MILWAUKEE, April 23, 2019 /PRNewswire/
-- Harley-Davidson, Inc. (NYSE:HOG) today reported first
quarter 2019 results. Company actions resulted in earnings
per share and retail sales finishing stronger than expected during
the quarter. The company's More Roads to Harley-Davidson
accelerated plan for growth continued to progress and delivered
results.
First Quarter 2019
- GAAP diluted EPS of $0.80 per
share, ahead of company expectations
- Encouraged by U.S. retail sales performance; Harley-Davidson
U.S. market share up
- Global dealer inventory down, well positioned for spring
selling season
- Intensified brand focus; hired President, Harley-Davidson Brand
- Acquired StaCyc, a producer of electric-powered two-wheelers
for kids
- Broadened reach with new Electra Glide® Standard at
$18,999 U.S. MSRP
- Manufacturing optimization remained on-track
- Thailand manufacturing
strategy accelerated retail sales growth in ASEAN emerging
markets
- Increased dividend 1.4 percent, repurchased $52.6 million of shares
First quarter 2019 GAAP diluted EPS was $0.80. Year-ago GAAP diluted EPS was $1.03. Excluding restructuring plan costs and the
impact of incremental tariffs, first quarter 2019 diluted EPS was
$0.98 compared to $1.24 in the first quarter of 2018. First
quarter 2019 net income was $127.9
million on consolidated revenue of $1.38 billion versus net income of $174.8 million on consolidated revenue of
$1.54 billion in 2018.
Harley-Davidson worldwide retail sales decreased 3.8 percent in
the first quarter. International retail sales were down 3.3
percent. U.S. retail sales were down 4.2 percent in the first
quarter driven by continued weak industry sales which were down 4.7
percent. First quarter worldwide retail sales were impacted
by the limited availability of Street motorcycles due to the recall
we announced in January.
"We are acting with agility and discipline to take full
advantage of rapidly evolving global markets. Harley-Davidson's
U.S. market share growth and retail sales performance in the first
quarter are further evidence of the effects we are having as we
continue to implement and dial-in our More Roads efforts," said
Matt Levatich, president and chief
executive officer, Harley-Davidson, Inc. "We are driven by our
un-paralleled rider focus and deep analytics that are guiding our
efforts today and into the future. We, along with our dealers, are
determined to lead and stimulate global industry growth."
Strategy to Build the Next Generation of Riders
More
Roads accelerated plan for growth
Harley-Davidson's strategic objectives through 2027 are to: build 2
million new riders in the U.S., grow international business to 50
percent of annual volume, launch 100 new high impact motorcycles
and do so profitably and sustainably.
The More Roads to Harley-Davidson accelerated plan for growth is
aligned with the company's strategy to deliver sustainable growth
and build the next generation of riders by delivering exciting
products in existing and new spaces, broader access to
Harley-Davidson and an optimized customer experience through an
even stronger dealer network. The company plans to
maintain its current investment and return profile and capital
allocation strategy, while it funds strategic opportunities
expected to drive revenue growth and expand operating margin
through 2022.
During the quarter, Harley-Davidson made further progress on its
More Roads plan, including appointing its first-ever brand
president, a move that positions the company to fully engage the
power of the brand as a catalyst to achieve its strategy and
long-term objectives. The company also expanded its electric
portfolio with the acquisition of StaCyc, a maker of electric
two-wheelers for kids. During the quarter, the company and its
dealers continued preparations to launch LiveWire®,
Harley-Davidson's first electric motorcycle, later this year.
"In the short eight months since we announced our More Roads
plan, we continue to accelerate our progress to build the next
generation of Harley-Davidson riders," said Levatich. "During
the first quarter we intensified our march by investing in our
future and adding capabilities that we're confident will inspire
riders today and for generations to come."
Building Riders
As Harley-Davidson continues to inspire diverse, new riders around
the globe, the company increased its reach and impact in the first
quarter and delivered a wide range of results including the
following highlights:
New, more diverse customers
- 278,000 new riders joined Harley-Davidson in 2018 in the U.S.
