MILWAUKEE, Oct. 26,
2022 /PRNewswire/ -- Harley-Davidson, Inc.
("Harley-Davidson") (NYSE: HOG) today reported third quarter
results.
"Harley-Davidson delivered a strong third quarter with solid
growth for both revenue and operating income, aligned to our
Hardwire strategic initiatives," said Jochen Zeitz, Chairman, President and CEO,
Harley-Davidson. "We are reaffirming our outlook for the year, and
as we approach our 120th anniversary that we will be
celebrating in our hometown Milwaukee and around the world, we are excited
about the potential of Harley-Davidson, the most desirable
motorcycle company in the world."
Third Quarter 2022 Summary of Results
- Global motorcycle shipments grew 19 percent in Q3 vs prior year
as production largely recovered from the previously announced
unexpected production suspension in Q2
- HDMC Revenue grew 24 percent behind this profitable unit growth
and global pricing
- HDMC Operating Income margin of 17.9 percent was up 9.5
points
- HDFS Operating Income declined 24 percent as the credit
environment normalizes
- GAAP diluted EPS of $1.78 was up
70 percent
- The Company reaffirms its full-year 2022 outlook on HDMC
Revenue, HDMC Margin and HDFS performance
- Merger transaction between LiveWire and AEA-Bridges Impact
Corporation was completed on September
26th, the first day of fiscal Q4
Third Quarter 2022 Results
Harley-Davidson, Inc. Consolidated Financial
Results
$ in millions
(except EPS)
|
3rd
quarter
|
2022
|
2021
|
Change
|
Revenue
|
$1,649
|
$1,365
|
21 %
|
Operating
Income
|
$339
|
$204
|
66 %
|
Net Income
|
$261
|
$163
|
60 %
|
GAAP Diluted
EPS
|
$1.78
|
$1.05
|
70 %
|
Consolidated revenue was up 21 percent in the third quarter
versus Q3 2021 driven primarily by HDMC revenue up 24 percent. The
increase in HDMC revenue was driven by a strong recovery in global
motorcycle shipments after being adversely impacted by an
unexpected production suspension in Q2. Consolidated operating
income growth of 66 percent, reflected 164 percent growth at HDMC
and a decline of 24 percent at HDFS. In line with expectations, the
HDFS decline was a result of a higher provision for credit losses
as the credit environment normalizes, and higher interest
expense.
HDMC Results: Motorcycles and Related Products
$ in
millions
|
3rd
quarter
|
2022
|
2021
|
Change
|
Motorcycle
Shipments (thousands)
|
57.1
|
47.9
|
19 %
|
Revenue
|
$1,437
|
$1,161
|
24 %
|
Motorcycles
|
$1,134
|
$886
|
28 %
|
Parts
& Accessories
|
$201
|
$205
|
(2 %)
|
Apparel
|
$70
|
$49
|
41 %
|
Licensing
|
$11
|
$8
|
26 %
|
Other
|
$22
|
$13
|
74 %
|
Gross Margin
|
34.1 %
|
26.7 %
|
7.4 pts.
|
Operating
Income
|
$258
|
$98
|
164 %
|
Operating
Margin
|
17.9 %
|
8.4 %
|
9.5 pts.
|
Global motorcycle shipments recovered strongly in Q3. HDMC
Revenue was up 24 percent primarily driven by a 19 percent increase
in wholesale shipments, favorable unit mix and continued global
pricing strength. Parts & Accessories was down 2 percent driven
by lower retail motorcycle volumes and offset by growth in Apparel
& Licensing behind seasonal product growth.
Third quarter gross margin was up 7.4 points compared to Q3
prior year. Global pricing and mix contributed approximately 5
points of margin benefit and more than offset cost inflation. In
addition, greater manufacturing leverage and lower tariffs
contributed positively and more than offset existing foreign
exchange headwinds. Third quarter operating margin improved to
17.9% from 8.4% in Q3 prior year due to the factors noted above.
Total operating expenses were $20
million higher compared to Q3 prior year, due in part to the
increased spend on LiveWire.
Harley-Davidson Retail Motorcycle Sales
Motorcycles
(thousands)
|
3rd
quarter
|
2022
|
2021
|
Change
|
North
America
|
32.2
|
33.9
|
(5 %)
|
EMEA
|
9.1
|
9.4
|
(4 %)
|
Asia Pacific
|
7.6
|
6.5
|
18 %
|
Latin
America
|
0.8
|
1.0
|
(27 %)
|
Worldwide
Total
|
49.6
|
50.8
|
(2 %)
|
Global retail motorcycle sales in the third quarter were down 2
percent versus prior year. Growth in Asia
Pacific was driven by strong demand and a quick refill of
dealer inventory coming out of the production suspension.
