Harley-davidson, Inc. · NYSE:HOG
Harley-davidson — Q4 2021 Earnings Presentation
19 slides from Harley-davidson's earnings presentation, Feb 8, 2022
Slide 1: Q4 2021 Financial Results & 2022 Outlook
Q4 2021 Financial Results & 2022 Outlook February 8, 2022 – Analyst Call Presentation
Slide 2: Business Update Conference Call
Business Update Conference Call Q4 2021 Financial Results & 2022 Outlook CALL PARTICIPANTS 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
Slide 3: Q4 & FY 2021 Performance Headlines
Q4 & FY 2021 Performance Headlines Successfully completed the first year of The Hardwire Five-year Strategic Plan Delivered full year GAAP diluted EPS of $4.19, up $4.18 vs. 2020 Grew Harley-Davidson’s total revenue by 32% Achieved 9.0% operating margin for the Motorcycles and Related Produc
Slide 4: The Hardwire: 2021-2025 Strategic Plan
The Hardwire: 2021-2025 Strategic Plan Enhance our position as the most desirable motorcycle brand in the world PROFIT FOCUS GROWTH BEYOND BIKES Investing in our strongest Expanding complementary businesses motorcycle segments and engaging beyond product SELECTIVE EXPANSION AND CUSTOMER EXPERIENCE R
Slide 5: Q4 2021 Results
Q4 2021 Results Q4 2021 Results Motorcycles 2 Financial Services Total ($ millions) HDMC HDFS HDI Revenue $816 $200 $1,016 % vs PY 54% 3% 40% Operating Income (Loss) ($102) $95 ($7) Margin % -13% 47% -1% % vs PY 48% 24% 94% Net Income $22 Margin % 2% Diluted EPS – GAAP $0.14 Diluted EPS – Adjusted 1
Slide 6: Full Year 2021 Results
Full Year 2021 Results FY 2021 Results Motorcycles Financial Services Total ($ millions) HDMC HDFS HDI Revenue $4,540 $796 $5,336 % vs. PY 39% 1% 32% Operating Income (Loss) $409 $415 $823 Margin % 9% 52% 15% % vs. PY1 320% 112% NM Net Income $650 Margin % 12% Diluted EPS – GAAP $4.19 Diluted EPS –
Slide 7: Worldwide Retail Sales and Inventory
Worldwide Retail Sales and Inventory Retail Sales Inventory Units H-D New Retail Motorcycle Sales (vs. Prior Year) H-D Worldwide Dealer Inventory Units Q4 ‘21 FY ‘21 (Thousands of Units3) North America +8% +22% EMEA -7% -16% Down 68% since Q4 ‘19 Asia Pacific -2% -8% 63 Latin America -16% -39% 59 Wo
Slide 8: Q4 & Full Year Revenue Growth
Q4 & Full Year Revenue Growth Q4 Motorcycles Segment Revenue Growth 54% 36% 13% 6% -1% Volume Pricing Mix FX Total Full Year 2021 Motorcycles Segment Revenue Growth 39% 26% 9% 2% 2% Volume Pricing Mix FX Total 8
Slide 9: Full Year 2021 Motorcycles Segment Operating Income Margin
Full Year 2021 Motorcycles Segment Operating Income Margin Operating Income Margin 2019 Op Income Margin 6.3% Motorcycle Units Down vs. 2019 (4) Pts Motorcycle Unit Mix +3 Pts 9.0% 2019 Cost Structure +4 Pts 2020 6.3% 2021 Pricing & Incentives +2 Pts Supply Chain Inflation (2) Pts F/X (0.3) Pts -5.7
Slide 10: Financial Services Segment – Q4 & Full Year 2021
Financial Services Segment – Q4 & Full Year 2021 Summary Financials Q4 2021 + / - PY FY 2021 + / - PY ($ millions) Revenue $200 +$6 $796 +$6 % vs PY +3% +1% Interest Expense $44 ($20) $193 ($53) Provision for Credit Losses $20 +$17 $25 ($157) Operating Expense1 $41 ($9) $163 ($3) Total Operating Exp
Slide 11: Financial Services Segment Performance
Financial Services Segment Performance Realized Retail Credit Losses Retail Finance Receivables & Allowance Average annual loss rate 1.87% Receivables ($ mm) Allowance Percentage 6.0% 5.9% 5.9% 2.0% 2.0% 1.9% 5.2% 5.1% 5.1% 5.0% 5.0% 1.8% 1.8% 4.4% $6,728 $6,664 1 $6,585 1.4% $6,521 $6,494 2 $6,416
Slide 12: Total H-D, Inc.
Total H-D, Inc. H-D, Inc. Operating Cash Flow ($ millions) FY 2021 – H-D, Inc. Financial Metrics Capital Investments1 – $141 million $1,178 $976 Cash & Cash Equivalents2 – $1.9 billion Dividends Paid – $92 million Effective Tax Rate3 – 21% FY '20 FY '21 1 Includes $21 million of capitalized
Slide 13: 2022 Outlook
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 Investments $190 – 220M Total Dollars 1Financial Servic
Slide 14: Supply Chain Outlook
Supply Chain Outlook 2021 Cost of Sales 2021 Cost Inflation 2022 Annual Outlook $3.2B Tariffs, Duties, Other Rates relatively stable annually; increased frequency of expedited shipping given supply chain backlogs; expect Logistics >100% logistics to improve in the back half of the year. Manufacturin
Slide 15: 2022 Product Launch: Further. Faster.
2022 Product Launch: Further. Faster. • Focused on stronghold, profitable segments • Launched 8 new Grand American Touring, Cruiser & Custom Vehicle Operation™ (CVO) models • Streamlined portfolio with model count reduced by 40% since 2020 ~1.5M VISITORS TO H-D.COM 1 ~540,000 VIEWS OF LAUNCH CONTENT
Slide 16: Non-GAAP Measures
Non-GAAP Measures This presentation includes financial measures that have not been calculated in accordance with U.S. generally accepted accounting principles (GAAP) and are therefore referred to as non-GAAP financial measures. The non-GAAP measures listed below are intended to be considered by user
Slide 17: Non-GAAP Measures: Reconciliation of GAAP to Non-GAAP Amounts
Non-GAAP Measures RECONCILIATION OF GAAP TO NON-GAAP AMOUNTS This presentation contains non-GAAP measures related to net income and diluted earnings per share that exclude restructuring plan costs. Reconciliations of GAAP amounts to non-GAAP amounts are included below. ($ thousands, except per share
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 Cautionary Note Regarding Forward-Looking Statements (continued) 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 oth