This group is the most diverse across age, ethnicity and gender in
all of the years Harley-Davidson has tracked this
data*
Impactful products broadening reach
- Expanded access to new customers in part with the launch of the
new Electra Glide® Standard motorcycle at $18,999 U.S. MSRP
Increased marketing support reached more consumers sooner and
drove action -- increased traffic to H-D.com, brand awareness,
trial and sales
- Media spend up nearly 90 percent, focused on increased brand
awareness and driving sales
- Direct marketing up over 200 percent
- PR and Media Impression - 2 billion, up from 436 million
* Data and analysis based on IHS Markit
Motorcycles in Operation (MIO) data for all CC's, On-Highway and
Dual purpose motorcycles in the U.S. as of December 31st of each year from 2001 through
2018. Rider demographics based on 3rd-party data for adults
age 18 and above.
Manufacturing
The company started supplying
motorcycles to ASEAN (Association of Southeast Asian Nations)
emerging markets from its Thailand
operations in late 2018. The tariff mitigation realized by
this strategy allowed more competitive pricing and helped drive a
Q1 retail sales increase of 126 percent in these markets.
To further improve its manufacturing operations and cost
structure, in the first quarter of 2018 the company commenced its
multi-year manufacturing optimization initiative anchored by the
consolidation of its motorcycle assembly plant in Kansas City, Mo. into its plant in York,
Pa. Upon completion of the program, the company continues to
expect ongoing annual cash savings of $65
million to $75 million after
2020. In the first quarter of 2019, costs related to the
manufacturing optimization were $17.6
million. For the full year, the company expects to
realize savings of $25 million to
$30 million and to incur $50 million to $60
million of operating expense.
Harley-Davidson
Retail Motorcycle Sales
|
Vehicles
|
1st
Quarter
|
2019
|
2018
|
Change
|
U.S.
|
28,091
|
29,309
|
(4.2)%
|
EMEA
|
10,797
|
10,862
|
(0.6)%
|
Asia
Pacific
|
6,074
|
6,329
|
(4.0)%
|
Latin
America
|
2,241
|
2,506
|
(10.6)%
|
Canada
|
1,948
|
2,080
|
(6.3)%
|
International
Total
|
21,060
|
21,777
|
(3.3)%
|
Worldwide
Total
|
49,151
|
51,086
|
(3.8)%
|
The U.S. 601+cc industry was down 4.7 percent in the first
quarter compared to the same period in 2018. Harley-Davidson's
first quarter U.S. market share was up 0.6 pts to 51.1
percent. Harley-Davidson's Europe market share was down 1.6 percentage
pts to 8.8 percent.
Motorcycles and
Related Products Segment Results
|
$ in
thousands
|
1st
Quarter
|
2019
|
2018
|
Change
|
Motorcycle Shipments
(vehicles)
|
58,891
|
63,944
|
(7.9)%
|
Revenue
|
$1,195,637
|
$1,363,947
|
(12.3)%
|
Motorcycles
|
$964,575
|
$1,121,673
|
(14.0)%
|
Parts
& Accessories
|
$ 159,703
|
$169,075
|
(5.5)%
|
General
Merchandise
|
$ 55,401
|
$56,601
|
(2.1)%
|
Gross
Margin
|
29.1%
|
34.7%
|
(5.6) pts.
|
Operating
Income
|
$108,381
|
$172,838
|
(37.3)%
|
Operating
Margin
|
9.1%
|
12.7%
|
(3.6) pts.
|
Revenue from the Motorcycles segment was down in the first
quarter behind lower shipments. Operating income decreased due to
lower revenues, unfavorable product mix and increased tariffs,
partially offset by lower SG&A and restructuring charges.
Financial Services
Segment Results
|
$ in
thousands
|
1st
Quarter
|
2019
|
2018
|
Change
|
Revenue
|
$188,743
|
$178,174
|
5.9%
|
Operating
Income
|
$58,731
|
$63,579
|
(7.6)%
|
Financial Services segment first quarter earnings of
$58.7 million were down 7.6
percent.
