other things: (i)
the ability of LiveWire to: (1) execute its plans to develop,
produce, market and sell its electric vehicles; (2) achieve
profitability, which is dependent on the successful development and
commercial introduction and acceptance of its electric vehicles,
and its services, which may not occur; (3) adequately control the
costs of its operations as a new entrant into a new space; (4)
develop, maintain and strengthen its brand; (5) execute its plans
to develop, produce, market and sell its electric vehicles on
expected timelines; and (6) effectively establish and maintain
cooperation from its retail partners, largely drawn from the
Company's traditional motorcycle dealer network, to be able to
effectively establish or maintain relationships with customers for
electric vehicles; (ii) competition; and (iii) other risks and
uncertainties indicated in documents filed with the SEC by the
Company or LiveWire Group, Inc., including those risks and
uncertainties noted in "Risk Factors" under Item 1.A of LiveWire
Group Inc.'s Annual Report on Form 10-K for the year ended December
31, 2022; (d) accurately analyze, predict and react to changing
market conditions and successfully adjust to shifting global
consumer needs and interests; (e) successfully access the capital
and/or credit markets on terms that are acceptable to the Company
and within its expectations; (f) successfully carry out its global
manufacturing and assembly operations; (g) 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 American Touring, large
Cruiser and Trike, and grow its complementary businesses; (h)
perform in a manner that enables the Company to benefit from market
opportunities while competing against existing and new competitors;
(i) manage ongoing risks related to the impact of the COVID-19
pandemic, such as supply chain disruptions, its ability to carry
out business as usual, and government actions and restrictive
measures implemented in response; (j) manage the regulatory
compliance matter relating to a third-party supplier's component
part in a manner that avoids additional costs or recall expenses
that are material (k) manage the quality issue relating to brake
hose assemblies provided by Proterial Cable America (PCA),
including (i) the nature and extent of the issue and the ability of
the supplier to remedy the potential issue, and (ii) the effects
that the production suspension caused by the quality issue relating
to the PCA brake hose assemblies may have on its business,
including on retail sales of new motorcycles; (l) successfully
appeal: (i) the revocation of the Binding Origin Information
("BOI") decisions that allowed the Company to supply its European
Union ("EU") market with certain of its motorcycles produced at its
Thailand operations at a reduced tariff rate and (ii) the denial of
the Company's application for temporary relief from the effect of
the revocation of the BOI decisions; (m) manage and predict the
impact that new, reinstated or adjusted tariffs may have on the
Company's ability to sell products internationally, and the cost of
raw materials and components, including the temporary lifting of
the Section 232 steel and aluminum tariffs and incremental tariffs
on motorcycles imported into the EU from the U.S., between the U.S.
and EU, which expires on December 31, 2023; (n) 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; (o) manage the impact
that prices for and supply of used motorcycles may have on its
business, including on retail sales of new motorcycles; (p)
successfully manage and reduce costs throughout the business; (q)
manage through changes in general economic and business conditions,
including changing capital, credit and retail markets, particularly
with the recent turmoil in the banking industry, and the changing
domestic and international political environments, including as a
result of the conflict in Ukraine; (r) 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 dealers may have difficulty obtaining capital
and managing through changing economic conditions and consumer
demand; (s) continue to develop and maintain a productive
relationship with Zhejiang Qianjiang Motorcycle Co., Ltd. and
launch related products in a timely manner; (t) maintain a
productive relationship with Hero MotoCorp as a distributor and
licensee of the Harley-Davidson brand name in India; (u)
successfully maintain a manner in which to sell motorcycles in
China and the Company's Association of Southeast Asian Nations
(ASEAN) countries that does not subject its motorcycles to
incremental tariffs; (v) 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; (w) accurately estimate and adjust to fluctuations in
foreign currency exchange rates, interest rates and commodity
prices; (x) retain and attract talented employees, and eliminate
personnel duplication, inefficiencies and complexity throughout the
organization; (y) prevent a cybersecurity breach involving
consumer, employee, dealer, supplier, or Company data and respond
to evolving regulatory requirements regarding data security; (z)
manage the credit quality, the loan servicing and collection
activities, and the recovery rates of Harley-Davidson Financial
Services' loan portfolio; (aa) 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; (bb)
manage through the effects inconsistent and unpredictable weather
patterns may have on retail sales of motorcycles; (cc) implement
and manage enterprise-wide information technology systems,
including systems at its manufacturing facilities; (dd) manage
changes, prepare for, and respond to evolving requirements in
legislative and regulatory environments related to its products,
services and operations; (ee) manage its exposure to product
liability claims and commercial or contractual disputes; (ff)
continue to manage the relationships and agreements that the
Company has with its labor unions to help drive long-term
competitiveness; (gg) achieve anticipated results with respect to
the Company's pre-owned motorcycle program, Harley-Davidson
Certified, the Company's H-D1 Marketplace, and Apparel and
Licensing; (hh) accurately predict the margins of its segments in
light of, among other things, tariffs, inflation, foreign currency
exchange rates, the cost associated with product development
initiatives and the Company's complex global supply chain; (ii)
optimize capital allocation in light of the Company's capital
allocation priorities; and (jj) manage through the effects
increased environmental, safety, emissions or other regulations or
other influences may have on the business and its operating
results.
