MILWAUKEE, Feb. 8, 2022 /PRNewswire/ -- Harley-Davidson, Inc.
("Harley-Davidson") (NYSE:HOG) today reported fourth quarter and full
year 2021 results.
"Harley-Davidson delivered a strong finish to the year, in which we have seen
proof points on all elements of our Hardwire Strategy," said Jochen
Zeitz, Chairman, President and CEO, Harley-Davidson. "Looking ahead, we are
fully committed to achieving our long-term Hardwire Strategy, as the most
desirable motorcycle brand and company in the world."
2021 Highlights and Results
-
Successfully completed the first year of The Hardwire Five-year Strategic
Plan
-
Delivered full year GAAP diluted EPS of $4.19, up $4.18 vs.
2020
-
Grew Harley-Davidson's total revenue by 32% behind increased shipments and
favorable motorcycle unit mix resulting from our Hardwire actions
-
Achieved 9.0% GAAP operating margin for the Motorcycles and Related Products
segment ("HDMC"), which was well ahead of prior year and +2.7 percentage
points ahead of 2019
-
Record Financial Services segment ("HDFS") operating income
of $415 million, up 112%, driven by lower provision for credit losses
and lower interest expense
-
Announced merger transaction for LiveWire with AEA-Bridges Impact
Corporation; deal expected to close in the first half of 2022
Fourth Quarter 2021 Highlights and Results
-
Delivered GAAP diluted EPS of $0.14 versus a loss
of $0.63 in Q4 2020
-
Grew Harley-Davidson's total revenue by 40% on higher units, profitable unit
mix and pricing
-
HDMC achieved improved GAAP operating margin as Hardwire actions
take effect
-
HDFS operating income growth of $18 million and 24% versus PY
driven by lower interest expense
2022 Financial Outlook
For the full year 2022, the company expects:
- HDMC revenue growth of 5 to 10%
- HDMC operating income margin of 11 to 12%
- HDFS operating income to decline by 20 to 25%
- Capital investments of $190 million to $220 million
The outlook assumes that supply chain challenges improve in the second half of
the year.
The company's cash allocation priorities are to fund growth through
The Hardwire initiatives, pay dividends, and execute discretionary
share repurchases.
Fourth Quarter and Full Year 2021 Results
|
Harley-Davidson, Inc.
Consolidated Financial Results
|
nm – not meaningful
|
|
$ in millions (except EPS)
|
4th quarter
|
Full Year
|
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
|
Revenue
|
$1,016
|
$725
|
40%
|
$5,336
|
$4,054
|
32%
|
|
Net Income (Loss)
|
$22
|
($96)
|
nm
|
$650
|
$1
|
nm
|
|
GAAP Diluted EPS
|
$0.14
|
($0.63)
|
nm
|
$4.19
|
$0.01
|
nm
|
|
Adjusted Diluted EPS
|
$0.15
|
($0.46)
|
nm
|
$4.21
|
$0.63
|
nm
|
Consolidated revenue was up 40 percent in the fourth quarter and up 32 percent
for the full year over 2020, driven by growth in HDMC revenue resulting from
stronger unit sales and mix. Consolidated net income in the fourth quarter
reflects HDFS operating income offsetting HDMC operating losses in the
seasonally slow quarter. Consolidated net income for the full year was driven
by significant operating income improvement with strong results at both HDMC
and HDFS.
|
HDMC Results
|
nm – not meaningful
|
|
|
|
|
$ in millions
|
4th quarter
|
Full Year
|
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
|
Motorcycle Shipments (thousands)
|
29.1
|
20.9
|
39%
|
188.5
|
145.2
|
30%
|
|
Revenue
|
$816
|
$531
|
54%
|
$4,540
|
$3,264
|
39%
|
|
Motorcycles
|
$546
|
$320
|
71%
|
$3,477
|
$2,350
|
48%
|
|
Parts & Accessories
|
$165
|
$146
|
13%
|
$742
|
$660
|
13%
|
|
General Merchandise
|
$73
|
$50
|
46%
|
$228
|
$186
|
23%
|
|
Licensing
|
$15
|
$8
|
88%
|
$38
|
$30
|
27%
|
|
Other
|
$18
|
$7
|
159%
|
$55
|
$38
|
44%
|
|
Gross Margin
|
19.5%
|
21.6%
|
(2.1) pts.
|
28.6%
|
25.4%
|
3.2 pts.
|
|
Operating (Loss) Income
|
($102)
|
($196)
|
nm
|
$409
|
($186)
|
nm
|
|
Operating Margin
|
(12.5%)
|
(37.0%)
|
nm
|
9.0%
|
(5.7%)
|
nm
|
Revenue from HDMC was up significantly during the fourth quarter of
2021 primarily driven by a 39 percent increase in wholesale shipments,
favorable motorcycle unit mix resulting from our Hardwire actions
and pricing in the U.S. market. Parts & Accessories fourth quarter revenue
was up 13 percent while General Merchandise was up 46 percent over Q4 2020, as
both businesses were favorably impacted by increased wholesale shipments and
refreshed product offerings.
