Harley-davidson, Inc. · NYSE:HOG
Harley-davidson — Q2 2024 Earnings Presentation
19 slides from Harley-davidson's earnings presentation, Jul 25, 2024
Slide 1: Q2 2024 Results
Q2 2024 Results Thursday, July 25, 2024
Slide 2: Call Participants
Q2 2024 RESULTS – EARNINGS CALL Call Participants ▪ Jochen Zeitz, Chairman, President and CEO ▪ Jonathan Root, Chief Financial Officer ▪ Karim Donnez, CEO – LiveWire (NYSE: LVWR) ▪ Shawn Collins, Director Investor Relations 2
Slide 3: Q2 2024 Performance Headlines
Q2 2024 PERFORMANCE HEADLINES • Delivered diluted EPS of $1.63 • HDMC operating income margin of 14.7% • North America motorcycle retail performance down 1%, while retail sales of Touring and CVO motorcycles up more than 12% in the U.S. • Touring market share of 75%, up 5.3% in first half of the yea
Slide 4: Consolidated – Q2 2024 Results
CONSOLIDATED – Q2 2024 RESULTS Q2 2024 Results1 Total ($ millions, except earnings per share) HDMC HDFS LiveWire HDI Revenue $1,349 $264 $6 $1,619 % vs PY 13% 10% -8% 12% Operating Income (Loss) $198 $71 ($28) $241 Margin % 14.7% 27.1% NM 14.9% % vs PY 2% 21% 12% 9% Net Income Attributable to HDI $2
Slide 5: Consolidated – June YTD 2024 Results
CONSOLIDATED – JUNE YTD 2024 RESULTS June YTD 2024 Results1 Total ($ millions, except earnings per share) HDMC HDFS LiveWire HDI Revenue $2,825 $512 $11 $3,349 % vs PY 3% 11% -25% 4% Operating Income (Loss) $436 $125 ($57) $504 Margin % 15.4% 24.4% NM 15.1% % vs PY -18% 7% -2% -15% Net Income Attrib
Slide 6: Harley-Davidson Worldwide Retail Sales and Inventory
HARLEY-DAVIDSON WORLDWIDE RETAIL SALES AND INVENTORY Harley-Davidson Retail Sales Dealer Inventory Units Retail Motorcycle Sales of H-D Motorcycles (vs. PY) Worldwide Harley-Davidson Dealer Inventory Units (Thousands)2, 3 Q2 June YTD 2024 2024 North America -1% 2% 79 EMEA -1% -5% 68 Asia Pacific -16
Slide 7: HDMC Revenue Bridge
HDMC REVENUE BRIDGE Q2 2024 HDMC Revenue Bridge1, 2, 3 13% 11% 7% -1% -4% Volume Pricing Mix FX Total YTD 2024 HDMC Revenue Bridge1, 2, 3 5% 3% 1% 0% -3% Volume Pricing Mix FX Total 1 HDMC Revenue Bridge compares Q2 ‘24 revenue to Q2 ‘23 revenue on a year-over-year basis and YTD 2024 revenue to YTD
Slide 8: Q2 2024: HDMC Operating Income Margin
Q2 2024: HDMC OPERATING INCOME MARGIN Operating Income Margin1,2 Q2 2023 Op Income Margin $194 mm 16.2% 16.8% Volume $40 1.5 Pts 16.2% 15.3% 14.7% FX ($14) -0.9 Pts 12.6% Mix $51 2.6 Pts Pricing ($45) -2.6 Pts Manufacturing & Other ($16) -1.2 Pts Operating Expenses ($12) -0.9 Pts Q2 2019 Q2 2021 Q2
Slide 9: June YTD 2024: HDMC Operating Income Margin
JUNE YTD 2024: HDMC OPERATING INCOME MARGIN Operating Income Margin1,2 YTD 2023 Op Income Margin $530 mm 19.2% 19.2% 17.4% 16.9% Volume $9 0.2 Pts 15.4% FX ($18) -0.6 Pts 11.0% Mix $58 1.0 Pts Pricing ($92) -2.6 Pts Manufacturing & Other ($38) -1.3 Pts Operating Expenses ($13) -0.5 Pts YTD 2024 Op I
Slide 10: HDFS Segment: Q2 2024 Results