Other Results
Cash and marketable securities were
$759.6 million at the end of
first quarter 2019, compared to $753.5 million in 2018.
Harley-Davidson generated $32.7 million of cash from
operating activities in first quarter of 2019 compared
to $191.6 million in 2018. The company paid a cash
dividend of $0.375 per share for the
first quarter, which was up 1.4 percent compared to last year. On a
discretionary basis, Harley-Davidson repurchased 1.5 million
shares of its common stock during the first quarter for $52.6
million. During the quarter, there were approximately 160.0 million
weighted-average diluted common shares outstanding. At the end of
the first quarter, 14.9 million shares remained on a board-approved
share repurchase authorization.
Harley-Davidson's first quarter effective tax rate was 24.9
percent compared to 24.1 percent in 2018.
2019 Outlook
For the full-year 2019, the
company continues to expect:
- Motorcycle shipments to be approximately 217,000 to 222,000
motorcycles. In the second quarter, the company expects to ship
approximately 65,500 to 70,500 motorcycles
- Motorcycles segment operating margin as a percent of revenue to
be approximately 8.0 to 9.0 percent
- Financial Services segment operating income to be down
year-over-year
- Effective tax rate of approximately 24.0 to 25.0 percent
- Capital expenditures of $225
million to $245 million
including approximately $20 million
to support manufacturing optimization
Company Background
Harley-Davidson, Inc. is the
parent company of Harley-Davidson Motor Company and Harley-Davidson
Financial Services. Since 1903, Harley-Davidson has fulfilled
dreams of personal freedom by leading the innovation of two-wheeled
mobility. The company offers an expanding range of leading-edge,
distinctive and customizable motorcycles and brings the brand to
life through Harley-Davidson riding experiences and exceptional
motorcycle parts, accessories, riding gear and apparel.
Harley-Davidson Financial Services provides financing, insurance
and other programs to help get Harley-Davidson riders on the road.
Learn more about how Harley-Davidson is Building the Next
Generation of Riders at www.harley-davidson.com.
Webcast Presentation
Harley-Davidson will discuss
first quarter results 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 Measures
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 diluted
EPS excluding restructuring plan costs and the impact of
incremental tariffs and net income excluding restructuring plan
costs and the impact of incremental tariffs. Restructuring plan
costs include restructuring expenses as presented in the
consolidated statements of income and costs associated with
temporary inefficiencies incurred in connection with the
manufacturing optimization plan included in Motorcycles and related
products cost of goods sold. The impact of incremental tariffs
include incremental European Union and China tariffs imposed on the company's
products shipped from the U.S., as well as incremental U.S. tariffs
on certain items imported from certain international markets.
Incremental tariff costs exclude incremental metals cost resulting
from the U.S. steel and aluminum tariffs. These adjustments are
consistent with adjustments used to determine financial objectives
under the company's incentive compensation plans. A reconciliation
of these non-GAAP measures to the comparable GAAP measure is
included later in this press release.
Forward-Looking Statements
The company intends that
certain matters discussed in this 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",
"strategy", "future", "may", "goals", or "estimates" or words of
similar meaning. Similarly, statements that describe future plans,
strategies, objectives, outlooks, targets, guidance 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 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 cautioned
not to place undue reliance on such forward-looking statements. The
forward-looking statements included in this release are only made
as of the date of this release, and the company disclaims any
obligation to publicly update such forward-looking statements to
reflect subsequent events or circumstances.