Fourth quarter gross margin was down 2 percentage points to Q4 prior year as
stronger units and pricing were offset by negative cost headwinds across the
supply chain and higher additional EU tariffs (1.3 percentage point impact).
Q4 operating margin was improved versus prior year due to lower operating
expenses and heavier restructuring charges in the prior Q4.
|
Harley-Davidson Retail Motorcycle Sales
|
|
Motorcycles (thousands)
|
4th quarter
|
Full Year
|
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
|
North America
|
19.6
|
18.1
|
8%
|
134.4
|
110.1
|
22%
|
|
EMEA
|
6.5
|
7.0
|
(7%)
|
31.1
|
36.9
|
(16%)
|
|
Asia Pacific
|
6.8
|
6.9
|
(2%)
|
25.1
|
27.2
|
(8%)
|
|
Latin America
|
1.0
|
1.2
|
(16%)
|
3.7
|
6.0
|
(39%)
|
|
Worldwide Total
|
34.0
|
33.3
|
2%
|
194.3
|
180.2
|
8%
|
Global retail motorcycle sales in the fourth quarter were up 2 percent versus
prior year, driven by a robust performance in North America offset
by declines across international markets. International results were the
result of strategic decisions made as part of the Rewire and Hardwire
Strategic Plan, including the exit of unprofitable product segments and
markets, as well as macro supply chain challenges, including slower shipping
times to the international markets.
|
HDFS Results
|
|
$ in millions
|
4th quarter
|
Full Year
|
|
2021
|
2020
|
Change
|
2021
|
2020
|
Change
|
|
Revenue
|
$200
|
$194
|
3%
|
$796
|
$790
|
1%
|
|
Operating Income
|
$95
|
$77
|
24%
|
$415
|
$196
|
112%
|
HDFS operating income growth of $18 million over Q4 2020 was driven
by lower interest expense and lower restructuring costs, partially offset by
higher provision for credit losses.
Other Results
-
Harley-Davidson generated $976 million of cash from operating
activities in 2021. Cash and cash equivalents were $1.9 billion at
the end of 2021, down $1.4 billion from the end of 2020 as the
company has normalized cash balances.
-
Tax Rate – The company's 2021 effective tax rate was 21 percent, which was
favorably impacted by several discrete income tax benefits recorded in the
year.
-
Dividends – The company paid cash dividends of $0.60 per share on
a full year basis in 2021.
Update on LiveWire Transaction
On December 13, 2021, Harley-Davidson and AEA-Bridges Impact
Corp. ("ABIC") (NYSE: IMPX), a special purpose acquisition company with a
dedicated sustainability focus, sponsored by executives of AEA
Investors and Bridges Fund Management, announced a definitive
business combination agreement under which ABIC will combine with LiveWire,
Harley-Davidson's electric motorcycle division, to create a new publicly
traded company. Its common stock is expected to be listed on the New York
Stock Exchange under the symbol "LVW".
The transaction is expected to close in the first half of 2022 and is subject
to the approval of ABIC shareholders and other customary closing conditions.
