Harley-davidson, Inc. · NYSE:HOG
Harley-davidson — Q3 2024 Earnings Presentation
19 slides from Harley-davidson's earnings presentation, Oct 24, 2024
Slide 1: Q3 2024 Results
Q3 2024 Results Thursday, October 24, 2024
Slide 2: Call Participants
Q3 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: Q3 2024 Performance Headlines
Q3 2024 PERFORMANCE HEADLINES • Delivered diluted EPS of $0.91 • Consolidated operating income of $106 million, down 49% year-over-year • North American retail sales down 10% year-over-year • Global retail sales down 13% year-over-year, where international markets have performed weaker than we expec
Slide 4: Consolidated – Q3 2024 Results
CONSOLIDATED – Q3 2024 RESULTS Q3 2024 Results1, 2 Total ($ millions, except earnings per share) HDMC HDFS LiveWire HDI Revenue $876 $269 $5 $1,151 % vs PY -32% 10% -41% -26% Operating Income (Loss) $55 $77 ($26) $106 Margin % 6.3% 28.5% NM 9.2% % vs PY -69% 29% -3% -49% Net Income Attributable to H
Slide 5: Consolidated – September YTD 2024 Results
CONSOLIDATED – SEPTEMBER YTD 2024 RESULTS September YTD 2024 Results1 Total ($ millions, except earnings per share) HDMC HDFS LiveWire HDI Revenue $3,701 $782 $16 $4,499 % vs PY -9% 11% -30% -6% Operating Income (Loss) $491 $202 ($83) $610 Margin % 13.3% 25.8% NM 13.6% % vs PY -30% 14% -2% -24% Net
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 Q3 Sept YTD Worldwide Harley-Davidson Dealer Inventory Units Motorcycles (vs. PY) 2024 2024 (Thousands)4 North America -10% -2% EMEA -23% -12% Asia Pacific -16% -15
Slide 7: HDMC Revenue Bridge
HDMC REVENUE BRIDGE Q3 2024 HDMC Revenue Bridge1 1% -1% 0% -32% -32% Volume Pricing Mix FX Total YTD 2024 HDMC Revenue Bridge1, 2, 3 3% -2% 0% -10% -9% Volume Pricing Mix FX Total 1 HDMC Revenue Bridge compares Q3 ‘24 revenue to Q3 ‘23 revenue on a year-over-year basis and YTD 2024 revenue to YTD 20
Slide 8: Q3 2024: HDMC Operating Income Margin
Q3 2024: HDMC OPERATING INCOME MARGIN Operating Income Margin Q3 2023 Op Income Margin $175 mm 13.5% Volume ($145) -10.0 Pts 13.5% Pricing $19 2.2 Pts FX $18 2.0 Pts Mix ($33) -3.8 Pts 6.3% Manufacturing & Other ($6) -0.7 Pts Operating Expenses $27 3.1 Pts Q3 2023 Q3 2024 Q3 2024 Op Income Margin $5
Slide 9: September YTD 2024: HDMC Operating Income Margin
SEPTEMBER YTD 2024: HDMC OPERATING INCOME MARGIN Operating Income Margin YTD 2023 Op Income Margin $705 mm 17.4% 17.4% Volume ($135) -1.8 Pts Pricing ($73) -1.7 Pts 13.3% FX ($1) 0.0 Pts Mix $25 0.1 Pts Manufacturing & Other ($43) -1.1 Pts Operating Expenses $13 0.4 Pts YTD 2023 YTD 2024 YTD 2024 Op
Slide 10: HDFS Segment: Q3 2024 Results
HDFS SEGMENT: Q3 2024 RESULTS Summary Financials Q3 +/- % vs. PY ($ millions) 2024 PY Revenue $269 $26 10% Interest Expense $94 $10 12% Provision for Credit Losses $58 ($3) -5% Operating Expense $40 $1 2% Total Expenses $192 $8 4% Operating Income $77 $17 29% Margin % 28.5% 10
Slide 11: HDFS Segment: September YTD 2024 Results
HDFS SEGMENT: SEPTEMBER YTD 2024 RESULTS Summary Financials YTD +/- % vs. PY ($ millions) 2024 PY Revenue $782 $74 11% Interest Expense $277 $33 14% Provision for Credit Losses $175 $5 3% Operating Expense $128 $11 10% Total Expenses $580 $49 9% Operating Income $202 $25 14% Margin % 25.8% 11
Slide 12: HDFS Segment Performance
HDFS SEGMENT PERFORMANCE Annualized Retail Credit Losses1, 2 Retail Finance Receivables & Allowance Receivables ($B) Allowance Percentage 5.9% 5.4% 5.5% 5.0% 5.1% 3.1% 4.4% $7.0 2.7% $6.8 $6.7 $6.5 $6.4 $6.3 1.8% 1.5% 1.4% 0.8% Q3 '19 Q3 '20 Q3 '21 Q3 '22 Q3 '23 Q3 '24 CECL Q4 '20 Q4 '21 Q4 '22 Q4 '
Slide 13: LiveWire Segment: Business Update
LIVEWIRE SEGMENT: BUSINESS UPDATE Q3 Highlights: • S2 Del Mar® won MCN’s Best Electric Bike of 2024 • S2 Del Mar® featured in worldwide televised event in August in Paris Looking Forward: • Plan to announce new product line aimed at driving growth and expanding addressable market at EICMA in Novembe
Slide 14: LiveWire Segment: Q3 and September YTD 2024 Results
LIVEWIRE SEGMENT: Q3 AND SEPTEMBER YTD 2024 RESULTS1, 2, 3 Q3 SEPTEMBER YTD ▪ Q3 unit sales of 99 electric motorcycles, an increase of 98% over Q3 2023 $ millions % vs % vs Actual 2023 2024 2023 2024 ▪ YTD unit sales of 374 electric motorcycles, a triple Units PY PY digit increase over prior year Mo
Slide 15: Consolidated – September YTD 2024 Results
CONSOLIDATED – SEPTEMBER YTD 2024 RESULTS HDI Operating Cash Flow ($ millions) HDI Financial Metrics $931 ▪ Capital Investments1 – $146 million $707 ▪ Effective Tax Rate – 18% ▪ Cash & Cash Equivalents2 – $2.2 billion ▪ Dividends Paid – $69 million ▪ Shares Repurchased on Discretionary Basis – $350
Slide 16: Share Repurchases / Dividends
SHARE REPURCHASES / DIVIDENDS $1.3 Billion in Total Capital Returned 28.1 Million Shares Repurchased $1.0B of Shares Repurchased2 + $259M in Cash Dividends 18% of Shares Outstanding 1,2 $418 $446 $419 10.2 9.5 8.4 2022 2023 YTD 2024 2022 2023 YTD 2024 Cash Dividends (in $ Millions) Shares Repurchase
Slide 17: Harley-Davidson, Inc. – 2024 Financial Guidance
HARLEY-DAVIDSON, INC. – 2024 FINANCIAL GUIDANCE Now Expect: Now Expect: Now Expect: HDMC HDFS LiveWire Revenue Operating Income Y-o-Y LiveWire Units1 Down 14 - 16% Up 5-10% 600 – 1,000 From previous down 5 to 9% From previous flat to up 5% From previous 1,000 -1,500 Operating Income Margin Operating
Slide 18: Forward Looking Statements
FORWARD LOOKING STATEMENTS Cautionary Note Regarding Forward-Looking Statements The Company intends that certain matters discussed in this report are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 199
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