Another Record For Harley
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Another Record For Harley
Fourth Quarter Results
The following is a press release from Harley-Davidson...
Harley-Davidson, Inc. (NYSE: HDI) today announced record revenue and earnings for its fourth quarter and year ended December 31, 2002. Revenue for the quarter was $1.03 billion compared with $905.9 million in the year-ago quarter, a 13.3 percent increase. Net income for the quarter was $150.9 million, an increase of 27.5 percent over the year ago quarter. Fourth quarter diluted earnings per share (EPS) were 49 cents, a 25.6 percent increase compared with last year’s 39 cents. Revenue for the full year was $4.1 billion, compared with $3.4 billion in 2001, a 20.1 percent increase. Net income for the year was $580.2 million, a 32.5 percent increase versus last year’s $437.7 million, while diluted EPS for the full year were $1.90, a 32.9 percent increase compared with $1.43 in 2001.
“The year 2002 was our 17th consecutive year of record revenue and net income,” said Jeffrey L. Bleustein, chairman and chief executive officer of Harley-Davidson, Inc. “Worldwide retail sales of Harley-Davidson motorcycles were strong in 2002 with 15.9 percent unit growth over the prior year. Strong demand for our products gives us confidence in maintaining our production goal of 289,000 Harley-Davidson motorcycles for 2003.”
"We believe that the excitement surrounding our 100th Anniversary celebration combined with the strength of the underlying fundamentals of our motorcycle business are helping us continue to grow - even in the face of a weak global economy. We are fulfilling the dreams of many new customers as we welcome them into the Harley-Davidson family,” said Bleustein.
Motorcycles and Related Products Segment - Fourth Quarter Results
Revenue from Harley-Davidson motorcycles was $820.3 million, an increase of $86.1 million or 11.7 percent over the same period last year. Fourth quarter shipments of Harley-Davidson motorcycles totaled 65,970 units. The Company had four fewer workdays in the fourth quarter of 2002 compared with 2001, yet shipped 2,435 more units, or 3.8 percent more than the same period last year.
Revenue from Parts and Accessories (P&A), which consists of Genuine Motor Parts and Genuine Motor Accessories, totaled $129.9 million, an increase of $18.5 million, or 16.6 percent over the year-ago quarter. Revenue from General Merchandise, which consists of MotorClothesä apparel and collectibles, totaled $54.8 million, an increase of $7.3 million or 15.4 percent. Revenue from 100th Anniversary P&A products was $12.7 million and revenue from General Merchandise associated with the 100th Anniversary was $12.5 million.
“We are very pleased with sales of our 100th Anniversary products, but we realize that not all of these were incremental because some substitution from standard offerings to commemorative anniversary products did occur,” said Bleustein.
Fourth quarter gross margin was 36.1 percent of revenue, up from 34.5 percent last year. Gross margin improved primarily due to wholesale motorcycle price increases, favorable product mix and foreign exchange effects.
Fourth quarter operating margin for the Motorcycles and Related Products Segment was 20.7 percent of revenue, which was better than last year’s fourth quarter operating margin of 18.6 percent. The increase in operating margin was driven primarily by the increase in gross margin.
Retail Sales Data
Harley-Davidson retail motorcycle sales for the year grew in the U.S. (18.3 percent), Europe (7.6 percent) and Japan (5.9 percent) compared to the same period last year. The most recent available data is listed in the accompanying tables.
Financial Services Segment - Fourth Quarter Results
Harley-Davidson Financial Services, Inc. (HDFS), a subsidiary of Harley-Davidson, Inc., reported fourth quarter operating income of $25.4 million, up $8.4 million or 49 percent compared to the year-ago quarter.
“Harley-Davidson Financial Services had a fantastic quarter and year, both in financial performance and in helping to make the dream of owning a Harley-Davidson motorcycle a reality,” said Bleustein.
The subsidiary benefited from the increase in Harley-Davidson’s U.S. motorcycle sales, growing acceptance of its consumer financing program and decreased cost of funds due to lower market interest rates.
Pension Plan Activities
During the quarter, the Company contributed $100 million to its various pension plans, which brought the total year contribution to $154 million, compared with a contribution of $19 million in 2001. The Company also responded to current market conditions by lowering its pension plan discount rate from 8.0 to 7.25 percent.
Cash Flow
Operations generated cash of more than $779 million in 2002, providing the Company the ability to invest $324 million in capital expenditures, repurchase 1.1 million shares of company stock for $57 million, pay $41 million in dividends and contribute $154 million to the Company’s pension plans, even as the Company increased cash and marketable securities by $160 million.
Twelve Month Results
For the fiscal year ended 2002, total Harley-Davidson motorcycle shipments were 263,653 units compared with 234,461 units in 2001, a 12.5 percent increase. Harley-Davidson motorcycle revenue was $3.16 billion, an increase of $489.7 million or 18.3 percent.
P&A revenue totaled $629.2 million, a 23.5 percent increase, while General Merchandise revenue totaled $231.5 million, a 41.2 percent increase compared with 2001.
On a longer-term basis, the Company expects the growth rate for P&A revenues to be slightly higher than the Harley-Davidson motorcycle unit growth rate. The General Merchandise growth rate is expected to be lower than the motorcycle unit growth rate over the long term.
Full year operating income for HDFS was $104.2 million, an increase of $43.0 million or 70.1 percent compared to 2001. The Company expects 2003 HDFS operating income to grow approximately 20 percent over 2002 performance.