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. The company's management reviews its results with and without the
impact of restructuring plan costs and does not consider past restructuring
plan costs to be indicative of ongoing operating
activities. Restructuring plan costs include restructuring expenses as
presented in the consolidated statements of operations. 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," "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 and the
evolution of LiveWire as a standalone brand, including the proposed separation
of LiveWire from the company through the combination of LiveWire with ABIC,
which includes the risks noted below; (B) manage supply chain and logistic
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 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) 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;
(2) adequately control the costs of its operations as a new entrant into a new
space; (3) develop, maintain, and strengthen its brand; (4) execute its plans
to develop, produce, market, and sell its electric vehicles; (5) 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; (6) maintain relationships with customers and suppliers and retain
its management and key employees; and (7) successfully collaborate
with Kwang Yang Motor Co., Ltd., as outlined in its Long Term
Collaboration Agreement, to accelerate development of two-wheel and other
electric vehicles and to explore further business opportunities in electric
vehicles markets; (ii) competition; and (iii) other risks and uncertainties
indicated from time to time in the final prospectus of ABIC, including those
under "Risk Factors" therein, and other documents filed or to be filed with
the SEC by the company, LW EV Holdings, Inc. (HoldCo) 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 growing 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)
successfully appeal: (i) 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 (ii) the
denial of the company's application for temporary relief from the effect of
the revocation of the BOI decisions; (J) 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; (K) 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; (L) manage the impact that prices
for and supply of used motorcycles may have on its business, including on
retail sales of new motorcycles; (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) 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; (S) 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; (T) accurately estimate and adjust to fluctuations in foreign
currency exchange rates, interest rates and commodity prices; (U) retain and
attract talented employees, and eliminate personnel duplication,
inefficiencies and complexity throughout the organization; (V) prevent a
cybersecurity breach involving consumer, employee, dealer, supplier, or
company data and respond to evolving regulatory requirements regarding data
security; (W) manage the credit quality, the loan servicing and collection
activities, and the recovery rates of HDFS' loan portfolio; (X) 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; (Y) manage
through the effects inconsistent and unpredictable weather patterns may have
on retail sales of motorcycles; (Z) implement and manage enterprise-wide
information technology systems, including systems at its manufacturing
facilities; (AA) manage changes and prepare for requirements in legislative
and regulatory environments for its products, services and operations; (BB)
manage its exposure to product liability claims and commercial or contractual
disputes; (CC) continue to manage the relationships and agreements that
the company has with its labor unions to help drive long-term competitiveness;
(DD) achieve anticipated results with respect to the company's pre-owned
motorcycle program, Harley-Davidson Certified, and the company's H-D1
Marketplace; (EE) 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 (FF) optimize capital allocation in light of the
company's capital allocation priorities.
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 U.S. 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 the COVID-19 pandemic, 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 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.
Additional Information and Where to Find It
In connection with the proposed business combination between LiveWire EV,
LLC ("LiveWire") and AEA-Bridges Impact
Corp. ("ABIC") (the "Business Combination"), LW EV
Holdings, Inc. ("HoldCo") and ABIC intend to file a registration
statement on Form S-4 (as may be amended from time to time, the "Registration Statement") as co-registrants that includes a preliminary proxy statement/prospectus
of ABIC and a preliminary prospectus of HoldCo, and after the
Registration Statement is declared effective, ABIC will mail a definitive
proxy statement/prospectus relating to the Business Combination to ABIC's
shareholders. The Registration Statement, including the proxy
statement/prospectus contained therein, when declared effective by
the Securities and Exchange Commission ("SEC"), will contain
important information about the Business Combination and the other matters to
be voted upon at a meeting of ABIC's shareholders to be held to approve the
Business Combination (and related matters). This press release does not
contain all the information that should be considered concerning the Business
Combination and other matters and is not intended to provide the basis for any
investment decision or any other decision in respect of such
matters. Harley-Davidson, Inc. ("H-D"), HoldCo and
ABIC may also file other documents with the SEC regarding the
Business Combination. ABIC shareholders and other interested persons are
advised to read, when available, the preliminary proxy statement/prospectus
and the amendments thereto and the definitive proxy statement/prospectus and
other documents filed in connection with the Business Combination, as these
materials will contain important information about H-D, LiveWire, HoldCo,
ABIC and the Business Combination.
When available, the definitive proxy statement/prospectus and other relevant
materials for the Business Combination will be mailed to ABIC shareholders as
of a record date to be established for voting on the Business Combination.
Shareholders will also be able to obtain copies of the preliminary proxy
statement/prospectus, the definitive proxy statement/prospectus and other
documents filed or that will be filed with the SEC by ABIC through
the website maintained by the SEC at www.sec.gov, or by directing a request to AEA-Bridges Impact Corp., PO Box 1093,
Boundary Hall, Cricket Square, Grand
Cayman KY1-1102 Cayman Islands.