North America retail performance
(down 5 percent) continued to be adversely impacted by lower dealer
inventories. Retail performance strengthened during the quarter as
dealer inventories replenished.
HDFS Results: Financial Services
$ in
millions
|
3rd
quarter
|
2022
|
2021
|
Change
|
Revenue
|
$212
|
$205
|
3 %
|
Operating
Income
|
$81
|
$107
|
(24 %)
|
HDFS' operating income decline of $26
million versus Q3 2021 was driven by a higher provision for
credit losses and higher interest expense, partially offset by
lower operating expenses. The increase in the provision for credit
losses was due to actual retail credit losses continuing to move
towards normalized levels, while the credit loss allowance rate
remained consistent. Total quarter ending financing receivables
were $7.3B, which was up 7% versus
prior year.
Other Results
- YTD generated $575 million of
cash from operating activities.
- Cash and cash equivalents of $1.7
billion at the end of the third quarter, down $331 million compared to the end of the prior
year third quarter.
- The Company's YTD effective tax rate was 23 percent.
- The Company paid cash dividends of $0.1575 per share in Q3 2022.
- In Q3 the Company repurchased $12
million of shares (0.4 million shares); YTD share
repurchases total $324 million (8.4
million shares)
2022 Outlook
For the full year 2022, the Company reaffirms its guidance and
continues to expect:
- HDMC revenue growth of 5 to 10%
- HDMC operating income margin of 11 to 12%
- HDFS operating income to decline by 20 to 25%
The Company now expects:
- Capital investments of $170
million to $190 million from a
previously expected spend of $190
million to $220 million
Closing of LiveWire Business Combination
On
September 26, 2022, Harley-Davidson
and AEA-Bridges Impact Corp. ("ABIC") (NYSE: IMPX) completed
their previously announced business combination under which
LiveWire EV, LLC, Harley-Davidson's electric motorcycle division,
combined with ABIC, to create a new public company. The combined
public company now operates as LiveWire Group, Inc. ("LiveWire")
and its common stock and warrants began trading on the New York
Stock Exchange ("NYSE") under the symbols "LVWR" and "LVWR WS,"
respectively, on September 27, 2022.
Through this combination, LiveWire raised approximately
$294 million in net proceeds after
fees including Harley-Davidson's contribution and became the first
and only publicly traded all-electric motorcycle company in the
U.S. to list on the NYSE. Following the close, Harley-Davidson has
an equity interest in LiveWire of approximately 89.4% and will
continue to consolidate LiveWire's results, with adjustments for
non-controlling shareholder interests.
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, 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 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," "intend," "is on-track,"
"forecasting," 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, including
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 the combination of LiveWire with
ABIC, 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; 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
the final prospectus of ABIC, including those under "Risk Factors"
in that prospectus, and other documents filed with the SEC by the
Company, LiveWire Group Inc. or ABIC; (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 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; (J) 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; (K) 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; (L) 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; (M) manage the impact that prices
for and supply of used motorcycles may have on its business,
including on retail sales of new motorcycles; (N) successfully
manage and reduce costs throughout the business; (O) manage through
changes in general economic and business conditions, including
changing capital, credit and retail markets, and the changing
domestic and international political environments, including as a
result of the conflict in Ukraine; (P) 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; (Q) continue to develop and maintain a productive
relationship with Zhejiang Qianjiang Motorcycle Co., Ltd. and
launch related products in a timely manner; (R) maintain a
productive relationship with Hero MotoCorp as a distributor and
licensee of the Harley-Davidson brand name in India; (S)
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; (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 Harley-Davidson Financial
Services Inc.'s 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 pre-owned
motorcycle program, Harley-Davidson Certified, and the Company's
H-D1 Marketplace; (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; and (GG)
optimize capital allocation in light of the Company's capital
allocation priorities.
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 Inc. has
experienced historically low levels of retail credit losses, but
there is no assurance that this will continue. The Company believes
that Harley-Davidson Financial Services Inc.'s retail credit losses
will increase over time due among other things to factors that have
contributed recently to low levels of losses, including the
favorable impact of recent federal stimulus payments that will not
recur and the conflict in Ukraine.
