Harley-davidson, Inc. · NYSE:HOG
Harley-davidson — Q1 2022 Earnings Presentation
16 slides from Harley-davidson's earnings presentation, Apr 27, 2022
Slide 1: Harley-Davidson Q1 2022 Earnings
Harley-Davidson Q1 2022 Earnings Wed, April 27, 2022
Slide 2: Earnings Call Q1 2022 Financial Results
Earnings Call Q1 2022 Financial Results ▪ Jochen Zeitz, Chairman, President and CEO ▪ Gina Goetter, Chief Financial Officer ▪ Edel O’Sullivan, Chief Commercial Officer ▪ Shawn Collins, Director Investor Relations This presentation supports the audio call. The audio playback for today’s call will be
Slide 3: Q1 2022 Performance Headlines
Q1 2022 Performance Headlines ▪ HDMC revenue growth of 6 percent driven by global motorcycle pricing and growth across P&A and Apparel businesses ▪ HDMC Operating Income margin of 15.6%; global pricing offset cost inflation, but margin was negatively impacted by production challenges due to the ongo
Slide 4: Strategic priorities: profit focus, growth beyond bikes, lead in electric
PROFIT FOCUS GROWTH BEYOND BIKES SELECTIVE EXPANSION AND CUSTOMER EXPERIENCE REDEFINITION LEAD IN ELECTRIC INCLUSIVE STAKEHOLDER MANAGEMENT
Slide 5: Consolidated – Q1 2022 Results
Consolidated – Q1 2022 Results Q1 2022 Results Total ($ millions, except per share) HDMC1 HDFS2 HDI3 Revenue $1,303 $192 $1,495 % vs PY 6% 1% 5% Operating Income $203 $86 $289 Margin % 15.6% 45.0% 19% % vs PY -11% -27% -16% Net Income $223 Margin % 15% Diluted EPS – GAAP $1.45 % vs PY -14% 1 HDMC an
Slide 6: Worldwide Retail Sales and Inventory
Worldwide Retail Sales and Inventory Retail Sales Inventory Units Retail Motorcycle Sales of H-D Motorcycles (vs. PY) H-D Worldwide Dealer Inventory Units (Thousands)2 FY ‘21 Q1 ’22 North America +22% -5% Down 61% since Q1 ‘19 EMEA -16% +28% 74 72 Asia Pacific -8% +16% Latin America -39% +13% Down 2
Slide 7: Q1 2022: HDMC Revenue Drivers
Q1 2022: HDMC Revenue Drivers +7% +6% +2% -2% -1% Volume Pricing Mix FX Total Global motorcycle pricing and volume growth in P&A offset the negative impact from product mix and FX 7
Slide 8: Q1 2022: HDMC Operating Income Margin
Q1 2022: HDMC Operating Income Margin Operating Income Margin1 Q1 2021 Op Income Margin 18.5% $228M 18.5% Volume2 +0.7 Pts $10M 15.6% Motorcycle Mix -1.5 Pts -$22M 9.1% Pricing +5.0 Pts $81M 7.7% Supply Chain Costs -6.3 Pts -$82M Operating Expenses -0.9 Pts -$12M Q1 2019 Q1 2020 Q1 2021 Q1 2022 Q1 2
Slide 9: Financial Services Segment – Q1 2022 Results
Financial Services Segment – Q1 2022 Results Summary Financials Q1 +/- % Change PY ($ millions) 2022 PY Revenue $192 +$2 +1% Interest Expense $42 -$14 -24% Provision for Credit Losses $29 +$51 nm Operating Expense $35 -$4 -9% Total Expenses $106 +$34 +47% Operating Income $86 -$32 -27% Margin % 45.0
Slide 10: Financial Services Segment Performance
Financial Services Segment Performance Realized Retail Credit Losses Retail Finance Receivables & Allowance Annual (FY) / Annualized (Q) Receivables ($ mm) Allowance Percentage Average annual loss rate 1.9% 5.9% 2.0% 1.9% 5.0% 5.0% 1.8% 1.8% 4.4% 1 $6.5 $6.5 1.4% 2, 3 $6.4 1.2% $6.3 FY '17 FY '18 FY
Slide 11: Total H-D, Inc.
Total H-D, Inc. H-D, Inc. Operating Cash Flow ($ millions) Q1 2022 – H-D, Inc. Financial Metrics $163 ▪ Capital Investments1 – $34 million $139 ▪ Cash & Cash Equivalents2 – $1.4 billion ▪ Dividends Paid – $24 million ▪ Discretionary Shares Repurchased – $248 million (or 6.2 million shares) ▪ Effecti
Slide 12: 2022 Outlook
2022 Outlook Company reaffirms its full-year 2022 outlook 2022 Outlook Motorcycle Segment Revenue Growth (HDMC) +5 – 10% YOY Growth Motorcycles Segment Operating Income Margin (HDMC) 11 – 12% % of Revenue Financial Services Segment Operating Income (HDFS)1 Down 20 – 25% YOY Growth Capital Investment
Slide 13: Supply Chain Outlook
Supply Chain Outlook 2022 Cost Inflation: Realized and Forecast 2021 Cost of Sales Q1 2022 $3.2B 2021 Actual 1H 2022E 2H 2022E Actual Tariffs, Duties, Other Logistics >100% ~50% +25% flat Manufacturing +3% +7% +7% +4% Materials +5% +4% +3-5% +3-5% 13
Slide 14: HDMC 2022 Expected Phasing
HDMC 2022 Expected Phasing HDMC Forecasted Front Half / Back Half Phasing ~Mid-Teen ~High ~Mid to High single digits Single Digit ~Mid single digit % Revenue Growth Operating Income Margin % 1H 2022E 2H 2022E Prior Year Operating Margin: • 1H 2021A Operating Income Margin = 16.1% • 2H 2021A Operatin
Slide 15: Forward-Looking Statements
Forward-Looking Statements 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
Slide 16: Forward-Looking Statements (continued)
Forward-Looking Statements Cautionary Note Regarding Forward-Looking Statements (continued) 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