The company's ability to meet the targets and expectations noted
above depends upon, among other factors, the company's ability to
(i) execute its business plans and strategies, including the
elements of the More Roads to Harley-Davidson strategy for growth
that the company disclosed on July 30,
2018, and strengthen its existing business while enabling
growth, (ii) manage and predict the impact that new or adjusted
tariffs may have on our ability to sell product internationally,
and the cost of raw materials and components, (iii) execute its
strategy of growing ridership, globally, (iv) effectively execute
the company's manufacturing optimization initiative within expected
costs and timing and successfully carry out its global
manufacturing and assembly operations, (v) accurately analyze,
predict and react to changing market conditions and successfully
adjust to shifting global consumer needs and interests, (vi)
negotiate and successfully implement a strategic alliance
relationship with a local partner in Asia, (vii) 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, (viii) perform in a manner
that enables the company to benefit from market opportunities while
competing against existing and new competitors, (ix) realize
expectations concerning market demand for electric models, which
may depend in part on the building of necessary infrastructure, (x)
prevent, detect, and remediate any issues with its motorcycles or
any issues associated 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, (xi)
manage supply chain issues, including quality issues and any
unexpected interruptions or price increases caused by raw material
shortages or natural disasters, (xii) manage the impact that prices
for and supply of used motorcycles may have on its business,
including on retail sales of new motorcycles, (xiii) reduce other
costs to offset costs of the More Roads to Harley-Davidson plan and
redirect capital without adversely affecting its existing business,
(xiv) balance production volumes for its new motorcycles with
consumer demand, (xv) manage risks that arise through expanding
international manufacturing, operations and sales, (xvi) manage
through changes in general economic and business conditions,
including changing capital, credit and retail markets, and the
changing political environment, (xvii) continue to manage the
relationships and agreements that the company has with its labor
unions to help drive long-term competitiveness, (xviii) accurately
estimate and adjust to fluctuations in foreign currency exchange
rates, interest rates and commodity prices, (xix) 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, (xx) retain and
attract talented employees, (xxi) prevent a cybersecurity breach
involving consumer, employee, dealer, supplier, or company data and
respond to evolving regulatory requirements regarding data
security, (xxii) manage the credit quality, the loan servicing and
collection activities, and the recovery rates of HDFS' loan
portfolio, (xxiii) 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, (xxiv) manage through
the effects inconsistent and unpredictable weather patterns may
have on retail sales of motorcycles, (xxv) implement and manage
enterprise-wide information technology systems, including systems
at its manufacturing facilities, (xxvi) manage changes and prepare
for requirements in legislative and regulatory environments for its
products, services and operations, (xxvii) manage its exposure to
product liability claims and commercial or contractual disputes,
(xxviii) successfully access the capital and/or credit markets on
terms (including interest rates) that are acceptable to the company
and within its expectations, (xxix) conduct its operations in
Thailand in a manner that
sufficiently mitigates certain international tariffs and lowers
prices of its motorcycles in certain markets, (xxx) accurately and
successfully determine, implement, and maintain a manner in which
to sell motorcycles in the E.U., China, and ASEAN countries that is not subject
to tariffs; (xxxi) have its application to mitigate E.U. tariffs
approved, or the appeal of a denied application acted on in a
manner favorable to the company, and (xxxii) accurately predict the
margins of its Motorcycles & Related Products segment in light
of, among other things, tariffs, the cost associated with the More
Roads to Harley-Davidson plan, the company's manufacturing
optimization plan, and our complex global supply chain.
The company could experience delays or disruptions in its
operations as a result of work stoppages, strikes, natural causes,
terrorism or other factors. Further, actual foreign currency
exchange rates may vary from underlying assumptions. Other factors
are described in risk factors that the company has disclosed in
documents previously filed with the Securities and Exchange
Commission. Many of these risk factors are impacted by the current
changing capital, credit and retail markets and the company's
ability to manage through inconsistent economic conditions.
The company's ability to sell its motorcycles and related
products and services and to meet its financial expectations also
depends on the ability of the company's independent dealers to sell
its motorcycles and related products and services to retail
customers. The company depends on the capability and financial
capacity of its independent dealers to develop and implement
effective retail sales plans to create demand for the motorcycles
and related products and services they purchase from the company.