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 dealers to sell its
motorcycles and related products and services to retail customers.
The Company depends on the capability and financial capacity of its
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 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 the COVID-19 pandemic, or other factors.
In recent years, Harley-Davidson Financial Services (HDFS)
experienced historically low levels of retail credit losses, but
credit losses have been normalizing to higher levels in recent
quarters. Further, the Company believes that HDFS's retail credit
losses will continue to change over time due to changing consumer
credit behavior, macroeconomic conditions including the impact of
inflation, and HDFS' efforts to adjust underwriting criteria based
on market and economic conditions, as well as actions that the
Company has taken and could take that impact motorcycle values.
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, war or other hostilities, including the conflict in
Ukraine, or other factors. Refer
to "Risk Factors" under Item 1.A of the Company's Annual Report on
Form 10-K for the year ended December 31,
2022 for a discussion of additional risk factors and a more
complete discussion of some of the cautionary statements noted
above.
### (HOG-Earnings)
|
Harley-Davidson,
Inc.
|
Condensed Consolidated
Statements of Operations
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
June 30,
|
|
June 26,
|
|
June 30,
|
|
June 26,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
HDMC revenue
|
|
$
1,198,136
|
|
$ 1,253,965
|
|
$ 2,755,965
|
|
$ 2,546,735
|
Gross profit
|
|
417,474
|
|
387,140
|
|
974,500
|
|
794,722
|
Selling, administrative
and engineering expense
|
|
223,137
|
|
176,361
|
|
444,427
|
|
365,137
|
Restructuring
benefit
|
|
-
|
|
(264)
|
|
-
|
|
(392)
|
Operating income
from HDMC
|
|
194,337
|
|
211,043
|
|
530,073
|
|
429,977
|
|
|
|
|
|
|
|
|
|
LiveWire
revenue
|
|
7,026
|
|
12,506
|
|
14,788
|
|
22,907
|
Gross profit
|
|
(2,940)
|
|
(390)
|
|
(1,676)
|
|
(337)
|
Selling, administrative
and engineering expense
|
|
29,044
|
|
18,966
|
|
54,855
|
|
35,078
|
Operating loss
from Livewire
|
|
(31,984)
|
|
(19,356)
|
|
(56,531)
|
|
(35,415)
|
|
|
|
|
|
|
|
|
|
HDFS revenue
|
|
240,361
|
|
202,616
|
|
463,456
|
|
394,631
|
HDFS expense
|
|
181,376
|
|
116,688
|
|
346,051
|
|
222,346
|
Operating income
from HDFS
|
|
58,985
|
|
85,928
|
|
117,405
|
|
172,285
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
221,338
|
|
277,615
|
|
590,947
|
|
566,847
|
Other income,
net
|
|
7,226
|
|
10,055
|
|
27,322
|
|
21,085
|
Investment income
(loss)
|
|
11,151
|
|
(3,530)
|
|
21,176
|
|
(5,509)
|
Interest
expense
|
|
(7,696)
|
|
(7,720)
|
|
(15,416)
|
|
(15,431)
|
Income before income
taxes
|
|
232,019
|
|
276,420
|
|
624,029
|
|
566,992
|
Income tax
provision
|
|
58,189
|
|
60,571
|
|
148,370
|
|
128,641
|
Net income
|
|
$
173,830
|
|
$
215,849
|
|
$
475,659
|
|
$
438,351
|
Less: Loss attributable
to noncontrolling interests
|
|
4,209
|
|
-
|
|
6,470
|
|
-
|
Net income attributable
to Harley-Davidson, Inc.