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 1A. Risk Factors of the Company's
Annual Report on Form 10-K for the year ended December 31, 2021 as well as Item 1A. Risk
Factors of the Company's Quarterly Report on Form 10-Q for the
quarter ended July 26, 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
|
|
Nine months
ended
|
|
|
September
25,
|
|
September
26,
|
|
September
25,
|
|
September
26,
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
|
|
Motorcycles and Related
Products revenue
|
|
$
1,436,962
|
|
$ 1,160,618
|
|
$ 4,006,604
|
|
$ 3,724,225
|
Gross profit
|
|
490,306
|
|
310,425
|
|
1,284,691
|
|
1,137,961
|
Selling, administrative
and engineering expense
|
|
232,541
|
|
212,243
|
|
632,756
|
|
626,211
|
Restructuring expense
(benefit)
|
|
3
|
|
517
|
|
(389)
|
|
731
|
Operating income
from Motorcycles and Related Products
|
|
257,762
|
|
97,665
|
|
652,324
|
|
511,019
|
|
|
|
|
|
|
|
|
|
Financial Services
revenue
|
|
211,613
|
|
204,692
|
|
606,244
|
|
595,650
|
Financial Services
expense
|
|
130,657
|
|
98,047
|
|
353,003
|
|
275,487
|
Financial Services
restructuring expense
|
|
-
|
|
98
|
|
-
|
|
436
|
Operating income
from Financial Services
|
|
80,956
|
|
106,547
|
|
253,241
|
|
319,727
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
338,718
|
|
204,212
|
|
905,565
|
|
830,746
|
Non-operating income
(expense), net
|
|
2,957
|
|
(6,723)
|
|
3,102
|
|
(17,053)
|
Income before income
taxes
|
|
341,675
|
|
197,489
|
|
908,667
|
|
813,693
|
Provision for income
taxes
|
|
80,489
|
|
34,516
|
|
209,130
|
|
185,236
|
Net income
|
|
$
261,186
|
|
$
162,973
|
|
$
699,537
|
|
$
628,457
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.79
|
|
$
1.06
|
|
$
4.71
|
|
$
4.09
|
Diluted
|
|
$
1.78
|
|
$
1.05
|
|
$
4.68
|
|
$
4.06
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares:
|
|
|
|
|
|
|
|
|
Basic
|
|
146,217
|
|
153,863
|
|
148,673
|
|
153,700
|
Diluted
|
|
147,073
|
|
155,117
|
|
149,535
|
|
154,903
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share:
|
|
$
0.1575
|
|
$
0.1500
|
|
$
0.4725
|
|
$
0.4500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harley-Davidson,
Inc.
|
Condensed Consolidated
Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
|
|
September
25,
|
|
December 31,
|
|
September
26,
|
|
|
|
|
2022
|
|
2021
|
|
2021
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
|
|
$ 1,730,250
|
|
$ 1,874,745
|
|
$ 2,061,303
|
Accounts receivable, net
|
|
|
|
300,454
|
|
182,148
|
|
282,627
|
Finance receivables, net
|
|
|
|
1,807,718
|
|
1,465,544
|
|
1,540,822
|
Inventories, net
|
|
|
|
680,762
|
|
712,942
|
|
475,314
|
Restricted cash(a)
|
|
|
|
287,264
|
|
128,935
|
|
153,873
|
Other current assets
|
|
|
|
205,734
|
|
185,777
|
|
194,481
|
|
|
|
|
5,012,182
|
|
4,550,091
|
|
4,708,420
|
|
|
|
|
|
|
|
|
|
Finance receivables,
net
|
|
|
|
5,534,730
|
|
5,106,377
|
|
5,322,436
|
Other long-term
assets
|
|
|
|
1,380,699
|
|
1,394,587
|
|
1,168,948
|
|
|
|
|
$
11,927,611
|
|
$
11,051,055
|
|
$
11,199,804
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities(a)
|
|
|
|
$ 1,149,078
|
|
$
976,959
|
|
$
982,068
|
Short-term deposits, net
|
|
|
|
97,856
|
|
72,146
|
|
92,626
|
Short-term debt
|
|
|
|
692,551
|
|
751,286
|
|
749,620
|
Current portion of long-term debt, net
|
|
|
|
1,740,422
|
|
1,542,496
|
|
1,605,798
|
|
|
|
|
3,679,907
|
|
3,342,887
|
|
3,430,112
|
|
|
|
|
|
|
|
|
|
Long-term debt,
net
|
|
|
|
4,738,234
|
|
4,595,617
|
|
4,876,292
|
Other long-term
liabilities
|
|
|
|
669,260
|
|
559,307
|
|
559,506
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
2,840,210
|
|
2,553,244
|
|
2,333,894
|
|
|
|
|
$
11,927,611
|
|
$
11,051,055
|
|
$
11,199,804
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harley-Davidson,
Inc.