In addition, the company's independent dealers and distributors may
experience difficulties in operating their businesses and selling
Harley-Davidson motorcycles and related products and services as a
result of weather, economic conditions or other factors. In recent
years, HDFS has experienced historically low levels of retail
credit losses, but there is no assurance that this will continue.
The company believes that HDFS' retail credit losses may increase
over time due to changing consumer credit behavior and HDFS'
efforts to increase prudently structured loan approvals to
sub-prime borrowers, as well as actions that the company has taken
and could take that impact motorcycle values. Refer to "Risk
Factors" under Item 1A of the company's Annual Report on Form 10-K
for the year ended December 31, 2018
for a discussion of additional risk factors and a more complete
discussion of some of the cautionary statements noted above.
### (HOG-F)
Harley-Davidson,
Inc.
|
Condensed
Consolidated Statements of Income
|
(In thousands, except
per share amounts)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
|
March 31,
|
|
April 1,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Motorcycles and
Related Products revenue
|
|
$
1,195,637
|
|
$
1,363,947
|
Gross
profit
|
|
347,439
|
|
473,773
|
Selling,
administrative and engineering expense
|
|
225,428
|
|
254,093
|
Restructuring
expense
|
|
13,630
|
|
46,842
|
Operating
income from Motorcycles and Related Products
|
|
108,381
|
|
172,838
|
|
|
|
|
|
Financial Services
revenue
|
|
188,743
|
|
178,174
|
Financial Services
expense
|
|
130,012
|
|
114,595
|
Operating
income from Financial Services
|
|
58,731
|
|
63,579
|
|
|
|
|
|
Operating
income
|
|
167,112
|
|
236,417
|
Other income
(expense), net
|
|
4,660
|
|
220
|
Investment
income
|
|
6,358
|
|
1,203
|
Interest
expense
|
|
7,731
|
|
7,690
|
Income before income
taxes
|
|
170,399
|
|
230,150
|
Provision for income
taxes
|
|
42,454
|
|
55,387
|
Net income
|
|
$
127,945
|
|
$
174,763
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
Basic
|
|
$
0.80
|
|
$
1.04
|
Diluted
|
|
$
0.80
|
|
$
1.03
|
|
|
|
|
|
Weighted-average
common shares:
|
|
|
|
|
Basic
|
|
159,311
|
|
168,139
|
Diluted
|
|
160,026
|
|
169,174
|
|
|
|
|
|
Cash dividends per
common share
|
|
$
0.375
|
|
$
0.370
|
Harley-Davidson,
Inc.
|
Reconciliation of
GAAP amounts to Non-GAAP amounts
|
(In thousands, except
per share amounts)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
Three months
ended
|
|
|
March 31,
|
|
April 1,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Net income excluding
restructuring plan costs and the impact of incremental
tariffs
|
|
|
|
|
Net income
(GAAP)
|
|
$
127,945
|
|
$
174,763
|
Restructuring plan
costs
|
|
17,210
|
|
47,574
|
Impact of incremental
tariffs
|
|
20,977
|
|
-
|
Tax effect of
adjustments(1)
|
|
(9,260)
|
|
(11,537)
|
Adjustments net of
tax
|
|
28,927
|
|
36,037
|
Adjusted net income
(Non-GAAP)
|
|
$
156,872
|
|
$
210,800
|
|
|
|
|
|
Diluted earnings per
share excluding restructuring plan costs and the impact of
incremental tariffs
|
|
|
|
|
Diluted earnings per
share (GAAP)
|
|
$
0.80
|
|
$
1.03
|
Adjustments net of
tax, per share
|
|
0.18
|
|
0.21
|
Adjusted diluted
earnings per share (Non-GAAP)
|
|
$
0.98
|
|
$
1.24
|
|
(1)The
income tax effect of adjustments has been computed using the
company's effective income tax rate excluding discrete
items.
|
Harley-Davidson,
Inc.