|
|
$
178,039
|
|
$
215,849
|
|
$
482,129
|
|
$
438,351
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.24
|
|
$
1.47
|
|
$
3.33
|
|
$
2.92
|
Diluted
|
|
$
1.22
|
|
$
1.46
|
|
$
3.27
|
|
$
2.91
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares:
|
|
|
|
|
|
|
|
|
Basic
|
|
143,414
|
|
147,211
|
|
144,724
|
|
149,936
|
Diluted
|
|
145,787
|
|
147,835
|
|
147,351
|
|
150,812
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share:
|
|
$
0.1650
|
|
$
0.1575
|
|
$
0.3300
|
|
$
0.3150
|
|
The Company operates in
three reportable segments: Harley-Davidson Motor Company (HDMC),
LiveWire and Harley-Davidson Financial Services (HDFS). The Company
changed its segments in the period ended December 31, 2022. The
change has been retrospectively reflected in the Company's
results.
|
|
LiveWire results
presented in the Company's financial statements represent the
LiveWire reportable segment as determined in accordance with
Financial Accounting Standards Board (FASB) Accounting Standards
Codification (ASC) 280 Segment
Reporting which may differ from
LiveWire Group, Inc. results.
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Harley-Davidson,
Inc.
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Condensed Consolidated
Balance Sheets
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(In
thousands)
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(Unaudited)
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|
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(Unaudited)
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June 30,
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December 31,
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June 26,
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2023
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2022
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2022
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ASSETS
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Current
assets:
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Cash
and cash equivalents
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$ 1,521,940
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$ 1,433,175
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$ 2,194,259
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Accounts receivable, net
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329,487
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252,225
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302,049
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Finance receivables, net
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1,979,645
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1,782,631
|
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1,674,970
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Inventories, net
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846,033
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950,960
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726,586
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Restricted cash
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135,618
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135,424
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226,488
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Other current assets
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201,702
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196,238
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183,816
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5,014,425
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4,750,653
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5,308,168
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Finance receivables,
net
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5,530,221
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5,355,807
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5,428,714
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Other long-term
assets
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1,470,915
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1,386,016
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1,384,736
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$
12,015,561
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$
11,492,476
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$
12,121,618
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LIABILITIES AND SHAREHOLDERS'
EQUITY
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Current
liabilities:
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Accounts payable and accrued liabilities
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$
950,110
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$
998,947
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$ 1,008,962
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Short-term deposits, net
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216,293
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79,710
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78,005
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Short-term debt
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695,356
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770,468
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701,384
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Current portion of long-term debt, net
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604,700
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1,684,782
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1,887,552
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2,466,459
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3,533,907
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3,675,903
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Long-term debt,
net
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5,765,246
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4,457,052
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5,204,317
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Other long-term
liabilities
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594,000
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594,709
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606,246
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Shareholders'
equity
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3,189,856
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2,906,808
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2,635,152
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$
12,015,561
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$
11,492,476
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$
12,121,618
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Harley-Davidson,
Inc.
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Condensed Consolidated
Statements of Cash Flows
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(In
thousands)
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(Unaudited
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Six months
ended
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|
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June 30,
|
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June 26,
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|
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2023
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2022
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|
|
|
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Net cash provided by
operating activities
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$
410,520
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$
244,186
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Cash flows from
investing activities:
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Capital
expenditures
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(86,526)
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(55,015)
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Finance
receivables, net
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(259,520)
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(439,241)
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Other investing
activities
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850
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797
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Net cash used by
investing activities
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(345,196)
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(493,459)
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Cash flows from
financing activities:
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Proceeds from
issuance of medium-term notes
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1,446,304
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495,785
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Repayments of
medium-term notes
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(1,056,680)
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(950,000)
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Proceeds from
securitization debt
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547,706
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1,826,891
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Repayments of
securitization debt
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(645,377)
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(610,205)
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Net decrease in
unsecured commercial paper
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(75,229)
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(50,672)
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Borrowings of
asset-backed commercial paper
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33,547
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425,253
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Repayments of
asset-backed commercial paper
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(129,961)
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(133,159)
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Net increase in
deposits
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122,288
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55,255
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Dividends
paid
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(48,193)
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(47,146)
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Repurchase of
common stock
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(169,645)
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(325,828)
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Other financing
activities
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76
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(1,237)
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Net cash provided by
financing activities
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24,836
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684,937
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Effect of exchange rate
changes on cash, cash equivalents and restricted cash