Participants in Solicitation
H-D, LiveWire, ABIC and their respective directors and officers may be deemed
participants in the solicitation of proxies of ABIC shareholders in connection
with the Business Combination. ABIC shareholders and other interested persons
may obtain, without charge, more detailed information regarding the directors
and officers of ABIC and a description of their interests in ABIC is contained
in ABIC's final prospectus related to its initial public offering,
dated October 1, 2021 and in ABIC's subsequent filings with
the SEC. Information regarding the persons who may,
under SEC rules, be deemed participants in the solicitation of
proxies to ABIC shareholders in connection with the Business Combination and
other matters to be voted upon at the ABIC shareholder meeting will be set
forth in the Registration Statement for the Business Combination when
available. Additional information regarding the interests of participants in
the solicitation of proxies in connection with the Business Combination will
be included in the Registration Statement that ABIC intends to file with
the SEC. You may obtain free copies of these documents as described in
the preceding paragraph.
Media Contact:
Jenni Coats
jenni.coats@Harley-Davidson.com
414.343.7902
Financial Contact:
Shawn Collins
shawn.collins@Harley-Davidson.com
414.343.8002
### (HOG-F)
|
Harley-Davidson, Inc.
|
|
Condensed Consolidated Statements of Operations
|
|
(In thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
Three months ended
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
Motorcycles and Related Products revenue
|
|
$ 816,015
|
|
$ 530,963
|
|
$ 4,540,240
|
|
$ 3,264,054
|
|
Gross profit
|
|
158,992
|
|
114,528
|
|
1,296,953
|
|
828,309
|
|
Selling, administrative and engineering expense
|
|
259,376
|
|
276,409
|
|
885,587
|
|
895,321
|
|
Restructuring expense
|
|
2,010
|
|
34,524
|
|
2,741
|
|
119,110
|
|
Operating (loss) income from Motorcycles and Related
Products
|
|
(102,394)
|
|
(196,405)
|
|
408,625
|
|
(186,122)
|
|
|
|
|
|
|
|
|
|
|
|
Financial Services revenue
|
|
200,418
|
|
194,259
|
|
796,068
|
|
790,323
|
|
Financial Services expense
|
|
105,093
|
|
107,852
|
|
380,580
|
|
583,623
|
|
Financial Services restructuring expense
|
|
238
|
|
9,621
|
|
674
|
|
10,899
|
|
Operating income from Financial Services
|
|
95,087
|
|
76,786
|
|
414,814
|
|
195,801
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) income
|
|
(7,307)
|
|
(119,619)
|
|
823,439
|
|
9,679
|
|
Non-operating income (expense), net
|
|
12,851
|
|
(5,650)
|
|
(4,202)
|
|
(25,409)
|
|
Income (loss) before income taxes
|
|
5,544
|
|
(125,269)
|
|
819,237
|
|
(15,730)
|
|
Income tax (benefit) provision
|
|
(16,023)
|
|
(28,871)
|
|
169,213
|
|
(17,028)
|
|
Net income (loss)
|
|
$ 21,567
|
|
$ (96,398)
|
|
$ 650,024
|
|
$ 1,298
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.14
|
|
$ (0.63)
|
|
$ 4.23
|
|
$ 0.01
|
|
Diluted
|
|
$ 0.14
|
|
$ (0.63)
|
|
$ 4.19
|
|
$ 0.01
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
153,879
|
|
153,281
|
|
153,747
|
|
153,186
|
|
Diluted
|
|
155,200
|
|
153,281
|
|
154,980
|
|
153,908
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per share:
|
|
$ 0.15
|
|
$ 0.02
|
|
$ 0.60
|
|
$ 0.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harley-Davidson, Inc.