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
March 31,
|
|
December
31,
|
|
April
1,
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
749,600
|
|
$
1,203,766
|
|
$
753,517
|
Marketable securities
|
|
10,003
|
|
10,007
|
|
-
|
Accounts receivable, net
|
|
353,541
|
|
306,474
|
|
355,107
|
Finance receivables, net
|
|
2,443,899
|
|
2,214,424
|
|
2,341,918
|
Inventories
|
|
595,806
|
|
556,128
|
|
564,571
|
Restricted cash
|
|
43,471
|
|
49,275
|
|
54,569
|
Other current assets
|
|
177,761
|
|
144,368
|
|
150,472
|
Total current
assets
|
|
4,374,081
|
|
4,484,442
|
|
4,220,154
|
|
|
|
|
|
|
|
Finance receivables,
net
|
|
4,994,693
|
|
5,007,507
|
|
4,784,524
|
Other long-term
assets
|
|
1,211,839
|
|
1,173,715
|
|
1,272,943
|
|
|
$
10,580,613
|
|
$
10,665,664
|
|
$
10,277,621
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
1,025,089
|
|
$
885,991
|
|
$
885,448
|
Short-term debt
|
|
1,192,925
|
|
1,135,810
|
|
1,036,976
|
Current portion of long-term debt, net
|
|
1,372,050
|
|
1,575,799
|
|
1,872,679
|
Total current
liabilities
|
|
3,590,064
|
|
3,597,600
|
|
3,795,103
|
|
|
|
|
|
|
|
Long-term debt,
net
|
|
4,744,694
|
|
4,887,667
|
|
4,108,511
|
Pension and
postretirement healthcare liabilities
|
|
192,759
|
|
202,229
|
|
167,952
|
Other long-term
liabilities
|
|
255,485
|
|
204,219
|
|
210,106
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
1,797,611
|
|
1,773,949
|
|
1,995,949
|
|
|
$
10,580,613
|
|
$
10,665,664
|
|
$
10,277,621
|
Harley-Davidson,
Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
|
March 31,
|
|
April
1,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$
32,671
|
|
$
191,594
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(35,255)
|
|
(28,436)
|
Finance
receivables, net
|
|
(35,548)
|
|
11,733
|
Acquisition of
business
|
|
(7,000)
|
|
-
|
Other
|
|
603
|
|
(4,948)
|
Net cash used by
investing activities
|
|
(77,200)
|
|
(21,651)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from
issuance of medium-term notes
|
|
546,655
|
|
347,553
|
Repayments of
medium-term notes
|
|
(750,000)
|
|
-
|
Repayments of
securitization debt
|
|
(76,505)
|
|
(67,955)
|
Net increase
(decrease) in credit facilities and unsecured commercial
paper
|
|
58,527
|
|
(234,145)
|
Borrowings of
asset-backed commercial paper
|
|
-
|
|
35,504
|
Repayments of
asset-backed commercial paper
|
|
(72,401)
|
|
(45,907)
|
Dividends
paid
|
|
(60,859)
|
|
(62,731)
|
Purchase of
common stock for treasury
|
|
(61,712)
|
|
(72,968)
|
Issuance of
common stock under employee stock option plans
|
|
616
|
|
1,719
|
Net cash used by
financing activities
|
|
(415,679)
|
|
(98,930)
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
|
(409)
|
|
2,034
|
|
|
|
|
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
|
$
(460,617)
|
|
$
73,047
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash:
|
|
|
|
|
Cash, cash
equivalents and restricted cash - beginning of period
|
|
$
1,259,748
|
|
$
746,210
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
|
(460,617)
|
|
73,047
|
Cash, cash
equivalents and restricted cash - end of period
|
|
$
799,131
|
|
$
819,257
|
|
|
|
|
|
Reconciliation of
cash, cash equivalents and restricted cash to the Consolidated
Balance Sheet:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
749,600
|
|
$
753,517
|
Restricted
cash
|
|
43,471
|
|
54,569
|
Restricted cash
included in other long-term assets
|
|
6,060
|
|
11,171
|
Total cash, cash
equivalents and restricted cash shown in the Statement of Cash
Flows
|
|
$
799,131
|
|
$
819,257
|
|
Adoption of New
Accounting Standards
|
|
On January 1, 2019,
the Company adopted accounting standards update (ASU) 2016-02
Leases using the modified retrospective method. As a result, the
Company recorded a right-of-use lease asset of approximately $60
million and a corresponding lease liability.