|
Condensed Consolidated
Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
Nine months
ended
|
|
|
|
|
|
|
September
25,
|
|
September
26,
|
|
|
|
|
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
|
|
|
$
574,704
|
|
$
925,551
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
|
|
|
(84,947)
|
|
(61,476)
|
Finance
receivables, net
|
|
|
|
|
|
(662,949)
|
|
(476,556)
|
Other investing
activities
|
|
|
|
|
|
2,160
|
|
2,485
|
Net cash used by
investing activities
|
|
|
|
|
|
(745,736)
|
|
(535,547)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of medium-term notes
|
|
|
|
|
|
495,785
|
|
-
|
Repayments of
medium-term notes
|
|
|
|
|
|
(950,000)
|
|
(1,400,000)
|
Proceeds from
securitization debt
|
|
|
|
|
|
1,826,891
|
|
1,169,910
|
Repayments of
securitization debt
|
|
|
|
|
|
(1,054,939)
|
|
(1,013,820)
|
Net decrease in
unsecured commercial paper
|
|
|
|
|
|
(60,281)
|
|
(261,978)
|
Borrowings of
asset-backed commercial paper
|
|
|
|
|
|
448,255
|
|
27,406
|
Repayments of
asset-backed commercial paper
|
|
|
|
|
|
(228,431)
|
|
(206,671)
|
Net increase in
deposits
|
|
|
|
|
|
54,080
|
|
210,144
|
Deposit in
advance of business combination(a)
|
|
|
|
|
|
100,000
|
|
-
|
Dividends
paid
|
|
|
|
|
|
(70,163)
|
|
(69,316)
|
Repurchase of
common stock
|
|
|
|
|
|
(338,496)
|
|
(11,545)
|
Other financing
activities
|
|
|
|
|
|
(1,237)
|
|
4,324
|
Net cash provided
(used) by financing activities
|
|
|
|
|
|
221,464
|
|
(1,551,546)
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
|
|
|
|
|
(33,361)
|
|
(11,050)
|
|
|
|
|
|
|
|
|
|
Net increase (decrease)
in cash, cash equivalents and restricted cash
|
|
|
|
|
|
$
17,071
|
|
$ (1,172,592)
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash:
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
|
|
|
|
|
$ 2,025,219
|
|
$ 3,409,168
|
Net increase (decrease)
in cash, cash equivalents and restricted cash
|
|
|
|
|
|
17,071
|
|
(1,172,592)
|
Cash, cash equivalents
and restricted cash, end of period
|
|
|
|
|
|
$ 2,042,290
|
|
$ 2,236,576
|
|
|
|
|
|
|
|
|
|
Reconciliation of cash,
cash equivalents and restricted cash on the Consolidated balance
sheets to
the Consolidated statements of cash flows:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
$ 1,730,250
|
|
$ 2,061,303
|
Restricted
cash(a)
|
|
|
|
|
|
287,264
|
|
153,873
|
Restricted cash
included in Other long-term assets
|
|
|
|
|
|
24,776
|
|
21,400
|
Cash, cash
equivalents and restricted cash per the Consolidated statements of
cash flows
|
|
|
|
$ 2,042,290
|
|
$ 2,236,576
|
|
|
|
|
|
|
|
|
|
(a)
During the quarter ended September 25,
2022, the Company received a $100 million cash deposit from an
independent strategic investor, Kwang Yang Motor Co., Ltd. (KYMCO)
in advance of the pending LiveWire transaction (discussed in note
16 of the Notes to Consolidated financial statements included in
the Company's Quarterly Report on Form 10-Q filed on August 4,
2022). As of September 25, 2022, the $100 million cash deposit was
included in Restricted cash and a $100 million liability,
representing the Company's obligation to return the funds to KYMCO
in the event the transaction did not close, was recorded in Accrued