The following is a press release from Harley-Davidson...
Harley-Davidson, Inc. (NYSE: HDI) today announced record revenue and earnings for its fourth quarter and year ended December 31, 2002. Revenue for the quarter was $1.03 billion compared with $905.9 million in the year-ago quarter, a 13.3 percent increase. Net income for the quarter was $150.9 million, an increase of 27.5 percent over the year ago quarter. Fourth quarter diluted earnings per share (EPS) were 49 cents, a 25.6 percent increase compared with last year’s 39 cents. Revenue for the full year was $4.1 billion, compared with $3.4 billion in 2001, a 20.1 percent increase. Net income for the year was $580.2 million, a 32.5 percent increase versus last year’s $437.7 million, while diluted EPS for the full year were $1.90, a 32.9 percent increase compared with $1.43 in 2001.
“The year 2002 was our 17th consecutive year of record revenue and net income,” said Jeffrey L. Bleustein, chairman and chief executive officer of Harley-Davidson, Inc. “Worldwide retail sales of Harley-Davidson motorcycles were strong in 2002 with 15.9 percent unit growth over the prior year. Strong demand for our products gives us confidence in maintaining our production goal of 289,000 Harley-Davidson motorcycles for 2003.”
"We believe that the excitement surrounding our 100th Anniversary celebration combined with the strength of the underlying fundamentals of our motorcycle business are helping us continue to grow - even in the face of a weak global economy. We are fulfilling the dreams of many new customers as we welcome them into the Harley-Davidson family,” said Bleustein.
Motorcycles and Related Products Segment - Fourth Quarter Results
Revenue from Harley-Davidson motorcycles was $820.3 million, an increase of $86.1 million or 11.7 percent over the same period last year. Fourth quarter shipments of Harley-Davidson motorcycles totaled 65,970 units. The Company had four fewer workdays in the fourth quarter of 2002 compared with 2001, yet shipped 2,435 more units, or 3.8 percent more than the same period last year.
Revenue from Parts and Accessories (P&A), which consists of Genuine Motor Parts and Genuine Motor Accessories, totaled $129.9 million, an increase of $18.5 million, or 16.6 percent over the year-ago quarter. Revenue from General Merchandise, which consists of MotorClothesä apparel and collectibles, totaled $54.8 million, an increase of $7.3 million or 15.4 percent. Revenue from 100th Anniversary P&A products was $12.7 million and revenue from General Merchandise associated with the 100th Anniversary was $12.5 million.
“We are very pleased with sales of our 100th Anniversary products, but we realize that not all of these were incremental because some substitution from standard offerings to commemorative anniversary products did occur,” said Bleustein.
Fourth quarter gross margin was 36.1 percent of revenue, up from 34.5 percent last year. Gross margin improved primarily due to wholesale motorcycle price increases, favorable product mix and foreign exchange effects.
Fourth quarter operating margin for the Motorcycles and Related Products Segment was 20.7 percent of revenue, which was better than last year’s fourth quarter operating margin of 18.6 percent. The increase in operating margin was driven primarily by the increase in gross margin.
Retail Sales Data
Harley-Davidson retail motorcycle sales for the year grew in the U.S. (18.3 percent), Europe (7.6 percent) and Japan (5.9 percent) compared to the same period last year. The most recent available data is listed in the accompanying tables.
Financial Services Segment - Fourth Quarter Results
Harley-Davidson Financial Services, Inc. (HDFS), a subsidiary of Harley-Davidson, Inc., reported fourth quarter operating income of $25.4 million, up $8.4 million or 49 percent compared to the year-ago quarter.
“Harley-Davidson Financial Services had a fantastic quarter and year, both in financial performance and in helping to make the dream of owning a Harley-Davidson motorcycle a reality,” said Bleustein.
The subsidiary benefited from the increase in Harley-Davidson’s U.S. motorcycle sales, growing acceptance of its consumer financing program and decreased cost of funds due to lower market interest rates.
Pension Plan Activities
During the quarter, the Company contributed $100 million to its various pension plans, which brought the total year contribution to $154 million, compared with a contribution of $19 million in 2001. The Company also responded to current market conditions by lowering its pension plan discount rate from 8.0 to 7.25 percent.
Cash Flow
Operations generated cash of more than $779 million in 2002, providing the Company the ability to invest $324 million in capital expenditures, repurchase 1.1 million shares of company stock for $57 million, pay $41 million in dividends and contribute $154 million to the Company’s pension plans, even as the Company increased cash and marketable securities by $160 million.
Twelve Month Results
For the fiscal year ended 2002, total Harley-Davidson motorcycle shipments were 263,653 units compared with 234,461 units in 2001, a 12.5 percent increase. Harley-Davidson motorcycle revenue was $3.16 billion, an increase of $489.7 million or 18.3 percent.
P&A revenue totaled $629.2 million, a 23.5 percent increase, while General Merchandise revenue totaled $231.5 million, a 41.2 percent increase compared with 2001.
On a longer-term basis, the Company expects the growth rate for P&A revenues to be slightly higher than the Harley-Davidson motorcycle unit growth rate. The General Merchandise growth rate is expected to be lower than the motorcycle unit growth rate over the long term.
Full year operating income for HDFS was $104.2 million, an increase of $43.0 million or 70.1 percent compared to 2001. The Company expects 2003 HDFS operating income to grow approximately 20 percent over 2002 performance.
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