|
|
Reconciliation of GAAP Amounts to Non-GAAP Amounts
|
|
(In thousands, except per share amounts)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
Net income (loss) excluding restructuring plan costs
|
|
|
|
|
|
|
|
|
|
Net income (loss) (GAAP)
|
|
$ 21,567
|
|
$ (96,398)
|
|
$ 650,024
|
|
$ 1,298
|
|
Restructuring plan costs
|
|
2,248
|
|
44,145
|
|
3,415
|
|
130,009
|
|
Tax effect of adjustments(a)
|
|
(524)
|
|
(18,576)
|
|
(784)
|
|
(34,599)
|
|
Adjustments net of tax
|
|
1,724
|
|
25,569
|
|
2,631
|
|
95,410
|
|
Adjusted net income (loss) (non-GAAP)
|
|
$ 23,291
|
|
$ (70,829)
|
|
$ 652,655
|
|
$ 96,708
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS excluding restructuring plan costs
|
|
|
|
|
|
|
|
|
|
Diluted EPS (GAAP)
|
|
$ 0.14
|
|
$ (0.63)
|
|
$ 4.19
|
|
$ 0.01
|
|
Adjustments net of tax, per share
|
|
0.01
|
|
0.17
|
|
0.02
|
|
0.62
|
|
Adjusted diluted EPS (non-GAAP)
|
|
$ 0.15
|
|
$ (0.46)
|
|
$ 4.21
|
|
$ 0.63
|
|
|
|
|
|
|
|
|
|
|
|
(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)
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
2021
|
|
2020
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
$ 1,874,745
|
|
$ 3,257,203
|
|
Accounts receivable, net
|
|
|
|
|
|
182,148
|
|
143,082
|
|
Finance receivables, net
|
|
|
|
|
|
1,465,544
|
|
1,509,539
|
|
Inventories, net
|
|
|
|
|
|
712,942
|
|
523,497
|
|
Restricted cash
|
|
|
|
|
|
128,935
|
|
131,642
|
|
Other current assets
|
|
|
|
|
|
185,777
|
|
280,470
|
|
|
|
|
|
|
|
4,550,091
|
|
5,845,433
|
|
|
|
|
|
|
|
|
|
|
|
Finance receivables, net
|
|
|
|
|
|
5,106,377
|
|
4,933,469
|
|
Other long-term assets
|
|
|
|
|
|
1,394,587
|
|
1,231,699
|
|
|
|
|
|
|
|
$ 11,051,055
|
|
$ 12,010,601
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued
liabilities
|
|
|
|
|
|
$ 976,959
|
|
$ 848,118
|
|
Short-term deposits, net
|
|
|
|
|
|
72,146
|
|
79,965
|
|
Short-term debt
|
|
|
|
|
|
751,286
|
|
1,014,274
|
|
Current portion of long-term debt, net
|
|
|
|
|
|
1,542,496
|
|
2,039,597
|
|
|
|
|
|
|
|
3,342,887
|
|
3,981,954
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, net
|
|
|
|
|
|
4,595,617
|
|
5,932,933
|
|
Other long-term liabilities
|
|
|
|
|
|
559,307
|
|
372,929
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
|
|
|
2,553,244
|
|
1,722,785
|
|
|
|
|
|
|
|
$ 11,051,055
|
|
$ 12,010,601
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harley-Davidson, Inc.
|
|
Condensed Consolidated Statements of Cash Flows
|
|
(In thousands)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Twelve months ended
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
|
|
|
$ 975,701
|
|
$ 1,177,890
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
|
|
(120,181)
|
|
(131,050)
|
|
Finance receivables, net
|
|
|
|
|
|
(341,406)
|
|
42,803
|
|
Other investing activities
|
|
|
|
|
|
2,140
|
|
21,464
|
|
Net cash used by investing activities
|
|
|
|
|
|
(459,447)
|
|
(66,783)
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
(1,340,638)
|
|
(1,041,751)
|
|
Net (decrease) increase in unsecured commercial
paper
|
|
|
|
|
|
(260,250)
|
|
444,380
|
|
Borrowings of asset-backed commercial paper
|
|
|
|
|
|
98,863
|
|
225,187
|
|
Repayments of asset-backed commercial paper
|
|
|
|
|
|
(261,367)
|
|
(318,828)
|
|
Net increase in deposits
|
|
|
|
|
|
210,112
|
|
79,947
|
|
Dividends paid
|
|
|
|
|
|
(92,426)
|
|
(68,087)
|
|
Repurchase of common stock
|
|
|
|
|
|
(11,623)
|
|
(8,006)
|
|
Other financing activities
|
|
|
|
|
|
2,488
|
|
89
|
|
Net cash (used) provided by financing activities
|
|
|
|
|
|
(1,884,931)
|
|
1,373,983
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash, cash equivalents and
restricted cash
|
|
|
|
|
(15,272)
|
|
18,712
|
|
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash, cash equivalents and
restricted cash
|
|