liabilities. The LiveWire transaction closed on September 26, 2022
as discussed in the Company's Form 8-K filed on September 30,
2022.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Motorcycles and Related
Products Revenue and Motorcycle Shipment Data
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
25,
|
|
September
26,
|
|
September
25,
|
|
September
26,
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
MOTORCYCLES AND RELATED
PRODUCTS REVENUE (in thousands)
|
|
|
|
|
|
|
|
|
Motorcycles
|
|
$
1,133,558
|
|
$
885,626
|
|
$ 3,132,717
|
|
$ 2,931,669
|
Parts &
accessories
|
|
201,003
|
|
204,506
|
|
581,068
|
|
577,035
|
Apparel
|
|
69,834
|
|
49,424
|
|
198,568
|
|
155,378
|
Licensing
|
|
10,662
|
|
8,481
|
|
28,940
|
|
22,865
|
Other
|
|
21,905
|
|
12,581
|
|
65,311
|
|
37,278
|
|
|
$
1,436,962
|
|
$ 1,160,618
|
|
$ 4,006,604
|
|
$ 3,724,225
|
|
|
|
|
|
|
|
|
|
U.S. MOTORCYCLE
SHIPMENTS
|
|
37,199
|
|
27,919
|
|
101,475
|
|
104,190
|
|
|
|
|
|
|
|
|
|
WORLDWIDE MOTORCYCLE
SHIPMENTS
|
|
|
|
|
|
|
|
|
Grand American Touring(a)
|
|
27,521
|
|
21,988
|
|
75,291
|
|
79,485
|
Cruiser(b)
|
|
17,403
|
|
16,531
|
|
47,853
|
|
52,117
|
Sportster® / Street
|
|
3,776
|
|
4,507
|
|
12,355
|
|
8,555
|
Adventure Touring
|
|
8,361
|
|
4,915
|
|
24,573
|
|
19,262
|
|
|
57,061
|
|
47,941
|
|
160,072
|
|
159,419
|
|
|
|
|
|
|
|
|
|
(a)
Includes Grand American Touring,
CVO™ and 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 the third quarter of 2021 to the third quarter of 2022 were as
follows (in millions):
|
|
|
Three months
ended
|
|
|
|
Nine months
ended
|
|
|
2021 gross
profit
|
|
$
310
|
|
|
|
$
1,138
|
|
|
Volume
|
|
68
|
|
|
|
47
|
|
|
Price and sales
incentives
|
|
88
|
|
|
|
259
|
|
|
Foreign currency
exchange rates and hedging
|
|
(23)
|
|
|
|
(43)
|
|
|
Shipment mix
|
|
21
|
|
|
|
4
|
|
|
Raw material
prices
|
|
-
|
|
|
|
(25)
|
|
|
Manufacturing and other
costs
|
|
26
|
|
|
|
(95)
|
|
|
|
|
180
|
|
|
|
147
|
|
|
2022 gross
profit
|
|
$
490
|
|
|
|
$
1,285
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Services
Finance Receivables Allowance for Credit Losses
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
25,
|
|
September
26,
|
|
September
25,
|
|
September
26,
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Balance, beginning of
period
|
|
$
352,137
|
|
$
358,811
|
|
$
339,379
|
|
$
390,936
|
Provision for credit
losses
|
|
36,617
|
|
11,208
|
|
94,572
|
|
4,935
|
Charge-offs, net of
recoveries
|
|
(28,658)
|
|
(14,185)
|
|
(73,855)
|
|
(40,037)
|
Balance, end of
period
|
|
$
360,096
|
|
$
355,834
|
|
$
360,096
|
|
$
355,834
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Retail Sales
of Harley-Davidson Motorcycles(a)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
|
|
United
States
|
|
30,000
|
|
31,699
|
|
91,228
|
|
107,421
|
Canada
|
|
2,154
|
|
2,158
|
|
7,116
|
|
7,403
|
Total North
America
|
|
32,154
|
|
33,857
|
|
98,344
|
|
114,824
|
EMEA
|
|
9,054
|
|
9,389
|
|
24,095
|
|
24,580
|
Asia Pacific
|
|
7,631
|
|
6,484
|
|
20,404
|
|
18,263
|
Latin
America
|
|
765
|
|
1,048
|
|
2,365
|
|
2,620
|
Total worldwide retail
sales
|
|
49,604
|
|
50,778
|
|
145,208
|
|
160,287
|
|
|
|
|
|
|
|
|
|
(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.