|
Motorcycles and
Related Products Revenue and
|
Motorcycle
Shipment Data
|
|
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
|
March 31,
|
|
April 1,
|
|
|
2019
|
|
2018
|
MOTORCYCLES AND
RELATED PRODUCTS REVENUE (in thousands)
|
|
|
|
|
Motorcycles
|
|
$
964,575
|
|
$
1,121,673
|
Parts &
Accessories
|
|
159,703
|
|
169,075
|
General
Merchandise
|
|
55,401
|
|
56,601
|
Licensing
|
|
8,577
|
|
8,358
|
Other
|
|
7,381
|
|
8,240
|
|
|
$
1,195,637
|
|
$
1,363,947
|
|
|
|
|
|
MOTORCYCLE
SHIPMENTS:
|
|
|
|
|
United States
|
|
34,505
|
|
38,797
|
International
|
|
24,386
|
|
25,147
|
Total
|
|
58,891
|
|
63,944
|
|
|
|
|
|
MOTORCYCLE PRODUCT
MIX:
|
|
|
|
|
Touring
|
|
25,043
|
|
30,857
|
Cruiser
|
|
20,451
|
|
21,554
|
Sportster®/ Street
|
|
13,397
|
|
11,533
|
Total
|
|
58,891
|
|
63,944
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Retail
Sales of Harley-Davidson Motorcycles(1)
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March 31,
|
|
March 31,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
United
States
|
|
28,091
|
|
29,309
|
|
|
|
|
|
Europe(2)
|
|
9,508
|
|
9,716
|
EMEA -
Other
|
|
1,289
|
|
1,146
|
Total
EMEA
|
|
10,797
|
|
10,862
|
|
|
|
|
|
Asia
Pacific(3)
|
|
3,786
|
|
4,452
|
Asia Pacific -
Other
|
|
2,288
|
|
1,877
|
Total Asia
Pacific
|
|
6,074
|
|
6,329
|
|
|
|
|
|
Latin
America
|
|
2,241
|
|
2,506
|
Canada
|
|
1,948
|
|
2,080
|
Total
International Retail Sales
|
|
21,060
|
|
21,777
|
Total
Worldwide Retail Sales
|
|
49,151
|
|
51,086
|
|
(1)
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.
|
|
|
|
|
|
|
|
|
|
(2)
Europe data includes Austria, Belgium, Denmark,
Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands,
Norway, Portugal, Spain, Sweden, Switzerland, and the United
Kingdom.
|
|
|
|
|
|
(3)Asia
Pacific data includes Japan, Australia, New Zealand and
Korea.
|
|
|
|
|
Motorcycle
Registration Data(1)
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March 31,
|
|
March 31,
|
|
|
2019
|
|
2018
|
United
States(2)
|
|
54,324
|
|
57,026
|
Europe(3)
|
|
111,317
|
|
93,217
|
|
(1)
Data includes on-road 601+cc models. On-road 601+cc models include
dual purpose models, three-wheeled motorcycles and
autocycles.
|
|
|
|
|
|
(2)United
States data is derived from information provided by Motorcycle
Industry Council (MIC). This third-party data is subject to
revision and update.
|
|
|
|
|
|
(3) Europe
data includes Austria, Belgium, Denmark, Finland, France, Germany,
Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain,
Sweden, Switzerland, and the United Kingdom. Industry retail
motorcycle registration data includes 601+cc models derived from
information provided by Association des Constructeurs Europeens de
Motocycles (ACEM), an independent agency. This third-party data is
subject to revision and update.
|
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SOURCE Harley-Davidson, Inc.