|
|
|
|
$ (1,383,949)
|
|
$ 2,503,802
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
(1,383,949)
|
|
2,503,802
|
|
Cash, cash equivalents and restricted cash, end of period
|
|
|
|
|
|
$ 2,025,219
|
|
$ 3,409,168
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of cash, cash equivalents and restricted cash on
the Consolidated balance sheets to the Consolidated statements
of cash flows:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
$ 1,874,745
|
|
$ 3,257,203
|
|
Restricted cash
|
|
|
|
|
|
128,935
|
|
131,642
|
|
Restricted cash included in Other long-term assets
|
|
|
|
|
|
21,539
|
|
20,323
|
|
Cash, cash equivalents and restricted cash per the
Consolidated statements of cash flows
|
|
|
|
$ 2,025,219
|
|
$ 3,409,168
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Motorcycles and Related Products Revenue and Motorcycle
Shipment Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
Three months ended
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
MOTORCYCLES AND RELATED PRODUCTS REVENUE (in thousands)
|
|
|
|
|
|
|
|
|
|
Motorcycles
|
|
$ 545,726
|
|
$ 319,959
|
|
$ 3,477,395
|
|
$ 2,350,407
|
|
Parts & accessories
|
|
164,762
|
|
146,431
|
|
741,797
|
|
659,634
|
|
General merchandise
|
|
72,728
|
|
49,749
|
|
228,106
|
|
186,068
|
|
Licensing
|
|
14,925
|
|
7,924
|
|
37,790
|
|
29,750
|
|
Other
|
|
17,874
|
|
6,900
|
|
55,152
|
|
38,195
|
|
|
|
$ 816,015
|
|
$ 530,963
|
|
$ 4,540,240
|
|
$ 3,264,054
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
MOTORCYCLE SHIPMENTS
|
|
15,719
|
|
10,372
|
|
119,909
|
|
79,731
|
|
|
|
|
|
|
|
|
|
|
|
WORLDWIDE MOTORCYCLE SHIPMENTS
|
|
|
|
|
|
|
|
|
|
Grand American Touring(a)
|
|
14,476
|
|
8,666
|
|
93,961
|
|
61,322
|
|
Cruiser(b)
|
|
7,377
|
|
7,314
|
|
59,494
|
|
49,974
|
|
Adventure Touring
|
|
1,361
|
|
-
|
|
9,916
|
|
-
|
|
Sportster®/ Street
|
|
5,861
|
|
4,941
|
|
25,123
|
|
33,950
|
|
|
|
29,075
|
|
20,921
|
|
188,494
|
|
145,246
|
|
|
|
|
|
|
|
|
|
|
|
(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
|
|
|
|
Twelve months ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020 gross profit
|
|
$ 115
|
|
|
|
$
828
|
|
|
|
Volume
|
|
75
|
|
|
|
277
|
|
|
|
Price and sales incentives, net of related costs
|
|
31
|
|
|
|
70
|
|
|
|
Foreign currency exchange rates and hedging
|
|
1
|
|
|
|
34
|
|
|
|
Shipment mix
|
|
27
|
|
|
|
197
|
|
|
|
Raw material prices
|
|
(27)
|
|
|
|
(72)
|
|
|
|
Manufacturing and other costs
|
|
(63)
|
|
|
|
(37)
|
|
|
| |
|
44
|
|
|
|
469
|
|
|
|
2021 gross profit
|
|
$ 159
|
|
|
|
$ 1,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Services - Finance Receivables Allowance for Credit
Losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
Three months ended
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
Balance, beginning of period
|
|
$ 355,834
|
|
$ 408,702
|
|
$ 390,936
|
|
$ 198,581
|
|
Cumulative effect of change in accounting(a)
|
|
-
|
|
-
|
|
-
|
|
100,604
|
|
Provision for credit losses
|
|
20,114
|
|
3,437
|
|
25,049
|
|
181,870
|
|
Charge-offs, net of recoveries
|
|
(36,569)
|
|
(21,203)
|
|
(76,606)
|
|
(90,119)
|
|
Balance, end of period
|
|
$ 339,379
|
|
$ 390,936
|
|
$ 339,379
|
|
$ 390,936
|
|
|
|
|
|
|
|
|
|
|
|
(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
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
18,855
|
|
17,274
|
|
126,276
|
|
103,650
|
|
Canada
|
|
734
|
|
809
|
|
8,137
|
|
6,477
|
|
Total North America
|
|
19,589
|
|
18,083
|
|
134,413
|
|
110,127
|
|
EMEA
|
|
6,521
|
|
7,028
|
|
31,101
|
|
36,906
|
|
Asia Pacific
|
|
6,827
|
|
6,949
|
|
25,090
|
|
27,220
|
|
Latin America
|
|
1,032
|
|
1,235
|
|
3,652
|
|
5,995
|
|
Total worldwide retail
sales
|
|
33,969
|
|
33,295
|
|
194,256
|
|
180,248
|
|
|
|
|
|
|
|
|
|
|
|
(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.