Harley-Davidson(US:HOG)2025-02-26 20:26Financial Performance - Harley-Davidson, Inc. reported total revenue of $5.19 billion for the year ended December 31, 2024, a decrease of 11.1% compared to $5.84 billion in 2023[327]. - The net income attributable to Harley-Davidson, Inc. for 2024 was $455.4 million, down 35.5% from $706.6 million in 2023[327]. - The company's motorcycle and related products revenue was $4.15 billion in 2024, a decline of 15.0% from $4.88 billion in 2023[327]. - Operating income for 2024 was $416.6 million, a significant decrease of 46.5% from $779.1 million in 2023[327]. - Basic earnings per share (EPS) for 2024 was $3.46, down from $4.96 in 2023, reflecting a decline of 30.2%[327]. - Comprehensive income attributable to Harley-Davidson, Inc. for 2024 was $427.6 million, compared to $743.6 million in 2023, indicating a decrease of 42.5%[330]. - The financial services segment generated revenue of $1.04 billion in 2024, an increase of 8.9% from $953.6 million in 2023[327]. - Total revenue for the Company in 2024 was $5,186.8 million, a decrease of 11.1% from $5,836.5 million in 2023[364]. Assets and Liabilities - Total assets decreased from $12,140,554 thousand in 2023 to $11,881,579 thousand in 2024, a decline of approximately 2.1%[333]. - Total liabilities decreased from $8,887,746 thousand in 2023 to $8,726,159 thousand in 2024, a reduction of about 1.8%[333]. - Long-term debt, net decreased from $4,990,586 thousand in 2023 to $4,468,665 thousand in 2024, a decline of approximately 10.4%[333]. - The total equity attributable to Harley-Davidson, Inc. decreased from $3,252,808 thousand in 2023 to $3,166,047 thousand in 2024, a decline of about 2.7%[333]. - The current portion of long-term debt, net increased from $577,203 thousand in 2023 to $683,272 thousand in 2024, representing an increase of about 18.4%[335]. - The company reported a net cash used by investing activities of $383,330 thousand in 2024, compared to $512,304 thousand in 2023, indicating a decrease of approximately 25.2%[338]. Cash Flow and Investments - Net cash provided by operating activities rose significantly from $754,887 thousand in 2023 to $1,063,833 thousand in 2024, an increase of approximately 40.8%[338]. - Cash and cash equivalents increased from $1,533,806 thousand in 2023 to $1,589,608 thousand in 2024, representing a growth of about 3.6%[333]. - The company repurchased common stock worth $459,829 thousand in 2024, compared to $363,987 thousand in 2023, an increase of approximately 26.4%[338]. - The company repurchased 12.5 million shares for $450.0 million in 2024, compared to 10.2 million shares for $350.0 million in 2023[388]. Derivative Financial Instruments - The notional U.S. dollar value of outstanding foreign currency contracts was $455.3 million, down from $540.1 million in 2023, indicating a decrease of approximately 15.7%[294]. - The notional value of derivative financial instruments used to hedge commodity prices was $4.2 million as of December 31, 2024, down from $6.3 million in 2023, reflecting a reduction of 33.3%[295]. - HDFS had an interest rate cap with a notional value of $273.0 million outstanding at December 31, 2024, significantly reduced from $617.9 million in 2023, a decrease of 55.8%[297]. - The notional value of cross-currency swaps was $759.8 million at December 31, 2024, down from $1.42 billion in 2023, indicating a decrease of 46.5%[300]. - The notional value of derivative financial instruments designated as cash flow hedging instruments was $1,215,765 in 2024, with assets valued at $19,837 and liabilities at $34,857[427]. - The company utilizes derivative financial instruments to manage risks related to foreign currency exchange rates, interest rates, and commodity prices[421]. Credit Losses and Receivables - The allowance for credit losses (ACL) for retail finance receivables was $378.4 million as of December 31, 2024, against a retail receivable portfolio totaling $6.7 billion[322]. - The allowance for doubtful accounts was $3.4 million as of December 31, 2024, compared to $2.1 million in 2023, indicating an increase of 61.9%[348]. - Retail finance receivables in the U.S. decreased to $6.5 billion in 2024 from $6.7 billion in 2023, representing a decline of 7.0%[401]. - The allowance for credit losses increased to $401.2 million in 2024 from $381.9 million in 2023, reflecting a rise of 5.9%[408]. - The company experienced increased retail credit losses in 2024 due to macroeconomic factors, including higher motorcycle payments and inflationary pressures[406]. Pension and Benefits - The Company has a defined benefit pension plan with a benefit obligation of $1,568.3 million as of December 31, 2024, up from $1,553.9 million in 2023[479]. - The total accumulated benefit obligation (ABO) for all pension and SERPA plans combined was $1.51 billion in 2024, compared to $1.57 billion in 2023[484]. - The service cost for pension and SERPA benefits was $4.698 million in 2024, down from $5.174 million in 2023[485]. - The interest cost for pension and SERPA benefits decreased to $80.478 million in 2024 from $81.911 million in 2023[485]. - The expected return on plan assets for pension plans was $132.574 million in 2024, compared to $146.076 million in 2023[485]. International Expansion and Market Risks - LiveWire plans to expand its business internationally, which is expected to increase its exposure to currency rate risk as it grows its international presence[296]. - The Company selectively uses derivative financial instruments to manage market risks, including foreign currency exchange rates, commodity prices, and interest rates[293]. - The Company’s HDMC segment operating results are significantly affected by fluctuations in the value of the U.S. dollar relative to foreign currencies, particularly the Euro and Australian dollar[294]. Tax and Regulatory Matters - The income tax provision for 2024 was $71.963 million, a decrease of 58% from $171.830 million in 2023[3]. - The total gross amount of unrecognized tax benefits at the end of 2024 was $16.179 million, down from $18.214 million at the end of 2023[383]. - The company had deferred income tax assets of $342.593 million and deferred income tax liabilities of $183.656 million as of December 31, 2024[379].