Harley-davidson, Inc. · NYSE:HOG
Harley-davidson — Q1 2024 Earnings Presentation
20 slides from Harley-davidson's earnings presentation, Apr 25, 2024
Slide 1: Q1 2024 Results
Q1 2024 Results Thursday, April 25, 2024
Slide 2: Call Participants
Q1 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: Hardwire Stage II Pillars
HARDWIRE STAGE II PILLARS 1 2 3 Profit Selective Lead in Focus Expansion & Electric Redefinition 4 5 6 Growth Integrated Inclusive Beyond Customer Stakeholder Bikes Experience Management 3
Slide 4: Q1 2024 Performance Headlines
Q1 2024 PERFORMANCE HEADLINES ▪ Delivered diluted EPS of $1.72 ▪ HDMC operating income margin of 16.2% ▪ North America motorcycle retail up 6%, driven by sales of the all-new Touring motorcycles ▪ HDMC revenue down 5% due to planned decrease in motorcycle shipments ▪ HDFS operating income finished d
Slide 5: Consolidated – Q1 2024 Results
CONSOLIDATED – Q1 2024 RESULTS Q1 2024 Results1 Total ($ millions, except earnings per share) HDMC HDFS LiveWire HDI Revenue $1,476 $249 $5 $1,730 % vs PY -5% 12% -39% -3% Operating Income (Loss) $238 $54 ($29) $263 Margin % 16.2% 21.7% NM 15% % vs PY -29% -8% NM -29% Net Income Attributable to HDI
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 Q1 2024 Q1 2023 North America 6% -17% EMEA -11% -6% 83 +26% vs. Q1 ’23 Asia Pa
Slide 7: HDMC Revenue Bridge
HDMC REVENUE BRIDGE Q1 2024 HDMC Revenue Bridge1 4% 0% -3% -5% -7% 2, 3 Volume Pricing Mix FX Total Modest topline decline driven by lower wholesale volume, lower pricing2 and favorable mix 1 Q1 2024 HDMC Revenue Bridge compares Q1 ‘24 revenue to Q1 ‘23 revenue on a year-over-year basis 2 Pricing ch
Slide 8: Q1 2024: HDMC Operating Income Margin
Q1 2024: HDMC OPERATING INCOME MARGIN Operating Income Margin1,2 Q1 2023 Op Income Margin $336 mm 21.6% 21.6% 19.8% Volume ($31) -0.6 Pts 16.9% 16.2% FX ($4) -0.3 Pts Mix $7 -0.5 Pts Pricing ($47) -2.5 Pts 7.7% Supply Chain Costs ($21) -1.4 Pts Operating Expenses ($2) -0.1 Pts Q1 2024 Op Income Marg
Slide 9: HDFS Segment: Q1 2024 Results
HDFS SEGMENT: Q1 2024 RESULTS Summary Financials Q1 +/- % vs. PY ($ millions) 2024 PY Revenue $249 $26 12% Interest Expense $89 $15 21% Provision for Credit Losses $61 $9 17% Operating Expense $45 $6 17% Total Expenses $195 $30 18% Operating Income $54 ($5) -8% Margin % 21.7% 9
Slide 10: HDFS Segment Performance
HDFS SEGMENT PERFORMANCE Annualized Retail Credit Losses1, 2 Retail Finance Receivables & Allowance Receivables ($B) Allowance Percentage 3.7% 5.9% 5.4% 5.4% 5.0% 5.1% 3.2% 4.4% $6.8 $6.8 2.7% $6.7 $6.5 2.2% $6.4 $6.3 1.8% 1.5% Q1 '19 Q1 '20 Q1 '21 Q1 '22 Q1 '23 Q1 '24 CECL Q4 '20 Q4 '21 Q4 '22 Q4 '
Slide 11: HDFS Credit Loss Seasonality
HDFS CREDIT LOSS SEASONALITY Historically, Highest Loss Rate Occurs in Q1 and Moderates During Riding Season1 Average Historical Quarterly Loss Rate Q1 Q2 Q3 Q4 1 This represents the 5-year average for each quarter during the period 2018 to 2023, while excluding data from 2020 due to the unique natu
Slide 12: LiveWire Segment: Q1 2024 Results
LIVEWIRE SEGMENT: Q1 2024 RESULTS1, 2 ▪ Unit sales of 117 electric motorcycles $ millions Q1 Q1 Actual Units % vs PY 2023 2024 ▪ LiveWire became #1 seller3 of on-road electric motorcycles in the U.S. Motorcycle Units 63 117 86% ▪ Launched 3rd electric motorcycle in March – ‘S2 Mulholland’ Revenue $8
Slide 13: Consolidated – Q1 2024 Results
CONSOLIDATED – Q1 2024 RESULTS HDI Operating Cash Flow ($ millions) HDI Financial Metrics ▪ Capital Investments1 – $48 million $104 ▪ Effective Tax Rate – 20% ▪ Cash & Cash Equivalents2 – $1.5 billion $47 ▪ Dividends Paid – $24 million ▪ Shares Repurchased on Discretionary Basis – $98 million (2.5 m
Slide 14: Harley-Davidson, Inc. – 2024 Financial Guidance
HARLEY-DAVIDSON, INC. – 2024 FINANCIAL GUIDANCE Continue to Expect: Continue to Expect: Now Expect: HDMC HDFS LiveWire Revenue Operating Income Y-o-Y LiveWire Units1 Flat to down 9% Flat to up 5% 1,000 - 1,500 No Change Operating Income Margin Operating Loss 12.6% to 13.6% ($105M) to ($115M) From pr
Slide 15: Share Buybacks / Dividends
SHARE BUYBACKS / DIVIDENDS $987 Million in Total Capital Returned 21.1 Million Shares Repurchased $773 Million of Buybacks + $214 Million in Cash Dividends 14% of Shares Outstanding 1,2 $446 $418 10.2 8.4 $123 2.5 2022 2023 Q1 2024 2022 2023 Q1 2024 Share Buybacks (in $ Millions) Cash Dividends (in
Slide 16: Appendix: Supplemental Information
APPENDIX: SUPPLEMENTAL INFORMATION 16
Slide 17: HDMC Unit Profitability
HDMC UNIT PROFITABILITY1,2,3 Excludes LiveWire Results for 2020-2023 ~$3,700/Unit ~$3,700/Unit ~$3,500/Unit ~$2,500/Unit ~$1,300/Unit '14A '15A '16A '17A '18A '19A '21A '22A '23A 1 “HDMC – Unit Profitability is measured as HDMC Operating Income (includes Motorcycles, P&A, Apparel, Licensing, Other)
Slide 18: LiveWire
LIVEWIRE® Successfully launched its 3rd electric motorcycle, S2 Mulholland , in March 18
Slide 19: 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 20: Forward Looking Statements Continued
FORWARD LOOKING STATEMENTS CONTINUED HDFS’ retail credit losses have normalized in recent quarters to higher levels after a period of historically low levels of credit losses. Further, the Company believes that HDFS's retail credit losses will continue to change over time due to changing consumer cr