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(490)
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(14,413)
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Net increase in cash,
cash equivalents and restricted cash
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$
89,670
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$
421,251
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Cash, cash equivalents
and restricted cash:
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Cash, cash equivalents
and restricted cash, beginning of period
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$ 1,579,177
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$ 2,025,219
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Net increase in cash,
cash equivalents and restricted cash
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89,670
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421,251
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Cash, cash equivalents
and restricted cash, end of period
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$ 1,668,847
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$ 2,446,470
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Reconciliation of cash,
cash equivalents and restricted cash on the Consolidated balance
sheets to the Consolidated statements of cash
flows:
|
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Cash and cash
equivalents
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|
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$ 1,521,940
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$ 2,194,259
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Restricted
cash
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135,618
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226,488
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Restricted cash
included in Other long-term assets
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11,289
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25,723
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Cash, cash
equivalents and restricted cash per the Consolidated statements of
cash flows
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$ 1,668,847
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$ 2,446,470
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HDMC Revenue and
Motorcycle Shipment Data
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(Unaudited)
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Three months
ended
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Six months
ended
|
|
|
June 30,
|
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June 26,
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June 30,
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June 26,
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2023
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2022
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2023
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2022
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HDMC REVENUE (in thousands)
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Motorcycles
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$
890,919
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$
935,172
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$ 2,193,297
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$ 1,992,177
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Parts and
accessories
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215,520
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214,267
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383,192
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379,587
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Apparel
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66,356
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77,325
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137,747
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128,729
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Licensing
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5,116
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11,781
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11,326
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18,278
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Other
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20,225
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15,420
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30,403
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27,964
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$
1,198,136
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$ 1,253,965
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$ 2,755,965
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$ 2,546,735
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HDMC U.S. MOTORCYCLE
SHIPMENTS
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24,229
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28,181
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66,817
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64,000
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HDMC WORLDWIDE MOTORCYCLE SHIPMENTS
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Grand American Touring(a)
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20,270
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21,758
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52,489
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47,770
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Cruiser
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15,476
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14,565
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36,734
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30,128
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Sport and Lightweight
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6,161
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8,452
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12,746
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18,106
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Adventure Touring
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1,027
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3,168
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3,202
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6,685
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42,934
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47,943
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105,171
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102,689
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(a)
Includes Trike
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LiveWire Motorcycle
Shipments
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33
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|
225
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|
96
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|
322
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HDMC Gross
Profit
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(Unaudited)
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The estimated impact of
significant factors affecting the comparability of gross profit
from the second quarter of 2022 to the second quarter of 2023 were
as follows (in millions):
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Three months
ended
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Six months
ended
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2022 gross
profit
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$
387
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$
795
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Volume
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(43)
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1
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Price and sales
incentives
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51
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|
154
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Foreign currency
exchange rates and hedging
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(13)
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(35)
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Shipment mix
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14
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42
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Raw material
prices
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8
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|
14
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Manufacturing and other
costs
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13
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4
|
|
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30
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|
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|
180
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2023 gross
profit
|
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$
417
|
|
|
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$
975
|
|
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HDFS Finance
Receivables Allowance for Credit Losses
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
June 30,
|
|
June 26,
|
|
June 30,
|
|
June 26,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Balance, beginning of
period
|
|
$
358,431
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$
340,473
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$
358,711
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$
339,379
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Provision for credit
losses
|
|
57,278
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|
29,133
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|
109,642
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|
57,955
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Charge-offs, net of
recoveries
|
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(33,929)
|
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(17,469)
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(86,573)
|
|
(45,197)
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Balance, end of
period
|
|
$
381,780
|
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$
352,137
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$
381,780
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$
352,137
|
Worldwide Retail Sales
of Harley-Davidson Motorcycles(a)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
June 30,
|
|
June 30,
|
|
June 30,
|
|
June 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
United
States
|
|
32,161
|
|
31,641
|
|
56,438
|
|
60,985
|
Canada
|
|
2,899
|
|
3,086
|
|
4,643
|
|
4,955
|
Total North
America
|
|
35,060
|
|
34,727
|
|
61,081
|
|
65,940
|
EMEA
|
|
8,120
|
|
8,656
|
|
14,037
|
|
14,946
|
Asia Pacific
|
|
7,525
|
|
6,045
|
|
14,406
|
|
12,744
|
Latin
America
|
|
821
|
|
791
|
|
1,427
|
|
1,600
|
Total worldwide retail
sales
|
|
51,526
|
|
50,219
|
|
90,951
|
|
95,230
|
|
(a)
Data source for retail sales figures
shown above is new sales warranty and registration information
provided by 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.