HDFS SEGMENT: Q2 2024 RESULTS Summary Financials Q2 +/- % vs. PY ($ millions) 2024 PY Revenue $264 $23 10% Interest Expense $94 $8 9% Provision for Credit Losses $56 ($1) (2%) Operating Expense $43 $4 11% Total Expenses $193 $11 6% Operating Income $71 $12 21% Margin % 27.1% 10
Slide 11: HDFS Segment: June YTD 2024 Results
HDFS SEGMENT: JUNE YTD 2024 RESULTS Summary Financials YTD +/- % vs. PY ($ millions) 2024 PY Revenue $512 $49 11% Interest Expense $182 $23 14% Provision for Credit Losses $117 $7 7% Operating Expense $88 $11 14% Total Expenses $387 $41 12% Operating Income $125 $8 7% Margin % 24.4% 11
Slide 12: HDFS Segment Performance
HDFS SEGMENT PERFORMANCE Annualized Retail Credit Losses1, 2 Retail Finance Receivables & Allowance Receivables ($B) Allowance Percentage 5.9% 5.4% 5.4% 5.4% 5.0% 5.1% 3.1% 4.4% $7.0 $6.8 $6.8 2.6% $6.7 $6.5 $6.4 $6.3 1.8% 1.9% 1.4% 0.8% Q2 '19 Q2 '20 Q2 '21 Q2 '22 Q2 '23 Q2 '24 CECL Q4 '20 Q4 '21 Q
Slide 13: LiveWire Segment: Q2 and June YTD 2024 Results
LIVEWIRE SEGMENT: Q2 AND JUNE YTD 2024 RESULTS1, 2, 3 Q2 JUNE YTD ▪ Q2 unit sales of 158 electric motorcycles, an $ millions increase of 35% over Q1 2024 and triple digit % vs % vs Actual 2023 2024 PY 2023 2024 PY increase over Q2 2023 Units ▪ Q2 operating loss improvement of $3.8 million (or Motorc
Slide 14: Consolidated – Q2 2024 Results
CONSOLIDATED – Q2 2024 RESULTS HDI Operating Cash Flow ($ millions) – YTD HDI Financial Metrics – YTD ▪ Capital Investments1 – $92 million $578 ▪ Effective Tax Rate – 19% $411 ▪ Cash & Cash Equivalents2 – $1.8 billion ▪ Dividends Paid – $47 million ▪ Shares Repurchased on Discretionary Basis – $200
Slide 15: Harley-Davidson, Inc. – 2024 Financial Guidance
HARLEY-DAVIDSON, INC. – 2024 FINANCIAL GUIDANCE Now Expect: Continue to Expect: Continue to Expect: HDMC HDFS LiveWire Revenue Operating Income Y-o-Y LiveWire Units1 Down 5 - 9% Flat to up 5% 1,000 - 1,500 From previous flat to down 9% Operating Income Margin Operating Loss 10.6 – 11.6% ($105M) to (
Slide 16: Share Repurchases / Dividends
SHARE REPURCHASES / DIVIDENDS $1.1 Billion in Total Capital Returned 24.1 Million Shares Repurchased $875M of Shares Repurchased + $237M in Cash Dividends 16% of Shares Outstanding 1,2 $446 $418 10.2 8.4 $247 5.5 2022 2023 1H 2024 2022 2023 1H 2024 Cash Dividends (in $ Millions) Shares Repurchased (
Slide 17: Consumer Profile
CONSUMER PROFILE Average Age of Harley-Davidson Customer is Stable1 60 44 45 44 45 45 30 15 Average Age of HDFS Customer 1 HDFS Internal data for the average age of HDFS customers for new and used motorcycle loans in North America for the period January 1, 2013 to September 30, 2023 17
Slide 18: Forward Looking Statements
FORWARD LOOKING STATEMENTS Cautionary Note Regarding Forward-Looking Statements The Company intends that certain matters discussed in this presentation are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act
Slide 19: Forward Looking Statements Continued
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 products and services to retail customers. The Company